We’re Number One!

Long Island at top of state’s mortgage crisis

Suffolk and Nassau counties accounted for 33 percent of subprime loans that were made in 2006 in New York State and that are now in foreclosure, according to a report to be released Friday by the Empire Justice Center, a nonprofit law firm that advocates for low-income families.

The analysis, based on data from the Federal Reserve Bank of New York, shows Long Island at the top of the mortgage crisis in the state, the Albany-based center said. The group will publicize the 80-page report, which will show foreclosure and default rates across the state and also talk about solutions and the impact on minority communities.

Long Island’s one-third foreclosure rate equates to 12,936 subprime loans, the report said.

At the same time, Long Island has 30 percent of all subprime loans scheduled to reset before October 2009, according to the study of subprime loans given out in 2006.

The articles cites aggressive mortgage sales and overinflated prices as the prime reasons for Long Island winning this honor. No doubt, but my best advice to avoid this kind of thing is don’t live on an island.  We’re developed from one end to the other now. There’s no longer the option to find affordable housing by moving farther out east, away from NYC.  Leaving Long Island, which a lot of people are doing, involves picking up stakes and changing your job, moving away from family and friends.  Could be that if you’re priced out of Westchester County, NYC’s northern suburb, you can find something in Rockland or Orange County without so much disruption.  And maybe it’s a little easier to find affordable rentals on the mainland. It couldn’t be much harder.

A lot of this is why I believe it might be time to embrace the post-nuclear, multi-generational family, instead of fighting it.  Our kids might not be homeowners, but at least they’re not  in danger of foreclosure and a default judgment on a mortgage in excess of a home’s value. We might not have an empty nest, but we don’t have to leave home to babysit.  Not that a nice quiet condo doesn’t sound pretty good sometimes….

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One response to this post.

  1. It’s too bad people are reaching for regulation and not letting this all shake itself out. Paulson’s proposal of onsolidating regulators and bailing out the failed investors is the worst of both worlds: it increases public exposure without any concomitant increase in regulatory authority over the high risk investors and investments involved. Plus, it would likely delay the liquidation process, which can function efficiently and quickly if everyone didn’t run in horror from the word recession. We need a recession to shake out all of this monetary-policy induced malinvestment. And housing prices need to drop. Foreclosures need to happen. And political opportunists need to STFU.

    Reply

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