Schenectady takes 159 properties in first foreclosures

PHOTOGRAPHER: Kathleen Moore

Just before Corporation Counsel John Polster walked into court Friday, he scratched one last name off his list of foreclosures.

Kasshif Alli had filed for bankruptcy just in time, faxing in his paperwork at 10:30 p.m. Thursday. Alli’s property, 824 Broadway, was safe.

But it won’t be his for much longer, Polster said. All the filing did was delay the foreclosure. The city can still take the property after a longer court hearing.

“All they’ve done is kick the can down the road a little,” Polster said.

Others were more creative. At least two owners sold their properties for cash just days before Friday’s foreclosure. The new owners were stunned to discover the city was taking their property. Two new owners were “hysterical” when they got the news, Polster said.

“They didn’t have an attorney [for the property sale], and then they found out they owe thousands,” he said. “The two that were in here that I witnessed, they bought the properties from, quote, friends. They were very angry with their friends.”

Selling a property just before foreclosure is not illegal.

“It’s unethical, but it’s not a crime,” Polster said. “With real estate sales, it’s buyer beware.”

The vast majority of the owners who lost their property Friday were landlords. City officials fanned out through the city to inspect the 159 properties taken at a court hearing Friday morning and discovered some still have tenants. City officials plan to offer rental agreements to the tenants, who would now pay rent to the city.

According to the list of foreclosed owners, many have Guyanese names and live in the area of New York City that Mayor Al Jurczynski visited repeatedly in an effort to get Guyanese immigrants to move here. He touted the city’s low property prices, its safety in comparison to New York City and its history as a city of immigrants.

He took them on bus tours of Schenectady, and, in response, thousands of Guyanese moved here. But some simply bought property, fixed it up with the help of a few friends and rented it out. Many of those properties are back in the city’s hands now.

Polster said many landlords on the list simply bet on the city never enforcing tax laws.

“People got properties real cheap, and they were just going as long as they could, milking it and not paying taxes,” Polster said.

The city had not foreclosed on property since 2003.

The current foreclosure effort is far from over. Polster is now pursuing another set of more than 100 properties that were recently posted with foreclosure warnings. City officials couldn’t find the owners of those properties, so they posted the buildings themselves.

In September, Polster said, the postings will have been up long enough for the city to foreclose.

After that, he’ll go to court to argue the cases in which owners hired attorneys to fight foreclosure.

In December, he’ll also start foreclosure proceedings against 20 owner-occupants who were exempted from this wave of foreclosures because they live in the home that would be taken by the city.

Those owners will have a few more months to pay the back taxes before foreclosure next year.

Police, including a dog, watched over City Hall on Friday just in case irate property owners showed up to complain after the foreclosures. But by midday, the building was quiet.

On Thursday, 30 owners had come in to pay or argue their case. On Friday, it seemed as if everyone knew it was over.