NY AG to use $15 million in servicer settlement to aid borrowers
New York Attorney General Eric Schneiderman plans to use $15 million from the state's $132 million share of the national mortgage servicing settlement to prevent foreclosures in his state.
Schneiderman plans to use a large percentage of the allocated funds to support the state's foreclosure prevention services program, which was set to expire April 1. About $9 million will be used to support the program and $6 million will fund housing and community support initiatives statewide.
Schneiderman's office will partner with various nonprofits across New York state to distribute the funds, the AG said in a press release.
The funds will support legal services for homeowners facing foreclosure.
"Funding for legal services is an essential first step in bringing relief to the homeowners and communities that have been devastated by the crash of the housing market," said Schneiderman. "As we continue to investigate the mortgage crisis that has impacted communities in every corner of this state, we must ensure that justice and accountability prevail at every step of the way."
The $25 billion national mortgage servicing settlement is a deal cut between the nation's five biggest mortgage servicers and state AGs over foreclosure documentation issues.
Each state in the settlement will receive a portion of the funds. Schneiderman has been extremely vocal about mortgage servicing issues in New York and was a last minute hold-out to the settlement before agreeing to sign on.