New York AG Announces Results of the Homeowner Protection Program (HOPP)

(Source: Attorney General Eric T. Schneiderman) - BUFFALO – In Buffalo, Attorney General Eric T. Schneiderman today announced the results of the Homeowner Protection Program (HOPP), a $60 million initiative to support housing counselors and legal services providers working with homeowners at risk of foreclosure across the State of New York. Attorney General Schneiderman reported that in just the first three months of the program, 547 at-risk homeowners in the Buffalo-Niagara region have received assistance, and roughly 3,600 have been served throughout New York State. Schneiderman also announced the creation of a statewide hotline 1-855-HOME-456 to provide help for homeowners facing foreclosure.

“The number of foreclosures across the Buffalo region is troubling, but this isn’t just a matter of numbers: each foreclosure represents a devastating loss for families and communities. This program is putting homeowners first, and it is getting our neighborhoods back on track,” said Attorney General Schneiderman. “Funding housing counseling and legal services is an essential step to help more families stay in their homes and avoid foreclosure. As we continue to investigate the mortgage crisis that has hurt communities in Western New York and across the state, our Homeowner Protection Program will ensure that homeowners get the expert guidance and legal representation they need to protect their rights before it’s too late. ”

According to the Federal Reserve Bank of New York, based on data provided by Lender Processing Services Inc, 4,245 loans are in foreclosure and 7,592 are 90 or more days delinquent in the Buffalo/Niagara region. In June of 2012, Attorney General Schneiderman announced funding for three legal service providers and four housing counseling organizations serving at-risk homeowners in the Buffalo/Niagara region. For the first year of operation, $1.1 million went to the seven local organizations.

The seven organizations are:

– Belmont Housing Resources- Housing counseling organization, serving residents in Erie, Niagara, Cattaraugus, Chautauqua, Orleans, Allegany, and Wyoming Counties.
– Buffalo Urban League- Housing counseling organization serving residents in Erie and Niagara Counties.
– Westside Neighborhood Housing Services – Housing counseling organization serving residents in Erie and Niagara Counties.
– Consumer Credit Counseling of Buffalo- Housing counseling organization serving residents in Erie, Niagara, Wyoming, Genesee, Orleans, Cattaraugus, Chautauqua and Allegany Counties.
– Western NY Law Center- Legal services organization serving residents in Erie, Niagara, Orleans, Genesee and Wyoming Counties.
– Legal Services for Elderly and Disabled- Legal services organization serving residents in Erie, Niagara, Orleans, Genesee and Wyoming Counties.
– Legal Aid Bureau of Buffalo- Legal services organization serving residents in Erie, Niagara, Orleans, Genesee and Wyoming Counties.

HOPP counselors provide at-risk homeowners with a range of services, including direct advocacy with lenders, financial counseling and assistance preparing the complex documentation that homeowners need in order to submit applications for loan modifications; an outcome that usually results in lower monthly mortgage payments and prevents foreclosures from going forward but which can take more than a year to negotiate. Of the 547 borrowers who have received counseling in the Buffalo/Niagara region through the HOPP program, 223 – or more than 40% ‑ are already in active negotiations or have been formally offered loan modifications.

Statewide the numbers are just as encouraging. Of the roughly 3,600 families counseled throughout New York, 1,500 homeowners – or close to 42% ‑ have pending or formally approved loan modifications thanks to assistance from one of the HOPP grantees.

April Conlon, who lives in the town of Hamburg, had never been late with a mortgage payment on the home that she has lived in since 1986. In 2006, after struggling through a long and messy divorce and reeling from an unexpected lay off from her job, April fell three months behind on her mortgage payments. The bank threatened foreclosure.

Fortunately, April found her way to the Western New York Law Center where a housing Counselor started working on Conlon’s case. After more than a year of negotiations, the counselor convinced the bank to modify Conlon’s mortgage, significantly lowering her interest payments and brining hermonthly mortgage payments from $861 down to $340. The savings and stability allowed Conlon to go back to school and today she is a practicing pharmacologist.

“I would no longer have my home if it were not for the Western New York Law Center,” said homeowner April Conlon. “I want to thank Attorney General Schneiderman from the bottom of my heart for his support and commitment to keeping organizations like this operating.”

Robert Sanders, a 63-year-old veteran, stepped in to help a relative who became incapacitated by a stroke and couldn’t make her mortgage payments. The outstanding balance on the home was $40,000, and Robert’s relative was in jeopardy of losing her home. Robert attempted a loan modification on his own through Chase Bank but was unsuccessful. He then went to the Buffalo Urban League and they helped him get a principal write down to $8,000. Now his relative has paid off the balance and lives in the home mortgage free.

“The assistance of Attorney General Schneiderman and the Buffalo Urban League was an absolute blessing in my life. Ever since I walked into their office to get help, things have been getting better and better. I can’t say enough wonderful things about the services these organizations offer to struggling homeowners,” said homeowner Robert Sanders.

The Attorney General’s office has also announced the launch of a statewide consumer hotline to assist those in need of mortgage counseling. By calling1-855-HOME-456 consumers will be connected with a qualified HOPP counselor or legal service provider within 24 hours. The hotline is based on a model program administered by the Center for New York City Neighborhoods (CNYCN) that has been operational in NYC for the past 3 years. During that time, the Hotline has generated more than 15,000 calls from consumers struggling to stay in their homes. The Attorney General has subcontracted with CNYNC to assist in managing the statewide hotline.

“Attorney General Schneiderman is helping to level the playing field for homeowners who are struggling to stay in their homes. The HOPP initiative and the Consumer Hotline are a huge resource for struggling homeowners in the Buffalo-Niagara regions and across upstate New York. Thanks to the Attorney General’s commitment, these families will have swift access to high quality advocates, which in turn, will greatly improve their chances at negotiating the preservation of their homes,” saidRebecca Case Caico, Program Coordinator at the Empire Justice Center.

The funds awarded for this program were the result of a competitive Request For Applications process and represent a portion of the millions of dollars that New York received as a result of the National Mortgage Servicing Settlement that was announced in February 2012 between the five largest mortgage servicing banks, 49 states, and the federal government over foreclosure abuses.

The combined seven organizations in the Buffalo-Niagara region that have received funding under the Attorney General’s HOPP Program began providing services in early October. This program ensured that there were no disruptions in services to homeowners who rely on these professionals as a lifeline during these very difficult negotiations.

Legal services and housing counseling funded through New York’s Foreclosure Prevention Services Program have become an integral part of the foreclosure process in New York State. Funding for the program was set to expire on April 1 of last year, but the Attorney General provided $15 million from the national mortgage settlement to extend it until October 1, 2012. Attorney General Schneiderman’s Homeowner Protection Program replaced the state’s Foreclosure Prevention Services Program when it expired and ensured that these critical services will continue to be funded for at least three more years.

New York’s comprehensive foreclosure prevention law entitles homeowners to a 90 day pre-foreclosure notice before a lender can begin a foreclosure action. This notice is required to include a list of at least five nonprofit housing counseling agencies that can assist homeowners at risk of foreclosure. These organizations can sometimes help homeowners obtain loan modifications from lenders at foreclosure settlement conferences. Without funding for the Attorney General Schneiderman’s Homeowner Protection Program, most of these agencies would lose the resources necessary to fulfill these critical obligations to homeowners.

In addition to penalties for past abuses, New York’s share of the National Mortgage Settlement includes direct relief to victims of wrongful foreclosure conduct and billions of dollars nationwide for loan modifications, including principal reductions for struggling homeowners. The settlement, which imposes strong national standards for mortgage servicing, also fulfilled Attorney General Schneiderman’s demand that he retain the right to bring legal action over misconduct that has not yet been fully investigated.

Today’s announcement is the latest part of Attorney General Schneiderman’s multi-pronged strategy to stem foreclosures, provide relief to struggling homeowners and hold accountable those responsible for the mortgage crisis. In 2012, Attorney General Schneiderman introduced the Foreclosure Fraud Prevention Act, which would impose criminal penalties for knowingly filing false documents in a foreclosure proceeding, or overseeing employees who engage in such activity.

Last year, Attorney General Schneiderman was appointed by President Obama to co-chair the Residential Mortgage-Backed Securities Working Group. This joint investigation brings together the Department of Justice (DOJ), HUD, the Securities and Exchange Commission (SEC), the Consumer Financial Protection Bureau, several state law enforcement officials, and other federal agencies to investigate those responsible for misconduct contributing to the financial crisis through the pooling and sale of residential mortgage-backed securities. It builds upon ongoing state and federal investigations, while also launching new ones.

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