AP

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May 8, 2008 — ALBANY - The state Assembly yesterday passed legislation to impose a one-year delay on foreclosures when homeowners default on mortgage payments, while the Senate was poised to consider a related measure backed by Gov. Paterson.

Both are meant to limit the impact in New York of the national crisis in subprime lending.

The Senate Banks Committee will hold a hearing Monday on Paterson’s proposal to delay foreclosure for 60 days after lenders get an owner’s offer to renegotiate.

“There’s nothing wrong with the governor’s proposal,” said Assemblyman James Brennan (D-Brooklyn). “It’s a welcome proposal and would do a lot of good, I’m sure.”

But Brennan said his bill for a yearlong delay, which passed the Assembly, 118-10, is also aimed at stopping predatory lenders from trying to foreclose, while giving homeowners respite to refinance as other national, state and commercial relief measures get off the ground.

“The mortgage industry aggressively marketed mortgages with low ‘teaser’ interest rates . . . Other questionable loans include interest-only mortgages and mortgages made with little or no income verification,” said Assemblyman Darryl Towns (D-Brooklyn), who chairs the Assembly Banks Committee.

New York already requires a judicial process for foreclosure that can take an additional year once a second or third missed mortgage payment starts the process.