Bonacic Announces Start Of "keep The Dream" Program

Across the country, it is well known that the issue of adjustable and "sub-prime" mortgages has become an issue for people who bought homes during the real estate boom, only to now face the reality of radically adjusting interest rates. For that reason, legislation (S.3965a/A.8799) sponsored by State Senator John Bonacic, and recently signed into law by Governor Spitzer, will provide up to $100 million to refinance some of those homes into a more conventional mortgage structure. Bonacic is Chairman of the Senate Committee on Housing, Construction, and Community Development.

Under the State of New York Mortgage Agency’s "Keep the Dream" program, the State is making up to $100 million available to refinance existing mortgages into more traditional mortgage products. Locally, in Orange, Ulster, Sullivan, and Dutchess Counties, M&T Bank in Fishkill is participating in the program. Lenders are accepting applications as of September 4th. The Fishkill office of M&T can be reached at (800) 990-6209 or (845) 440-2800.

"Foreclosure affects not only the family that is facing foreclosure, but the entire real estate market. If a ranch home on one street is being foreclosed against, every other ranch home up for sale in that community sees their selling price diminished. Even those who bought homes using traditional thirty year mortgages are paying a price from the sub-prime mortgage problems because the foreclosed homes can drive down the price for every similar home in the community," Senator Bonacic said.

Borrowers are eligible if they can demonstrate that they have experienced a mortgage payment hardship or will experience a mortgage payment hardship in the near future. Generally, the program will help borrowers with adjustable rate or interest-only mortgages where the interest rate has just increased or will increase in the near future. Borrowers who are less than 60 days behind on their mortgage payments because of higher payments due to an increased rate reset may also be eligible.


Eligible borrowers can have incomes up to 165% of the Area Median Income in New York City, Long Island and the counties of Dutchess, Orange, Ulster, Westchester, Rockland and Putnam and up to 125% of the Area Median Income for the rest of New York State. Income limitations by county, according to SONYMA, are as follows: Dutchess and Orange Counties: $126,060; Putnam: $93,720; Sullivan $70,870; and Ulster $104,770.

Owners of single-family homes, condominiums and cooperatives are eligible. Borrowers must live in the home being financed.


A SONYMA "Keep the Dream" mortgage can be as high as $417,000. Financing is available for up to 100% of the value of the borrower’s property. Proceeds of the mortgage can be used to pay prepayment penalties, closing costs, and most second mortgages. However, proceeds cannot be used to repay other debt or expenses.

All borrowers who qualify for a "Keep the Dream" mortgage will be required to complete a home buyer education course with a federal or state approved not-for-profit organization. A list of eligible counseling agencies will be provided to applicants. Borrowers must also agree to participate in early delinquency intervention counseling should they become delinquent for 30 days or more on their refinanced mortgage.

Bonacic emphasized the "Keep the Dream" program is not a "hand-out". "This is not about giving away taxpayer dollars. It is refinancing existing mortgages - which means the borrowers must pay them off, but at more conventional rates. It would be easy to say that these borrowers got themselves in trouble and deserve whatever becomes of it, but the reality is these borrowers, who are now homeowners, should be given an opportunity to bail themselves out if possible with more conventional financing through a proven program like SONYMA."

"We all have an interest in ensuring a stable housing market based on realistic pricing. The "Keep the Dream" mortgage program is an important part of it and one which I see being successful and expanded to help the growing number of homeowners who will need to refinance in the next several years," Bonacic said.