New York Ends Mortgage Requirement for Homeowners Who Receive Welfare Benefits
The Social Services Law 106 was repealed in the New York State Budget. This important and necessary reform was long overdue. As a result of the repeal and subsequent guidance issued by the Office of Temporary Disability Assistance, Temporary Assistance applicants in New York State will no longer have to give the Department of Social Services a mortgage lien on their home as a condition of eligibility for temporary assistance. Social Service Districts will also immediately halt recovery of any temporary assistance real property and/or mortgage liens that were previously accepted and not yet satisfied.
Prior to the repeal, applicants were required to sign a mortgage in order to receive cash assistance to meet their basic needs. For many low-income individuals, a home is their primary asset and source of financial stability. These liens were particularly problematic for divorced spouses, who often received the home as the only asset in the divorce; elderly individuals who were looking to sell their family home; and homeowners who needed to refinance to avoid foreclosure or obtain home equity loans.
Predatory practices like Social Services Law 106 have no place in the social safety net. Everyone should be able access assistance to meet their basic needs without compromising their future financial stability. As we celebrate this important reform, we must also remember the substantial work yet to be done to ensure access to public benefits in New York State and around the country.