Communities throughout WNY have been launching "Stay In Your Home" campaigns this past month with fears foreclosures could drastically rise in 2021.
COVID-19 abruptly put many out of work last year. According to the New York Department of Labor, Western New York saw a decrease of over 50,000 private sector jobs in 2020.
With unemployment a concern across the counrty, Erie County announced its "Stay In Your Home" campaign Feb. 11. Not long after, the City of North Tonawanda did the same.
Kate Lockwood, WNY Law Center Director of the Vacant and Abandoned Properties Program, said there is good reason for concern.
“In 2020, because of all the moratoriums and things, there is a significant drop in actual foreclosure filings, which adds to the concern that when foreclosure filings happen again, we'll sort of see a glut of new cases,” Lockwood explained.
The WNY Law Center tracks foreclosure filings in Erie and Niagara County.
In a typical year, Erie County has 1,200-1,500 Lis Pendens filings, most of which are foreclosures. But in 2020, Lockwood said there were under 500.
“We expect to see those cases that we would typically see in a year still happen. And then obviously, that exponentially increased because of people's financial situations and COVID,” Lockwood said. “And so ultimately, when those cases are able to move forward, one of the big concerns is the rush of cases to the court and the backlog.”
During the last housing crisis in the late 2000’s, Lockwood said Western New York was decimated by foreclosures while not having a housing bubble.
“One of our concerns this time around, as we see people defaulting at a higher rate, is that for the last several years, we have had higher housing prices and lower interest rates,” Lockwood said. “So a lot of people have refinanced their loans. A lot of people maybe had to spend a little bit more money on their housing than they would have in the past that will put them that much closer to falling behind if something were to happen.”
Lockwood is concerned of what will happen once moratoriums are lifted by federal and state officials.
“We're going to see an inevitable spike of foreclosures and it's not just going to be within the city of Buffalo, it is going to be all around Western New York, suburban, rural, inner city,” she said. “It will impact just about every neighborhood you can imagine.”
Lockwood is urging anyone facing financial strife to reach out to services like WNY Law Center as soon as possible.
“So stay in your home, if you're behind on your loan or your taxes, and then reach out for free help,” she said. “We have free legal services in Western New York. We have free housing counseling agencies that are HUD approved housing counseling agencies that can guide people through the options that are available to them.”
The current “Stay in Your Home” campaign throughout WNY includes a group of cross sector organizations and individuals including politicians and banks.
The collaboration is something Lockwood said should help with distributing resources in the future.