Report says Newark hard hit by foreclosures

TRENTON – Newark has been extremely hard hit by the foreclosure crisis. 

That is the assessment of a report by a new grassroots group, New Jersey Communities United, which states that foreclosed homes have cost Newark residents and businesses at least $56 million in taxpayer money.

“The typical foreclosure costs local governments more than $19,000 for increased costs of safety inspections, police and fire calls, trash removal, and maintenance,” the report said. “In Newark these costs are estimated to be more than $56 million.”

More than 9,000 Newark homeowners owe on average $70,000 more on their mortgages than what their homes are worth, according to the report.

Newark homeowners have lost an estimated $1.9 billion in home values as a direct result of the 6,810 foreclosures for 2008-2012.

Overall, the state has seen some 88,000 foreclosures in that same period, making New Jersey the state with the second highest rate for foreclosures in the nation.

Despite receiving federal help through the Homekeeper Program, the report said New Jersey has been slow to use it. 

“In 2010, the state received $300 million from the federal government’s Hardest Hit Program to help unemployed and underemployed families struggling to keep up with their mortgages,” the report said. “However, as of December 2012, the program had accepted only 1,922 applicants. New Jersey is among the states with the worst record, having dispersed a mere 8.9 percent of its allocated funds, which is far below the national state average of 17.6 percent.”

It said an ordinance the Newark City Council adopted a year ago does not go far enough. 
“In 2011, the City Council approved an ordinance that requires the registration of vacant properties that have fallen into disrepair. The ordinance also provides for daily fines when the building is not registered, secured, and/or does not provide contact information on the premises,” according to the report.

“All of this is a good start; however, the registration fees only begin to cover the cost of administering the program,” the report states.

According to the report, the ordinance does not address other forms of blight associated with vacant properties such as accumulated trash and overgrown lawns, and most importantly excludes all properties up for sale or rental, which could potentially include many of the foreclosed properties owned by the banks.

Anti-foreclosure advocates, city leaders and others are meeting at 11 a.m. today at Newark City Hall to hold a hearing into the various issues. Report says Newark hard hit by foreclosures