NY Times | Push to Avert Foreclosures Hits Court Logjam

Push to Avert Foreclosures Hits Court Logjam

The hearings that form the core of New York’s approach — special settlement conferences, which are required to try to modify mortgages to make them affordable — have become comic exercises slowed by endless paperwork, requests for additional information and the mysterious loss of documents.

During a day of more than 30 of the conferences in State Supreme Court in Queens last week, homeowners with screaming children and wheelchair-bound grandmothers appeared befuddled by the paper chase. Some of the cases had already been taken up in the settlement conferences as many as nine times, over many months, only to be delayed each time until yet another meeting.

“We don’t have the full file,” said a bank’s lawyer during one of the conferences.

“Unfortunately, I wasn’t able to review the documents,” said another lender’s lawyer in another case a few minutes later.

“We should have received it, but it didn’t get into our system,” said a third.

A fourth lawyer conceded that the homeowners had mailed information to the bank, but said that “only fax and e-mail” were acceptable.

On several occasions the court official who conducted the conferences that day, Tracy Catapano-Fox, mentioned to homeowners the system’s Catch-22: as they rush to gather newly demanded tax and bank records, information they supplied earlier to address other questions grows too old to be useful.

Completed applications turn back into incomplete ones, leading to more delays to collect more information while the newest information, in turn, grows stale. Ms. Catapano-Fox told one homeowner after another of the trap that awaited them.

“I have psychic powers,” she said with a sympathetic grimace, having conducted hundreds of the conferences. “There’s no question that the next time we come in here, they will claim that the documents are stale.”

Full story here…

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