Housing

Cook County Takes A "Huge Step" Towards Relieving Foreclosure Crisis

Angela Caputo — Fri, 20 Nov 2009 10:21:28 -0800

After the Cook County Board of Commissioners finally agreed yesterday to fund foreclosure mediation services, housing advocates are celebrating the move as "a huge step" towards stemming the problem.

As regular readers know, it's been a tough slog for those community activists -- led by the group Action Now -- who've been pushing the county to devote more resources to mediation -- a proven method of staving off foreclosure. By a vote of 16 to 1, the board approved a $3 million budget amendment introduced by Comm. Earlene Collins (D) at the behest of Board President Todd Stroger and Cook County's Chief circuit court Judge Tim Evans (Republican Comm. Tony Peraica was the lone dissenter).

Like elsewhere in the state, foreclosures continue to pile up in Cook County. During a roundtable on WTTW's Chicago Tonight yesterday, MB Bank Vice President Thomas FitzGibbon noted that one of the biggest challenges in enabling mortgage modifications is getting through the daunting paperwork. "Having a neutral third party helping that consumer, helping that household, fill out the documents is an extremely important part of this whole process," said FitzGibbon, who also sits on the board of the non-profit Neigborhood Housing Services. "Seventy percent of the applications for this service -- for this help that we send out to consumers who we know are in trouble -- never comes back." Watch his remarks (full video here):

Once up and running, Cook County's program will help fill this void. Action Now is hoping that the initiative will follow in the footsteps of a successful mandatory mediation program in Philadelphia. In highlighting the program, the New York Times explained earlier this week how it works:

Under the rules adopted by Philadelphia’s primary civil court, no owner-occupied house may be foreclosed on and sold by the sheriff’s office before a “conciliation conference,” a face-to-face meeting between the homeowner and the lender aimed at striking a workable compromise. Every homeowner facing a default filing is furnished with counseling, and sometimes legal representation [...]

The Philadelphia program forces an outcome by bringing together all the principals in one room. If the mortgage company proves intractable, the homeowner has the right to request mediation in front of a volunteer lawyer serving as a provisional judge, who relays recommendations to the program’s supervising judge. If the judge finds that the mortgage company is not acting in good faith, she can hold the house in limbo by denying permission for a sheriff’s sale.

If all goes according to plan, early next year Cook County homeowners will have the chance to begin working directly with judges and their lenders to modify loans.

In the meantime, if you live in the Chicago area, check out the "How Not To Lose Your House Party" being hosted this Sunday by WBEZ and Vocalo.org. The event is being held in conjunction with the station's extensive series on the local housing crisis.

Activists Push For Better TIF Investment: "We Need This Housing"

Angela Caputo — Wed, 18 Nov 2009 08:14:37 -0800

A few months back, a coalition of community activists from across Chicago met at City Hall to call out the Daley administration for investing so few tax increment financing (TIF) dollars in affordable housing. After all, over the past decade, a mere 4 percent of the economic development money has gone towards such projects. That's despite the fact that home construction and the stabilization of housing stock can be key drivers in the rejuvenation of blighted communities. But instead of using substantial amounts of the money for these purposes, regular readers know that Mayor Daley has more often played favorites and doled out money to deep-pocketed corporations to subsidize their swank office renovations.

With the Sweet Home Chicago coalition at their back, Alds. Walter Burnett (27th Ward) and Manny Flores (1st Ward) have taken the lead in proposing that a larger chunk of the money -- 20 percent of TIF revenue collected each year -- is committed to affordable housing projects. These new and rehabbed developments would address the city's housing imbalance by setting aside apartments for low- and moderate-income families (earning $37,700 a year or less) who are priced out of decent housing in a growing number of Chicago communities.

Yesterday, the coalition of community groups gathered in in Uptown where they highlighted some of the blighted buildings that could benefit from greater TIF investment. "We need this housing," neighborhood housing activist Laverne Johnson said, pointing to her neighbors' sub-standard living conditions. "We are all suffering." Watch:

So far, five aldermen have signed on to the ordinance. Once it has 15 supporters, the measure will go to the full City Council. The Sweet Home Chicago organizers are working on drumming up more support in wards throughout the city. "Until you have pressure from the outside," co-sponsor Ald. Joe Moore (49th Ward) tells us, "the conversation won't happen."

Foreclosure Prevention On The Cook Co. Agenda ... Finally (Corrected)

Angela Caputo — Fri, 13 Nov 2009 10:48:52 -0800

Over the past two weeks, we've been covering some intense efforts by Chicago-area who want to see Cook County set aside some of the millions in foreclosure filing fee revenue for mediation services. After a year of unsuccessfully trying to get a meeting with County Board President Todd Stroger, the group Action Now finally sat down with Chief Judge of the Cook County Circuit Courts Tim Evans earlier this week, who pledged to recommend such an initiative to the board president.

It looks like the organizers' hard work may be paying off. Action Now informed us today that Stroger is currently circulating a budget amendment that will set aside $3 million next year to bolster much-needed foreclosure mediation and prevention efforts. Of that, $1.3 million will go toward outreach and adding legal staff to a foreclosure hotline. The remainder will go directly toward funding additional court and mediation staff.

Action Now's Aileen Kelleher tells us that the remaining question is whether the amendment will survive if the board succeeds in passing a partial repeal of Stroger's controversial one-percent sales tax hike, which is on their agenda this coming Monday. "We have to keep up the pressure on elected officials to see that this stays in the budget," Kelleher adds. Check back for more details on Monday afternoon.

(CORRECTION 11/16: This post originally stated that Comm. Larry Suffredin had also introduced a $1.3 million foreclosure prevention amendment. It turns out that the measure is for the functioning of the county courts, not exclusively for foreclosure-related services. We regret the error.)

Will Stroger Push More Foreclosure Prevention Funding?

Angela Caputo — Wed, 11 Nov 2009 09:54:41 -0800

Last week, a group of housing activists showed up at Cook County Board President Todd Stroger's office demanding to know why he hasn't spent a dime of the estimated $15 million collected in foreclosure filing fees on mediation services, which are proven to help people hang onto their homes. "Where is that money going?" asked Michelle Young of the group Action Now.

After trying to land a meeting with Stroger for nearly a year, Action Now was finally invited to sit down with him yesterday afternoon. But Stroger ended up inexplicably "detained," Young tells us. To his credit, Chief Judge of the Cook County Circuit Courts Tim Evans made the meeting. And Action Now members tell us that Evans has agreed to recommend that the county finally set more resources aside, beginning with $3 million over the coming year. A measure is expected to be introduced at next week's county board meeting.

"Mediation has been effective in other places," Young tells us, "but we need the money to fund it." Florida's Miami-Dade County is a prime example. Since making mediation mandatory earlier this year, 78 percent -- or 465 of the 599 foreclosure cases scheduled -- were settled in the local courts. While these local efforts are no substitute for a real loan modification program at the federal level, the fact that Cook County continues to pull in millions from foreclosure filing fees presents a logical revenue source for such a program. And the need remains real. As the Federal Reserve of Chicago has pointed out (PDF), a glut of vacant, lender-owned properties tends to "weaken [homeowners'] interest in reinvesting in their property," thus diminishing "the safety and security of the neighborhood" and straining public services elsewhere.

We'll be watching carefully to see if the Stroger administration helps push the proposal through as part of the county budget. "At least that would give people a fighting chance," says Action Now's Marsha Godard.

Activists Call On Stroger To "Give People A Fighting Chance"

Angela Caputo — Thu, 05 Nov 2009 14:03:57 -0800

Deluged by the thousands of foreclosure cases that have clogged the Cook County court system, Chancery Division Presiding Judge Dorothy Kirie Kinnaird made a bold move back in June when she called for a two-month reprieve on mortgage defaults. Despite her effort to buy homeowners time to seek mediation, resources remain too scarce -- particularly for people from the low-income communities hit hardest by the foreclosure crisis.

With the county pulling in millions in foreclosure filing fees, some local housing advocates are calling on Cook County Board President Todd Stroger to get creative and start redirecting that money toward mediation services. The local community organization Action Now estimates that the spike in $300 foreclosure filing fees has generated an additional $15 million for the county's coffers. Still, the Stroger administration has yet to allocate any of that money toward foreclosure prevention. "Why not use some of that money for mediation?" Marsha Godard of West Lawndale asked at a rally outside Stroger's office this morning. "At least that would give people a fighting chance."

It's no secret that low-income and African American neighborhoods have seen the highest concentration of foreclosures here in Illinois. "We saw someone getting put out on our way down here," activist Michelle Young of Austin reported at the rally. "This is about people losing their homes -- people who are moving out in the middle of the night because they're ashamed to say 'I'm having trouble with my mortgage.'" Watch:

While local officials continue to tout an infusion of federal money intended to mitigate the housing fallout, new foreclosures continue to pile up. In September alone, 13,000 additional homeowners received notices. And that's only adding to the stress in African-American communities. "It encourages the bad element," Godard tells us. "There's the drug dealers. And children who are walking alone could be snatched up in one of those abandoned buildings. We need a local response."

Renter's Bill Of Rights Takes Effect Today

Adam Doster — Thu, 29 Oct 2009 09:16:00 -0700

Over two years removed from the beginning of the subprime mortgage crisis, foreclosure filings continue to stack up. In Illinois alone, 13,000 homeowners received a foreclosure notice last month. Many of the households forced to leave don't even own the homes; the Woodstock Institute believes that 32 percent of 2008 residential foreclosure filings in Chicago were on properties with between two and six units. In other words, renters unfortunate enough to live in a building whose landlord can't make payments must scramble for a new place to live.

But starting today, those very renters will gain some legal protections thanks to the work of housing advocates in Illinois. That's because Public Act 96-0111, otherwise known as the Renter's Bill of Rights, is now in effect. Sponsored by Chicago Democratic State Rep. Will Burns and State Sen. Jaqueline Collins and signed by Gov. Pat Quinn this summer, the law guarantees that, should a new owner step in to run a foreclosed rental building, existing tenants must be informed within 21 days that management of the property has changed hands.Those notices must also include contact information for the new operator of the premises as well as a foreclosure case number, if necessary. And if the tenant is evicted, he or she will have at least 30 days to find a new residence.

The bill that eventually passed both chambers was not flawless. Stripped from it was a clause requiring new habitability standards for any foreclosed property, meaning landlords are not required to maintain an environment that’s “safe, healthful, and fit for occupancy." But it's a step in the right direction, specifically in a state that's trying to solve mounting budgetary and ethics problems.

Burnett's Affordable Housing Push: "This Is Just The Beginning"

Angela Caputo — Thu, 08 Oct 2009 13:00:44 -0700

With an Olympic development bonanza now out of the picture, there's been plenty of speculation over Mayor Daley's next move for boosting the city's sagging economy. Credit remains tight and the housing market is still deeply distressed. But there are tools sitting in the Daley woodshed that could help ameliorate this problem; As we've pointed out before, the mayor is sitting on a $1.3 billion tax increment financing (TIF) surplus that could go a long way toward rejuvenating crumbling neighborhoods. The question is what will it take to get the mayor to finally dip into his honey pot?

Today, the Sweet Home Chicago Coalition ratcheted up the pressure on the mayor to begin spending in the communities that need it most. "Instead of waiting on the federal government to send us a stimulus package, we need to start our own stimulus," Ald. Walter Burnett (27th Ward) told members of the coalition early this afternoon as they rallied outside of a series of TIF-funded projects that transformed vacant Humboldt Park lots into thriving (and affordable) apartment buildings. Burnett and colleague Ald. Manny Flores (1st Ward) are currently crafting an ordinance that would require the city to commit 20 percent of all TIF revenues toward affordable housing. Today, proponents of the plan built a symbolic yellow brick road paved with the TIF surpluses. Check out our slide show:

The new 20 percent benchmark would be a vast departure from the mayor's current priorities. While downtown corporations continue to pocket millions upon millions to lure white collar workers, a mere 4 percent of TIF revenue has been reinvested in truly affordable housing since 1995, according to an analysis by the Chicago Coalition for the Homeless (CCH). In doing so, CCH argues that the Daley administration has overlooked an intriguing statistic; for every 1,000 units of affordable housing built, 1,030 permanent jobs are created. And the projects would alleviate the affordable housing crisis that's pushing more working-poor families into homelessness.

"You all give me the strength to stand up to Mayor Daley and anyone who gets in our way," Burnett said today. "You inspire me ... This is just the beginning." We'll be following their next steps closely.

Rally Cap: Chicago Family Saved From Eviction

Adam Doster — Mon, 05 Oct 2009 15:11:25 -0700

"Rally Cap" is a new recurring feature at Progress Illinois in which we recap -- with photography or video -- progressive-oriented protests and political rallies held around the state.

The Set-Up:
For almost a year, Erica Bledsoe has been fighting to keep control of a subsidized Rogers Park apartment that belonged to her late mother, Rosetta Bledsoe, the legal guardian to three young grandchildren (ages 14, 11, and 9). Following Rosetta's death last September, Northpoint, the company that leases the residence, ordered Erica and her three nieces and nephews to vacate the premises (and risk homelessness). As justification, they cited the fact that her name did not appear on the lease.

After One Story Up blogger Megan Cottrell began reporting on their plight this summer, the Bledsoes witnessed an outpouring of community support, including the formation of a community group that gathered over 600 signatures of support for the family. They also received assistance from attorneys with the Legal Aid Foundation, who have argued that Erica's three nieces and nephews -- whose names do appear on the lease -- have the legal right to stay in the apartment and have Erica's name added to the document.

Today, supporters delivered a stack of signed postcards to HUD headquarters in downtown Chicago and also announced news that the Department of Housing and Urban Development is intervening in hopes of settling the case on the family's behalf in the coming days. This outcome, while still tentative, is a testament to the real-world influence of good reporting, publicly-subsidized legal aid, and smart organizing.

Quote of the day:
"I never thought so many people cared. But so many people showed support. I want to say thank you to the people in my community -- and outside my community. ... We can stick together." - Erica Bledsoe

Multimedia:

Erica Bledsoe discusses her relief that HUD has intervened:

Organizer Frank Edwards talks about the neighborhood effort to keep the Bledsoe family in their apartment:

Rally location:
Federal Plaza, Chicago

Participants:
Erica Bledsoe
Committee To Support The Bledsoe Family
One Story Up

Background reading:
One Story Up: Federally-funded Company Evicting Orphans
One Story Up: Orphans Facing Homelessness, Community Trying To Intervene
Committee To Support The Bledsoe Family: Letter To Public Officials
Progress Illinois: Legal Aid Safety Net Stretched Thin

Durbin, Colleagues Push New Housing Bill

Adam Doster — Thu, 01 Oct 2009 10:08:09 -0700

The Obama administration's Making Home Affordable loan modification program has stumbled out of the gate. Through July, only 160,000 homes went into trial modifications, according to the Government Accountability Office. (The Obama administration pegged the number a bit higher at 235,250, but the number of successful modifications is undoubtedly lower than that.) Meanwhile, foreclosures keep stacking up. In Illinois alone, 13,000 homeowners received a foreclosure notice last month. And the economic devastation is focused in communities least able to recover. A new paper by the Woodstock Institute found that vacant, lender-owned properties "are concentrated in African American communities, go unsold longer, and incur greater losses to the lender." Clearly, more action is required to protect vulnerable homeowners and the communities in which they live.

Enter Sen. Dick Durbin and three of his Senate colleagues. Yesterday, they introduced a bill titled the "Preserving Homes and Communities Act of 2009" that would expand federal loan-modification programs to more borrowers and crack down on lenders eager to foreclose on delinquent homeowners. Bloomberg has more:

The legislation, introduced today by Senator Jack Reed of Rhode Island, would require lenders to evaluate all borrowers for affordable loan modifications before initiating foreclosure. It would also require banks to offer and approve a loan modification if the restructured mortgage returns more money, the so-called net-present value, to investors than would foreclosure.

The proposal would establish new penalties and would let borrowers overturn foreclosures if lenders fail to comply. It would also place new limits on fees charged in foreclosure.

The senators plan also includes provisions to provide more people with access to affordable housing. An additional $6.3 billion in federal funds would be available to states offering homeowners grants or subsidized loans. Another $1 billion would be spent on building or rehabilitating affordable housing stock.

Unfortunately, Durbin's mortgage modification idea has been placed on the back burner, meaning the problem of negative equity still has not been addressed by the White House or Congress. Even so, the banking lobby has come out with guns blazing, identifying a number of measures they consider non-starters.

Durbin isn't backing down, telling reporters yesterday that "it’s long past time for the Senate to step up to keep families in their homes and to help lead the way toward economic recovery.”

Closer to home, hundreds of Chicago residents affiliated with National People’s Action will meet with officials from the Federal Reserve and the Federal Reserve Bank of Chicago on the Southwest Side to discuss solutions to the foreclosure crisis ripping through the city. Here's what they will likely propose, according to a press release:

A number of local and federal solutions will be proposed at the meeting to help keep families in their homes. Residents will ask Aldermen to support a city ordinance to help provide resources to prevent foreclosures. The ordinance includes directing 50% of the fees and fines collected under the Vacant Property Ordinance to foreclosure counseling and outreach and mediation.

On the federal level, Federal Reserve officials will be asked to ensure that lending and the banking system are fair, transparent and accountable to the American people. Federal Reserve officials will also be asked to convene the top five foreclosing banks in Chicago (in no particular order: US Bank, Wells Fargo, JP Morgan Chase, Bank of America and Deutsche Bank) to create solutions that work for families and keep people in their homes.

Image used under a Creative Commons license by Flickr user jbrownell.

Durbin Calls Veteran Homelessness "A National Disgrace"

Angela Caputo — Thu, 24 Sep 2009 11:50:03 -0700

Calling it "a national disgrace" that veterans still constitute such a large share of Illinois' homeless population, Sen. Dick Durbin and members of the state's congressional delegation met with Veterans Affairs Assistant Secretary Tammy Duckworth yesterday to come up with a plan to address this issue. Last year alone, veterans filled an estimated 18,000 shelter beds in the Chicago area. After meeting with Reps. Bill Foster, Debbie Halvorson, Mike Quigley, and Dan Lipinski, Durbin noted that it's going to require some creative thinking to stretch federal resources and begin solving the problem. The AP reports:

"A possibility might be to turn foreclosed homes into opportunities for training and employment for veterans — maybe even ultimately a residence that they can live in," said Sen. Dick Durbin, the delegation's chairman and the Senate's second-highest ranking Democrat.

"Some homeless veterans are struggling with addictive issues and issues of mental illness, and they need counseling, and that has to be part of it."

Encouragingly, the Obama administration increased spending on homeless veterans programs by $3.2 billion this year. A majority of the funding ($2.7 billion) will be used to fill gaps in medical care and counseling services across the nation. The remaining $500 million is earmarked specifically for homelessness initiatives. Because Illinois and the Chicago area in particular have been struggling with an affordable housing crisis for years, the state's share of the funding will only go so far. To mitigate the impact on veterans, Durbin is co-sponsoring the Zero Tolerance for Veterans Homelessness Act (S. 1547), which would extend 30,000 federal housing vouchers to veterans in 2010 and phase in up to 60,000 vouchers by 2013.