Running out of Stimulus Money, N.Y. Zeroes Out Foreclosure Representation and Counseling Funds
Legal Services E-lert
Bibliographic Info:
Author: Dan Bilefsky
Source: The New York Times, “Budget Cuts Imperil Legal Aid in Foreclosure Cases"
Date: May 13, 2011
The New York Times reports: “In the large immigrant community of Jamaica, Queens, which is ground zero of New York City’s foreclosure crisis, a small squad of young lawyers fans out to local courts every day to do battle with lenders, negotiate hard-fought changes to onerous loans and provide free legal representation to low-income homeowners about to lose their homes. Now, however, the anti-foreclosure team itself is facing foreclosure. The state’s budget squeeze has put at risk more than 120 legal aid and homeowner-counseling agencies across the state that have provided a last-ditch legal and economic lifeline to thousands of distressed homeowners. ‘I am not sure I will have enough money to pay my staff by the end of this year,’ said Jennifer Ching, the project director of Queens Legal Services, one of the groups whose future is threatened. ‘New York could soon find itself with thousands of unrepresented homeowners who risk falling through the cracks.’ Foreclosure-prevention programs, which over the past three years have helped more than 3,000 homeowners facing foreclosure in New York City, have been financed since 2009 by federal stimulus spending, but that money will run out by the end of this year. That has left lawmakers scrambling to try to find new state financing, while the small army of pro bono lawyers fighting foreclosures wait and worry. Some have already stopped taking on new clients.. . . New York’s foreclosure-prevention laws are among the most stringent in the country, requiring lenders to give a 90-day preforeclosure notice during which homeowners can seek help. But Ms. Ching said that the lack of new financing would undercut the law’s effectiveness.”