Tag Archives: foreclosure

New Report: Wells Fargo’s at the Bottom of the Heap

When it comes to foreclosing on Californians, it looks like Wells Fargo may take the prize.  According to a report released today, Wells Fargo is responsible for more homes in the foreclosure pipeline in California than any other single lender.  

Wells Fargo is servicing the most loans, but they are providing less principal reduction to struggling borrowers than either Bank of America and Chase – who themselves should be doing more!  Wells Fargo trails behind Bank of America and Chase when it comes to the amount of principal reduction given with first lien loan modifications, according to the Monitor of the multi-state Attorneys General settlement with the five big mortgage servicers.

This is the very same Wells Fargo that just had its most profitable year ever in 2012, with earnings of $19 billion.  

The report, California in Crisis: How Wells Fargo’s Foreclosure Pipeline Is Damaging Local Communities, by ACCE (Alliance of Californians for Community Empowerment), the Center for Popular Democracy and the Home Defenders League, shows the harm coming to homeowners, communities and the economy unless Wells Fargo reverses its course and averts some or all of the impending foreclosures.  

Download the report at: http://www.calorganize.org/sit…

The report uses data from Foreclosure Radar to look at loans currently in the foreclosure pipeline in California – meaning loans that have a Notice of Default or Notice of Trustee Sale. Of the 65,466 loans in the foreclosure pipeline, close to 20% of them are serviced by Wells Fargo.

If Wells Fargo’s 11,616 distressed loans go through foreclosure, California will take a next $3.3 billion hit: Each home will lose approximately 22 percent of its value, for a total loss of approximately $1.07 billion; homes in the surrounding neighborhood will lose value as well, for an additional loss of about $2.2 billion; and government tax revenues will be cut by $20 million, as a result of the depreciation.  

And not surprisingly, African American and Latino communities will be particularly hard-hit. The report includes maps for seven major cities showing minority density and dots for each of Wells Fargo’s distressed loans. In city after city, they are heavily clustered in neighborhoods with high African American and Latino populations.

“My community has been absolutely devastated by the foreclosure crisis, and I put a lot of the blame at the doorstep of Wells Fargo,” says ACCE Home Defenders League member Vivian Richardson.   “Wells Fargo’s heartless and unfair foreclosure practices are sending far more homes into foreclosure than is necessary.”  

“Our communities and our entire State are still reeling from the housing crisis, and will be for years to come,” said San Francisco Supervisor David Campos.  “As this report shows, the numbers of homes still facing foreclosure is enormous.  Principal reduction is clearly a critical strategy for saving homes and stabilizing the economy.  Wells Fargo and the other major banks should be doing more of it.”

The report recommends:

1. Wells Fargo should commit to a broad principal reduction program.  

This means that every homeowner facing hardship should be offered a loan modification, when Wells has the legal authority to do so. The modification should be based on an affordable debt-to-income ratio, achieved through a waterfall that prioritizes principal reduction and interest rate reductions. Junior liens must also be modified.

2. Wells Fargo should report data on its principal reduction, short sales, and foreclosures by race, income, and zip code.  

Wells Fargo must be more transparent about its mortgage practices. The bank has an egregious history of harming California’s African American and Latino communities through predatory and discriminatory lending. To show the public that it has reformed, Wells Fargo must make this data available. The people of California need to know that Well Fargo is no longer discriminating against people of color and is fairly and equitably providing relief to homeowners and to the hardest hit communities.  

3. Wells Fargo should immediately stop all foreclosures until the first two demands are met

In the event that it takes a few months to set up a fully functioning principal reduction program, Wells Fargo needs to immediately stop all foreclosures. Wells Fargo has done enough harm. It’s time to stop. California deserves a break.

ACCE is waging a campaign to push Wells Fargo to be a leader in California, their home state, in saving homes – beginning with their performance to comply with the Attorneys General Settlement and with the Homeowner Bill of Rights, but not ending there.  

To sign on to a letter to Wells Fargo CEO John Stumpf to support the campaign demands, click here: http://salsa.wiredforchange.co…

ACCE is a multi-racial, democratic, non-profit community organization building power in low to moderate income neighborhoods to stand and fight for social, economic and racial justice. ACCE has chapters in eleven counties across the State of California. For more information visit http://www.calorganize.org/ or follow ACCE on twitter @CalOrganize

On Dec. 6th, Occupy goes “home” for the holidays

Four years ago Wall Street bankers crashed our economy after reckless gambling with our homes and our livelihoods. Then they looted our Treasury for bailouts and bonuses while their 1% allies used the economic chaos as an excuse to rob us of the investments we've made in helping every Californian achieve the American Dream. But since September 17, the simmering anger at Wall Street has found a powerful expression through the Occupy movement, massive campus mobilizations and increasing numbers of homeowners standing up to wrongful bank evictions by organizing community-led “home defenses.”

This month, the Occupy Wall Street movement is joining with brave homeowners (underwater and foreclosure victims alike), renters fighting foreclosure-related evictions, and other community members personally affected by Wall Street's greed around the country to say, “Enough is enough – we're not going to let them take our homes.” On December 6th hundreds of homeowners and renters facing foreclosure are announcing that they are not leaving when the sheriff comes. Some are even taking the bold step of moving back in to the homes from which they have been evicted. Collectively, the 99% are taking a stand against Wall Street and their 1% allies a step further by demanding negotiations instead of fraudulent foreclosures and justice instead of avarice.

Here in California, one of the path-breakers in taking this type of action is Rose Gudiel, a member of the Alliance of Californians of Community Empowerment (ACCE) and the ReFund California campaign. In October, she successfully defended her home and family from a foreclosure eviction by taking decisive action. She was arrested for protesting outside of a Fannie Mae office in Pasadena. After her arrest, Fannie Mae agreed to halt her eviction and then met with her to negotiate a modification of her loan. Other home defenses have sprouted in places such as Atlanta,Cleveland,Minneapolis and San Francisco.

25% of homeowners in America are underwater and by the end of 2012 nearly 13 million homes will be in some stage of the foreclosure process. There is no shortage of families being pushed to the brink and the December 6th Occupy Our Homes Day of Action represents the launch of an effort to support families that are ready to stand up to Wall Street. Everyone has a right to decent, affordable housing. The website, occupyourhomes.org was launched to help the 99% fight for this right. It features an online action toolkit and a “Pledge in Defense of Homes and Neighborhoods” that anyone around the country can sign as a signal of their willingness to take action in defense of their own home or their willingness to stand in solidary with others taking that bold step. The goal is to get 50,000 people to take the pledge in the coming weeks.

Rose Gudiel and others that have stood up to their banks know that eviction defenses and home occupations should not be taken on lightly. That's why the Alliance of Californians for Community Empowerment (ACCE) has put together a teach-in called “Know Your Rights: How to Defend Your Home from Illegal Bank Actions” to help would be home defenders. Most teach-ins will take place this Saturday, December 3: anyone can sign up at www.calorganize.org/knowyourrights

On the day before Thanksgiving, appropriately, Occupy Wall Street in New York announced that they were supporting December 6th as a national day of action and encouraging people across the country to defend their homes against illegal bank actions. Throughout California and across the country people are organizing a variety of actions and many will publically announce that they are refusing to leave when faced with an unfair eviction.

As OWS member Max Berger told Salon, “This is a shift from protesting Wall Street fraud to taking action on behalf of people who were harmed by it. It brings the movement into the neighborhoods and gives people a sense of what's really at stake.”

Are you ready to be the next Rose Gudiel? Are you ready to stand by a neighbor or friend that is resisting a wrongful foreclosure? Sign up for a teach-in at www.calorganize.org/knowyourrights and then take the pledge at occupyourhomes.org

Why we are taking a stand against an immoral foreclosure

 By Rose Mary Gudiel  

Last Friday, the moment I had been dreading arrived: my family was served an eviction notice by the Los Angeles County Sheriff Department. OneWest Bank and Fannie Mae believe this is the final chapter of the foreclosure on our family’s home of almost 7 years. But myself, my mother Rosa Maria, my brother Herbert, and my father Miguel have decided that we will not leave. Fannie Mae will not take our family home!

It is hard for us to believe the manner in which we have been treated by first Indy Mac, then One West bank and now Fannie Mae. After the unfortunate passing of our youngest brother, our family fell behind two weeks on our mortgage payment.  During this time, in the wake of the Wall Street meltdown, I was also furloughed from my state job helping others to find employment. It was a miracle that we made it through that time, but we did. We did it by staying focused, working hard, making sacrifices and most importantly coming together as a family.

But my circumstances meant nothing to the bank. OneWest refused my mortgage payment that was just two weeks late. Although three of us have full-time jobs and we are able to pay, they have refused every single payment ever since.   Instead, we’ve been taken on a roller coaster ride of paperwork requests, false promises and denials. It makes no sense.

My parents taught us to work hard, play by the rules and to be good citizens and we have done our best.  It has always been my dream to repay them for all they have given me by buying them a home.  I worked hard and saved money to achieve that dream, and we had a home for our multi-generational family of eight.  We have celebrated Christmases, birthdays and Thanksgiving in this home, so the prospect of losing it to greed and injustice is simply too much to bear.

Stopping preventable foreclosures is better for families, neighborhoods, and our economy. How is it better to flood our neighborhoods with vacant, abandoned foreclosures than to have homeowners keep paying their mortgage and keep up their properties? Or in other cases to sell them at half the price – lower even than a modified mortgage they could offer to me on my own home first?

That’s why we have decided that we are refusing to leave.  We are asking that our eviction be halted and that out loan be modified so we can stay.  But if the sheriff comes first, we are refusing to move.  And we’ll be joined by the hundreds of friends, neighbors, supporters and co-workers that have pledged to stand with us.  

There are thousands of families like ours in California and across the nation.  The greedy, predatory and irresponsible practices of big banks and their rich CEOs caused the economic collapse and foreclosure crisis, destroying millions of American jobs and devastating families like ours.

Yet after getting bailed out by taxpayers, banks today are making billions in profits by continuing to prey on consumers and extract profits from our communities, with no regard for the impact on neighborhoods and people’s economic livelihoods. By holding homeowners underwater and refusing to clean up the foreclosure mess, banks are devastating our neighborhoods, depressing the economy, and preventing millions of working Californians from getting back on their feet.

We are proud to be working with hundreds of families to organize a week of activities to take our fight to the banks to send the message that it’s “time to make Wall Street banks pay.”  We will be calling on banks to keep families in their homes, pay their fair share of taxes and help rebuild hard-hit neighborhoods.  The actions will end on October 6th with a mass mobilization of over a thousand people beginning at California Plaza at 350 South Grand.  

Together, with your support, we will fight to save our American Dream and thousands of other families across the state.  We are not leaving.  Will you stand with us?

Rose Mary Gudiel is a member of ACCE, the Alliance of Californians for Community Empowerment.  For more information about the mobilizations, please visit http://www.makebankspaycalifornia.com

Fed up homeowners to stand up to Wall Street Banks

Note: This is a preview to two weeks of actions, rallies and mobilizations of homeowners who are fighting to “Make Wall Street Banks Pay” in the Bay Area (Spet 26-29) and LA (Oct 3-6). Details of events can be found at www.MakeBanksPayCalifornia.com

Last Thursday’s news was startling even for those who already knew California is at the epicenter of America's foreclosure crisis. New data showed that California had a staggering 55% increase in foreclosure notices in August, the highest in the nation. Coincidentally, it also marked three years since the shocking day that Lehman Brothers declared bankruptcy and our economy began to unravel.

Last Thursday’s news was startling even for those who already knew California is at the epicenter of America's foreclosure crisis. New data showed that California had a staggering 55% increase in foreclosure notices in August, the highest in the nation. Coincidentally, it also marked three years since the shocking day that Lehman Brothers declared bankruptcy and our economy began to unravel. It was appropriate, then, that a broad coalition of homeowners, students, faith leaders and activists spent yesterday shining light on the foreclosure crisis and economic despair and announced plans to fight back with even more intensity. Over the last two weeks, community events have been held across the state in Sacramento, San Jose, San Francisco, Richmond, Oakland, Los Angeles and San Diego, where people like Ana Guardado told their stories. Guardado, who lives in San Jose, has watched neighborhood friends of over 25 years move away as they lost their homes. She told the San Mercury News, “Two years ago, I saw a family outside in their yard on Christmas Day, and I decided I had to get involved. The family had all this stuff spread out, and they had a Christmas tree in the front yard so their kids could have Christmas.” Guardado invited people to get involved in helping affected families by visiting www.MakeBanksPayCalifornia.com

The new report released detailed the impact of the foreclosure crisis in neighborhoods across the state. In Sacramento, one of the hardest hit regions of the state, the numbers are staggering for a small city: by 2012, the 5 year total of foreclosed homes is expected to reach 71,470. Homeowners have lost an estimated $17.7 billion in property values, tax revenue losses are estimated at $108 million, and local government costs for increased safety inspections, police and fire calls, trash removal, and maintenance are estimated at $620 million.

“This report quantifies what people in California have understood for years – banks’ practices are financially devastating to our neighborhoods and cities,” said Peggy Mears of the Alliance of Californians for Community Empowerment (ACCE), a statewide community organization helping California residents organize and take action to improve their lives.

The report offers the latest evidence that fixing the foreclosure crisis is central to fixing the economy. Data from the report shows that:

  • The crisis of homeowners being underwater (owing more on their mortgages than their homes are now worth) could be solved by banks writing down those mortgages. It would save affected California homeowners an average of $810 every month and pump $20 billion annually into local economies.
  • With the extra $810 per month, homeowners could start spending again, making purchases they have been putting off. The increase in consumer demand would in turn help create 300,000 jobs in California.
  • Sacramento alone has 80,361 homeowners underwater by $7.4 billion. If banks wrote down those mortgages, it could pump $781 million into the local economy and create 11,544 jobs.

The situation is similar in Los Angeles, says ACCE member Lyneva Mottley, who lives in the Watts neighborhood. “For months now, banks have been ignoring the demands of residents in Watts and other neighborhoods to clean up the housing mess and end business practices that are devastating our communities,” said Mottley, who has seen foreclosures destroy her neighborhood. “It’s time to make Wall Street banks pay for their predatory actions. If they don’t clean up the trash they leave in our neighborhoods, stop unfair foreclosures and start paying their fair share of taxes, we are going to take our concerns directly to the banks and make our voices heard.” . Community members also went door to door in cities throughout the state to spread the word among neighborhood residents about a week of actions to force banks to pay their fair share.

The events are planned for September 26-29 in the Bay Are and October 3-6 in the Los Angeles. The rallies and protests will lead up to mass mobilizations in the Bay Area on September 29 and in Los Angeles on October 6. While Wall Street banks crashed the economy, are destroying local communities and are wrecking state budgets in California and across the country, regular citizens are paying the price. Today, California homeowners are still overpaying for their mortgages, students are getting hit with new fee hikes, and families are paying millions in overdraft fees because of the mess created by the banks (which are back to earning record profits and paying their CEOs enormous bonuses).

The campaign's goals are to: 1. Fix the economy by fixing the housing crisis through enacting a widespread mortgage principal reduction program, creating 300,000 California jobs and injecting over $20 billion into the economy. 2. Restore needed state revenue by making Wall Street banks pay their fair share of taxes and closing tax loopholes exploited by rich corporations. 3. Rebuild California neighborhoods by helping homeowners and restoring revenue to local communities by penalizing banks for foreclosures and blight, renegotiating costly interest-rate swap deals and winning court-based mediation for homeowners. California residents are encouraged to join the campaign and get more information by calling 877-633-9251  or visiting www.MakeBanksPayCalifornia.com

Sunday Action Alert — Now More Than In Years Progressives Must Facilitate Action For Change

Being suddenly totally disabled has given me more than enough time to blog about moving this country forward. Please take a few minutes of your Sunday, and I do only mean 15 minutes, to encourage PROGRESSIVE CHANGE, by taking action that DOES make a difference while having your Sunday Morning cup of coffee. More details and reads I promise you have not seen in your local news are at FreeFlightNewMedia.typepad.com

Over 10 THOUSAND–YOU READ IT RIGHT–10 THOUSAND people showed up in Sacramento (aka COWTOWN) for help keeping their home. The Government program to assist is a big mess and must be fixed. Action: Call For Foreclosure Halt – Nationwide


– Sign the Petition | Change.org

USA National Foreclosure Moratorium NOW

Targeting: The President of the United States, The U.S. Senate, and The U.S. House of Representatives

Started by: Andrew Delaney

This petition is to request that ALL of OUR elected Officials consider making this their #1 Issue Immediately.

This foreclosure crisis is growing exponentially and needs attention. There are questions regarding the legal aspects of what is happening in OUR courts.

Foreclosures are being processed, aka…Rocket Docket style, in FL and in many other states nationwide. Including both Judicial and Non-Judicial states.

If we dont ACT NOW we will have a country full of empty houses. For what purpose? The Housing market is scarily sluggish and the glut will continue as Americans leave their homes without knowing If they ever really had to.

Look at the TRUTH

Some light is being shed on this as a possibility , but, only in a selected 23 states? And by GMAC and not OUR Elected Officials?

There should be a USA National Foreclosure Moratorium NOW & Until Further Notice instituted by these same elected officials.

Please HELP to support this cause.

Your VOICE Still Counts. Thank You America.


Mr. President. STOP THE MADNESS! REQUIRE Banksters and loan processors make those harmed whole, with penalties. Your Re-Election may depend on it.

You can go into the program (HAMP) current on your loan, just seeking reduction in monthly payment, and wind up in DEFAULT/FORECLOSURE by simply following lender/processor instructions.


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Democrats dodge Obama, so he focuses on what he’s good at: Talking for $,$$$ | Top of the Ticket | Los Angeles Times (Top of the Ticket)

OpEdNews – Article: It Is Time for a Moratorium on Foreclosures

Thank you.

OUTRAGE: Treasury’s Shocking Admission: Struggling Homeowners Program Ploy To Enrich Banksters

ZACK CARTER, AlterNet’s economics editor, and a fellow at Campaign for America’s Future, writes for the Media Consortium and is a frequent contributor to The Nation magazine, exposes the United States Treasury Program for Struggling Homeowners Just a Ploy to Enrich Big Banks!

After working many decades in various Government programs, I did not think much of anything could surprise me. Wow…Was I ever Wrong.

Mr. Carter’s latest economic article title should have folks in Washington shaking in their boots before the “ink dries” on this bombshell. An immediate public investigation should be initiated by Congress before the end of this week. Even worst, this “bombshell” may clearly destroy hope for thousands of homeowners in the US Government program that was to help out the little guy, homeowners in financial distress due to the economy. The Title of Mr. Carter’s expose may tell you everything you need to know to get the hair on the back of your neck and blood pressure up!

Treasury Makes Shocking Admission: Program for Struggling Homeowners Just a Ploy to Enrich Big Banks

The Treasury Dept.’s mortgage relief program isn’t just failing, it’s actively funneling money from homeowners to bankers, and Treasury likes it that way.



The Treasury Department’s plan to help struggling homeowners has been failing miserably for months. The program is poorly designed, has been poorly implemented and only a tiny percentage of borrowers eligible for help have actually received any meaningful assistance. The initiative lowers monthly payments for borrowers, but fails to reduce their overall debt burden, often increasing that burden, funneling money to banks that borrowers could have saved by simply renting a different home. But according to recent startling admissions from top Treasury officials, the mortgage plan was actually not really about helping borrowers at all. Instead, it was simply one element of a broader effort to pump money into big banks and shield them from losses on bad loans.

That’s right: Treasury openly admitted that its only serious program purporting to help ordinary citizens was actually a cynical move to help Wall Street megabanks.


Hopefully, thanks to the work of Mr. Carter, exposure of the Treasury Department actions will quickly get the HAMP program on track to do that which it was billed to do. I think you will agree that homeowners who have been harmed by this Government program billed as THE HOMEOWNER PROGRAM to save the little guy–will be made whole. I am just not sure what that would be. Suggestions?

Two more things:

Where are the major Media Outlets on this story?

Shouldn’t this be the lead on every TV evening news?

Link to full story: http://www.alternet.org/econom…



Out of touch in the Inland Empire

In a dramatic illustration of my campaign theme that Republican incumbent assemblyman Paul Cook is out of touch with his district, he was quoted in Monday’s Riverside Press-Enterprise on his reason for voting against Sen. Mark Leno’s SB 1275, which would help homeowners by requiring banks and mortgage companies to better communicate with delinquent borrowers about modification options before beginning the foreclosure process.  Said Cook, “I needed a good reason to vote for it and I just didn’t see it.”

Well, Mr. Cook, let me suggest a few good reasons.  Our Assembly District 65, in the heart of the Inland Empire, has the highest unemployment rate of any large metropolitan area in California (15.1%, second nationally only to metro Detroit).  We are Ground Zero for the foreclosure crisis; when the New York Times did a series on foreclosures, they came to Moreno Valley for their interviews.  

Widespread foreclosures lead to failing neighborhoods, which in turn burden already underfunded schools.  Many schools in the 65th lag behind the rest of the state, mortgaging (no pun intended) the futures of our area’s youth.

Cook’s response to these multiple crises in his district?  Not a single bill that addresses the economic crisis or relief for its victims.  Although he proclaims his passion for recognizing the service of military veterans, his legislative record contains nothing that addresses the needs of the thousands of veterans in the 65th District facing unemployment, foreclosure and possible homelessness.

The 65th AD is poised to turn Democratic.  From a 23% Cook win in 2006, the Republican margin was cut to 6.5% when I ran against him in 2008.  If ever there was an area needing the solutions that only progressive Democrats can provide, it is the Inland Empire in 2010.

                       Please visit www.wood4assembly.org

Oakland ACORN Home Defenders Stop Eviction!

Every 13 seconds another family in America faces foreclosure, a grim statistic that symbolizes the depth of the crisis that lies at the heart of the economic meltdown.

Home Defenders Defend Tosha's Home

One of people caught up foreclosure crisis is West Oakland resident Tosha Alberty. A County Transportation Services Coordinator, she has been fighting with First Franklin Home Loan Services for months to save her home, but the bank has not negotiated in good faith. In fact, it has pursued foreclosure.

But with the help of the ACORN Home Defenders, she has successfully fought off eviction, most recently on Thursday June 25th. The Home Defenders mobilized an emergency home defense and were joined by many of her neighbors, ACORN members, and local elected officials including Oakland City Councilmember Desley Brooks and representatives from Councilmember Nancy Nadel’s office and Alameda County Supervisor Keith Carson’s office., By blocking the house’s entrance, they first stopped the locksmith from changing the locks, then they refused to let the sheriff take Tosha Alberty’s home.

This wasn’t the first time the ACORN Home Defenders stopped Tosha from losing her house. Twice previously Home Defender mobilizations stopped evictions and allowed her to enter negotiations with the bank with the help of ACORN Housing’s HUD certified counselors to keep her in her home and modify her loan so she could afford to stay. Despite actively negotiating the case, First Franklin refused to call off the eviction, so ACORN Home Defenders mobilized for the 3rd time on Thursday in an emergency Home Defense.

Joining in the defense was Oakland City Council Member Desley Brooks, honoring a pledge to join with ACORN made at the beginning of its Home Defending campaign back in February. She put her promise into action at this home defense, joining the Home Defenders in risking arrest to stop the eviction. In addition to Home Defenders were joined by representatives from Nancy Nadel and Keith Carson’s offices, and City Council members Jane Brunner and Rebecca Kaplan also expressed their support and willingness to help.

One of the most powerful moments of the action came when the locksmith arrived. After learning of the situation, he told the ACORN Home Defenders that he would stand in solidarity with Tosha and not change the locks – that the sheriff would have to get someone else to do the job!

When the sheriff’s deputy finally arrived, he pulled up and saw public officials, neighbors, and ACORN’s Home Defenders ready to stop the eviction. Instead of following through, he took a picture and drove away. Shortly after that, Rodney Brooks of Keith Carson’s office confirmed that the sheriff had postponed the eviction. They would not evict on Thursday.

But they can return at any time.

The ACORN Home Defenders will continue to defend Tosha’s home and press the bank to engage in meaningful negotiations. They will not allow the home to be taken without a just solution.

If you live in the East Bay, Oakland ACORN is looking for people willing to be Home Defenders – not just for homes in Oakland, but around the East Bay. We are holding civil disobedience and Home Defender trainings on Tuesday, June 30th at 6pm and Thursday July 2nd at 6pm. For more information, contact Claire Haas at chaas [at]acorn.org or 510-434-3110 x 502.

You can also follow Oakland ACORN’s Home Defender actions on Twitter @OaklandACORN and our work on Thursday was featured on the National ACORN Facebook page at www.facebook.com/acorn.

Stopping the 13 Second Clock: ACORN and Leading Mayors Join Together in Fighting Foreclosures

California’s economy can’t really stabilize until the foreclosure crisis is resolved.

Yesterday I was honored to be on a call with America’s leading mayors and the US Conference of Mayors to talk about a huge problem affecting cities from coast to coast: the foreclosure crisis.

I’ve been talking about how a family is losing their home every 13 seconds for awhile now and the recent failure by Congress to enact bankruptcy reform to protect homeowners because of industry pressure was a real blow to stopping that clock.  

But the failure in Washington isn’t going to stand in the way of ACORN’s push to address the crisis at the heart of the economic meltdown and teaming up with some of the leading mayors in the United States is a major way we’re moving forward to help families stay in their homes.

Let’s set the record straight about one thing – mayors and ACORN tried to stop this crisis before it began, only to be preempted by federal regulators who did the industry’s bidding, and now we are left to clean up the mess.  It took the election of Barack Obama for the federal government to start helping families, but even his excellent Making Home Affordable program only aims to prevent 3 to 4 million foreclosures out of the expected 9 million over the next four years.

So it’s up to us – regular folks, community organizations, and local community leaders.  We cannot sit on the sidelines while 5 to 6 million families lose their homes.

Luckily there is a tremendously successful model already in existence in the city of Philadelphia. Called “mandatory mediation” it is based on one simple technique: having borrowers and lenders sit down and talk. The success rate is astounding.  As we have shown in our recent report, “Road to Rescue: How the Philadelphia Model Can Reduce Foreclosures Across the Country“,  fully 78 percent of homeowners who have participated in mediation are still in their homes today. 78 percent! Imagine if we could replicate that across the nation!  

The Philadelphia program works because it incorporates four pillars: (1) It is mandatory. (2) It involves extensive community outreach to struggling borrowers. (3) It has an easy threshold for participation. (4) It makes use of housing counselors to ensure affordability of workouts.  

On yesterday’s call, we heard from Philadelphia Mayor Michael Nutter, whose office now coordinates this highly effective program.  He has raised money from the private sector to join city funds, but he needs more help, including from the federal government, especially as the foreclosure crisis lays at the heart of our recession.

President Obama himself understands this, and in his February speech laying out the foreclosure plan, said, “We are going to award $2 billion in competitive grants to communities that are bringing together stakeholders and testing new and innovative ways to prevent foreclosures. Communities have shown a lot of initiative, taking responsibility for this crisis when many others have not. Supporting these neighborhood efforts is exactly what we should be doing.”

Unfortunately, no such support for local foreclosure prevention yet exists.  ACORN will join mayors in fighting to make sure the federal government does as President Obama promised and funds these initiatives.  Despite a recent unanimous Senate vote on an amendment offered by Senators Casey and Gillibrand to open up some of the Neighborhood Stabilization Program funds for foreclosure prevention, rather than just buying properties after they’re foreclosed, the amendment died in the House.

Across the country, ACORN Housing counselors are waging daily battles just to get reasonable modifications and save homes, but the industry is still foreclosing on hundreds of thousands of families that could be helped but don’t live in a city with a mediation program. The efforts of mayors and ACORN to facilitate more affordable loan modifications will be critical in halting the national housing and economic downfall.  

Mayor Bloomberg is joining us in pressuring Albany to improve the state’s mediation law, Mayors Villaraigosa and Dellums are working with us to get needed changes out of Sacramento, and Mayors Slay (St. Louis) and Diaz (Miami) also committed to working with us locally, statewide, and nationally to help save homes.  

With millions more foreclosures staring us in the face, we have to act now to create sensible local solutions that will improve our communities, safeguard families, stabilize tax bases, and revive the economy.  With leading mayors stepping up yesterday, we’re starting to get the ball rolling.

Fannie Mae Executives Who Accept Bonuses Should Be Fired

(Move over, AIG, this is the next outrage. – promoted by David Dayen)

Fool us once, shame on you.  Fool us twice, shame on us.  Given the intense public backlash against the shameful AIG bonuses, it is unthinkable that Fannie Mae would now award million dollar bonuses to four of its top executives.  According to recent news reports, Executive Vice Presidents Kenneth Bacon, David Hisey, Michael Williams, and Thomas Lund will each receive over $1 million in bonuses.  This is unacceptable.

Let’s not forget that Fannie Mae failed last year.  At least $15 billion of precious taxpayer dollars have been injected into Fannie Mae to keep it afloat, and hundreds of billions more are being used to guarantee their loans.  We fire executives for bad judgment.  It is beyond bad judgment for any of Fannie Mae’s executives to accept their million dollar bonuses.  There are many Wall Street executives without a job right now who will happily take top positions at Fannie Mae without the need for million-dollar bonuses.

Fannie Mae executives should already be on thin ice for coming out with guidelines that reward speculators and investors.  The Fannie Mae guidelines issued on March 4, 2009 allow speculators with second homes and investment properties to take advantage of the refinancing component of President Obama’s Making Home Affordable plan.  This directly contradicts President Obama’s repeated statements that his plan will not reward speculators.  Fannie Mae needs to follow the President’s public statements and revise the guidelines immediatley.

We need to clean house on Wall Street.  We need a cultural change where taxpayer interests are placed above corporate greed; where homeowners’ interests are placed above speculators’ interests; and where common sense prevails over utter stupidity.  

I call on Fannie Mae executives to return any bonuses they receive while their company is being propped up by taxpayer dollars.  If they do not, they should be fired.

Ted W. Lieu (D-Torrance) is Chair of the Assembly Rules Committee and former Chair of the Assembly Banking and Finance Committee.  He is the author of the landmark California Foreclosure Prevention Act, which was signed into law last month.