Sen. Jeff Klein reported that Long Island filed 1,211 foreclosures and seven lenders with a majority of foreclosure properties in the metropolitan area have taken no less than $122 billion up to the present moment from the $700 billion federal rescue from financial difficulties.

Kleins report, all of the names in the list, which he labeled “Subprime Scrooges”, are accounted for nearly 5,000 foreclosures a couple of months ago. He emphasized that they are not determined to make the proper attempt to reshape mortgages and impede foreclosure homes.

US Bancorp tops the list on Long Island with a reported 204 foreclosures-related filings. According to Lisa Clark, assistant vice president for media relation of the bank, their role is just a trustee working for investors who bought these mortgages. She clearly outlined their position that they have nothing to do with foreclosures and as a trustee they only take care of the paperwork.

Klein is making a move to put forward the proposals intended for borrowers having trouble with their loans and permitting municipalities to resolve foreclosure properties and send a statement to lenders or their owner. One of his proposals is comparable to a government program and demands the State of New York Mortgage Agency to provide new financing for borrowers with troubled loans and share in part of the properties subsequent appreciation.

To be considered in refinancing, the value of the property must be higher than the mortgage owed and homeowners should not have bad credit, said the owner of RJB Financing Consultant, a mortgage broker based in Farmingdale.

In front of foreclosures, numerous homeowners are inquiring lenders and mortgage brokers regarding new financing as a result of dropping mortgage rate after the announcement of the federal government that it would buy up to $600 billion in troubled loans and mortgage subsidized securities.

Pre-foreclosure fillings were down by 7% compared to September’s rates and 10% to that of the high disturbing rates of August’s. Given that the pre-foreclosure rates are a preview of possible good things to come, McGee was reported to have said that the latest rates are welcome news.

Change in the number of REO properties was also noted by ForeclosureS.com. The report said that the 22% rates in September fell down to 84, 286 properties in October. The website believes that the October rate for REO properties is the lowest monthly total since the end of May 2008.

However, McGee expresses certain concerns on the future rates of foreclosure properties. She said that the positive changes we have witnessed this October might be put on a stall. She cited that the special programs that lenders commonly offer to home owners can cause a halt to the decline of the rates. McGee explained that such programs will not rescue borrowers from the problem.

Given the state of loans, she said that the process for qualifying units as soon-to-be foreclosure homes will just be delayed and not prevented by the special programs. Despite her observation, McGee is still optimistic.

But analysts begged to differ; they said that there are still a lot of factors that could contribute to the stoppage of the decrease in rates. Local legislations, in particular, can only put a temporary hold on foreclosure properties. Take, for example, the case of Massachusetts. The State’s foreclosure rates soared to 365 percent between August and September after a fall in rates from the previous months. Analysts said that the temporary decrease was made possible only by the local legislation requiring lenders to give their borrowers a 90-day right to work on their mortgage problems before initiating procedures to foreclosed homes.

Unlike August, a steady decline in housing prices and the uncertainty of unemployment rates impeded housing sales activities. Prospective buyers are reluctant to purchase new properties, including foreclosed homes, with the economic situation still under the heat. This is in spite of the drop in home pricing levels and interest rates that has never occurred since 2003.

On the other hand, a sharp decline in home pricing, particularly for properties in foreclosure, made contemplative homeowners forego selling these properties. Some homes dropped in value to almost half its original price.

With the economy continually deteriorating, consumers are wary of letting go of their dollars while experts predict the crisis will continue until next year. Some experts are calling on the government to focus more on housing, particularly for foreclosed homes, which would be better for the National Treasury in terms of losses.

Despite this bleak overall picture for the real estate industry, some states did register an increase in sales volume. These activities are concentrated on regions where pricing have already dropped as a result of previous foreclosures in these areas.

Tips for Sellers:

Homeowners willing to sell their homes should exert more effort in convincing buyers regarding the value of their homes. They should make the homes more presentable and give emphasis on unique features. They should note that they will be competing with banks which are more than willing to sell foreclosed homes at extremely marked down prices. Sellers should also be ready to sell themselves short by reducing prices at least 5% below standard market rates. Doing so would attract more buyers.

Tips for Buyers:

Prospective buyers should look for homes that have in the market block for three to six months. They could strike a good bargain from sellers desperate to make the deal, particularly for owners facing imminent foreclosures.