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SCHENECTADY
Burdens of ownership
City set to take hundreds of properties at once
BY KATHLEEN MOORE Gazette Reporter

Foreclosure day is coming, and nearly 600 tax-delinquent properties are going to be seized.
That means the city must board up 600 houses. Inspect 600 houses. Maintain 600 lawns. And finally — try to sell them all. It won’t be cheap. But city officials don’t have any cost estimates. In preparation for the mass of foreclosures on Aug. 31, they’re sending crews to each house now to find out basic details.
    “At the moment, I can’t even tell you if it’s vacant or occupied,” Corporation Counsel John Polster said.
    The City Council must also decide whether to evict tenants and owners still living in the homes. The city might write leases and allow people to pay rent instead of immediate eviction.
    “We don’t want to be kicking people out of their homes,” Polster said.
    But for the few owner-occupants on the list, the change will make it clear they no longer own the house. At that point, Building Inspector Eric Shilling will be able to analyze building conditions.
    He can’t do it in advance because some owners keep making alterations. After the foreclosure, “at least they have to stop changing things,” he said.
    Offering some houses for rent has its downsides — the city would have to handle maintenance calls, Polster said. And the city will likely have to inspect for safety hazards before approving the lease.
    But it would bring in some revenue against the thousands of dollars each property owes in taxes, he said. And it would give the property some protection until the city gets to it.
    The city has struggled for years with the twin problems of collecting taxes from delinquent owners and maintaining hundreds of abandoned buildings.
    Officials tried to solve the tax delinquency problem by selling liens to private tax collection company American Tax Funding. At first, ATF paid all of the taxes owed by each property owner, giving the city a much-needed revenue stream.
    But eventually ATF started paying only half of each owner’s taxes, so the city stopped selling the tax liens this year.
    And the sales never solved the problems of blight — arsons set by homeless people living in abandoned houses, prostitutes and drug dealers using those buildings as storefronts, and a general look of deterioration.
    So Mayor Gary McCarthy embarked on foreclosures in hopes of collecting revenue while also putting the buildings into the hands of responsible owners.
    Polster said, “Part of the problem is we’re going to have hundreds of properties here, and there’s no physical way for us to deal with all of them simultaneously.”
YEARS OF PAPERWORK
    They’re already starting to triage. Owner-occupied houses will be left to their former owners until Sept. 30 at the earliest. That’s the deadline for those owners to buy back their properties.
    After that, some houses might sit empty for a long time.
    Shilling says it will take him three days to evaluate and write a renovation plan for one house. Finishing all the houses on the list, then, would take him about 1,800 days.
    He doesn’t plan to get much sleep, he joked.
    It will be his job to evaluate every property, diagnosing roof leaks and structural problems that need immediate work, as well as everything else — right down to the rooms that need fresh paint.
    He will place every house in one of four categories: sell immediately; light repairs; major renovations; demolition. Contractors will be able to bid on the houses, do the work, and then fl ip them for their own profi t.
    Shilling said he’ll probably get through just one neighborhood before winter. It will take years to get every house sold or demolished.
    “I think we’re looking at a severalyears program,” he said.
    But for those still living in the houses, there are only two months left.
    On Aug. 31, the city will take offi cial control of all 580 properties. Residents can buy their property back until Sept. 30, but if they don’t do so, they lose the house.
FAMILY STORY
    One family is already preparing for eviction.
    Pam Belanger said there’s no way for her family to come up with the money they need in time to save their house.
    It’s a sad end for the Belanger family. They bought their Van Vranken Avenue home for $1 from the city 11 years ago, when it last tried to get vacant houses back on the tax roll. The house was in poor condition, so Pam and Nate Belanger took out a small mortgage to make repairs.
    But then the family business, an auto mechanic shop, was forced to close when people cut back on car repairs during the recession. For two years, they couldn’t pay their taxes.
    Now they have a new shop, and money is finally coming in. But they can’t catch up on their taxes. As of April, they owed $22,684, and interest is accruing daily. The city’s interest rate is 21 percent.
    “That whole tax thing, it defi nitely bit us in our butt. Once you get behind, you can’t catch up — all the fees,” Pam Belanger said. “It keeps on coming and coming.”
    She sighed.
    “I love Schenectady. I’ve lived here all my life,” she said.
    They’re trying to arrange a short sale with their bank, in hopes of keeping a foreclosure off their credit report. “Because sometime, we’d like to buy a house again,” she said. “We’re going to put up a for-sale sign and see what we can do.”
    Polster said that banks usually take months to approve a short sale — but that he might sign off on a sale after the foreclosure date if the bank agrees.
    “What may get the bank to move very quickly is, they’re going to lose everything. They might be willing to take 50 cents on the dollar,” he said. “My view would be ... if they get a buyer and want to close on Sept. 20, I’d rather sell it and get our money rather than have another house on our hands.”
    The Belangers are looking for an apartment in Saratoga County — possibly Ballston Spa, because they like the schools. Their three elementary-school children attended St. John’s until it closed this year.
    “So we’re getting hit both ways,” Belanger said. “It’s sucky. But we’ll deal with it. We’re just going to move forward.”
CITY AS LANDLORD
    Once they leave, city officials will roll in. Along with Shilling will come plumbers, electrical inspectors, and engineers, all focused on getting houses up to code and back in residential hands.
    “We’re not turning houses over to the marketplace that will continue to have issues,” Shilling said.
    But if he finds major problems, such as roof leaks, that must be fi xed quickly to save the house, there’s not much he can do.
    “Our hands are tied by our resources,” he said.
    So at first, those houses won’t get much help.
    “Secure, board-up, cut utilities,” he said. “Do the best we can to preserve the property until we can get there. We’re light on resources.”
    For each house, he will upload a renovations plan to the city website. Qualifi ed contractors can bid on the project. But not every house will get fi xed. “There’ll be some that we’ll have to write a prescription that’s the kiss of death,” Shilling said. “Demolition.”
    He’s hoping for a gentle winter to help the contractors speed through their projects.
    “A lot of these renovations can be done if we have another winter like last winter,” he said. “You can work right through the winter.”
    He is vetting contractors to determine which ones are competent. They will be rated by what they can handle: the easiest, medium or most complicated projects. .........................>>>>.....................>>>>......................http://www.dailygazette.net/De.....r00100&AppName=1

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It’s a sad end for the Belanger family. They bought their Van Vranken Avenue home for $1 from the city 11 years ago, when it last tried to get vacant houses back on the tax roll. The house was in poor condition, so Pam and Nate Belanger took out a small mortgage to make repairs.
    But then the family business, an auto mechanic shop, was forced to close when people cut back on car repairs during the recession. For two years, they couldn’t pay their taxes.
    Now they have a new shop, and money is finally coming in. But they can’t catch up on their taxes. As of April, they owed $22,684, and interest is accruing daily. The city’s interest rate is 21 percent.

Quoted from DemocraticVoiceOfReason

.   The RENAISSANCE continues!

Quoted from DemocraticVoiceOfReason

.   The RENAISSANCE continues!

Quoted from DemocraticVoiceOfReason

…

and since most of you folks just cry about high taxes but aren't willing to actually do anything sensible -- like grow the tax base through economic development

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  So Mayor Gary McCarthy embarked on foreclosures in hopes of collecting revenue while also putting the buildings into the hands of responsible owners.

Quoted from CICERO

If they are looking to purchase property in Schenectady, they have already proven to be irresponsible.  

Quoted from mikechristine1

quote=800]…

and since most of you folks just cry about high taxes but aren't willing to actually do anything sensible -- like grow the tax base through economic development

Quoted from bumblethru

YUP..........schenectady will be the next Harrisburg PA!!!!

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What Rate Of Interest May My Company Lawfully Charge In New York?
by ADMIN on JANUARY 4, 2011
In New York State, the rate of interest upon the loan or forbearance of any money, goods, or things in action may not exceed 16% per year.  N.Y. Gen. Oblig. Law § 5-501(1); N.Y. Banking Law § 14-a(1).  That is, in New York, charging interest of more than 16% per year is civil usury.

N.Y. Gen. Oblig. Law § 5-511 renders void any transaction taking interest in excess of that allowed by N.Y. Gen. Oblig. Law § 5-501.  Further, any person who has paid interest in excess of the (16%) rate authorized by N.Y. Gen. Oblig. Law § 5-501 may bring a civil lawsuit against the usurer to recover the amount of money paid above that lawful rate.  N.Y. Gen. Oblig. Law § 5-513.

Moreover, N.Y. Penal Law § 190.40 renders it a class E felony knowingly to charge, take, or receive interest at a rate exceeding 25% per year.  In other words, in New York, charging, taking, or receiving interest of 25% or more per year is criminal usury.

There are various exemptions from the (16%) civil usury provisions and from the (25%) criminal usury provision.

Corporations or limited liability companies (“LLCs”) borrowing money generally cannot interpose the defense of civil usury in a civil action.  N.Y. Gen. Oblig. Law § 5-521(1); N.Y. Limited Liab. Co. Law § 1104(a).

Although corporations or LLCs borrowing money may interpose the defense of criminal usury in a civil action, see N.Y. Gen. Oblig. Law § 5-521(3); N.Y. Limited Liab. Co. Law § 1104(c), it has been held that “there is no specific statutory authority for voiding a loan that violates the criminal usury statute.”  Funding Group, Inc. v. WaterChef, Inc., 19 Misc.3d 483, 490-491, 852 N.Y.S.2d 736, 740-742 (N.Y. Sup. Ct. N.Y. County 200; see also In re Venture Mortgage Fund, L.P., 282 F.3d 185, 190 n.4 (2d Cir. 2002) (stating in dictum that “there seems to be no specific statutory authority for voiding a loan that violates the criminal usury statute without violating the civil usury statute”).

Loans or forbearances of $250,000 or more generally are exempt from the (16%) civil usury statutes, but remain subject to the (25%) criminal usury statute.

Loans or forbearances of $2,500,000 or more are exempt from all of New York’s usury statutes.

Loans or forbearances secured pursuant to Article 9 of the New York Uniform Commercial Code, N.Y. U.C.C. Law §§ 9-101 – 9-710, are not subject to civil usury or criminal usury limitations, if on the date when the interest is charged or accrued, such interest is not greater than eight percentage points above the prime rate.