For Immediate Release: Monday, February 26, 2018
Contact: Matthew Creegan, 212-863-7879


City's Community Restoration Fund Acquires 38 Distressed Mortgages to Preserve Affordable Housing

City announces purchase of distressed home-owner mortgages from the federal government to stabilize neighborhoods still recovering from the mortgage crisis


NEW YORK, NY – The New York City Department of Housing Preservation and Development (HPD) Commissioner Maria Torres-Springer joined a number of non-profit organizations as well as financing partner Goldman Sachs Urban Investment Group to announce the acquisition of 38 distressed mortgage notes via the City’s Community Restoration Fund (CRF) Program. The mortgage notes, for one- to four-family properties located in the Bronx, Brooklyn, Queens and Staten Island, were acquired from the Federal National Mortgage Association (Fannie Mae) for $8.7 million through their Community Impact Pool (CIP). Fannie Mae’s CIP provides not-for-profits, minority- and women-owned business enterprises, and neighborhood advocacy organizations the ability to bid competitively on mortgage notes being offered for sale. 

“Nearly a decade after the financial crisis, too many hard working New Yorkers are still not out of the woods, with profound impacts not just on families, but on neighborhoods. The Community Restoration Fund works to stabilize communities and give struggling homeowners the chance to find firm footing once again,” said Housing Preservation and Development Commissioner Maria Torres-Springer.  “I want to thank City Council for their support of this program and our many partners for their commitment to keeping our neighborhoods strong and thriving.”

The CRF Program was established by HPD and several not-for-profit partners to facilitate the acquisition of distressed mortgage notes from mortgage lenders, and reposition these properties to preserve affordable homeownership and rental opportunities. The CRF Program works to strategically acquire distressed mortgage notes in areas of the greatest need and attempts to reduce the negative economic and physical effects caused by distressed properties in foreclosure, as well as the consequential social effects, while creating new affordable homeownership and rental opportunities for New York City residents.

"This is an important step toward addressing New York City's affordability crisis," said Congressman Joe Crowley. "Homeowners in Queens and the Bronx are still recovering from the Great Recession, and the Community Restoration Fund will help families stay in their homes. This is yet another example of how we can create a stronger community by investing in the financial future of all New Yorkers."

"Providing support for Brooklyn residents to be able to stay in their homes is vital to building stronger communities in every corner of the borough. I commend HPD and their non-profit partners for empowering homeowners in central and eastern Brooklyn to remain in their homes or find alternative affordable housing solutions, particularly in an area that has endured decades of economic disadvantage. We must ensure that moving forward the rising popularity of these communities translates into sustained prosperity for the longtime residents who have made our borough's success possible," said Brooklyn Borough President Eric Adams.

“In the three years since I and Council Member Richards, along with former Council Members Wills and Garodnick, championed the Community Restoration Fund’s creation, 62 distressed mortgages, including seven in the 27th District, constituting nearly one hundred housing units have been preserved,” said Council Member I. Daneek Miller. “I applaud HPD Commissioner Torres-Springer, the Center, Neighborhood Restore and the rest of their partners on the CRF’s latest achievement. Southeast Queens continues to be the epicenter of the foreclosure crisis that has affected New Yorkers of color for over a decade now. In this increasingly deregulated economy, the Fund is vital to ensuring that the burst of the next housing bubble won’t jeopardize homeowners and plague entire neighborhoods, and I will continue working towards strengthening its influence in stabilizing our communities.”

“In the wake of the subprime mortgage crisis and broader affordability crisis facing New York City, programs like the Community Restoration Fund are critical to helping stabilize the housing market here in NYC. This most recent purchase of distressed properties by the CRF is representative of our commitment as a city to preserving affordable units, helping New Yorkers stay in their homes, and preventing the proliferation of negative consequences for communities in need,” said Council Member Robert E. Cornegy. “As the new Chair of the Council’s Committee on Housing & Buildings, I look forward to working closely with Commissioner Torres-Springer and the entire team at HPD to help more New Yorkers stay in their homes by continuing to advance programs like the CRF that help preserve affordable housing.”

Helping homeowners identify solutions – such as mortgage modification or refinancing – that allow them to remain in their homes is a primary outcome that CRF aims to achieve by providing proactive outreach and owner counseling to current at-risk homeowners. In cases where these home-retention solutions are not attainable, CRF works to establish in-place rental outcomes where homeowners are income-qualified to stay in the same home or another within the portfolio. In cases where a defaulted homeowner cannot afford to stay in the home, CRF will work with its not-for-profit partners to provide alternative options that include relocation assistance.  

CRF’s most recent acquisition of 38 distressed mortgage notes on the brink of foreclosure is part of the City’s continued effort to assist  struggling homeowners remain in their homes while stabilizing communities still reeling from the effects of the national mortgage crisis, which devastated the economy a decade ago. The last round of CRF acquisitions was in 2016, when the City facilitated the purchase of 24 distressed mortgages for one- to four-family homes – with a total of 41 residential units – in the Bronx, Brooklyn, Queens and Staten Island. CRF has been diligently working with the borrowers to determine appropriate loss mitigation outcomes with the primary goal of home retention.  Several of the borrowers have already benefited from permanent loan modifications.

“We are thrilled to continue our partnership with an outstanding coalition of non-profit, for-profit, and public sector organizations that have created a scalable model to address the ongoing foreclosure crisis,” said Managing Director and Head of the Goldman Sachs Urban Investment Group Margaret Anadu.  “Models like this one help families re-enter the path to sustainable homeownership and create affordable rental housing in their communities. Fannie Mae’s CIP program enables local non-profit organizations like Preserving City Neighborhoods and the Center for New York City Neighborhoods to direct positive outcomes and maintain local control of important community assets.”

“We are proud to continue working with our colleagues at the City, Goldman Sachs and our non-profit partners to help stabilize our communities and transform these distressed properties into affordable community assets. This latest round of Community Restoration Fund acquisitions brings 38 chances to preserve affordability for those who still may be feeling the effects of the financial crisis,” said Executive Director of Neighborhood Restore Housing Development Fund Corporation Salvatore D’Avola. “Through our affiliate, Preserving City Neighborhoods Housing Development Fund Corporation, we look forward to maintaining our momentum and continuing to develop this essential resource for homeowners facing foreclosure.”

“Selling non-performing loans to municipalities working hand-in-hand with local nonprofits is a great way to help both homeowners and communities. This partnership takes a creative, collaborative approach to keeping homeowners in their homes through borrower outreach, counseling and loss mitigation. Even in those cases where the homeowner cannot recover, the partnership can help return properties to productive use so that they don’t contribute to blight or disinvestment,” said President of the National Community Stabilization Trust Rob Grossinger.

“MHANY Management Inc. in partnership with NYC HPD, Center for NYC Neighborhoods, Neighborhood Restore and the National Community Stabilization Trust is proud to have counseled the first twenty homeowners to keep their homes or get to a sustainable outcome,” said Executive Director of MHANY Management, Inc. Ismene Speliotis. “We look forward to the ongoing opportunity to work together to preserve affordable homeownership, modify loans that keep families in their homes and provide needed stabilization to the neighborhoods where these homes are located. We appreciate the City’s and the City Council’s support for this critical program.”

"We’ve seen what happens when private equity and speculative investors maximize profit in our neighborhoods: homeowners get left on the curb," said Executive Director of the Center for NYC Neighborhoods Christie Peale. "The Community Restoration Fund represents the best of what we can do when we collaborate and leverage the resources of the nonprofit sector, government and our mission-driven partners in private finance. We are incredibly proud to work with our partners at PCN, MHANY, NCST and HPD, so that our communities can retain our hard-earned investment and equity. We are also very grateful to our early and steadfast supporters in the City Council for helping our neighborhoods thrive, when they face aggressive speculation."

HPD established CRF in 2015 in partnership with the Center for NYC Neighborhoods (CNYCN), The National Community Stabilization Trust (NCST), MHANY Management, Inc. (MHANY), and Preserving City Neighborhoods Housing Development Fund Corporation, an affiliate of Neighborhood Restore Housing Development Fund Corporation. The program was established to achieve three core goals; stabilize neighborhoods with high rates of foreclosure and distress, ensure positive outcomes for homeowners and residents, and maintain affordability and viability of the housing stock across the City.

The CRF Program is administered by Preserving City Neighborhoods Development Fund Corporation, which was incorporated in 2011 to act as a vehicle for HPD to acquire overleveraged mortgage notes for the purpose of repositioning and preserving distressed or at-risk housing in the city.

The acquisition and repositioning of the 38 properties was financed with a $7.5 million loan from Goldman Sachs Bank USA, $1 million in City Council discretionary funds, and $6 million in Morgan Stanley settlement funds. The total expected cost of acquisition and repositioning is to be $14.5 million, which includes acquisition, financing, servicing, administrative and carrying costs.


The New York City Department of Housing Preservation and Development (HPD) is the nation’s largest municipal housing preservation and development agency. Its mission is to promote quality housing and diverse, thriving neighborhoods for New Yorkers through loan and development programs for new affordable housing, preservation of the affordability of the existing housing stock, enforcement of housing quality standards, and educational programs for tenants and building owners. HPD is tasked with fulfilling Mayor de Blasio’s Housing New York Plan which was recently expanded and accelerated through Housing New York 2.0 to complete the initial goal of 200,000 homes two years ahead of schedule—by 2022, and achieve an additional 100,000 homes over the following four years, for a total of 300,000 homes by 2026. For full details visit and for regular updates on HPD news and services, connect with us on Facebook, Twitter, and Instagram @NYCHousing.