Consumer Groups Demand NY Governor Cuomo Sign Foreclosure Mediation Bill

Industry Update: On July 5, Mortage Servicing News published an article titled Consumer Groups Demand Gov. Cuomo Sign Foreclosure Process Bill.

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Consumer Groups Demand Gov. Cuomo Sign Foreclosure Process Bill

A coalition of consumer groups called New Yorkers for Responsible Lending is calling on Gov. Andrew Cuomo to sign a bill which would amend state law which its supporters claim will move homeowners in danger of foreclosure into court-mandated mediation much quicker by making lenders file certification of the legitimacy of the foreclosure action on a more timely basis.

Under current state law, both sides are required to enter into mediation within 60 days of the lender filing proof of service. The amendment, S4530-A/A5582-A, supported by state attorney general Eric Schneiderman and the State Office of Court Administration, would require lenders to file those certifications at the time the foreclosure suit is filed.

NYRL claims that 92 homeowners fall into a “shadow docket” every day because the certifications are not filed when the foreclosure action is started. They cite a figure from SOCA which said the shadow docket already consists of 25,000 cases.

At the start of June, while the bill was passed by the Assembly but still in consideration in the Senate, Schneiderman filed a lawsuit that accuses HSBC Bank USA and HSBC Mortgage Corp. of intentionally trapping homeowners into a foreclosure processing maze.

In its memorandum opposing the legislation while it was under consideration, the New York Bankers Association said, “Often, however, it is not at all certain whether the borrower lives at the property; therefore determining with certainty whether the certificate will be required may not be possible in many instances.”

Rather than speeding up the process, which in New York already stands at an average of three years, NYBA said the bill would only slow it down even further.

To view the online article, please click here.



About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

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