GreenPath Debt Solutions, a nonprofit consumer credit counseling service with seven offices in the Greater New York City area, recently released mortgage delinquency data regarding its clients in New York state and New York City.
Statewide, clients with past-due mortgages jumped 52%, and New York City clients with past-due mortgages jumped 58% in 2009 versus 2008.
‘The first wave of defaults was the upturn of adjustable-rate mortgages, while home values declined,’ says Kathy Conley, a GreenPath housing counselor. ‘The next wave was the exotic loans, which include interest-only and option adjustable-rate mortgages, many with negative amortization.’
Prime mortgages have fallen victim to the most recent wave, she adds, explaining the new default class is the result of high unemployment.
New state legislation signed into law last week by Gov. David Paterson will lead to an increase in inquiries for foreclosure counseling, Conley predicts. The legislation requires the 90-day pre-foreclosure notice currently sent for subprime loans to be expanded to include all home loans.
‘Based on the new legislation, we anticipate calls to increase at GreenPath and other groups, like the New York State Comptroller's Foreclosure Prevention Helpline,’ Conley says.
SOURCE: GreenPath Debt Solutions