Last December, when New York State Senator Craig Johnson (D- Nassau) released the names of the 10 banks that are responsible for the most foreclosure filings on Long Island, it probably came as no surprise to some people as they may have had to deal with them in the past.

In a speech that highlighted the problem, and was delivered right here in Westbury, Senator Johnson lamented the fact that banks were continuing to foreclose on homes even though they were recipients of taxpayer subsidies.

Senator Johnson is not a late responder to this problem; just before the subprime bubble burst last year, when consumers were being lured by fast talking pitchmen to take advantage of low interest loans, he embarked on a series of seminars warning the public to be leery, advising of his plans to do something about it legislatively at the state level. Everyone is now aware that these deals were too good to be true, and the day of reckoning came sooner than some of us expected.

The media is replete with statistics on the problem; from states with the highest foreclosure rates, to individual communities that are hit the hardest, there are stories of gloom and doom all over the airwaves and in the print media. Westbury may not be among the worst, but it is certainly not among the best. As I travel through various communities, "For Sale" signs that would have usually disappeared after a few months, sometimes weeks, now remain for extended periods of time and seem to increase in number from month to month.

It is not hard to find someone that is affected by this crisis - family member, friend, coworker - as the unemployment pendulum bounces people to the side, and credit lines freeze, leaving them out in the cold. In fact, according to a study by the First American Core Logic, one in five U.S. mortgage borrowers owe more to their lenders than their properties are worth. This translates in 20 percent of underwater borrowers.

In the midst of all that is going on, it is hard to believe that predatory practices are still being perpetrated, and targeted towards certain segments of the population. In 2007, at the height of the home buying frenzy, one needed only to tune in to just about any station on the A.M. band that offered airtime for a fee during certain time slots; so-called broker radio, to hear sales pitches promoting "NINJA" loans: no income, no job accountability and urging listeners to take advantage of the offer. These expensive subprime mortgages are targeted towards certain ethnic groups who often have cash income and no bank account. Mortgage brokers usually jump at such deals, as they were quicker and more profitable.

When these "deals" went south for the borrowers, the same predators use their airtime to offer credit repair services, such as loan modification services - for a fee, and encourage the elderly to enter into reverse mortgage deals, knowing fully well that the equity in homes in a down market decline rapidly and that it was only a matter of time before the equity runs out altogether and the owner loses his house.

Perhaps Senator Johnson should focus his attention on these predators in an effort to rein them in; notwithstanding caveat emptor (let the buyer beware) because high foreclosure rates impact communities in more negative ways than one: it impacts adjacent home, water systems, school systems and municipalities that depend on the values of homes. Not to mention the safety aspect, as homes that are boarded up, unkempt or appear unoccupied attract unsavory characters, and become blights on communities.

Chester McGibbon
Vice President
Westbury PTA Council

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