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

 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

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