BRONX, N.Y. (Legal Newsline) - New York Attorney General Eric Schneiderman announced proposed legislation on Thursday that would close a loophole banks have used since the financial crisis to deny foreclosure victims their right to a court-mediated settlement conference.
Schneiderman and other New York officials, including Sen. Jeff Klein (D-34th) and Rep. Helene Weinstein (D-41st), encouraged Governor Andrew Cuomo to pass the Certificate of Merit bill when it reaches his desk. The bill would close the loophole that is keeping foreclosure victims from their right to a settlement conference that could help them keep their homes, protecting every homeowner's right to an in-person, court-supervised settlement conference within 90 days of entering foreclosure.
By denying homeowners their right to a settlement conference, banks forced approximately 14,000 New York homeowners into the state court system's shadow docket, allowing banks to keep foreclosure actions open without ever negotiating with the homeowner, even if the homeowner is willing and able to pay the full amount owned. This causes interest charges and late fees to escalate. The banks are then able to demand larger sums from homeowners when the foreclosure action makes it to the courtroom.
"All across New York state, thousands of homeowners are trapped in the 'shadow docket' that prevents them from even getting a chance to keep their homes," Schneiderman said. "The 'Certificate of Merit' addresses this problem by proposing common-sense reforms to keep homeowners out of the legal limbo and ensure their rights are honored. I am committed to ensuring that the big banks play by the rules, and that New Yorkers get a fair shake."
The protection of homeowners struggling to avoid foreclosure is a top priority for Schneiderman's office. In June 2012, Schneiderman announced the Homeowner Protection Program, a three-year, $60 million initiative to fund legal services and housing counselors throughout the state. The program is meant to make sure that every family facing foreclosure can access a qualified and knowledgeable professional advocate.
Want to get notified whenever we write about
any of these organizations
Next time we write about
any of these organizations,
we'll email you a link to the story. You may edit your settings or unsubscribe at any time.
Sign-up for Alerts
Organizations in this Story
New York Attorney General
99 Washington Square
Albany, NY 12205
Governor Andrew Cuomo
Albany, NY 12224