Foreclosures Growing At Alarming Rate:Comptroller
City Comptroller William Thompson says that there is a growing problem throughout the city that seems to be hitting the eastern end of the Rockaway peninsula harder than most: home foreclosures.
"The number of foreclosures throughout the city is reaching 14 to 15,000 and it's only going to get worse before it gets better," Thompson told The Wave in a telephone interview on Wednesday. "Rockaway seems to have that problem, particularly the eastern end; in Far Rockaway and Arverne."
And, while comprehensive statistics are not yet available on the number of foreclosures in those two communities, calls to his Foreclosure Hotline and entries on Craigslist.com seem to show that the numbers are climbing into the hundreds. Thompson launched his Foreclosure Prevention Helpline in early September to "assist New Yorkers struggling to overcome burdensome mortgage payments and threatened with foreclosure."
Of the more than 1,600 calls that have come into the Foreclosure Helpline, nearly 40 percent have come from Queens; and nearly 20 have come from Rockaway.
Of those, half have come from Far Rockaway. Another 30 percent come from Arverne, with only 20 percent from the rest of the peninsula, including Rockaway Park, Rockaway Beach, Belle Harbor and Neponsit.
Thompson said that the foreclosure rate is growing because of a number of factors.
First and foremost, he said, were the sub-prime loans, which often allowed new homeowners a year or two of low mortgage rates before the rates began to climb to a point where they could no longer afford to pay off the mortgage.
Another reason, Thompson believes, is greed."Many people bought into the market because home prices were going up each year and they thought they could hold the property for two or three years and then sell it at a huge profit," he said. "The market no longer allows them to do that and they have to hold the house or sell for less than they paid."
A problem that seems to be more prevalent on the Rockaway peninsula than in other areas because of the plethora of new homes, is the ability to pay a mortgage based on rental income for an apartment in the two-family home.
Many of the new homes in Rockaway, in fact, are sold, a real estate expert said, on the premise that a rental apartment will bring in $1,300 to $1,600 a month - enough to pay off some mortgages. When those tenants do not materialize, however, the new homeowner cannot pay the mortgage.
Thompson says that his helpline assists homeowners in trouble by packaging all the information and feeding the problem to several non-profits, who then help the homeowner negotiate with the bank to bring the mortgage into line with what the homeowner can pay.
"The banks have shown some understanding," he said. "They don't want to take back the properties, nor do they want to damage the housing market."
Thompson urges homeowners at risk of losing their homes to "pick up the phone and call the helpline."
It can be reached at 212-669-4600.
"The dream of homeownership is one that we should all embrace and support," Thompson said. "Yet, we must do all we can to ensure that New Yorkers enter into loan agreements that they can afford."