New FHFA plan spells higher lending rates for NY

TRD New York /
Sep.September 20, 2012 05:30 PM

Five sates with the most drawn out foreclosure process, including New York, would see government-backed mortgage fees increase under a new proposal by the Federal Housing Finance Agency, which oversees Freddie Mac and Fannie Mae.

The proposal has home loan borrowers in those states paying a one-time fee of 0.15 percent to 0.3 percent for federally backed mortgages starting in 2013, Bloomberg News reported.In addition to New York, New Jersey, Connecticut, Florida and Illinois are the states that could be affected by the proposal. These areas mandate court involvement in foreclosure cases and have some of the longest processing times, rendering those loans more expensive to foreclose upon.

But the plan has so far been met with political opposition. New Jersey Senator Robert Menendez called the plan “outrageous.”

“After banks preyed on homeowners with subprime loans and improper foreclosures,
FHFA now wants to penalize homeowners in states that have strong consumer protections to stop banks from wrongfully foreclosing,” Menendez said.

In New York it takes 820 days on average for a foreclosed property to reenter the market, while daily carrying costs are 112 percent of the national average. Compare that to Virginia, the state with the fastest turn around for a foreclosure, where it takes 270 days on average for a property to get back onto the market and carrying costs are 13 percent lower than the national average. In April, Brooklyn became the area with the longest foreclosure process in the nation.

The FHFA is currently hearing public comments on its proposal over the next two months. [Bloomberg] — Christopher Cameron


Related Articles

arrow_forward_ios
(Getty, iStock)

Hudson’s Bay, Simon Property Group hit with $846M foreclosure lawsuit

Hudson’s Bay, Simon Property Group hit with $846M foreclosure lawsuit
Citizens Bank CEO Bruce Van Saun and SL Green CEO Marc Holliday with 106 Spring Street (Getty; Sl Green; Google Maps)

One of Soho’s priciest retail spaces heads to foreclosure

One of Soho’s priciest retail spaces heads to foreclosure
Senator Mitch McConnell and House Speaker Nancy Pelosi (Getty)

$2.2T House stimulus package would ban evictions for 12 months

$2.2T House stimulus package would ban evictions for 12 months
(iStock)

Banks required balloon payments, stayed mum on foreclosure moratorium

Banks required balloon payments, stayed mum on foreclosure moratorium
Governor Andrew Cuomo (Getty; iStock)

Commercial evictions, foreclosures halted through October

Commercial evictions, foreclosures halted through October
Tillary Hotel at 85 Flatbush Avenue (Image via Kutnicki Bernstein Architects)

Isaac Hager’s Downtown Brooklyn hotel heads to foreclosure

Isaac Hager’s Downtown Brooklyn hotel heads to foreclosure
A million homeowners haven’t requested forbearance on their mortgages — and are now at risk for foreclosure and eviction. (iStock)

1M struggling homeowners didn’t request forbearance. Now what?

1M struggling homeowners didn’t request forbearance. Now what?
U.S. foreclosure filings in August jumped 11% as some states ended relief measures, though continued government intervention has prevented sharper increase (iStock)

US foreclosure filings jump as some states end relief measures

US foreclosure filings jump as some states end relief measures
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...