Starting in June 2014, judges on Long Island will take on a
substantial role in Foreclosure Settlement Conferences as issues arise in
foreclosure litigation. The purpose of this new
policy is to solve homeowners’ issues in an efficient way and help more
homeowners obtain loan modifications in an area of the country where the
percentage of foreclosures is still quite high.
New York requires judicial intervention in the foreclosure
process. It is New
York State Law that the courts must hold Foreclosure Settlement Conferences
for all residential foreclosure actions involving home loans originating
between January 1, 2003 and September 1, 2008, or nontraditional home loans.
Previously overseen only by Court-appointed referees, these conferences allow borrowers
to discuss workout options with their mortgage lenders in order to avoid
foreclosure. However, the process has always been flawed, as lenders oftentimes
would send representatives who not only did not have knowledge of the cases but
also had no authority. This new policy is supposed to address these types of
issues quickly, correct the flaws of the Foreclosure Settlement Conferences,
and protect borrowers against the wrongful practices of these mortgage lenders.
A judge is much more equipped to handle these issues than a referee, allowing
for fewer foreclosures on Long Island.