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Suffolk tops state list for rate of homes in foreclosure process

Kim Buttgereit stands outside her Kings Park home

Kim Buttgereit stands outside her Kings Park home holding paperwork that has built up during the four years she has been trying to avoid foreclosure. (June 14, 2010) Photo Credit: Liz Malone

Suffolk County so far this year has the state's highest rate of homes in some stage of foreclosure, with Nassau fourth among counties, according to a midyear report by RealtyTrac.

Foreclosure-related filings, from the initial lawsuits to notices of bank repossessions, were sent to 4,567 Suffolk homes, or one out of every 119 households, the midyear report said. For all of last year, Suffolk ranked second, data show.

In Nassau, notices were sent to 2,758 homes, or one out of every 166 households, RealtyTrac said. The county last year ranked fifth in rate of foreclosure filings among households, said the firm, an online market for foreclosures.

Suffolk's number was less than a half-percent up from the preceding six months but a 30 percent jump from the same time last year, RealtyTrac said. Nassau's 2,758 homes was a 30 percent drop from the preceding six months and just a blip below numbers a year ago.

Both counties have often been in the state's top five in various reports, because not-so-qualified buyers inundated the Long Island market during the easy credit years.

Suffolk's foreclosure rate has been a little more dire than Nassau's for various reasons, said lenders' attorneys, housing counselors and other industry experts. For one thing, many first-time and not-so-qualified buyers were drawn to Suffolk, where the prices were inflated but still generally lower than Nassau's, they said. The county generally has a higher jobless rate than Nassau.

Not surprised, Mineola-based attorney Michael Cohn said his caseload has been heavier in Suffolk during the 20 years he's been representing lenders in foreclosures. "Economically, it's probably not as well off as Nassau," he said.

Nationwide, foreclosure filings for the first half of this year have fallen 5 percent from the preceding six months but gone up 8 percent from the same period last year, RealtyTrac said.

RealtyTrac's chief sees a slowdown in the number of new cases filed -- as lenders try to modify loans -- but an increase in homes taken by banks as they cleared out the backlog of 2009 cases that didn't survive loan modifications.

"The roller-coaster pattern of foreclosure activity over the past 12 months demonstrates that while the foreclosure problem is being managed on the surface, a massive number of distressed properties and underwater loans continues to sit just below the surface, threatening the fragile stability of the housing market," chief executive James J. Saccacio said.

Real estate broker Dave Guzzetta, who markets Suffolk bank-owned homes from his Port Jefferson base, said his foreclosure listings have fallen 30 percent from a year ago.

Back then, he thought the foreclosure crisis would run through in two years. Now, with homeowner protection laws and loan modifications delaying foreclosures in many cases, he's revised his timeline to five years.

Like other distressed borrowers, Kim Buttgereit of Kings Park said lenders and loan servicing companies have been so disorganized and swamped that people like her have been stuck in the foreclosure pipeline.

She said she completed a trial loan modification that gave her a lower interest rate. When she asked a few months ago when that would be made permanent, she learned that the lender had started foreclosure again - in September, the same month she had been approved for the modification.

"I don't think they have their heads screwed on right," Buttgereit said. "We're ready to throw in the towel."

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