Irvington, NJ – A municipal hearing on foreclosure was held here, July 10. The main emphasis was placed where it belongs: on the testimony of distressed homeowners themselves. The council chambers were packed.
Trenton, NJ – People gathered here to rally and hold a press conference, March 29, on the need for uncompensated write-down of overpriced mortgages contracted during the housing bubble, the period after 1997. The event marked a court hearing aimed at elimination of ‘robo-signing,’ foreclosures undertaken by banks that cannot prove ownership of the mortgage.
One year after the current financial crisis began, the situation has gone from bad to worse. What began with the failure of small mortgage lenders has toppled Wall Street investment banks, the largest mortgage company in the world, and a trillion-dollar insurance firm. Depositors are starting to flee banks and money market funds, putting businesses in danger of not being able to get loans. Banks don’t want to lend to each other and the stock market can’t find buyers. The economy continues to get worse month by month. As job losses mount, companies declare bankruptcy, foreclosures rise and consumers cut back on spending.
San Jose, CA – On Dec. 6, the Mortgage Bankers Association of America reported that home foreclosures and late mortgages rose to record highs in the July to September period. The next day, Bush’s Treasury Secretary Paulson announced a plan to aid home-buyers. While consumer advocates criticized the plan for being too little, too late, Wall Street liked the plan, which would let banks off the hook, and sent stocks up.
In January, both Fannie Mae and Freddie Mac will stop evicting tenants in foreclosed homes. Instead tenants will be able to stay on as renters. Both Fannie and Freddie were taken over by the government last year and have changed some policies to help slow the tidal wave of foreclosures and evictions. By allowing tenants to stay on, the blight of abandoned foreclosed homes will be lessened, and families who rent will not be uprooted from their schools and communities.