Brooklyn Deed Theft Victims May Get Relief From The New York State Assembly And State Senate

Brooklyn deed theft has become a crisis and Albany is finally acting on it.

Senator Velmanette Montgomery and Assemblymember Helene Weinstein have introduced a bill that will help victims of Brooklyn deed theft. The bill would help homeowners get their property back. The legislation has passed both the New York Assembly and the state Senate. The bill is awaiting the governor’s signature.

Local officials and housing advocates say deed fraud has turned into a crisis in Brooklyn’s gentrifying neighborhoods.

The legislation provides greater protections for homeowners who are in default or foreclosure. It also strengthens laws regulating shady property consultants.

Weinstein told the Brooklyn Eagle:

It has a simple point. A District Attorney can bring an action and find fraud but there’s not a way to get the homeowner’s home back. This allows the DA to get into court and have the illegal deed thrown out and have the house restored to the owner.

New York AG Letitia James stated that her office receives more deed theft complaints from Brooklyn than any other borough.

Deed theft primarily happens in two ways. The simplest way is through forgery; a thief submits falsified documents to the city recording a transfer of ownership. More insidious is deed fraud that occurs when scammers prey on homeowners facing foreclosure. Scammers pressure their victims into a quick and cheap sale after identifying distressed properties. They also pretend to be authorities or making too-good-to-be-true promises.

Homeowners may inadvertently sign away the deeds to their homes, sometimes not realizing the mistake until years later, according to Montgomery. Reversing the deed transfer can be close to impossible when homeowners have to take on the cost and time of a lawsuit.

Fraudulent companies target seniors, homeowners struggling financially, and those for whom English is not their first language.

Brooklyn Deed Theft Relief Would Build On HETPA

The legislation would build upon the Home Equity Theft Prevention Act. The HETPA provides more protections and transparency to homeowners who could make for ripe targets. HETPA provides the right to a complete contract, five days to cancel the contract and the right to an honest buyer and a fair sale.

The new bill expands on this by prohibiting certain tactics used by scammers.

Other fraudulent activities are also prohibited:

• Prohibiting deceptive behaviors such as pretending to be law enforcement or government representatives, taking temporary ownership of a deed, or engaging in harassment of the homeowner or the homeowner’s family
• Eliminating the requirement that a homeowner post a bond in order to file a lawsuit to stop a deed transfer.
• Prohibiting loan modification consultants from requiring upfront fees for services.
• Extending the amount of time a homeowner has to rescind transactions with distressed property consultants from five days to 14 days.

In her statement, Montgomery called the bill “a major step forward in addressing one of the most pressing issues among homeowners.”

“This is such a huge win for Brooklyn and our state. Fraudulent companies have targeted our homeowners for far too long,” Wright said.

Also, see:

The Only Brooklyn Foreclosure Defense Team That Has Beaten Wall Street