LI foreclosure sales fall 32% in 3Q
Melissa Stasi-Thomas, a self-employed sewing teacher in East Moriches, spent more than a year in settlement hearings and finally learned this month her monthly mortgage payments will be cut. (Jan. 25, 2012) Credit: Joseph D. Sullivan
The number of foreclosure sales dropped by nearly a third in the third quarter in Nassau and Suffolk counties from a year earlier.
The decline reflects a less aggressive stance by banks, due largely to the "robosigning" scandal over foreclosure record-keeping, and could delay an eventual recovery in housing prices as foreclosure sales continue to weigh on the market.
A smaller factor may be a growing willingness by banks to modify mortgages, some real estate observers said.
Long Island's 580 foreclosure sales from July through September mark a 32 percent drop compared to the same period a year ago, according to RealtyTrac data released Wednesday. That figure includes sales of bank-owned homes as well as those in the foreclosure process that have not been repossessed -- a category that typically includes short sales, or sales of a home for less than what is owed, said Daren Blomquist, a vice president at RealtyTrac.
During the same period, sales of bank-owned properties on the Island fell by more than half compared to the year-earlier period, from 254 to 124.
Foreclosures on Long Island have slowed since 2010, when banks were required to provide more documentation proving they are legally entitled to foreclose.
Banks "are taking longer to start the foreclosure process, and once the foreclosure process starts, they're taking longer to finish," Blomquist said.
"I don't think the reduction is at all indicative that fewer people are in distress," said Michael Wigutow, a supervising attorney at Nassau/Suffolk Law Services.
The Long Island Housing Partnership has seen no reduction in the number of homeowners seeking help, said Peter Elkowitz, president and chief executive. Suffolk has the most foreclosures in New York State, and Nassau ranks third, he said.
However, banks have become more open to modifying mortgages, streamlining the process and hiring more people to field calls, Elkowitz said.
Melissa Stasi-Thomas, 45, a self-employed sewing teacher who lives in East Moriches, said she hit a rough patch and began making partial mortgage payments after her ex-husband lost his job in 2009 and could no longer make full child-support payments. Chase returned her sixth partial payment and foreclosed in March 2010, she said.
After more than a year of settlement hearings, this month she obtained a mortgage modification reducing her monthly payment from $3,753 to $2,570, she said. She mailed the first reduced payment Wednesday.
"I would tell anybody," she said, "if they have the intestinal fortitude, to fight."
