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SAVE OUR HOMES!
HUD MUST HELP!
Rally At HUD January 22
On January 22, we rally at the Department of Housing and Urban Development (HUD) in Washington, D.C. to demand a moratorium on home foreclosures, and comprehensive federal intervention to restructure loans and stop the repossession of homes. Forty years after the passage of the Fair Housing Act and the assassination of Dr. King, we rally in his tradition, combining mass action with legislation and litigation to confront discriminatory, predatory lenders at the federal, state and local levels.
Today our country faces a foreclosure crisis brought on by reverse redlining and abusive subprime lending. This crisis is not an accident.
It was orchestrated by powerful financial interests who are now attempting to walk away while hardworking Americans, who thought they were playing by the rules, face the loss of everything they’ve worked for.
Dr. King called for civil equality–or in today’s language, Equanomics– measurable, quantifiable racial and economic equality as an answer to institutional discrimination and structural inequality. We demand justice for the victims of this massive financial scam. We must bailout the individuals and homeowners who were exploited, not just the corporate giants who did the exploiting.
The Department of Housing and Urban Development (HUD) must play a role in alleviating this crisis. “HUD's mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination.”
Where was HUD as this crisis developed---as America’s major financial institutions supported or directly engaged in clearly discriminatory lending practices?
The facts are clear:
In 2005 and 2006, over 50% of all loans made to African-Americans and over 40% to Latinos were subprime compared to only 19% for white borrowers.
African-American and Latino borrowers were victims of steering. A Wall Street Journal analysis says that 55% of subprime loans went to borrowers with good credit, and data from a study by First American Loan Performance, a San Francisco research firm, says the proportion rose even higher by the end of 2006, to 61%.
The effects are devastating:
The homeownership rate for African-Americans has dropped a full 3.4 percentage points over the past three years and continues to decline.
Foreclosures will increase by at least 1.4 million in 2008; these homes represent a market value of $316 billion.
Home price declines across the United States will average 7% in 2008, ranging as high as 16% in California.
HUD is charged with “supporting community development”;
but communities are being destroyed as tax bases erode due to the flood of foreclosures. A city can lose up to nearly $20,000 a year in lost property taxes and other costs for every property abandoned by foreclosure.
A report by the U.S. Conference of Mayors shows that in just ten representative states, the total loss of tax revenue will equal 6.6 billion dollars. This will result in massive cut backs in education, health and other vital social services.
What is HUD’s response? The FHASecure plan through which “an estimated 240,000 families can avoid foreclosure by refinancing their mortgages.” Foreclosures will increase by at least 1.4 million in 2008 and HUD is offering assistance to 240,000 homeowners. This is an unacceptable response.
This crisis must be addressed now. And it must be addressed in a way that allows people to stay in their homes. We demand a moratorium on foreclosures. We demand massive government intervention to restructure loans and not repossess homes.
Bold thinking is required to stave off this impending economic tsunami. It’s time for another government sponsored Marshall Plan—an infusion of aid to restore homeowners’ and investors’ confidence and dreams.
And HUD is in a position to facilitate such a plan.
Past presidents have used agencies like the Reconstruction Finance Corporation and the Reconstruction Trust Corporation to deal with massive economic issues facing the country. Mortgages were underwritten, infrastructure financed, loans made, farmers aided--we even bailed out the S&L’s. Now it’s time to provide a lifeline to American’s homeowners and working families.
Predatory lending stymies families’ attempts at wealth building, ruins people’s lives and, given the disproportionate number of minority homeowners who are targeted by predatory lenders, and decimates whole communities.
Today our coalition demands that HUD take leadership in putting forward a plan that will allow the restructuring of mortgages for all borrowers who are at risk of foreclosure. Not just some, all.
And HUD must also address the plight of those who have already been forced into foreclosure. Those who lost their homes before the nature of the crisis was even clear. They have been lost in the unfolding of this national tragedy.
So we take mass action at HUD on Janaury 22. But we must also act to prevent the possibility of this ever happening again. We demand the immediate passage of legislation to curb predatory lending. Congress should pass a comprehensive bill regulating the subprime loan industry, which is currently governed by a patchwork of state laws.
We encourage state attorney generals, and city attorneys and prosecutors to file litigation against predatory and discriminatory practices and abuses by the financial services industry. Minorities were steered into sub-prime loans and are disproportionately affected by the foreclosure crisis. Already, states like Illinois and cities like Cleveland and Baltimore are taking action. We also support the NAACP’s class action lawsuit against the subprime lending industry for practices that target African Americans with good credit for predatory loans.
We will keep up the fight for economic equality—Equanomics--on all fronts -- fighting for homeowners’ rights in court and in Congress, while forcing the mortgage lending industry to do the right thing: Restructure Loans, Don’t Repossess Homes. And HUD must help make this happen. |
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