Even as the national economy has recovered to a slow if bumpy hum, the Great Recession left behind a lingering problem: homes in foreclosure, many of them abandoned. Often, the properties are left to decay, blighting communities and depressing the values of neighboring homes. This is unacceptable.
New York State has one of the largest backlogs of foreclosed homes, with the second-highest foreclosure rate in the nation — or 11,554 properties in Nassau and 16,046 in Suffolk last year, according to state Comptroller Thomas DiNapoli. Legislation to address this nagging issue just passed in the State Assembly. The Senate should approve it, too.
The bill would speed New York’s foreclosure process, now one of the longest in the country at an average of three years. The legislation would establish special courts to expedite foreclosure cases. It also would require banks and loan-servicing companies to register the homes in a state database, making ownership easier to track, and to maintain the properties. Current state law says a bank must repair and care for a vacant property only after it obtains a judgment of foreclosure. This leaves abandoned properties open to abuse by squatters, drug dealers and vermin.
Localities unfairly carry the burden of so-called zombie properties. Some municipalities require lenders to post security deposits or they attach liens to properties. A law that applies evenly throughout the state would make more sense.
Reducing the backlog and keeping zombie properties from dilapidation would go a long way toward strengthening housing markets and animating local economies. It’s time for New York to leave behind this legacy of the 2008 mortgage crisis. — The editorial board