By all accounts, the Obama Administration’s anti-foreclosure plan is failing. The Home Affordable Modification Program (HAMP) was supposed to help three to four million homeowners by 2012, but only 389,000 have received permanent mortgage modifications.
The statistics are staggering: one in seven mortgages is now delinquent or in foreclosure and a record one in ten homeowners missed at least one mortgage payment between January and March. The number of US home foreclosures reached a record for the second consecutive month in May. Nearly 25 percent of homeowners are underwater, owing more on their mortgages than their homes are worth.
A vicious cycle continues unimpeded: increased foreclosures and blight, brings decreased property values and revenues for local and state government, leading to increased layoffs and even more foreclosures.
It’s no wonder that people are beginning to take matters into their own hands.
Recently I wrote about the letter sent to the Big Banks by seven powerful New York City unions and City Comptroller John Liu, asking what the banks are doing to increase the number of modifications including principal write-downs. Some of the union presidents made it clear that they would look to move their pension monies if the banks weren’t responsive.
Then on July 22, the Atlanta Fighting Foreclosure Coalition and the AFL-CIO held hearings on the crisis and demonstrated in front of the Wells Fargo downtown Atlanta branch to demand that the bank do a better job on mortgage modifications.
Initially, Wells Fargo claimed that bank officials were unavailable to meet with coalition representatives, but when the hundreds of demonstrators showed up at the bank, the execs were magically free.
Just hours after meeting with AFL-CIO Executive Vice President Arlene Holt Baker, Atlanta-North Georgia AFL-CIO President Charlie Flemming, Georgia State Senator Vincent Fort, and the Reverend Timothy McDonald, Wells Fargo requested another meeting with the AFL in Washington, DC.
That meeting took place between senior bank and union officials on Monday. Here is what Ms. Holt Baker said to me about how it went:
Holt Baker: This was a good second step. We had the first meeting in Atlanta—after hearings and demonstrations there—then the doors of the banks were open to us.
There is no doubt that we are all on the same page as it relates to this crisis. It’s not in the interest of the bank, the homeowners being foreclosed on, and we certainly know that it’s not in the interest of the community.