New York Gov. Andrew Cuomo, right, and New York Attorney...

New York Gov. Andrew Cuomo, right, and New York Attorney General Eric Schneiderman talk during a news conference at the Capitol in Albany, N.Y. (July 2, 2013) Credit: AP

Distressed homeowners on Long Island got good news this week when Gov. Andrew M. Cuomo and Attorney General Eric T. Schneiderman agreed on how to divvy up some of the $613 million the state will get from a settlement with JPMorgan Chase over its mortgage-lending practices. Essentially, they will equally split $163 million, ending for now an unbecoming weekslong turf war over whether the governor could put the money into the state's general fund rather than have it be distributed by the attorney general, as has been custom in such cases. Schneiderman's office plans to use its share for several foreclosure-prevention programs; the governor's portion also will be spent on housing-related programs. The agreement is a most welcome development for Long Island, where the mortgage crisis lingers on.

Schneiderman's plans offer hope for real relief. He wants to expand a program that funds counseling and legal services for homeowners; the 13 Long Island groups in the program helped nearly 5,000 families in the first year, an important contribution in a region where foreclosure activity increased by about 25 percent in 2013. He also wants to expand a pilot program in New York City that pays off small debts -- medical bills or tax liens, for example -- to clear the way for mortgage modifications. The money would be repaid when the homeowner sells, refinances or pays off the mortgage. A third proposal would provide relief for thousands of homeowners at once, rather than the usual one-at-a-time approach to foreclosure prevention: It would identify groups of homeowners who fail by a narrow margin the federal test that determines whether someone qualifies for a mortgage modification, and it would provide loans to get them those modifications and prevent foreclosure.

The JPMorgan money could be a lifeline for individual homeowners and for the real estate market on Long Island as a whole. Preserving that should be the primary focus for Cuomo and Schneiderman as they negotiate how to allocate the $450 million still to come.

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