WNY Law Center Foreclosure Study

The feds don’t have it, the state doesn’t have it, but Erie
County has important analysis of loan foreclosures in the area thanks to the
diligence of the Western New York Law Center.

Yesterday at 10AM, Western New York Law Center, in conjunction
with Western New York AmericorpsVista, gave a presentation of their intensive
study of the foreclosure process on WNY.  Included in the report was an
analysis of all of the loans that entered the legal foreclosure process in all
of Erie County during 2007 and 2008.  The entire report can be viewed in
pdf format here.

The study was pursued at the regional level because Erie
County requires the recording of foreclosure initiations due to state law,
though federal and state sources do not routinely analyze foreclosure
data.  

“These are records historically kept for legal
purposes,” explains Kathleen Lynch, Esq., of WNYLC. “They’re not set
up for analysis, but we’ve realized that no current method to collect loan data
exists. Through our research, we found out that nearly 50 percent of loans in
Erie County are not reported to the federal government because non-bank lenders
were not subject to the same laws as larger financial institutions.”  

Lynch said that to find out who was lending in our market, she
had to rely on the lis pendens that has to be filed any time legal foreclosure
is being started.  ”There is one filed for every foreclosure, but
there’s no way to capture a default loan until it’s filed,” Lynch said.  

The total number of lis pendens filings
turned out to be 5,000 in Erie County. Some details were surprising to many in
the room at the presentation according to AmericorpsVista’s Patrick Metzger,
who was present.  He points out the following:

·      
In 2007, the City of Buffalo, with 1,110 filings, had four times the number of
lis pendens filings than the next highest municipality in Erie County, making
up over 40% of apparent foreclosures in the county. The next highest was
Cheektowaga with10%.

·      
The top five banks that originated the most lis pendens only originated 244
loans, and yet they filed to begin the foreclosure process on 880 properties.

·      
One of the top five, Deutsche Bank National Trust Company, filed 247 lis
pendens, but they didn’t originate a SINGLE mortgage that went into foreclosure
in Erie County in 2007 and 2008. (This means they didn’t directly loan money
out to any local homeowner, but instead purchased mortgages from other banks
that had made the loans, and subsequently those mortgage loans entered
foreclosure.)

“This study has been a big lesson learned.  We need to
routinely collect information on loans so that the people can be helped through
a consumer agency, as devised by our new president.”

Lynch said that Governor Paterson introduced legislation just
before the legislation “stopped working” that would make the
originators of loans responsible for reporting loans and foreclosures to give a
better sense of what’s out there and who owes what to whom.  In the past,
non-banking lenders had no legal, ethical, feduciary responsibility to clients.
 Many of these loans had a fixed rate for first two years that was subject
to go up every 6 months until the loan became unaffordable. “The market
has changed drastically,” Lynch says, noting that foreclosure rescue scams
are as bad or worse than the original debt.  Her objective through WNYLC
is to let consumers know that there is free counseling available.

“We have a good pic of these loans now, and we can use it
to advocate,” she says. “New York State enacted a law in
September of this year that requires a settlement conference, getting the  homeowner
and lender in same room, and the AmeracoreVista paralegals help in court.  We
can help.  People don’t have to be afraid of lis pendens letters.”

For more information go to WNYLC.  

 

About the author  ⁄ Elena Cala Buscarino

6 comments
jeffrey freedman
jeffrey freedman

The bottom line is that many families in W.N.Y are having trouble making their mortgage payments.

We see this every day when we meet with clients.

There is no easy solution to this problem.

Its a sad commentary when a family loses their home for non- payment of the mortgage.

Whether there is a layoff,or a serious illness causing the problem, its quite sad. The whole familiy is impacted.

The most important advice we give clients is that they need to get help from a reputable non profit agency or law firm as soon as possible. They must not ignore the problem, because that will only make things worse.

SenecaFire_is_a_Fool
SenecaFire_is_a_Fool

SenecaFire, based on your other comments, it is more than apparent that you have no credibility whatsoever. The fact is, anyone can know exactly how many people entered into the foreclosure process in Buffalo or the entire county. Obviously, you do not know what a Lis Pendens is. A Lis Pendens is filing with the clerk showing that a foreclosure has commenced in Erie County. Each Lis Pendens was counted. Do you see why your comment makes no sense? Did you even read the article? If you account for the moratorium on foreclosures last year, the numbers have stayed relatively consistent for the past 3 years, all while the population continues to decrease. Anyone from the area would accept that lawmakers need more accurate reporting like this in order to have a chance at producing sound, effective policy to combat this crisis. Also, any response from you will be disregarded; it's unfair to engage in a battle of wits with an unarmed man.

jolopy
jolopy

"I will have to sell and bail out of NY.And that is probably one thing that isn’t counted the number of people that got out of NY just before foreclosure"

Thats a very good point. It would be intersting to see a study on the percentage of people who leave nys due to such high taxes. I'm almost positive it will be a high number. But of course no group will make money off findings such as these so one probably wont be studied.

Allentwnguy
Allentwnguy

I’m really surprised there aren’t more foreclosures in Buffalo. While I kept hearing “we're holding the line on property taxes” mine went up over $550 this year. I am on a fixed income and have cut back on a lot of items. I no longer have pay TV. I cut out the landline to the house and only use a cell phone. Cut back on going out for dinner. Repairs on the house have almost stopped. If the city of Buffalo and the State of NY don’t get their SH** together (instead of getting into a pissing match for control of the legislature for a month) I will have to sell and bail out of NY.

And that is probably one thing that isn’t counted the number of people that got out of NY just before foreclosure. So you have less and less taxpayers to support more and more Government expense. Lets drive everyone out of NY or into foreclosure. GREAT PLAN!!!!!!

SenecaFire
SenecaFire

Another fraudulent report to justify their funding! The real shame is that we need organizations like the law center to help people because not even one foreclosure should be acceptable, but why do they feel the need to exaggerate the numbers. Fact is we don't know exactly how many people enter into the foreclosure process but we do know exactly how people have been foreclosed on and that number has gone down the last 3 years in a row. Their numbers are the exact opposite of what the reports issued by the Erie County Clerk, Buffalo Niagara Association of Realtors, New York Association of Mortgage brokers have stated.

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