Lull seen in new LI foreclosure filings
Fewer Long Island homeowners were hit with foreclosure-related notices last month compared to a year earlier, but that's not necessarily a sign of an economic comeback, according to a report being released Thursday.
The 34 percent drop was driven by a reduction in newly filed foreclosure cases, dovetailing with a 17 percent drop nationwide, said RealtyTrac, which monitors foreclosures. January's 714 new cases on Long Island were down from the 1,130 a year earlier, data show.
But last month's total number, which include auction filings and repossession of homes, grew 7 percent from December.
RealtyTrac chief executive James J. Saccio said the numbers don't show definitive good news but reflect the recent "robo-signing" scandal in which employees of three major lenders said they signed thousands of foreclosure-related documents monthly without verifying them.
"Unfortunately, this is less a sign of a robust housing recovery and more a sign that lenders have become bogged down in reviewing procedures, resubmitting paperwork and formulating legal arguments related to accusations of improper foreclosure processing," he said.
At the nonprofit Long Island Housing Partnership, the number of incoming homeowners seeking help with mortgages has dropped also by about 25 percent compared with a year ago, chief executive Peter Elkowitz said. The agency now has about 300 mortgage cases.
He also said the lull in new clients is a "false indication" of the current scope of the foreclosure crisis. "Automatically people think there's a decrease in the problem," he said.
But potential clients are trying to get help elsewhere instead of from nonprofits, Elkowitz said. Lenders are reaching out more to work with homeowners and giving borrowers temporary breaks on their mortgage terms, he said.
Also, more law firms and other businesses have been advertising mortgage-intervention services, he said, while nonprofits like his do the work for free but have little money to tout their services.
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