Archive for the 'New York Repo Homes' Category

A beautiful three bedroom ranch house being sold in a foreclosed home auction in the Hamptons is a sign of the times.

The home, located near a golf course frequented by the rich and famous, will be auctioned off for only $250,000 in the last week of August at the town hall of East Hampton, after the owner failed to pay HSBC a loan balance of $495,140.22.

The home is just one of several residential properties in the Hamptons that are in foreclosure. After Wall Street suffered huge financial losses, a number of formerly top-paid executives who purchased homes in the Hamptons have had to cede their homes to foreclosure or sell them at a loss to prevent foreclosure.

In Suffolk County, where the Hamptons sit, a total of 154 new foreclosures were filed in July, a jump of 105 percent from foreclosures filed in July 2008.

As the housing crisis spread across the U.S. in 2006 and 2007, the Hamptons and other parts of New York were largely protected by the financial power of Wall Street. But as the recession lingered, the financial markets succumbed, battering financial executives and professionals.

Based on the Long Island Real Estate Report, the number of lis pendens filed in the last week of July reached 21 filings, representing residential properties worth $9.66 million. During the same period last year, 11 foreclosure cases were filed, representing properties worth $5.5 million.

Bill Stanford, CEO of real estate information provider Property Shark, said that housing-related difficulties in the Hamptons will rise, but he added that distressed bankers would rather sell at a loss than suffer the humiliation of foreclosure.

Recently, the average home price in the area dropped to $754,552, a drop of 46 percent from $1.36 million last year.

Some of the high-profile bargain home sales include the seven-bedroom Southampton cottage of hedge fund executive John Paulson, who sold it for $9.99 million in June after failing to sell it for $19.5 million in April last year.

Another is the Bridgehampton home of Joe Gregory, former chief operating officer of Lehman Brothers. He initially listed his home, which sits on 2.5 acres and has 200 feet of ocean frontage, at $32.5 million, but he is now offering it at $27.9 million.

Nevertheless, a long-time broker in the Hamptons said he is optimistic the market is looking up, as June home sales have gone up by 142 percent compared to May.

Mirroring the foreclosure trend nationwide, two counties in New York have also experienced a rise in repossession homes filings for the first six months of this year.

According to a market report, Suffolk and Nassau experienced a significant increase in foreclosure filings from January to June of this year, earning them the third and fifth spots in the state foreclosure total, respectively.

The report showed that one in every 115 properties in Suffolk, including apartments, was in some kind of foreclosure proceedings. In Nassau, one in every 166 homeowners received at least one foreclosure filing.

All in all, Suffolk had 3,512 and Nassau 2,762 repossession homes filings, a 3 percent decline from the previous year for the same period but a whopping 63.6 percent rise from the second half of 2008.

According to industry experts, foreclosure activity in the second half of 2008 was artificially low because many lenders started giving a 3-month notice before they initiate foreclosure proceedings.

They said that the rise in foreclosure fillings occurred despite intensive efforts of the Obama Administration and the nonprofit sector to contain the number of repossession homes. Many factors have hindered the progress of the housing market recovery effort, foremost of them is the rising unemployment rate.

In Long Island, joblessness has worsened the struggle of many homeowners to pay their mortgages. Community Development Corp. of Long Island housing counselor Joan LaFemina confirmed that unemployment is one of the major reasons for the foreclosure crisis in the area.

Meanwhile, Richard Neiman, New York State Banking Superintendent, said that the Obama Administration’s mortgage relief plan has failed to make a dent on the foreclosure problem. He said that federal officials are planning to ask lenders and servicers on how well they are following the relief plan.

He also noted concerns about how homeowners take advantage of the programs. Last month, lending institutions posted foreclosure filings on 43 houses in Suffolk and 70 in Nassau. Foreclosure filings may include notices of default and auction and repossession of the property.

On the other hand, foreclosure related activity in the country grew even higher in the first six months of this year, with 1.53 million properties on the brink of becoming repossession homes.

New York Governor David Paterson has launched a comprehensive legislation that would deal with the rise in repossessed houses for sale and mitigate their effects.

The current bill would build upon the subprime lending law enacted in 2008 by adding provisions aimed at lessening the impact of repossessed houses for sale on homeowners, renters and neighborhoods.

Paterson cited the projection that New York homeowners could lose $64 billion in home equity by December this year due to the home price impact of repossessed houses for sale. He described the state’s commitment to prevent the erosion of property values, protect neighborhoods and help distressed homeowners and renters.

The comprehensive bill would expand protections in the foreclosure prevention bill enacted in 2008. One of the provisions of the current bill is the inclusion of all mortgage loans taken out before September 1, 2008 in the 90-day notice requirement for lenders before they proceed with foreclosure.

The bill would also require lenders to disclose their foreclosure proceedings to the Division of Housing and Community Renewal and the Banking Department. This would enable the agencies to provide assistance to homeowners and track statistics on foreclosures.

In the 2008 bill, only homeowners who took out subprime loans were eligible for mandatory settlement conference. The current bill would expand the provision to include all types of home loans.

Renters of foreclosed properties would also be protected. Lenders are required to notify in advance renters about foreclosure filings and to allow the renters to remain in the repossessed houses for sale for at least three months or until they use up all their security deposits.

To prevent neighborhood decay, owners of repossessed houses for sale are required to maintain the properties. To prevent fraudulent foreclosure prevention consultants from victimizing distressed homeowners, the bill prevents them from charging upfront fees.

More homeowners would also be helped with the expansion of the state’s foreclosure counseling program which was funded with another $25 million in the 2009-2010 budget.

Under the HALT Task Force, Governor Paterson has been coordinating the mortgage-related activities of the state’s housing finance and consumer protection agencies such as the Banking Department, Consumer Protection Board, NY Homes and DHCR.

Among the achievements of the state’s mortgage programs are the launching of the 40-year fixed-rate home loan through the services of the State of New York Mortgage Agency, the mandatory maintenance of repossessed houses for sale to ensure the stability of New York neighborhoods and the formation of the Banking Department’s Mortgage Fraud Unit.