The City of Peekskill has passed a local transfer tax effective December 1, 2010. Accordingly, owners who sell homes in the City of Peekskill will now have to pay 1% of the sale price to the City of Peekskill at the time of closing. Moreover, since the typical foreclosure contract requires a purchaser to pay all transfer taxes, purchasers seeking to buy foreclosed properties in the City of Peekskill will now have to pay thousands extra at the time of closing.

     Key provisions of the law include:

     1. Since the law applies to "real property" cooperative apartments are not included; and

    2. Transactions arising from contracts entered into prior to December 1, 2010(the effective date of the law) are also exempt from the Peekskill Transfer Tax. 

Foreclosure Firm Steven J. Baum to Close Down

By PETER LATTMAN


In a photo from a former employee of the law firm of Steven J. Baum, two employees
mocked homeowners whose homes had been foreclosed.

A law firm that had become a
lightning rod in the controversy over mortgage-foreclosure practices has shut
down, costing 89 employees their jobs.

The Steven J. Baum
P.C. law firm, which has offices in Amherst, N.Y., and Westbury,
N.Y., has filed papers with government agencies notifying them that it plans to
close. It made the filings under a federal law requiring employers to provide
notice before mass layoffs.

“Disrupting the livelihoods of so many
dedicated and hardworking people is extremely painful, but the loss of so much
business left us no choice but to file these notices,” said Mr. Baum in a
statement issued on Monday. A firm spokesman said it would have no further
comment beyond the release.

Mr. Baum and his colleagues have
come under fire for their foreclosure-related legal work. They are one of
numerous firms across the country that represent banks and services in trying
to foreclose on the millions of homeowners who have defaulted on their loans.
Some of these firms’ aggressive, and, in some cases, duplicitous practices,
have earned them the moniker “foreclosure mills.”

The Baum firm’s tactics, which
included the “robo-signing” of documents, has been among the most criticized.
Last year, a state court judge in Brooklyn called one foreclosure filing from
the Baum firm “incredible, outrageous, ludicrous and disingenuous.”

Last month, the firm struck a
settlement with the United States attorney’s office in Manhattan, which had
been investigating the Baum firm and whether, on behalf of its lender clients,
it filed misleading legal papers to expedite foreclosures. The firm agreed to
pay a $2 million penalty and vowed change its practices to resolve the case.

“In mortgage foreclosure
proceedings, there are no excuses for sloppy practices that could lead to
someone mistakenly losing their home,” Preet S. Bharara, the United States
attorney in Manhattan, said in a statement at the time of the settlement.
“Homeowners facing foreclosure cannot afford to have faulty paperwork or
inadequate evidence submitted, and today’s agreement will help minimize that
risk.”

But despite its settlement with the
federal government, the firm’s fortunes worsened this month after The New York
Times published photos of a Halloween party at the Baum firm showing employees
wearing costumes mocking people who had lost their homes.

After those photos surfaced, the
mortgage giants Freddie Mac
and Fannie Mae cut off the Baum firm, forbidding
servicers of their mortgages from using Mr. Baum and his colleagues. That
effectively served as the firm’s death knell.

On Saturday, Joe Nocera, The Times
columnist who originally wrote about the firm’s Halloween party,
published another column about the controversy. In it, he
quoted an e-mail that Mr. Baum had sent him last week.

“Mr. Nocera — You have destroyed
everything and everyone related to Steven J. Baum PC,” said the letter. “It took
40 years to build this firm and three weeks to tear down.”

“I think that’s what they call
shooting the messenger,” Mr. Nocera wrote.

We can expect that a growing number of communities in Westchester County will pass legislation requiring the Sellers of real property (and cooperative apartments in some instances) to get updated certificates of occupancy prior to the sale. Accordingly, people who added decks, finished basements or created bathrooms or bedrooms without obtaining building permits will have to legalize these improvements in order to sell their properties.

The City of Peekskill was the first municipality to pass this kind of legislation. Peekskill was later joined by Sleepy Hollow and more recently Dobbs Ferry. Since this legislation increases revenues via the $100 inspection fee and increased taxes as improvements are legalized more municipalities strapped for cash will undoubtedly follow suit.