From Paralysis to Protest

There ought to be a place in life where a line in the sand is drawn, where retreat refuses to continue, where inaction is no longer an option, and where enough becomes enough! According to reports there were 2,330,483 properties with foreclosure filings nationwide in 2008. Five percent of the total is in Ohio, of which my resident county posted the top rate in the state where 1 in 30 housing units are in foreclosure. This amounts to losing an estimated 3% per year of the housing stock to the foreclosure process. According to the Center for Responsible Lending, there are an astronomical 6,600 new foreclosures a day nationally; one every 13 seconds.

The economic downturn has also affected the suburban and other areas that have been previously shielded from the foreclosure crisis but has been particularly hard on the African American community that has lost from $73 billion to $93 billion in wealth nationally.

What is tragically unjust is that this flood of foreclosures is occurring while the corporate world and Wall Street are experiencing the highest executive pay and the largest bailouts in history. Corporate CEOs make 344 times the average worker, and the wealthiest 10% of Americans own more than two-thirds of the nation’s wealth. In the last 35 years, the richest 1% of Americans experienced a 62% drop in their federal income tax rate while their incomes increased over 80%. The riches of a few continue to mask the economic dangers faced by the middle , working, and marginalized classes who as the real victims, struggle to buy food, pay fuel and heating costs, maintain health care, and try to remain in their homes while being portrayed as irresponsible perpetrators of self-inflicted suffering.

Banks and financial institutions, on the other hand, and who can be gluttonous as well as miserly but certainly cannot be manipulated or hoodwinked by a financially unsophisticated consumer public, point blame at those who supposedly attempted to “buy more house than they can afford.” Yet banks and mortgage companies have access to tools and information technology such as credit reports, debt ratio calculations, and other methods of credit evaluation.

The truth is, that many consumers took money from a deregulated mortgage lending industry that wanted to lend money to them and assumed mortgages at high rates of interest or adjustable rates that started low but reset later at substantially higher rates and that could balloon by 29-50% which was buried in the fine print. The mortgage brokers and loan originators raked in enormous fees and lined their pockets from these predatory and subprime transactions.

Many of the borrowers were two income households who played by the rules and found themselves in foreclosure only after being laid off because of the recession and weakened economy, the loss of jobs that moved overseas, and high energy costs. Overall, the number of unemployed persons increased by 851,000 to 12.5 million in February alone, and the unemployment rate rose to 8.1 percent, although at 13.4% for blacks and 33% for black teens. Over the past 12 months, the number of unemployed persons has increased by about 5.0 million,and the unemployment rate has risen by 3.3 percentage points.

In addition, the number of those jobless for 27 weeks or more increased by 270,000 to 2.9 million in February. Over the past 12 months,the number of long-term unemployed was up by 1.6 million.

One wonders whether in a crisis of this magnitude and amidst trillion dollar bailouts for the greedy, if families who truly need relief can get rescued?
Rabbi Hillel stated “Every morning we wake up the scales are equally balanced between good and evil. What we do during the day will determine where the scales fall."

Many of those experiencing job loss or foreclosure are paralyzed by the fear and the hopelessness of not knowing where to turn. However, Doing nothing is not an option. It is a day for challenging the power structure that holds people down instead of lifting them up and that holds them back instead of helping them out. "We can no longer be silent or passive while being oriented toward our private wants instead of public needs."

With 8 to 9 million additional foreclosures projected over the next four years, Congresswoman Marcy Kaptur (D.Ohio) suggests that we fight to take back our homes. We can do this by using the courts. If facing foreclosure, you should get legal help to fight for your property and demand that brokers establish the paperwork that proves clear ownership. Many brokers are not able to do this as many of the mortgages were bundled together and sold to foreign investors. Legal and other help or assistance is available through Ms. Kaptur’s office at 419-259-7500, local Fair Housing Centers, legal aid offices, or United Way 211.

President Obama's economic plan will help an estimated 1 in 9 homeowners stay in their homes. 1.6 million additional homes can be saved under the “Helping Families Save Their Homes in Bankruptcy Act of 2009” legislation that has passed the House and is now in the Senate (S.B.61). This bill could require bankruptcy judges to lower the interest rate to as low as 2 percent, reduce mortgage payments to no more than 31% of income or lower the principal owed on the loan. Send an electronic letter to the legislators telling them to "help the people who are hurting rather than the bankers who are threatening them and stop foreclosures without tax dollars by lifting the ban on Judicial Modifications."

Tell them also to introduce legislation and oversight that puts a moratorium on foreclosures while legislation is pending. In addition, advise our leaders to end the abusive lending practices that produced the foreclosure crisis in the first place and to start to focus again on strengthening homeownership, rather than allowing an unsupervised financial services industry to become rich through speculation and predatory lending.

If we are going to emerge from the current economic tsunami the first task will be to repair the damage to the housing market and the lives of working, middle-class, and marginalized citizens. We have already seen that assistance will not come if we continue to sit silently by watching the havoc wreaked on our lives by an uncaring and unchallenged power structure. It will take action to accomplish this and nothing less.