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
FHFA Director Mark Calabria (Photo by Zach Gibson/Getty Images)

Fannie, Freddie offer multifamily landlords a break — strings attached

Governor Andrew Cuomo (Credit: Getty Images, iStock, and Pixabay)

Cuomo’s executive order tells banks to give homeowners a break

Caught up in a dozen recent lawsuits, Brooklyn developer Toby Moskovits blames her firm’s debt troubles on “collusion” and a “personal vendetta” (Illustration by The Real Deal; Moskovits by Sasha Maslov)

Creditors are banging on Toby Moskovits’ door

NYC saw a dip in home foreclosures last year (Credit: iStock)

Home foreclosures dip in NYC for 2nd straight year

The 30-year fixed-rate average fell to 3.45 percent (Credit: iStock)

US mortgage rates hit 3-year low

Selina Hotel at 516- 518 West 27th Street and Adam Neumann (Credit: Google Maps, Getty Images)

Lender moves to foreclose on site of NYC hotel linked to Adam Neumann, Mexican magnate

Nationwide foreclosures are at a 15-year low (Credit: iStock)

Foreclosures nationwide fell to 15-year low in 2019

494 Broadway and Thor Equities' Joe Sitt (Credit: Google Maps)

Thor faces foreclosure on site where lender says it’s seeking “unrealistic rents”

arrow_forward_ios
Loading...