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Foreclosure Prevention Loans Preserve $20 Million for Low Income New Yorkers
In 2008, at the height of the foreclosure crisis, New Economy Project launched the NYC Foreclosure Prevention Gap Loan Program. Gap Loans were targeted to low income New Yorkers harmed by predatory lending and servicing practices. Over its five years of operation, the Gap Loan Program helped nearly 400 New Yorkers stop foreclosure and stay in their homes, while preserving more than $20 million in home equity.
Designed in collaboration with foreclosure prevention advocates, the program provided small loans to fill financing “gaps” needed to obtain affordable loan modifications, or other long-term solutions. With a Gap Loan commitment in hand, struggling homeowners and their advocates were often able to negotiate major principal reductions, short pay-offs of unaffordable loans, and other powerful results. New York City and State have replicated our loan fund, committing millions of dollars for foreclosure prevention lending. Read our impact report.