Families caught in foreclosure crisis unite in national campaign
A national campaign representing more than 50,000 families caught up in America’s foreclosure crisis has been launched, with the aim of making mortgage relief a key issue in battleground states during the 2012 election.
The Home Defenders League, launched on Thursday, plans to be active in 17 states across the US recruiting members via phone and door-to-door campaigns. Staffed by people who themselves are suffering from foreclosure, the HDL wants to create a powerful lobby in swing states like Florida, Colorado, Nevada and elsewhere.
This weekend it will hold more than 20 rallies, phone banks and house parties to recruit supporters in a three-day membership drive. It is planning to tap into some of the 15.7 million American homeowners suffering from foreclosure or whose houses are “underwater” and thus worth far less than their mortgages.
It seeks to vet politicians on their attitudes towards a policy of resetting mortgages at current market levels, arguing such a move would keep families in their homes and provide a stimulus to the economy. “This country needs this. It is not just about helping struggling homeowners, it is about fixing our country,” said Amy Schur, head of the Alliance of Californians for Community Empowerment, which is one of 18 different groups that have backed the HDL.
The development comes amid signs that the foreclosure crisis that lay at the heart of the Great Recession is showing little prospect of abating in America. Last week new figures from Zillow, a real estate valuation service, showed some 32 percent of US mortgages were “underwater”, a figure that was far more than previously expected. Zillow said those mortgage holders owed some $1.2tn dollars in debt more than their homes were worth. Many of them risk foreclosure.
HDL activists argue that writing down that debt via reducing mortgages to reflect current market prices would allow a broader economic recovery. “It would be the kind of economic stimulus our country needs. It would keep millions in their homes and put billions back into people’s pockets,” said Rose Gudiel, a Californian HDL activist whose own home has faced foreclosure.
Organisers say that they will focus on organising in swing states in the coming election in order to persuade politicians in both the Republican and Democratic parties that their votes need to be courted in strategically vital parts of the 2012 electoral map. “Colorado is a swing state. Our citizens are going to be very important in the coming elections,” said Cathy Busby, a Colorado-based real estate agent and HDL campaigner.
Other organising groups are also targeting the foreclosure crisis in key areas of the country. An internet advertising campaign, with paid ad buys on Google and Facebook, also launched today in six swing states that aim to highlight the issue and is specifically targeted at the Obama campaign. It is being paid for by the Campaign for a Fair Settlement and the New Bottom Line, whom both lobby on reducing mortgage debts for homeowners.
“Almost 16 million homeowners owe more on on their mortgage than their home is worth. That’s 16 million votes that President Obama could win by showing leadership on the housing crisis,” said Tracy Van Slyke, co-director of the New Bottom Line.
Much activist anger is aimed squarely at major banks, claiming that fraud and incompetence were the main contributors to a housing bubble whose bursting in 2007 almost brought the world economy to its knees. Obama announced earlier this year the formation of the Mortgage Fraud Task Force, which is aimed at investigating prosecutions in the industry. But the Obama administration has come under fire from liberal activists for not pursuing potentially criminal acts more aggressively.
However, there are signs that legal actions are growing elsewhere on the issue of the banking and mortgage industry. On Wednesday Manhattan District Attorney Cyrus Vance indicted Abacus Federal Savings Bank and 19 ex-employees on charges of issuing hundreds of millions of dollars worth of fraudulent mortgages that were then repackaged as investment securities. Prosecutors say the bank systematically falsified documents to make borrowers qualify for mortgages.
Meanwhile, the city of Buffalo, New York, has announced it will close its 45 million dollar account with JP Morgan Chase in protest at the bank’s foreclosure policies. City funds will now be held with a different, smaller bank. The divestment move follows other large New York state cities like Ithaca and Binghamton.
“Local governments across the state need to continue to send the message to banks that if you want to do business in our communities, you need to support the interest of our communities and keep homeowners in their homes.” said Harold Miller, upstate director of New York Communities for Change, which was one of several groups that lobby for shifting municipal accounts in protest at foreclosures.
[Image via iStock]