Gov. David A. Paterson yesterday signed legislation that requires lenders to give subprime loan borrowers a 90-day notice before starting foreclosure proceedings.

Subprime loan homeowners will now have time to meet with lenders and receive other information on dealing with their debt. Subprime loans are generally held by borrowers with shaky credit, and carry higher interest rates. Foreclosures statewide were up 14 percent in the first quarter of 2008 over the same period in 2007.

Statewide, Suffolk ranks third in rate of foreclosure-related filings and Nassau is fourth, according to calculations by state officials. Suffolk had 1,964 homes that had foreclosure-related filings in the second quarter of this year, while Nassau had 1,334, according to the latest data from RealtyTrac, an online market for foreclosures. Filings include default and auction notices.

The 90-day notice by registered or certified mail - part of other reforms in the law - will especially help in cases where the loan-servicing company is so swamped that it can take a long time to set the groundwork for negotiations, said Marianne Garvin, president of the Community Development Corp. of Long Island, which renegotiates loans on behalf of troubled borrowers.

“It does take a long time to go through a foreclosure process already in New York, but what we’re finding when we do workout packages with the servicers is they haven’t been as motivated in some instances as they can be,” Garvin said.

“They are overwhelmed with the amount of requests that are coming their way, and they haven’t completely been able to staff up and they don’t have the full capacity to respond. So oftentimes we are sending packages two or three times to the servicer.”

DETAILS ABOUT THE LAW

Mandates court conferences in certain cases between lenders and borrowers

Requires lenders to provide housing counseling information to borrowers.

Bans prepayment penalties

Prohibits teaser rates that last less than six months

Requires lenders to verify the borrower’s ability to pay and put money in escrow for taxes and insurance starting July 2010

Adds “residential mortgage fraud” as a crime to the penal code, starting with loans that originate in November