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Immediate Mortgage Relief Required for Victims of Hurricane Sandy

Homeowners who were impacted by Hurricane Sandy urgently require more sustainable mortgage relief.  Specifically, mortgage servicers must affirmatively offer homeowners:

• At least 12 months of mortgage relief, with payments either forgiven with a one-time waiver of principal and interest or suspended by forbearance.
• Sustainable repayment structures for homeowners granted forbearance with no requirement for re-amortization, loan modification application process, or subordination of secondary liens that either (a) allow the homeowner to repay through a term extension on the loan (with a prohibition on any interest charged on the forbearance amount), or (b) where term extension is expressly prohibited by any governing security instrument, provide a non-interest-bearing balloon payable at the maturity of the loan.

Homeowners affected by Hurricane Sandy who have received forbearance from their servicers should not be required to pay the full amount of deferred principal and interest immediately at the end of the forbearance period or through short-term repayment plans.  Such repayment structures are unreasonable and create a situation where a homeowner is likely to fall into mortgage delinquency, and may very well lead to foreclosure.  Meaningful mortgage relief – relief that will enable homeowners to return to financial stability and support neighborhood recovery – must prohibit balloon payments at the end of forbearance periods and short-term repayment plans. 

The region’s economic recovery hinges on learning from the experience of the Gulf Coast after Hurricanes Katrina and Rita, where forbearance periods did not adequately protect the rights of affected homeowners, and drove many families out of the communities where they had long lived.  Mortgage servicers have been offering homeowners impacted by Hurricane Sandy between three and 12 months of forbearance.  The minimum period of mortgage relief offered must be 12 months in order to provide a sufficient window of time for homeowners to repair or reconstruct their homes, overcome loss or reduction of employment and/or rental income, replace personal property, and cover the costs of temporary housing.

Without immediate and meaningful mortgage relief, many homeowners affected by Hurricane Sandy may face mortgage foreclosure.  Legislators across the region should send letters that call for the U.S. Department of Housing and Urban Development’s Federal Housing Administration (“HUD/FHA”), the Federal Housing Finance Agency (“FHFA”), and all mortgage servicers serving the region hit by Hurricane Sandy to immediately provide affected homeowners with at least 12 months of mortgage relief and sustainable repayment structures.  HUD/FHA and the FHFA must set the standard by requiring their contracted servicers to offer such terms to all homeowners who can document property damage from Hurricane Sandy with proof that a FEMA or insurance claim has been filed.

The Neighborhood Recovery Fund (NRF), the emergency grant and loan program for victims of Hurricane Sandy, has been exhausted due to overwhelming demand for the available funds.  The program has been a tremendous success, helping people in neighborhoods throughout New York City get back on their feet so that they can begin the recovery and rebuilding process.  

CNYCN is grateful to Goldman Sachs Give for the grant that made NRF possible, to our Network Partners who worked tirelessly on the applications, and to the community groups that spread the word about the availability of the fund in their neighborhood networks.

Though CNYCN will continue to seek additional funds to make more grants and loans possible, we can no longer accept applications for NRF at this time.

MAYOR’S FUND TO ADVANCE NEW YORK CITY AND GOLDMAN SACHS GIVES PARTNER WITH HPD TO PROVIDE $1.4 MILLION FOR NYC HOMEOWNERS AFFECTED BY HURRICANE SANDY

Public-Private Partnership to Provide Housing Counselors, Legal Services and Grants in Partnership with Center for NYC Neighborhoods

December 14, 2012 NEW YORK: Today the Department of Housing Preservation and Development and the Board of Directors of the Center for New York City Neighborhoods (CNYCN) joined with Goldman Sachs Gives and the Mayor’s Fund to Advance New York City to announce $1.4 million in new funding to CNYCN to help homeowners affected by Hurricane Sandy.  Goldman Sachs Gives contributed $900,000 and the Mayor’s Fund allocated $500,000 to fund an extensive network of housing counselors and legal services providers in the neighborhoods most affected by the storm. CNYCN, in coordination with HPD and the Mayor's Office of Housing Recovery, will give homeowners access to expert help in navigating the complex rebuilding and recovery process.  In addition, the funds from Goldman Sachs Gives will allow CNYCN to launch the Neighborhood Recovery Fund (NRF), an emergency grant program that will provide direct financial assistance to homeowners impacted by the storm.

Through its Hurricane Sandy relief activities, CNYCN’s network of housing counselors and legal services professionals will help homeowners secure critical resources and relief from FEMA, insurance providers, and other public and private programs. In addition to providing legal services, counselors will assist homeowners in applying for forbearances and loan modification workouts so that they can maintain their mortgage while repairing their homes and rebuilding their communities. Homeowners seeking assistance with mortgage-related issues can connect to CNYCN by calling 311 or 646-786-0888.

"Since its founding in 2008, the CNYCN has helped thousands of New Yorkers address issues brought on by the housing market crash and economic downturn," said HPD Commissioner Mathew M. Wambua. "I’m thrilled that the City and the Mayor’s Fund will join Goldman Sachs Gives in supporting this proven organization. We have the utmost confidence that these funds will be put to the best use, and that this will happen quickly. Through their large network of partners, they have provided housing and legal counseling, financial workouts with banks, and loans to help people avoid foreclosure and stay in their homes. The work they do is critically important, especially now with so many homeowners affected by Sandy who need assistance navigating their recovery.”

“This partnership is timely and well-conceived,” said Brad Gair, Director of the Mayor’s Office of Housing Recovery. “After a disaster the magnitude of Sandy, homeowners not only need flexible funding to fill a myriad of needs, but also sound guidance on how to rebuild both their homes and their finances.”

As homeowners affected by Hurricane Sandy continue the recovery process, many will struggle to make their mortgage payments due to unanticipated expenditures due to Sandy.  The Center for New York City Neighborhoods recommends that all homeowners affected by Sandy contact their mortgage service provider and ask for a forbearance that allows them to delay or reduce their payments for a set period of time.  Many servicers are offering forbearances to those affected by Sandy, but homeowners must proactively reach out to receive the forbearance.

After receiving a forbearance, homeowners are encouraged to connect to legal services and housing counseling so that they can seek loan modifications or other work-outs that will make their mortgage more affordable.  Call 646-786-0888 for CNYCN to connect you to legal services today. 

The attached flyer provides more information for homeowners affected by Sandy who may benefit from a forbearance and provides contact information for several of the major loan servicers.  Please share this flyer with individuals and families affected by the storm.

As our city continues to respond to the crisis, the Center for New York City Neighborhoods remains committed to its mission of keeping New York City Neighborhoods thriving.  With that in mind, our first course of action has been to  compile resources for homeowners immediately impacted by Hurricane Sandy to help get them back on their feet.   From immediate disaster relief to longer term help with repairing and stabilizing your home, CNYCN wants New Yorkers to have access to the best free assistance available.  Please check back for additional updates.

Disaster Relief:

Contact FEMA immediately to see what federal assistance programs you qualify for, including rental assistance, repair loans, grants and more. It is important that you reach out within 60 days of the disaster.

  Click http://www.disasterassistance.gov/ or call 1-800-621-3362.

1)      Register with FEMA as soon as possible at http://www.disasterassistance.gov/.  The application deadline is 60 days from the disaster declaration on October 30th, but we have heard that early requests for assistance are more likely to get a speedy reply. 

2)      After registering with FEMA, you may receive an application from the Small Business Association.  You need to complete this, as it will help FEMA determine what kinds of assistance you might be eligible for.

3)      Apply for Disaster Unemployment Assistance by December 3^rd to receive temporary wage replacement if you can’t work, can’t get to work, or can’t start your new job due to the storm.  This program is not just for those whose homes have been affected by the storm.  In addition, self-employed individuals may qualify.  You need to be ineligible for regular unemployment benefits in order to qualify for this program.  Please help to get the word out about this, as the deadline is approaching very quickly!  http://www.labor.ny.gov/ui/2012-sandy-services.shtm

NYC Department of Housing Preservation and Development (HPD) Commissioner Mathew M. Wambua, the Center for New York City Neighborhoods (CNYCN), the NYC Department of Consumer Affairs (DCA) and partners announce that more than $1.3 million in loans have been made to NYC homeowners through the Mortgage Assistance Program (MAP). The program makes loans of up to $25,000 to New York City homeowners at risk of foreclosure so that they may enter into a sustainable and affordable mortgage. To apply for the program, homeowners work with a housing counselor or legal services provider, at no cost, to determine eligibility and work with their lender to negotiate a resolution.

This program was created under Mayor Michael R. Bloomberg’s New Housing Marketplace Plan (NHMP). The NHMP is a multi-billion dollar initiative to finance 165,000 units of affordable housing for half a million New Yorkers by the close of Fiscal Year 2014. For every dollar invested by the City, the Plan has leveraged $3.41 in private funding for a total commitment of more than $19.4 billion to fund the creation or preservation of over 140,920 units of affordable housing across the five boroughs.

“We are committed to stabilizing neighborhoods, keeping communities intact, and most important, doing all we can to help families live in homes they can afford. Being able to provide financial assistance to mortgage holders who are having trouble with unaffordable loans  assistance so that they may hold on to their homes,” said HPD Commissioner Mathew Wambua. “The Mortgage Assistance Program has given families the extra support and security they need to avoid foreclosure. I want to thank The Center for New York City Neighborhoods, HPD staff and partners who work hard to give families at risk of foreclosure a helping hand.”