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Foreclosure Crisis Still Plagues Jamaica as Families Struggle to Keep Homes

By Ewa Kern-Jedrychowska | September 6, 2016 10:45am
 Charmayne Roberts at her home in South Jamaica.
Charmayne Roberts at her home in South Jamaica.
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DNAinfo/Ewa Kern-Jedrychowska

QUEENS — Charmayne Roberts, a mother of three, bought a small two-bedroom home in South Jamaica in 2006. Initially, her $1,200 mortgage seemed affordable, even though the house required a lot of costly repairs, she said.

But when two years later her grandmother passed away, Roberts, 55, spent all her savings — about $5,000 — on the funeral.

“I couldn’t recover,” she said.

Shortly after that, Roberts, then a clerk at a law firm, had her hours cut during the 2008 financial meltdown. Her husband's salary was modest as well, she said.

She started lagging behind on her mortgage payments. “I would pay them a little something, but not the full amount,” she said.

Roberts said that a foreign bank, which at some point purchased the mortgage she originally took out with Ameriquest, did not participate in the Home Affordable Modification Program (HAMP), a government initiative created in 2009 to help struggling homeowners avoid foreclosure by modifying their loans and making them economically feasible.

In March 2014, she received a notice of foreclosure.

Last year, her husband and she split, leaving her with her two sons, 24 and 33, and a 13-year-old daughter who has Asperger's syndrome, she said.

Roberts is among many homeowners who have been struggling with foreclosure in southeast Queens, which has become the epicenter of the New York City housing crisis since it first hit in 2008.

But while much of the city has recovered from it, the problem lingers in Jamaica and surrounding neighborhoods.

According to a report issued in July by PropertyShark, in the second quarter of 2016 there were 673 properties scheduled for first-time auctions across the city, including 302 in Queens, mostly in southeast neighborhoods.

By comparison, only 25 homes were auctioned off in the whole of Manhattan in the second quarter, the report claims, although some areas of The Bronx and southeastern Brooklyn also saw a high numbers of foreclosures during the same period of time.

The situation was even more dire last year in Community Board 12, which covers Jamaica, South Jamaica, Hollis, St. Albans and Springfield Gardens. Homeowners there were issued 1,369 notices of foreclosure in 2015, according to the NYU Furman Center for Real Estate and Urban Policy.

“People were victimized by predatory lenders and all these bad loans that haven’t gone away,” said Robert Tilley, a foreclosure counselor at the Neighborhood Housing Services of Jamaica.

"This is the continuing fallout from all of that."

Isa Abdur-Rahman, a Jamaica-based real estate attorney, said that the reasons why the area continues to struggle with recovery are primarily economic.

“A lot of the households that have struggled with foreclosure in southeast Queens don’t have income or income growth at the rate of other parts of the city so they have less reserves or sources of cushion,” he said.

“So once you fall back a month or two … then before you know it, two or thee months become six months, six become 12 and then at that point you just can no longer recover.”

According to City-Data.com, a website that collects statistics on cities, the median household income in Jamaica was $48,559 in 2013 compared to $57,369 citywide.

Since the government introduced the HAMP program and other initiatives, banks have become more proactive when it comes to offering loan modifications, but many residents “still struggle to get the modification because … you still have to qualify for it based on your income,” Abdur-Rahman said.

The Mortgage Bankers Association of NY, which advocates on behalf of banks and mortgage firms, declined to comment about the foreclosure crisis in Southeast Queens for this story.

But Tilley said that even receiving loan modifications does not guarantee a good outcome for homeowners.

“The inflated values of these mortgages remain and have to be paid,” Tilley said.

“And we saw quite a few people who were defaulting on modifications because while their interest rate was adjusted, there wasn’t much principal reduction which would bring the home value more in line with market value.”

As a result, a number of homeowners in the area who bought their property in the early 2000s now often owe more on their mortgages than their property is worth due to depressed housing prices, Tilley said.

According to a report from the Center for New York City Neighborhoods, which focused on areas of the city including Southeast Queens where the majority of homeowners are black, at least 10 percent of homes in the area with a mortgage are underwater, meaning that the value of their loan exceeds the market value of the house. 

In many cases, including Roberts’, these households have only one breadwinner which also makes it harder to make payments, Abdur-Rahman said.

Over the years, a number of foreclosed homes in the area have been abandoned, blighting the neighborhood with squatters, gang activity and drug dealers, officials and residents said.

To address the crisis, the city introduced the Foreclosure Buyback Program in June. Through the initiative the city will buy back distressed mortgages from the federal government to help families in danger of being foreclosed on.

Under the pilot program, homeowners will be working on their mortgages with community organizations — as opposed to private equity firms and hedge funds — which will help them modify loans, according to Jamaica Councilman Daneek Miller, who worked on the initiative with Councilmen Ruben Wills and Donovan Richards.

But so far, the city has only been able to purchase 24 distressed mortgages, including six in southeast Queens, officials said.

Meanwhile, local nonprofits urge homeowners to seek help, but oftentimes "the stigma of foreclosure" and lack of knowledge prevents them from asking for assistance until it's too late, local officials said. 

"One — people don’t know their rights. Two — people don’t know that there are programs out here that ... can help them," said Yvonne Reddick, district manager for Community Board 12.

But Roberts said that she has sought help everywhere. She even wrote a letter to President Barack Obama and received a response referring her to foreclosure hotlines and government websites.

With the help of Wills' office, she is now trying to find out whether she qualifies for the new foreclosure buyback program. But she said she doesn’t have much hope.

Earlier this year, Roberts, who recently went on disability because of a double knee replacement and back problems, found out she still owed more than $355,000 to the lender.

“Where am I going to go?" she said, her voice breaking in tears.

"I’m a single mom now. I don’t want to be homeless. I just pray for my daughter so that she could stay here.”