A state senator representing some of the most foreclosure-beset neighborhoods of metropolitan New York has compiled tandem Top 10 lists to which financial institutions would rather not be named, and a California bank and a Minnesota-based bank with no brick-and-mortar presence here rank at the top in Westchester.
Based in Bera, Calif., Fremont Investment and Loan was the leading originating lender of mortgages with the highest foreclosure rate in the metropolitan area, including the five New York City boroughs and Westchester and Nassau counties, Sen. Jeffrey D. Klein, D-34th District, recently reported in his area survey of subprime mortgages.
Klein, the Senate deputy minority leader, based his rankings for his “Subprime Hall of Shame” on the top mortgage lenders and foreclosing creditors for the two ZIP code areas with the highest number of foreclosure filings in each borough and county.
In Westchester County, Fremont Bank originated 43 of the 344 mortgages for homes in Yonkers and Mount Vernon for which foreclosures were filed between July 1, 2006 and July 31, 2007. A total of 868 foreclosure filings were recorded for all of Westchester County in the same period. The Yonkers and Mount Vernon neighborhoods accounted for more than 35 percent of those filings in the county, Klein noted.
Following the California bank on Klein”™s list of mortgage lenders in Westchester were Dynamic Dwellings L.L.C., White Plains, and Washington Mutual Bank.
For originating lenders of foreclosed mortgages in the metropolitan area, Fremont Bank was followed by WMC Mortgage, General Electric Co.”™s subprime mortgage unit that is now for sale; New Century Financial Corp., which declared bankruptcy in April, and Argent Mortgage Co., a company that has vacated its White Plains offices and has been bought by Citigroup.
In Westchester, the leading foreclosing lender for the 13-month span that ended July 31 was U.S. Bank, the sixth-largest bank in the nation whose parent company, U.S. Bancorp, is headquartered in Minneapolis. U.S. Bank accounted for 35 of the 344 foreclosure filings on homes in Yonkers and Mount Vernon.
Following U.S. Bank on the Westchester list were Wells Fargo, with 31 foreclosure filings, and Deutsche Bank, with 28 filings.
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Deutsche Bank in the senator”™s report led the metropolitan area with 2,299 foreclosure filings on homes in neighborhoods most affected by the subprime mortgage crisis. Of banks with offices in Westchester, HSBC ranked fourth on the metro list with 989 foreclosure filings; JP Morgan Chase fifth with 838 filings; Bank of New York sixth with 807 filings; Washington Mutual Inc. seventh with 673 filings; and Citigroup ninth with 582 filings.
Klein called upon lenders who “grew rich off of defrauding the American dream” to follow the lead of Countrywide Financial Corp., the nation”™s leading home-loan lender, which, as the senator noted, recently announced it will refinance $16 billion worth of loans, mostly from the subprime market.
Klein said banks should identify borrowers whose subprime mortgages are due to reset in the coming months and renegotiate terms in order for them to avoid any future financial difficulty; identify subprime borrowers already in financial difficulty and provide them with a financial workout and waive all refinancing charges for borrowers seeking to refinance due to being placed in a subprime mortgage.
The senator has sponsored the New York Subprime Predatory Lending Prevention Act, a measure that would prohibit loan flipping when there is no tangible benefit to the buyer and require a lender to verify a borrower”™s ability to repay the loan and to offer counseling for all subprime products. The law also would create a fiduciary duty for mortgage brokers to act in the best financial interests of the borrower.
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