Eight million people are at risk of losing their homes because Wall Street abandoned responsible lending practices to gain short-term profits. The housing crisis is not just a problem for families facing foreclosure - it's a problem for every homeowner in America. As long as foreclosures persist, home values will keep going down, and everyone loses.
We need your help. Have you been affected by the housing meltdown? Foreclosed on? Underwater? Record your story, or the story of a friend, family member, or neighbor, and send it to us. You can also add your written story along with a photo for the map. Then, watch the video stories of the families, mothers, fathers, and children who have lost, or are losing the place they call home.
On Tuesday, Congress will vote on whether or not to level the playing field between the banks that caused the collapse of the housing market and struggling homeowners. Representative John Conyers has introduced legislation in the House that authorizes judges to require banks to reevaluate overpriced mortgages of bankrupt homeowners.
Conyers’ proposal is a simple, modest fix that will help keep hundreds of thousands of families in their homes. This bill is a win for every homeowner in America. By helping stem foreclosures, it will help arrest the decline in home values for everybody, not just those who are struggling to make payments. President Obama supports the bill and has called on Congress to pass it. The banks and the lobbyists that represent them oppose the bill with a passion.
These are the same banks that started this recession in the first place by hawking worthless subprime mortgage loans to naïve or unsuspecting borrowers. Joan Adams of Irvine, California lost her home to foreclosure, and is now living out of a motel by the airport. “There’s no one out there to help,” Joan says. “Billions of dollars to all the banks for bailouts for something they caused, and yet we’re the ones that are homeless.”
It was just six years ago that Olive Thompson purchased a home in a quiet working class neighborhood on Long Island with a mortgage from Option One. Her story is similar to hundreds of thousands of Americans who now face the very real possibility that they will be evicted from their homes. Throughout the country the foreclosure rate in 2008 skyrocketed. In the first two months of this year there have been more than 10,000 foreclosures in New York state alone.
Perhaps more striking than the foreclosure epidemic is just how easily it could have been avoided. Thompson discusses her predicament and what she plans to do if she’s issued an eviction notice.
Yesterday, the first activist in a civil disobedience campaign to resist foreclosure was arrested in Baltimore. The campaign, launched by ACORN earlier this month, aims to draw attention to the foreclosure crisis and ultimately allow people to save their homes. The question is whether activists and home defenders can help affect policy and whether cities will begin to adopt moratoriums on home foreclosures.
The folks at Brave New Films talked to Rep. Marcy Kaptur and economist Dean Baker about the TARP, Wall Street and regular folks. As Rep. Kaptur said, somewhere in the economic mess, “there has to be some justice for Main Street.”
Dean Baker lays things out on the table:
Certainly I can understand people being very upset at being forced out of their home. The government doesn’t appear to be anything to help homeowners, they’ve gone to great lengths to help banks — the banks that got us into this, and very often under false pretenses. As Rep. Kaptur has said, representations that were made to Congress before the passage of the TARP were not accurate, were not honest.
Most importantly…I’ll just mention that the Federal Reserve board had the authority to directly buy commercial paper from non-financial companies. The reason why this is important was it was argued before they passed the TARP, that the economy was shutting down because…other companies couldn’t get the money they needed to meet their payrolls and pay their bills.
Well, it turned out that the Fed always had the authority to simply buy their commercial paper so that they would have that money. And they began doing that only after Congress approved the TARP.
So this is really dishonest on the part of the Fed. And this is the sort of behavior that you could certainly understand people being outraged about: that we’re helping the banks, but not the people who are losing their homes.
If you were to make a pie chart showing the amount of attention given to the banking part of the financial crisis — both by the government and by the media — and the amount of attention given to the foreclosure part, the catastrophe being faced by millions of American homeowners would barely rate a sliver.
But we are facing nothing less than a national emergency, with 10,000 Americans going into foreclosure every day and 2.3 million homeowners having faced foreclosure proceedings in 2008.
When we put flesh and blood on these numbers, the suffering they represent is enormous and so is the social disintegration they entail.
For a small sample, check out Brave New Foundation’s new site, Fighting For Our Homes, where you can see video of people doing just that. People like Debra from Pennsylvania who, due to health care costs, is facing foreclosure on her home of 33 years or Penny from Texas who has been pushed to the brink of homelessness as the result of costly repairs necessitated by Hurricane Ike.
Housing is a big issue, and like other big issues such as health care or education, both sides of the political spectrum like to take credit for it. Both George Bush and Democrats supported increased homeownership, Bush through his “ownership society” and Democrats through programs to make housing more affordable and available to low-income and minority families.
Of course, when housing becomes a political liability, as it is now that the real estate bubble has popped, blame gets thrown around quickly.
It’s sometimes hard to untangle right from wrong. Without a doubt, a good number of real estate speculators took advantage of rising housing prices to turn a quick buck - as the New Yorker this week vividly portrays. But mortgage lenders made a lot of risky bets using bait-and-switch tactics to prey on the dreams and ignorance of their customers. And those subprime loans were then bought up by greedy Wall Street investors, all without oversight from a government asleep at the wheel.
As part of Brave New Foundation’s Fighting for Our Homes campaign, stories are available from people who’ve lost or are losing their homes all over the country, with the option for visitors to add their own stories. It’s a powerful testament to the greed of mortgage brokers and Wall Street, and a sad reminder of how important financial literacy is to social justice.
If you’re a Wall Street executive who drove your firm into the ground and nearly capsized the U.S. economy, it seems like all you have to do these days to get a multibillion dollar bailout from Congress is put your hand out.
But if you’re like Guillermo San Pedro, a hardworking truck driver in Los Angeles who fell victim to a predatory loan and is at risk of losing his home, you’re on your own.
Eight million people are at risk of losing their homes because Wall Street abandoned responsible lending practices to gain short-term profits. The housing crisis is not just a problem for families facing foreclosure - it’s a problem for every homeowner in America. As long as foreclosures persist, home values will keep going down, and everyone loses. No Wall Street bailout will fix that problem.
We’re collecting stories from people all over the country who have been hit by the housing crisis so we can show what’s really happening on Main Street: while Wall Street takes hundreds of billions of dollars in taxpayer money to pay for lavish executive bonuses and luxurious office furniture, homeowners at risk of foreclosure still aren’t getting any relief.
We need your help. Have you been affected by the housing meltdown? Foreclosed on? Underwater? Trapped in a predatory loan? Do you know anyone else whose life has been turned upside down by the collapse of the real estate market? Record your story, or the story of a friend, family member, co-worker, or neighbor, and send it to us. If you have a video camera or webcam, then please send us your video. You can also add your written story along with a photo we can post on our interactive map.
We have already heard too much from bailed out banks. Their corporate greed clearly knows no bounds as they continue predatory lending practices after taking tens of billions from the government, which they failed to use to jump-start economic recovery. And now we’ve heard from Treasury Secretary Timothy Geithner, who rolled out his controversial Financial Stabilization Plan today that will devote $50 billion to help dam up the flood of foreclosures drowning our economy. Who have we not heard from?
How about the 2.3 million Americans who faced foreclosure proceedings last year? How about the 860,000 people whose homes were repossessed by lenders? How about the millions more out there right now struggling to renegotiate their mortgages with banks bent on reducing lending, restricting loans, and lying about conditions? Those are the heartrending stories we haven’t heard yet, but that’s about to change.
Today, Brave New Foundation is unveiling its newest campaign: Fighting for Our Homes. The website enables anyone affected by the housing crisis to tell their tale in their own words, either by recording it on camera or writing it down and submitting it with a photo of the house in jeopardy. Watch as people from around the country give accounts of their nightmarish ordeals. These stories fill up an interactive Google map symbolizing the toll this economic meltdown has taken on Main Street homeowners, reminding us of the consequences of irresponsible lending and corporate malfeasance.
