PHILADELPHIA, March 31, 2008 /PRNewswire-USNewswire via COMTEX/ -- 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.

Philadelphia Neighborhoods with High Concentrations of Subprime Loans

Neighborhood	Number of Loans:	Number of Subprime Loans:	% of Subprime Loans:
Allegheny West	210	87	41.4%
Cedarbrook/Stenton	1447	634	43.8%
Eastwick	599	274	45.7 %
Fairhill	73	35	47.9 %
Frankford	1034	449	43.4 %
Germantown	531	201	37.9%
E. Germantown	530	277	52.3%
Gray's Ferry	105	39	37.1%
Hunting Park	143	73	51%
Kingsessing	311	169	54.3%
Lawncrest	1581	570	36.1%
Logan/Ogontz/Fern Rock	854	446	52.2%
Mantua	149	53	35.6%
North Philadelphia/West	488	188	38.5%
Oak Lane/East Oak Lane	618	240	38.8%
Olney	983	433	44%
Overbrook	1255	574	45.7%
Point Breeze	416	171	41.1%
Southwest Philadelphia	605	303	50.1%
Tacony/Wissinoming	1636	589	36%
Tioga/Nicetown	210	99	47.1%
West Oak Lane	667	358	53.7%
West Philadelphia/Cobbs Creek	791	375	47.4%
West Philadelphia/Parkside	738	389	52.7%
Wynnefield	442	176	39.8%

Source: Philadelphia Inquirer analysis of Home Mortgage Disclosure Act data.

Developing a System to Head Off Wide Spread Subprime Mortgage Foreclosures in Philadelphia

We need an agreement from lenders holding subprime loans to do loan modifications at a scale sufficient to head off large-scale foreclosures for Philadelphia homeowners and neighborhoods. With the volume of subprime loans on the books in this city, we believe that lenders and servicers will need help to prevent these foreclosures and the accompanying losses they will cause.

• We ask that servicers agree to use the city of Philadelphia's extensive network of housing counseling agencies to do work outs for Philadelphia homeowners.
• These agencies would put together sufficient information to determine what a workable modification or other work out would be to resolve a delinquent mortgage without loss of the home. This would allow servicers to handle the volume of resets and defaults coming out of the subprime mortgage crisis which hurts lenders, borrowers and communities.
• We would agree on a standard format to forward information to servicers from homeowners and servicers would agree to offer affordable workouts as computed by the counseling agencies.
• Counseling agency staffs would be trained to implement the system.
• We would have to work out agreeable criteria for affordable workouts and servicers could spot check forms submitted to check for improper submissions from the counseling agencies.
• Foreclosure actions would stop while work outs are in process
• Until such an agreement can be negotiated the city should institute a moratorium on Sheriff's Sales to protect homeowners and property values in our neighborhoods.

Without this public private partnership we think that large numbers of homes will be lost to foreclosure devastating families and leading to large scale abandonment of properties in many Philadelphia neighborhoods, to say nothing of losses to lenders and investors. Servicers will not be able to keep up with the numbers of loan modifications and workouts needed in the next few years in Philadelphia.

Philadelphia Foreclosure Crisis Committee Philadelphia Unemployment Project ACORN Community Legal Services Philadelphia Legal Assistance

SOURCE Philadelphia Unemployment Project

http://www.philaup.org