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Foreclosure filings fall in state; Banks hold back after crackdown

New mortgage foreclosure filings dropped last year in the state while edging up nationally, according to State Comptroller Thomas P. DiNapoli, who cautioned the fallout continues from the U.S. housing crisis and recession.

The state decline can be attributed partly to a temporary suspension of foreclosure activity by banks, not an improvement in the market, DiNapoli said.

"In general, the foreclosure crisis in New York State and New York City was less severe than in other parts of the country," he said. "But neighborhoods in Brooklyn, Queens and the Bronx were especially hard hit."

In November 2009, state lawmakers passed a bill giving homeowners and renters more protection, expanding a mandatory 90-day preforeclosure notice to all types of home loans -- not just subprime mortgages -- and letting renters living in foreclosed properties remain for the remainder of their lease or 90 days, whichever is longer.

Last October, the state's chief judge imposed rules requiring lawyers handling foreclosures to verify that all paperwork is accurate. That followed complaints that lenders nationwide had cut corners on paperwork and legal procedures in seizing homes.

Foreclosure filings dropped last year to 43,900 from 50,000 statewide, while rising nationally to 2.9 million from 2.8 million, according to the Comptroller's Office. That lowered New York to 42nd place among states. For the fourth straight year, Nevada had the most filings.

But three years after the U.S. housing bubble burst in 2007, the cumulative inventory of properties in the foreclosure process kept climbing in New York, the report showed. The percentage delinquent by 90 days averaged less than 1 percent before the housing crisis. Those in the foreclosure process continued to rise to 5.2 percent in the fourth quarter of last year.

The report analyzed data from RealtyTrac and the Mortgage Bankers Association along with federal mortgage data.

The report shows foreclosure filings rising to 8,123 from 7,650 in Suffolk County on Long Island and to 578 from 560 in suburban Putnam County, while falling to 2,738 from 3,257 in Westchester County.

Upstate, filings rose to 540 from 499 in Syracuse's Onondaga County, but fell to 404 from 629 in Albany County and to 965 from 2,859 to Erie County.

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