Home foreclosures in Bronx again became the focus of New York City Mayor Michael Bloomberg this week when he launched a nationwide campaign together with national nonprofit NeighborWorks to fight mortgage fraud.
Financially troubled residents of the city are being approached by a rising number of con artists promising them relief from problems related to foreclosures houses and consumer debts.
In New York City, NeighborWorks partnered with the Consumer Affairs Department to promote the campaign through an animated billboard on Times Square. Events offering free counseling and legal services to homeowners facing foreclosure will also continue to be held.
The consumer department will also organize groups of volunteers to go around foreclosure-hit neighborhoods and distribute flyers promoting the anti-fraud campaign.
According to a foreclosure tracking firm, the rate of New York home foreclosures surged year-over-year by 31 percent in January 2009 and increased by 0.7 percent in 2009 compared to 2008.
Nationwide, foreclosure activity stepped up by 15.1 percent year-over-year in January this year and surged by 21.2 percent in 2009 compared to 2008.
On a month-over-month basis, nationwide foreclosures dropped by 9.7 percent in January this year, but analysts said foreclosure activity will again surge in the coming months because of various factors. Aside from the major cause, which is unemployment, the other reasons are negative equity, failure of the Home Affordable Modification Program, readjustment of flexible-rate loans, serious illness and divorce.
The same foreclosure factors are playing out in New York, although serious financial problems by owners of multifamily buildings are exacerbating home foreclosures in Bronx. The bankruptcies and foreclosures of affordable housing complexes in the Bronx have been leaving these properties without owners able to make needed repairs.
In the 5 boroughs of New York City, a total of 1,825 households were notified of delinquency or foreclosure in January, a still relatively high number for the city, although it marked a 9.3 percent drop from December.
The campaign launched by Mayor Bloomberg to curb mortgage fraud and cut down foreclosures was supported by a newly-approved law which requires all foreclosure relief firms and loan modification services to inform homeowners of their rights before signing them to contracts, including telling them that they are not being charged upfront fees.
According to Eileen Fitzgerald, chief operating officer of NeighborWorks, equipping homeowners with relevant information is one of the most effective ways to fight mortgage fraud and home foreclosures in Bronx and in other parts of the city.