Nearly everyone loses in the foreclosure crisis that is gripping southeast Queens.
When families forfeit their homes, neighborhoods become unstable. When the foreclosure sale sign goes up, the value of surrounding homes goes down. The banks lose when these homes are sold at a fraction of what is owed on the mortgage. These banks have the option of pursuing the original owner, but that is most often an exercise in futility.
The family that once had a home may now be looking for public housing, putting an increased burden on the taxpayer.
The only winners are the real estate speculators who buy the homes at auction or on a short sale for a fraction of their worth. They are vultures making a profit off the economic crisis. They are making no commitment to the future of southeast Queens.
The statistics we reported last week are alarming. According to the Neighborhood Economic Development Advocacy Project, in the first half of 2011 35,590 90-day, pre-foreclosure notices were sent to Queens homeowners.
On a recent Friday, six out of 10 properties auctioned off in Queens were homes in southeast Queens, and as many as 150 out of every 1,000 mortgages in this area are at risk.
Several factors have contributed to the crisis. First is unemployment. President Barack Obama says the nation has turned the corner on this problem, but we haven’t seen evidence of this in this part of Queens.
Second is the fact that many of the homes were sold to people who simply couldn’t afford them.
Standing with City Councilman James Sanders, U.S. Rep. Gregory Meeks recently announced an event April 26 to 30 at the Jacob K. Javits Convention Center in Manhattan that will try to help struggling homeowners.
Every major lender in the country is expected to be there, including Sallie Mae and Freddie Mac, and they can reduce interest rates as low as 2 percent and, in some cases, reduce a mortgage’s outstanding principal.
Arguably no community in America has more at stake in the foreclosure crisis. Communities made up of proud homeowners have been the heart of southeast Queens.
It’s commendable that Meeks, Sanders and others are working to get a handle on this problem. For everyone’s sake, we wish them success.