The Real Deal New York

Financing for counsel to distressed New York homeowners runs low

May 16, 2011 12:08PM

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Funding has run dry for more than 120 legal aid agencies across New York state that provide counsel to distressed homeowners, the New York Times reported. A federal stimulus program has financed the agencies since 2009, but by the end of this year that money will be completely spent. Some Democrats tried to ensure the survival of these agencies by allocating $4 million of the state budget towards foreclosure-prevention spending for the three months between the end of the federal financing and the beginning of the state’s next fiscal year. But their proposal was unsuccessful, and so too was a $1.5 million budget earmark proposed by Brooklyn Assemblyman Vito Lopez that was vetoed by Governor Andrew Cuomo. Supporters of the programs, which have staved off foreclosure for more than 3,000 homeowners, according to the Times, believe that if the programs cease to receive funding for even a short time, it will be nearly impossible to attract permanent financing. Some of the pro bono lawyers have already stopped taking on new clients, as they await the fate of their compensation. [NYT]

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