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Banking Superintendent Neiman Uses Third HALT Summit to Call on Servicers to Report Progress on Commitment to Modify Unaffordable Loans

October 17 , 2007

New York, NY: Today, Banking Superintendent Richard H. Neiman stressed the importance of servicers’ delivering on their vow to modify unaffordable loans and encouraged mass modification solutions. While reports from a multi-state working group, made up of state regulators and attorney generals, concluded that servicers are being proactive in offering modifications, Mr. Neiman wants to see evidence of the follow-through and the impact on consumers.

“We want to be sure there’s no disconnect between what we’re hearing from servicers and what we’re seeing in practice,” stated Superintendent Neiman. “I also encourage servicers to consider modifying loans on a mass scale using a customized approach that sorts loans into basic categories.”

Mr. Neiman’s comments came while he was delivering opening remarks at the third HALT (Halt Abusive Lending Transactions) Summit at SUNY Farmingdale in Long Island, New York.  The summit was hosted by Governor Spitzer’s interagency subprime HALT task force, in conjunction with Nassau and Suffolk Counties. Other participants in today’s summit included Deborah Boatright, Regional Director of NeighborWorks America; Jane Azia, Director of Nondepository Institutions and Consumer Protection for the New York State Banking Department; Hillary Jochmans, Assistant Director of Congressional Affairs from Governor Eliot Spitzer’s Executive Chamber; and Dr. Pearl Kamer, Chief Economist of the Long Island Association.

The task force, chaired by Mr. Neiman, was formed by Governor Spitzer earlier this year to provide a coordinated government response to the ongoing turmoil in the subprime mortgage sector.  The task force has been taking a comprehensive look at the subprime lending industry and predatory lending practices in order to recommend legislative solutions to protect borrowers, while maintaining industry vitality and limiting the economic impact.

The task force has been reaching out directly to effected communities through a planned series of regional day-long symposiums that bring together regulators, law enforcement, local community and advocacy groups, and industry representatives to discuss the problems facing a particular region. The first two HALT Summits were held in New York City on April 11 and in Buffalo on June 28, 2007. Feedback form these summits has been extremely positive, with comments noting that the forums are unique in bringing together consumer advocates and industry in an open and constructive dialogue.

In addition to hosting the series of HALT summits, the interagency task force continues to:

  • Analyze foreclosure and lending data to identify borrowers and communities most at risk;
  • Develop loan and refinance programs, such as the “Keep the Dream Program,” to help homeowners whose current loans are inappropriate for their financial circumstances.  The “Keep the Dream” program was developed by the State of New York Mortgage Agency (SONYMA) specifically to help eligible New York homeowners avoid foreclosures attributable to certain high-risk mortgages;
  • Create statewide outreach and educational campaigns to assist the state’s most vulnerable borrowers;
  • Propose legislative and regulatory changes to expand consumer protections; and
  • Pursue enforcement actions against those engaging in wrongful conduct and, where appropriate, coordinate these actions with other federal, state and local law enforcement agencies.

The HALT task force consists of agency heads from the Department of State, (SONYMA), the Division of Human Rights, the Consumer Protection Board, the Division of Housing and Community Renewal, the Governor’s Office of Regulatory Reform, and members of the Governor’s Executive Chamber.

The full text of Mr. Neiman’s remarks is available on the Banking Department website.

TheNew York State Banking Department is the regulator for all state-chartered banking institutions, virtually all of the United States offices of international banking institutions, all of the State’s mortgage brokers, mortgage bankers, check cashers, money transmitters and budget planners.  The aggregate assets of the depository institutions supervised by the Banking Department are more than $1.8 trillion.

In addition to regulating banking institutions, the Banking Department is active in informing and educating all New Yorkers on banking matters.  To contact the Banking Department, please call 1-877-BANK-NYS or visit our Web site at www.banking.state.ny.us.

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