ACORN to meet with Federal Reserve chair today on predatory lending
by mrickard, Wed Jun 20, 2007 at 09:43:56 AM EDT
ACORN members called on Federal Reserve Chairman Ben Bernanke to ban predatory lending practices, and held press conferences and rallies two weeks ago in more than a dozen U.S. cities. Federal Reserve Chairman Ben Bernanke quickly agreed to meet with ACORN representatives today to discuss regulating the lending industry to help forestall the torrent of home foreclosures.
The Federal Reserve Board has the authority to address mortgage problems, but had not done so, while an estimated 2.2 million U.S. home loans are predicted to foreclose as a result of subprime lending during the past decade.
ACORN today released a home foreclosure study, highlighting more than 110 U.S. cities and counties with the highest foreclosure rates. The information was collected from RealtyTrac and compiled by ACORN's Financial Justice Center.
In 2006, 1.2 million foreclosures were filed - on average two per minute. Nevada has the highest number of foreclosures in the country - 21,045 in 2006. Atlanta's Intown neighborhood had 331 filings as of April. Communities in Chicago, Cleveland and two other Atlanta neighborhoods were close behind.
To force attention to the foreclosure crisis, ACORN chapters held press conferences and rallies in Baltimore, Chicago, Dallas, Denver, Detroit, Houston, Little Rock, Los Angeles, Minneapolis, New York, Oklahoma City Pittsburgh, San Francisco, Washington D.C. and other cities.
"We appreciate Chairman Bernanke's quick response to the letter our members delivered to the Fed in events around the country yesterday," ACORN National President Maude Hurd said. "If the Fed acts strongly and soon to against predatory lending, many families' homes and financial futures could be saved," Hurd said.
Dallas ACORN members Gloria Ramirez and Erika Feist testified about their predatory loan experiences at a press conference held at the Dallas Federal Reserve. The event was attended by 25 members and covered by public radio and four TV stations. An organizer and two members were later invited to meet with the bank's vice president and community relations officer who agreed to pass along their list of demands and letter to Chairman Bernanke.
At Philadelphia's press conference, ACORN leader Cheryl Harvey talked about how she had been tricked into a high-interest home improvement loan that included thousands in kickbacks to brokers and contractors.
The Oklahoma City protest, which was reported by The Oklahoman, noted that more than 8,000 homes in that state's capital were in foreclosure last year.
Until now, Chairman Bernanke had said the Fed's responsibility was only to provide the proper disclosures. The regulating agency even named a representative from one of the worst predatory lenders, New Century, to serve on its advisory council.
ACORN has prepared a list of demands, including:
► Prohibiting lenders from making loans that become unaffordable with rate increases;
► Stopping the misuse and abuse of stated income loans;
► Reducing or eliminating prepayment penalties on subprime loans;
► Holding lenders responsible for the actions of brokers;
► Requiring subprime lenders to escrow for taxes and insurance