Faith Groups Fight Banks on Foreclosures
With recent data stating that U.S. foreclosure filings surged 71 percent in the third quarter from a year earlier, to the highest on record, it’s clear that we have yet to hit the bottom of the nation’s housing troubles. With daily headlines letting us know that the government is bailing out another company for billions it’s easy to forget that there are REAL people out there who are, rightly or wrongly, losing their homes.
I was reading an article in Bloomberg and you might be a bit stunned as I was by a quote they included in the article:
“Every time I call them they say they can’t help,” said Flores, 31, a graphic designer and bartender in Contra Costa County, California, where one in every 146 homes is in foreclosure. “They tell you the solution is that they take Visa or MasterCard.”
What a loaded sentence! First off, Flores works two jobs, so I naturally want to root for him to be able to keep his home. But that wasn’t the real grabber in that paragraph - look at what the bank told him when he asked for help - “They tell you the solution is they take Visa or MasterCard.” Really? That’s akin to asking an alcoholic to buy each of you a shot of liquor because you bought him a shot a couple weeks ago.
Don’t flame me for getting upset at a business that is just trying to get an individual to live up to their end of the bargain. I understand the necessity of making money and I understand that from the bank’s perspective, they just want to get paid - how they get paid isn’t their concern. What does bother me is the sheer lack of concern about the greater problem that many of these banks have created.
Naturally, most problems are created through a conspiracy of mistakes and dumb decisions. There’s a good chance Flores purchased a home that he probably couldn’t afford. But, I guarantee you there were a plethora of banks willing to make him a loan that they knew he couldn’t afford to capitalize on his mistake. They did so knowing that they could easily package the loan and sell it off to investors, therefore absolving themselves of the mistake they helped Flores made.
I keep asking myself, why did the banks fail to realize that while they are citizens of their community in addition to being citizens of their corporation? I know they chiefly owe a duty to their shareholders, but what about a sense of decency to their common man? While it’s obvious we can’t expect that from them, thankfully others are willing to help:
Now Flores has a new ally: the Antioch, California-based Contra Costa Interfaith Supporting Community Organization, one of a growing number of religious and community groups pushing lenders to renegotiate troubled loans so owners can stay in their homes.
Still, more homeowners are turning to groups such as the Contra Costa organization for help in the early stages of mortgage problems, before they result in foreclosures. An affiliated group called the PICO National Network, based in Oakland, California, says it is working with hundreds of families in Contra Costa County and plans to help as many as a million homeowners nationwide.
PICO, short for People Improving Their Communities Through Organizing, is kicking off a national tour tonight in Flores’s hometown of Antioch, where 500 clergy and community leaders are due to meet with representatives from Wells Fargo & Co., Bank of America Corp. and the Federal Deposit Insurance Corp.
The group says it will then move to Kansas City and three other cities before traveling to Washington for a meeting with House Financial Services Committee Chairman Barney Frank. Washington Mutual Inc., now part of JPMorgan Chase & Co., and Wachovia Corp. are other lenders the group is trying to sway.
“It’s a local issue in terms of impact on families and communities but this needs a national response,” said Tim Lilienthal, PICO’s communications coordinator. “We need to move from a case-by-case way of doing things to a more systematic approach.”
PICO has 20 local affiliates in California. Other faith- based groups like the Gold Cross of America in Deltona, Florida, are offering assistance to homeowners as they negotiate with mortgage companies.
I’m glad there are organizations like those who are willing to help homeowners but it’s a shame that they’re even necessary.
For more information:
California Faith Groups Fight Banks on Foreclosures [Bloomberg.com]
Tags: charity, faith groups, financial crisis, foreclosures, mortgages
