This statistic captures why the foreclosure issue transcends any sort of moral judgement about people “just not paying their mortgages.” Home vacancies are at an all time record high in the U.S. right now [18.6 million empty homes, 3% of the housing stock].
If you see all the folks on the street without a home, that’s enough to make empty homes a tragedy. It’s not just the homeless, though.
Does your rent or mortgage pinch you a little financially? How do you think people with less money feel? Yet, we’ve got almost 20 million homes sitting empty.
In Philadelphia, it’s even worse, because we have a lot of neighborhoods that are already about half condemned. Every time another house ends up standing vacant, that’s another house that’s likely to decay to the point of condemnation.
That’s why THE DAILY NEWS is saying it is so great that Philadelphia has innovated a better way to connect homeowners with lenders desperate to keep mortgages in the black.

Lenders aren’t helping people that have fallen behind on their mortgages quickly enough. That’s the conclusion of a new report by the State Foreclosure Prevention Working Group, a coalition of banking regulators atnd attorneys general from 11 different states.

From the Wall Street Journal:

The study, compiled by the State Foreclosure
Prevention Working Group, made up of banking regulators and attorneys
general in 11 states, found that seven out of 10 borrowers who are
seriously delinquent on their mortgages aren’t on track to receive any
kind of help with their payment problems.

…

“While there’s been a lot of effort put in by mortgage
servicers and government officials, there has been little change in
outcomes for homeowners,” said Mark Pearce, deputy banking commissioner
for North Carolina.

A reporter for Bloomberg News reported a New York official who suggested automatically giving loan modifications to whole swaths of borrowers that fell into certain groups:

New York State Banking Superintendent Richard Neiman
recommended widespread “automated” loan modifications that would group
delinquent borrowers together based on their payment histories, credit
scores or the amount they owe as a percentage of their home’s value.
Those criteria could then be used to offer uniform loan modification
terms to entire groups, he said.



“We’re still way behind,” Miller said. “It’s going to be pretty impossible to do these on a one-to-one basis.”

Judge Darnell Jones anounced an innovative plan to stem foreclosures in Philadelphia Wednesday. Philadelphia homeowners will have a chance to modify the terms of sub-prime and predatory loans so that they can again afford the payments. It’s a modification, not a re-finance, which means that they don’t have to reapply or accrue new settlement fees. The lender simply agrees to lower the interest rates and change the terms on the existing mortgage.

The deal only applies to owner-occuppied residences. It also only applies if the owner-occupant takes advantage of the court-mandated opportunity to meet with attorneys for their lender within 45 days of the foreclosure filing. If they don’t, foreclosure will proceed like it always does.

In Harold Brubaker’s story on the deal in yesterday’s Business Section of the Inquirer, Tobi Walker of the Pew Charitable Trusts said, “This is one of the more innovative approaches we’ve seen.”

The situation for lenders has been bad enough that they have been willing to pursue modifications with homeowners, but the process has been so cumbersome that many homeowners have still lost their homes because the foreclosure moved faster than lenders’ workout staff could get through the volume of cases. Philadelphia advocates had a key insight: we have a large workforce of housing counselors available and willing to manage the lion’s share of the modification process, if only the lenders would agree to give them that authority. Now, the court is requiring it.

Common Please Court has made this happen procedurally. It now simply requires lenders to give homeowners the opportunity to modify loans before permitting a foreclosure to go forward in court. There’s no case or decision to look up. The court has simply changed the way it conducts the business of foreclosure.

Hopefully, other municipalities will look to Philadelphia’s example and emulate it. While national organizations are cutting deals with big lenders and praising the Hope Now Coalition’s voluntary policies, Philadelphia’s organizations have taken the initiative to force lenders to exercise good sense at last. began calling Philadelphians holding mortgages through Countrywide. We invited them to meet as a group with our housing counselors, discuss their options as individuals and ask them to join with us as a group to press for a better deal through our Foreclosure Crisis Committee. Then, in December, the Save Our Homes Coalition convened in the PUP offices.

From the Philadelphia Unemployment Project

An Open Letter

April 10, 2008

Dear Senator Clinton and Senator Obama:

Healthcare has been central to each of your campaigns. As you work here in advance of the April 22nd primary, we wanted to alert you that healthcare is the number one opportunity we have to improve the lives of working Pennsylvanians right now. We, the undersigned, believe your campaigns could advance the cause of Pennsylvania’s reforms, should you choose to make them an issue.

Early last year, Governor Rendell unveiled an ambitious package of reforms known as The Prescription for Pennsylvania (Rx4PA, www.rxforpa.com). Rx4PA would expand access to health insurance with a high quality healthcare plan. With revisions from the House Democrats, that plan is now known as “Access to Basic Care,” and it passed the House this month in Senate Bill 1137.

Rx4PA would also rein in the forces that have driven up the price of insurance in the small group market, reward employers already providing coverage and insure that no one with a pre-existing condition is denied coverage.These also passed the House of Representatives in House Bill 2098 and House Bill 2005.

If these reforms succeed in the Commonwealth, it will make the arguments for either of your national plans much stronger. Rx4PA’s success should also galvanize your allies in Washington while chastening your opponents. In this way, the states really are the proving ground for great changes that Washington can adopt later. It will take state action first to begin changing the way that healthcare gets paid for.

In the national debate and in Pennsylvania, some argue that market forces can fix healthcare. “Consumer Driven Plans” are getting pitched here, too, though everyone reasonable knows it has been lax oversight in the insurance market that has allowed the industry to make coverage unaffordable. We must defeat the argument for a pure market solution soundly.

The undersigned ask that you help us get another 200,000 Pennsylvanians covered. Your campaigns could each focus a great deal of attention on these reforms. That’s why we are looking to you now. Help us pass The Prescription for Pennsylvania.

John Dodds, Philadelphia Unemployment Project
Rev. Robert Coombe, Yardley United Methodist Church
Rev. Randy Barge, Calvin Presbyterian Church
Joe Hoeffel, Montgomery County Commissioner
Lance Haver, Director of Consumer Affairs, City of Philadelphia
Campaign for Working Families
National Physicians Alliance
Coalition of Labor Union Women
Greater Philadelphia Coalition Against Hunger
David Hodo- Norristown Councilman at large, President George Washington Carver Community Center
Jewish Labor Council
Linda Christian, Norristown Councilwoman 2nd District
William Caldwell, Norristown Councilman 3rd District
Olivia Brady, Norristown Community Activist
National Nursing Centers Consortium
Pathways PA
The PFT Local#3 Retirement Chapter
Pennsylvania ACORN
Pennsylvania Democracy for America

We are optimistic that Health Centers in Philadelphia will receive greater funding. A strong contingent of PUP members turned out for the Health Department buget hearing, and Mayor Nutter has already submitted a budget with significantly better funding for the next fiscal year.

Ben Waxman wrote about the issue in the Daily News, and cited PUP’s work on the issue:

The system is far from perfect. According to a report released by the
Philadelphia Unemployment Project last year, it can take up to five
months to schedule an appointment with a doctor at a health center.
Advocates say the centers need to extend evening hours and add staff to
shorten waiting times. The mayor’s proposed funding increase is
supposed to deal with some of these issues.

ABC-6 video report on Hope Now Alliance event in University City on April Fool’s Day.

Action News reporter Nydia Han covered the Foreclosure Crisis Committees informational picket at the Hope Now Alliance meeting and info session in Philadelphia yesterday. As Han reports, no homeowners left the meeting with modified loans.

PUP Director John Dodds appears toward the end of the segment calling for an extended foreclosure moratorium so that homeowners can get deals worked out.

From Han’s report:

The HopeNow Alliance has been trumpeted by the Bush administration as
an aggressive measure to alleviate the foreclosure crisis. But
protesters outside the HopeNow event said the program offers a lot of
false hope and indeed lenders that have agreed to help homeowners
through the program do so only on a voluntary basis. Action News, could
not find any consumers today who actually walked away with modified
loans or concrete answers.

You can see the video if you click the link at the top of this post.

Also, the issue received thorough coverage in the New York Times. Including photos of PUP’s Foreclosure Crisis Committee demonstrating in our informational picket.

UPDATE: PUP is also cited by CBS3 as a source for help getting through the housing crunch.

Technorati Tags: Hope Now, Foreclosure, PUP, Philadelphia

Tuesday April 1, 2008 2 PM
University of Pennsylvania
Houston Hall, 3417 Spruce St.

The Philadelphia Unemployment Project’s Foreclosure Crisis Committee will hold an informational picket outside Houston Hall of the University of Pennsylvania on Tuesday April 1 at 2 PM where the Hope Now Alliance is holding a Homeownership Preservation Forum.

The picket is to call attention to the need for a more substantial response to subprime foreclosures than the heavily promoted Hope Now program provides. “With sub prime loans increasing dramatically in Philadelphia in the past three years from 20% in 2004 to 37% in 2006 we need more than a public relations road show to protect families and neighborhoods from this crisis, said John Dodds, Director of the Philadelphia Unemployment Project. “We hope that some families get relief and have our own housing counselors helping out, but this is not going to be enough to protect families in this city.”

Hope Now Alliance Hotline has gained a reputation for causing frustration and minimal help to large numbers of homeowners trying to use their services. The Alliance is heavily dominated by the mortgage industry.

“They didn’t even reach out for local housing counselors until this Tuesday for a large scale event a week away”, said Pam Kennebrew a housing counselor for the Unemployment Information Center. “The phone number for the flyer they sent to local homeowners had a bad phone number to call to get information on the Homeownership Forum. A woman in Las Vegas was getting the calls.”

The Bush Administration has repeatedly pointed to the HOPE Now Hotline as their answer to the foreclosure crisis while opposing bills to allow judges to modify unaffordable sub prime loans and to allow HUD to purchase and modify sub prime loans.

MSNBC reported that a recent story on the HOPE Now Hotline generated hundreds of emails from homeowners, the vast majority of whom were critical of the Hotline.

PUP is calling for a system to use city funded housing counseling agencies to do tentative loan modifications agreements for distressed homeowners and forward the information to mortgage servicers to approve the modifications. Many city neighborhoods had between 40% and 50% of all loans made in 2005 fall into the sub prime category. The numbers are even higher in 2006. Until the system is in effect PUP is calling for a moratorium on Sheriff Sales.

Pa. House passes health-insurance bill, coverage in the Philadelphia Inquirer yesterday.

HARRISBURG - A bill aimed at providing health coverage to about 270,000 uninsured Pennsylvanians passed the state House of Representatives yesterday but faces long odds in the Senate.

The 118-81 vote would establish the Pennsylvania Access to Basic Care program, covering legal U.S. residents ages 19 to 64 who meet income guidelines and who have gone six months without insurance.

The bill (SB 1137) sponsored by House Democrats also provides help for smaller low-wage employers to offer workers health insurance.

“It’s time to stop kicking the can down the road,” said Rep. Karen Beyer of Lehigh County, who was among the Republicans who crossed party lines to vote for the measure. “We know that the lack of health care, those folks who are uninsured in the state of Pennsylvania, are an incredible drain on our economy.”

More in the link above. It’s important to keep in mind that the way this bill is set up, we can expand coverage without a legislative fight. If the Center for Medicare and Medicaid Services is willing to grant us a waiver on the patients it provides matching funds for, the state can just expand the number of people it offers Access to Basic Care.

Two editorials today in both of our city’s main dailies highlight the hope for Final passage of much needed coverage for the Uninsured.

Editorial: Covering the Uninsured, The Inquirer

A SICK PLAN, The Daily News

Both papers say that the House should approve “Access to Basic Care” in S.B. 1137.

Up for first consideration in the House today, as well, is HB 2005, which reforms the market for insurance purchasers for small groups of people — the small and medium sized business. This legislation would make it impossible to deny coverage to individuals because they have a health problem (the “pre-existing condition”). In other words, sick people will still be able to buy coverage.

Insurers won’t be able to jack up people’s rates based on their medical history, and the cost of covering someone will be based only on their age and the average cost of covering a person in that area or community, modified by the individual’s age. HB 2005 will also lower costs. When the uninsured get covered and when hospitals quit making so many mistakes, insurers won’t have to pay out as much money for medical bills anymore. Under HB 2005, the state can make sure that insurers can’t keep the difference. Instead, they’ll have to lower premiums, making insurance less expensive for individuals and easier for employers to provide.

Even as this goes up, the House is debating an amendment that would expand health insurance coverage, at no or very low cost, to at least 200,000 uninsured people. Now is the time to call your State Representative and let them know you want to get this bill passed.
Pennsylvania has a health care crisis for patients as well as doctors. We have a chance right now to make a difference in this crisis if you call your State House member right now. I mean NOW.