Lisa Simpson
Nov 11,2009
In: Foreclosure

Low Income Housing Groups at Risk of Foreclosures Because of Water Liens

Water liens placed on low income housing groups could trigger off a swath of foreclosures.
Theresa Brathwaite became nervous when she saw her name published in the local daily along with many other property owners of the city for lagging behind in payment of water and sewer bills. Theresa is a septuagenarian and survives on her income from Social Security. Her dues were nearly $3,000. The loan put at risk her house in Brooklyn that had been her home for over half a century.
She said that the notice had devastated her. She was lagging behind because of higher costs for heating oil and other related expenses to run day to day life. She said, “I only get one check and it has to go so many different ways.”
From May 2008 the city has been selling about 3,200 water liens mostly in low-income localities of Brooklyn, Queens as well as Bronx. Previously the water liens were sold only with liens on property tax.

Private collection firms purchase the water lienss when the dues of properties, whether residential or commercial, are more than $1,000 or past a year. If the owners fail to clear the dues the houses are foreclosed upon. Experts forecast that the first wave of foreclosures from water liens will surface before this year draws to a close.

April Tyler of Neighborhood Economic Development Advocacy Project said, “The very neighborhoods that were victims of predatory lending and are suffering foreclosures are now being hit by city tax lien sales.”

Al Vann (Democrat) the city councilman said, “It increases the pool of people that are in danger of losing their homes.” He initiated a bill last August that would extend the eligibility for exemptions from lien sales. It would also stipulate that the city would have to wait for a period of three years before selling off these water liens. At the moment the owners of one-family houses, seniors with low income and the disabled with low income are excluded from the water lien sales.

The irony is that not all who are qualified to be exempted are benefiting. This is because it is the individual who has to report his or her status and once a lien is sold it is nearly impossible to retrieve the property out of the dues. It is hoped that the bill being introduced by Vann will be cleared by the end of this year.

banner_one1