Senator Charles Schumer Calls For Crackdown On Sub-Prime Mortgage Lenders
Senator Charles Schumer wants to see a state crackdown on mortgage companies who he says are pushing more and more New Yorkers into foreclosure.
Schumer criticized the companies for continuing to run what he says are misleading advertisements for loans as the sub-prime mortgage market continues to collapse.
With millions of homeowners struggling to avoid foreclosure, Schumer says the major companies need to step up and help homeowners.
“We are asking these very companies that have made record profits – from Countrywide the biggest in the country, on down – to provide the money for refinancing and if they don’t we will consider forcing them to,” said Schumer.
According to RealtyTrac.com, foreclosure filings in the city have spiked 80 percent in the last six months.
State Senator Jeffrey Klein is also speaking out on the sub-prime mortgage crisis. His office conducted a study of the areas in the city being hit hardest by the crisis.
The study found that East New York, Brooklyn has suffered the most with 507 foreclosures in the past 13 months.
Klein says this is a problem which will eventually have a devastating affect on all New Yorkers.
“This has ramifications for everyone and I want to make it very, very clear: this can impact you even if you don’t have a sub prime loan that’s ready to be foreclosed upon,” said Klein. “This is gonna go to our housing market. We’re going to see a drop in real estate prices, home ownership around the city. No one wants a couple of homes on a block boarded up because of foreclosure. That’s going to affect neighborhoods.”
By borough, the neighborhoods most affected are Rochdale Village in Queens, Wakefield in the Bronx, Castleton Corners and New Springville on Staten Island and Hell’s Kitchen in Manhattan.
Klein’s report estimates that over 20 percent of sub-prime mortgages opened in 2005 will end in foreclosure.