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Foreclosure help program faces loss of funding, advocates say

Carrie Roman, a housing counselor with Long Island

Carrie Roman, a housing counselor with Long Island Housing Partnership in Hauppauge, works with a client trying to avoid foreclosure in 2014. Photo Credit: Newsday / John Paraskevas

A network of housing agencies and legal groups that has helped more than 20,000 Long Islanders facing foreclosure is pushing to get funding for its work included in next year’s state budget.

The groups — including 15 Long Island organizations — are due to lose funding in September if they do not receive state support, said Maria DeGennaro, Long Island regional coordinator for the Empire Justice Center, which is helping to coordinate the program.

The statewide network of almost 90 groups says it has provided 70,000 homeowners with federally certified housing counselors and volunteer attorneys since 2012. The program is funded by major settlements with mortgage lenders. To continue the work after the settlement money runs out, the groups are seeking $10 million in the state fiscal year that begins April 1, and $20 million for the following year.

The program “has been a long time in the making, and it’s finally giving the homeowners some protections they should have been afforded in the first place,” DeGennaro said. “To lose funding now would be a terrible tragedy.”

Funding for the services was not included in the $162 billion spending plan released by Gov. Andrew M. Cuomo last month.

State Sen. Phil Boyle (R-Bay Shore) said he and other legislators expect to include the funds in their own budget proposals. The deadline for the budget to be approved is April 1.

A spokesman for the state budget division said in a statement that the budget talks are “ongoing.”

One member of the network, the Nassau County Bar Association, runs twice-monthly clinics offering free legal advice, counseling and translators to homeowners facing foreclosure. It also sends volunteer attorneys to represent homeowners in state Supreme Court.

Homeowner Keith McKinney, 58, who lives in the Village of Hempstead and works as a house painter, said he received crucial help from the bar association in his foreclosure case. He said he and his wife fell behind on their mortgage when they lost their jobs during the 2007-2009 recession.

The volunteer attorneys “gave us excellent advice about our case,” he said.Their case is still pending, but the volunteers helped the couple buy time until they could save up to hire a private attorney, and they are hopeful about their chances in court, he said.

Since 2012 the network of housing and legal groups, known as the Homeowner Protection Program, has received $100 million from settlements with major lenders accused of wrongdoing during the foreclosure crisis. State Attorney General Eric Schneiderman distributed the funds from a $25 billion settlement with five major lenders and a $13 billion settlement with JPMorgan Chase.

Before 2012 the state funded housing counseling and legal services for homeowners in the wake of the housing crisis, advocates said.

The distressed homeowners who have sought help include senior citizens, people with limited English skills, homeowners who ran into trouble with reverse mortgages and those who cannot afford an attorney, said Gale Berg, director of pro bono attorney activities at the Nassau County Bar Association. The groups have helped homeowners avoid scams and negotiate with lenders, she said.

“There’s been a huge shift in the ability of homeowners to defend their rights and try to save their homes,” Berg said. Without it, she said, “all these homeowners are going to end up getting no help, not knowing where to turn and be on the street.”

Pending foreclosure cases in 2016

Nassau: 5,796

Suffolk: 13,923

Source: New York State Unified Court System

To reach the Homeowner Protection Program: (855) HOME-456

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