X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

EAST STROUDSBURG, Pa. – More than 200 people attended a hearing June 14 of the Capital Markets Subcommittee of the House Financial Services Committee that was convened by Rep. Paul Kanjorski (D-Pa.) East Stroudsburg, Pa. in response to widespread reports of housing fraud in the Poconos in Monroe County. The hearing, explained Paul Wentzel, executive assistant and legislative liaison for the Pennsylvania Department of Banking, was called to discuss the preliminary findings of a state-commissioned Monroe County Foreclosure Study conducted by the DofB and mandated by House Resolution 364 that was prompted by hundreds of complaints from consumers who said they were tricked into buying overpriced homes with inflated appraisals. The lead witness for the DofB at the hearing was Ira Goldstein of the Reinvestment Fund, the company hired by the state Department of Banking to do the study and investigate housing problems in the area. There have been 6,100 foreclosures in Monroe County since 1995 – more than 20% of all the homes in the area – and most of these have been for new homes. Between 2000 and 2003 there were more than 2,700 foreclosures. The initial findings of the study showed the clusters of foreclosures were in the Pocono Country Place development in Coolbaugh Township, Indian Mountain Lake development in Chestnuthill and Tunkhannock townships, and in Stroud and Middle Smithfield townships. Preliminary findings of the study show foreclosure rates have gone from about 1.8 per every hundred housing units in 2000, to about 2.3 per hundred in 2002. Wentzel who attended the hearing, said Goldstein stated during his testimony that if an epidermioligist saw clusters like that on a map, he or she would “be concerned there’s something poison in the ground.” The study further showed that a large number of the foreclosures were done on Black and Hispanic families. Wentzel described the foreclosure situation in Monroe County as “epidemic, worse than anywhere else in the state.” He explained that the Poconos area which used to be known as a resort vacation spot has become viewed as a suburb of New York and New Jersey, and many residents from those two states were attracted to build or buy homes in Monroe County because they found they could get comparable real estate for less money. Unfortunately, he continued, because of the long commute to New York City where many of these consumers worked – approximately a two hour drive – many of them had to take lower paying jobs located closer or wound up using a sizeable chunk of their salaries on transportation. “When they fell behind in their mortgage payments and went into foreclosure, they tried to sell their homes only to find the appraisal had been inflated,” said Wentzel. Kanjorski, whose district includes Monroe County, said he scheduled the hearing “so that members of Congress can learn more about the problems of the many homeowners in the Poconos who have unfortunately faced foreclosure, run into difficulties with their mortgages, and encountered problems in buying a home.” Wentzel said the Department of Banking expects to release the results of the Monroe County Foreclosurre Study by the end of July. Along with the study results, the agency will simultaneously announce a set of action steps to address the issues and remedy the situation. He emphasized there are a lot of issues that are becoming apparent – appraisals are out of whack, quality of homes, lenders who have purchased the loans. He said it became evident at the hearing that a lot of the issues relate to builders and inflated appraisals. – [email protected]

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.