New York facing daunting backlog of foreclosures

Speeding up New York's nearly three-year foreclosure process, and clearing out a backlog of foreclosures, won't be an easy job.

In the wake of the 2010 scandal over robo-signing, New York's courts imposed a new rule requiring lenders' attorneys to swear that foreclosure documents were accurate, said Gale Berg, director of pro bono activities for the Nassau County Bar Association.

In some cases, lenders' attorneys have delayed as long as two years before filing those sworn statements -- a necessary step for the case to move ahead, said Kirsten Keefe, of the Empire Justice Center in Albany.

A new law took effect last month that requires lenders to verify, as soon as a new foreclosure case is opened, that the lender has the right to foreclose. The measure was proposed by state Attorney General Eric T. Schneiderman and the state Office of Court Administration.

The attorney general also has sued a mortgage lender, HSBC Bank, in a bid to force it to move ahead with foreclosure cases instead of keeping them in limbo while interest and fees accrue. According to Schneiderman's lawsuit, HSBC delayed filing paperwork that triggers settlement conferences. At those conferences, homeowners can seek loan modifications or other help. An HSBC spokesman declined to comment.

"We knew the recovery from the housing market's collapse would be long and tough," Schneiderman said in a statement. "I'm committed to helping families across Long Island and New York State get out of this mess."