New York Attorney General Eric Schneiderman is launching a free loan program to help homeowners struggling to avoid foreclosure. Homeowners can borrow up to $40,000 interest free.
The loans are aimed at homeowners trying to secure mortgage modifications which may be stalled because of small outstanding debts like back taxes or delinquent second mortgages.
The money is coming from the state's share of the $25 billion National Mortgage Settlement in 2013. States and the federal government sued big banks for reckless lending. New York's share came out to around $1.8 billion dollars. Schneiderman has been using the money to help homeowners with legal counsel in order to keep their homes.
Officials don't know how many loans can be offered, but Long Islanders will be the first in line for program out of recognition that the region has been particularly devastated by the foreclosure crisis.
The Attorney General's office will begin processing applications September 15.