In the letter, a copy of which was provided in advance to The New York Times, Mr. Liu and the presidents of six of New York’s most powerful unions will ask the banks to immediately name a high-level official to handle appeals of borrowers who are denied mortgage loan modifications.
Their letter criticizes the banks for “unanswered phone calls, delays in the modification process and multiple requests for homeowners to resend paperwork already submitted.”
“Banks like you can do more,” the comptroller and union presidents write.
The coalition will officially announce the effort a news conference on Wednesday. The unions involved are the United Federation of Teachers, the 1199 health care workers union, the Transport Workers Union, the District Council 37 municipal employees union, the New York Hotel and Motel Trades Council, and Local 32BJ of the service employees union.
The group said that 265,000 mortgages in New York State — 13 percent of all mortgages in the state — are past due or already in the foreclosure process.
The officials ask the banks what efforts they have undertaken to respond promptly to customers’ requests about modifying mortgages and to suspend foreclosures while evaluating a borrower’s eligibility for loan modification.
Michael Mulgrew, president of the United Federation of Teachers, said hundreds of teachers and teachers aides faced foreclosure. “We’re trying to help people who are doing the right thing,” he said. “It seems that the banks are not really doing a lot on this. They’re not trying to negotiate in many instances.”
The letter asks the banks to respond by Sept. 1, with some of the signers suggesting there will be a second letter that demands the banks take specific steps.
Federal officials, from President Obama on down, have tried various techniques to persuade banks to make more loan modifications and take other steps to reduce foreclosures. But so far, those steps appear to have done little to stem the foreclosure flood.
Mr. Liu said that “it’s premature to talk about sticks,” like moving city funds out of banks that are deemed unresponsive.
But Mr. Mulgrew said he had alerted the trustees of his union’s pension fund to the situation, raising the possibility that they might take some action. Union officials say pension funds are hurt by foreclosures because they weaken the economy and hurt bank profits, helping to drive down bank share prices.
Richard Simon, a Bank of America spokesman, said his bank had led the industry in addressing the foreclosure crisis. In an e-mail message, he said, “Bank of America is committed to helping our customers remain in their homes, as demonstrated by 650,000 modifications we have completed since January 2008, including about 160,000 so far this year.”
A Citigroup spokesman, Mark Rodgers, made similar comments. “In the first quarter of 2010, our various modification and extension programs helped many families stay in their homes in New York State, outnumbering those who were foreclosed by approximately 54 to 1,” he said in an e-mail message. “Nationally, from Jan. 1, 2007, through March 31, 2010, Citi has helped more than 900,000 homeowners avoid potential foreclosure.”
