Despite signs of a recovering economy, many homeowners are still struggling to avoid the foreclosure of their homes. NorthStarNews.com’s home state of New Jersey, and Essex County in particular, has been particularly hit hard by the foreclosure crisis and Black and Latino families disproportionately impacted. It is why NorthStarNews.com is joining community leaders to convene a public hearing for Community Voices on the Mortgage Foreclosure Crisis on December 14 at 5:30 pm in Smith Hall on the campus of Essex County College, 303 University Avenue in Newark New Jersey (Directions to the campus). The public is invited to share their experiences and to engage in a discussion on how to hold financial institutions accountable. The focus will be on questionable practices by banks and the steps the community needs to take to combat the foreclosure crisis. Several of the area’s banks have been invited to participate, as well as local elected officials. Newark Mayor Ras Baraka and City Council President Mildred Crump have confirmed their attendance as has Orange Mayor Dwayne Warren.
“We decided to join this effort because it is clear so many families are being affected,” noted NorthStarNews.com Executive Editor Walter Fields, who once served as the political director of the New Jersey NAACP. Fields explained, “So many people who are in foreclosure have been cast as irresponsible when that is so far from the truth. These are people who have been responsible homeowners but were impacted by the recession and never recovered. They dutifully paid their mortgages and taxes for years but were hit hard by the economic downturn. We have to end the public shaming and find ways to keep families in their homes by encouraging financial institutions to respond to those in need of help in a more humane way.”
The foreclosure crisis has been particularly onerous in New Jersey and Essex County. The state with a foreclosure rate of 1 in every 563 properties rates second in the nation behind Delaware in terms of foreclosure rates. The states with the highest rates of foreclosure are Delaware, New Jersey, Maryland, Illinois and South Carolina. The top counties for foreclosure in the state are Atlantic County, Salem County, Camden County, Sussex County and Gloucester County. In Essex County, where a majority of the African-American population resides in the northern corner of the state, the rate is 1 in every 679 properties with some municipalities (Irvington, 1 in every 376; East Orange, 1 in every 522; West Orange, 1 in every 527; and Newark, 1 in every 670) particularly hard hit. (Source: RealtyTrac)
Last week in Irvington New Jersey a not-for-profit organization, Boston Community Capital, hosted a workshop with the support of Mayor Tony Vauss to help local residents who were entangled in a home foreclosure proceeding. The organization has been working with the Essex County Board of Chosen Freeholders, the governing elected council of the county, to assist homeowners that have been affected by the foreclosure crisis. Jessica Brooks, the organization’s Senior Vice President of Development and Communications, spoke to NorthStarNews.com prior to the workshop. She stressed that homeowners who are facing foreclosure “need to understand what they can afford to pay and the foreclosure process, and work with a housing counselor.” Unlike some states, the foreclosure process in New Jersey can take years and homeowners should take advantage of every available resource to maintain ownership of their homes.
Ms. Brooks noted that Boston Community Capital has intervened on behalf of 750 homeowners across the country and in its early work in New Jersey has assisted a dozen homeowners. The organization has been successful in reducing mortgages by as much as 35 percent with new mortgages set at the current value of a house. Boston Community Capital receives no government funding and relies on foundation and individual donor support for its programs.
One of the challenges facing homeowners in foreclosure is the shame and humiliation that accompanies the trauma of losing one’s home. Ms. Brooks observed, “Banks often paint the picture of the ‘irresponsible’ homeowner but the truth is that many people got into the market at the wrong time and have been victims of predatory lending. These are generally very responsible people.” She added, “Foreclosures have a ripple effect on other houses on the block and the entire neighborhood. It threatens home values and the equity of all homes. If we can prevent someone from losing their home, it makes a big impact.”
Also last week, the National Fair Housing Alliance and 20 allied organizations filed a federal civil rights lawsuit against mortgage lender Fannie Mae alleging the company does not maintain its foreclosed properties in African-American and Latino middle class neighborhoods in urban communities as opposed to middle class white neighborhoods. The lawsuit suggests that by allowing these properties to be in disrepair in communities of color, Fannie Mae is contributing to the deterioration and destabilization of these neighborhoods.
An owner occupied residence in a Black middle class New Orleans neighborhood (National Fair Housing Alliance)
A Fannie Mae property next to the residence in the picture above (National Fair Housing Alliance)
Another Fannie Mae property in the same neighborhood as above (National Fair Housing Alliance)
Longtime NAACP activist James E. Harris notes, “This is truly a civil rights issue but more importantly, a human rights issue. While many homeowners have been affected by this foreclosure crunch, African-American homeowners have been disproportionately affected. We need a targeted strategy to help keep Black families in their homes.”
Fredrica Bey of Women in Support of the Million Man March (WISOMMM, Inc.) added, “We must also make certain that financial institutions operate within the law and homeowners, as consumers, are protected. We have developed a set of guidelines that we believe all financial institutions should follow and we demand our elected officials will help hold these institutions accountable to our community and individual homeowners.”
One of the most important considerations in the mortgage foreclosure crisis is the impact on children. When children do not have the security of stable shelter, it affects their physical well-being as well as their ability to perform at optimal levels in school. The loss of a home is traumatizing for adults and no less so for children. By keeping families in their homes, as a society we support the welfare of children and stabilize neighborhoods by keeping properties occupied and well maintained.
Citizens will be given 5 minutes each to share their experiences with foreclosure or their interaction with financial institutions. Following the “public speaks” portion of the event, a discussion will be engaged around the responsibility of financial institutions to the larger community and individuals in financial distress.
NorthStarNews.com Executive Editor Fields reminded, “Anyone can find themselves in the unfortunate predicament of a home foreclosure. Fortunately for some, they have the resources to weather such an event. That is not the case for most people and particularly not in working class communities of color. Our aim is to make sure the American dream of homeownership is not derailed by economic circumstances beyond the control of the homeowner.”