During the summer of 2024, New York State has seen several significant developments in residential mortgage foreclosures:
Foreclosure Rates: Upstate New York has experienced a notable rise in foreclosure rates. Cities like Utica, Buffalo, Binghamton, and Syracuse have reported substantial increases in foreclosure filings, with some areas seeing jumps as high as 75%. This trend is attributed to the economic challenges posed by high-interest rates and the lingering effects of the pandemic on household finances (Spectrum Local News).
Legislative Changes: The Foreclosure Abuse Prevention Act (FAPA), signed into law by Governor Kathy Hochul, has introduced stricter limitations on lenders' ability to foreclose. The Act enforces a six-year statute of limitations for foreclosure actions and removes many previously available extensions or tolling provisions. This legislation aims to protect homeowners from prolonged foreclosure proceedings and prevent abuses in the foreclosure process (Harris Beach).
Foreclosure Protections: New York lawmakers are working to strengthen protections for homeowners facing foreclosure due to tax liens. Proposed legislation seeks to extend the same protections to these homeowners as those in mortgage foreclosure, aiming to prevent displacement due to unpaid property taxes. This measure is particularly targeted at older homeowners and those financially struggling (Spectrum Local News).
Market and Economic Impact: The high-interest rate environment has made borrowing more expensive, impacting both homeowners and lenders. Small and regional banks, in particular, are feeling the strain, which could lead to increased foreclosure activity if these financial pressures persist. The overall economic conditions, including potential recession risks, continue to influence the real estate market's stability (Moneywise) (McCarter & English, LLP).
These factors collectively highlight the ongoing challenges and legislative efforts to address the foreclosure crisis in New York State. For more detailed information, you can refer to reports from sources such as Spectrum News and Harris Beach.
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