HARTFORD –The Northside Institutions Neighborhood Alliance has scheduled a tour of two renovated town homes in the Asylum Hill neighborhood during an open house this weekend.
The tour is slated for Oct. 16 and 17 from 1:00 p.m. to 4:00 p.m. and is set to begin at 87-89 Atwood St. It will include Victorian era homes on Sargeant Street.
The event is sponsored by NINA, and other community organizations. Ken Johnson, executive director of NINA, oversaw the meticulous restoration of the homes, which are all for sale.
The homes are located in Asylum Hill and are within walking distance from work, restaurants, theaters, nightclubs and beautiful parks, organizers said. This Old House magazine named Asylum Hill in Hartford “one of the best places in the U.S. to buy an historic house… home to a diverse mix of singles and couples, many of them first-time buyers, as well as empty-nesters looking for an urban lifestyle.”
“People are often surprised at how spacious and affordable the homes are,” Johnson said.
NINA has been revitalizing Asylum Hill since 2003. Formed by six major Hartford institutions to improve the Asylum Hill neighborhood, NINA engages residents, addresses quality of life issues and develops home ownership opportunities to make Asylum Hill a desirable place to live, work and play.
The Associated Press is reporting that the foreclosure crisis is near. That’s because, the report says, for the first time in almost three years, the number of homeowners falling behind on their loans is declining.
WASHINGTON — The end of the foreclosure crisis is finally in sight. For the first time in almost three years, the number of homeowners falling behind on their loans is declining. The drop means the number of people losing their homes will start to fall.
But some pain from the crisis is sure to persist. Because millions of people are already in foreclosure, deeply discounted houses will put pressure on home prices for years. “Housing is on a path to recovery,” said Mike Larson, a real estate analyst with Weiss Research.
“It’s going to be a very long, gradual process.” In high-foreclosure cities like Las Vegas, Phoenix and Miami, homes have lost roughly half their values from their peaks. But a report Friday from the Mortgage Bankers Association showed Nevada, Arizona and Florida had some of the biggest declines in new delinquencies.
The figures probably mark “the beginning of the end” of the crisis, said Jay Brinkmann, the trade group’s chief economist. However, more than 15 percent of homeowners with a mortgage have missed at least one payment or are in foreclosure, a record. Worse, nearly half of all delinquent borrowers were at least three months behind on their payments, up from a typical level of less than 20 percent.
“The bad news is that we still have a big problem,” Brinkmann said. “The good news is it looks like it may not get much bigger.” That’s because the percentage of borrowers who missed just one payment on their home loans fell to 3.6 percent in the October-to-December quarter from 3.8 percent in the third quarter, according to the Mortgage Bankers Association.
That decline was even more surprising because delinquencies usually rise at that time of year due to higher heating bills and holiday spending. In another encouraging sign, the number of borrowers who had missed at least one payment but were not yet in foreclosure also fell for the first time since the beginning of 2007.
Banks are delaying the foreclosure process, traditionally between four and six months, as they evaluate borrowers for help under the Obama administration’s $75 billion mortgage-relief effort. It lowers borrowers payments to as low as 2 percent for five years and extends loan terms to as long as 40 years.
But experts warn that hundreds of thousands of borrowers will not be eligible or will not complete the process. So far, only 116,300 borrowers out of 1 million who enrolled have had the terms of their mortgages changed permanently.
Despite the government’s efforts, there may be 6 million foreclosed homes that are put on the market over the next three years, according to Barclays Capital. Timing is key. If banks unload them suddenly, “it will be much more detrimental to the housing recovery than if it’s a slow, gradual bleed,” said Michelle Meyer, a Barclays economist.
On Friday, Obama announced that housing agencies in the five hardest-hit states of Arizona, California, Florida, Michigan and Nevada will receive $1.5 billion in financial rescue money. It will go to local programs to help unemployed homeowners, “under water” borrowers who owe more than their home is worth, or to give lenders incentives to assist borrowers with second mortgages.
The programs will need to be approved by the Treasury Department. “Government alone can’t solve this problem,” Obama said. “But government can make a difference.” In a briefing with reporters, administration officials acknowledged that the effort was just a small one. But they said it could help develop broader national solutions. “What we’re trying to do here is foster innovation,” said Herbert Allison, an assistant Treasury secretary.
Associated Press Writer Ben Feller in Las Vegas contributed to this report.
HARTFORD – Connecticut residents fleeced by one of the top ten sub-prime lender will receive more than $3,000 each for being a victim of the company’s abusive lending practices.
Attorney Richard Blumenthal at press conference today announced that Countrywide Financial Corporation on Friday mailed payments to 370 Connecticut residents. Each resident will get up to $3,452.54, Blumenthal said.
The payments are part of an $8.4 billion, nation-wide settlement with Countrywide. Connecticut’s slice of that $113 million agreement is $1.27 million.
Countrywide is one of the top ten subprime lenders that contributed to the housing crisis, which led to millions of foreclosures, helping to sink the economy deeper into an already recession.
And in the meantime, they crushed dreams of many.
” Countrywide turned the American dream of homeownership into a nightmare for thousands of home buyers and families,” Blumenthal said.
Another lender accused of doing just that was Wells Fargo. This lawsuit accuses the bank of unfair and misleading lending practices to minority communities and what’s often known as “reverse red-lining.”
In January of 2008, the city of Baltimore sued Wells Fargo for a range of deceptive practices to push high-interest, subprime loans onto African Americans in Baltimore and in Maryland suburbs, leading hundreds into foreclosure. In July, the Illinois Attorney General Lisa Madigan sued Wells Fargo for having, quote, “transformed our cities into ground zero for subprime lending.” DemocracyNow highlighted this story last August.
In August 2008 Blumenthal was among several state attorneys general to file suit against Countrywide, claiming that the loan company used “oppressive, unethical, immoral and unscrupulous” practices.
In October 2008 Bank of America, which bought Countrywide, settled in June 2009, Blumenthal said.
The money sent out went to consumers who have mortgages that have been foreclosed, or is in serious default. And the first mortgage payments must have been due between Jan. 1, 2004 and Dec. 31, 2007.
Other aspects of the settlement include loan modifications and another type of restiution, Blumenthal said. He warns that some people who receive payments, however, may still end up losing their house.
Editor’s Note: This story, which originally appeared in El Diaro/La Prensa, was produced as part of NAM’s Stimulus Watch coverage and was funded with a grant from the Open Society Institute. It is part two of a three-part series. You can read part one here.
Maria Jacome stands in front of her home
which was saved from foreclosure. Ph: Eva SanchisNew York – Maria Jacome, an Ecuadorian migrant, attributes the rescue of her home at 890 Bushwick Avenue to the president and the Virgin.
“I am blessed by God and President Obama because without their help I would have been unable to get out of this situation,” says Jacome, who was about to lose the house where her family has lived since 1985, when she could not meet the payments last year.
Jacome, 68, prayed for months to the Virgin for help. Her prayers were answered in March with a miracle, when President Barack Obama announced a $75 billion plan for banks to ease the mortgages of up to four million homeowners in distress.
“When I heard the news that Mr. Obama was going to help homeowners, I thought to myself: This is my chance!” Jacome recalls.
However, she suddenly ran into another obstacle: a broker she knew called her and offered to help with the application process in exchange for $4,500. Another person, who works for a lender in Bushwick, made her a similar offer.
“If I didn’t have $2,800 to pay the mortgage, where would I find $5,000?” says Jacome, who was fortunate to find a housing counselor who helped her modify her mortgage free of charge.
There are dozens of legitimate counselors in the city that do this process for free, and it is usually the homeowners who pay for this kind of help who end up as victims of fraud, according to experts.
“Companies that offer to modify mortgages and ask for large sums of money in advance are rarely legitimate: they usually do nothing for the people from whom they take money,” says Mike Mastman, a housing counselor of Grow Brooklyn, a Bushwick-based non-profit affiliated to the Brooklyn Cooperative.
Scam artists proliferate in Bushwick
stealing the wealth of the community. Ph: Eva Sanchis.In this Brooklyn neighborhood, where foreclosures became an epidemic, opportunists are making a killing. Many offer them help from President Obama’s mortgage rescue plans in exchange for thousands of dollars, and vanish once they receive the money.
“The scammers are saying we’re legitimate, we’ll help you apply for the modification program, the ‘Obama Plan,’ and they use all the catchy phrases that are caught on through the news, and people trust them, because they trust the federal government,” says Mastman.
Eduardo Torres, a housing counselor from Flatbush Development Corporation, says that several of his clients have paid $7,500 in these “modification” scams.
“The government information is there, but they use the same government language, the same words, to confuse people,” says housing counselor Tadelloj Johnson, from the Center for NYC Neighborhoods (CNYCN), which coordinates and supports the efforts of more than 20 city non-profits that offer homeowners free advice. “They act as though they represent the federal government and even include logos from federal government agencies in their brochures.”
Among those who fell victims to these practices is the Ortiz family, Jacome’s neighbors.
Last May, when they were two months behind in their mortgage payments, the Ortiz received a letter from the so-called Alliance Mortgage Modification Agency. It stated that it was a “foreclosure stimulus update” and offered help to modify their mortgage in exchange for $2,000: they offered to reduce their mortgage interest rate (6.1%) to fixed rates as low as 1%, and to talk to their lender so that they would not have to make payments for six months.
“They said in six weeks I should see a difference,” recalls Ramona Ortiz, whose family has lived in the same three-story house for almost 40 years. “You know it’s impossible, but when you are in desperate need everything seems possible”.
Ortiz discovered everything was a fraud when she received a letter from her bank demanding an overdue mortgage payment of five moths. A foreclosure process was already under way. (In New York State, this process typically starts after the homeowner is more than 90 days behind on her mortgage payments.)
The association that tricked Ortiz used several aliases and a fake Washington, D.C., address, has an unknown location and nearly 60 claims filed against it in the Better Business Bureau.
When Ortiz called the company and complained, they sent her a package back with her documents, urging her to send them to her lender, following a few instructions that they provided.
“They told me to fight it: We’ll prepare you to fight, they said, and you take it from there,” she recalls them saying to her.
Within the last two years, the U.S. Attorney from the Eastern District of New York, which covers Brooklyn, as well as the Brooklyn District Attorney, have devoted specific resources to tackle mortgage fraud, resulting in the prosecution of dozens of cases. The New York State Attorney General has also opened his own investigations into the “foreclosure rescue” industry, and last August filed a lawsuit against Amerimod, accused of having cheated thousands of homeowners, many of them Spanish-speaking, to whom they offered contracts only in English.
“The scams are as varied as ingenuity allows, just when we thought we have seen every variety, we see something new,” says Richard Farrell, chief of the new Real State Fraud unit at the offices of the Brooklyn DA Charles Hynes.
“We still have people forging deeds, powers of attorney, selling buildings to straw buyers,” says Farrell. “Anything that can be forged is forged: W-2, bank statements, you name it.”
In the Bushwick neighborhood, where more than 1,598 foreclosure processes have started from 2006 to date, “stop foreclosure” signs posted by swindlers are common. They also frequently leave business letters or cards in the mailboxes of their potential victims.
Herman de Jesús, a senior program associate at NEDAP, whose mission is to eliminate discriminatory economic practices, says that identifying these victims is easy because information on mortgage payment defaults is public.
“You can pay a specialized company to compile a list of homeowners who are running behind in their payments or, if you know the address of the house you are interested in, you can find this information in the New York City databases,” says De Jesús.
Authorities also recommend mistrusting Bushwick posted signs that offer “cash 4 house.” It’s a common fraud scheme: a property is bought for less than its value and resold shortly afterwards at an inflated price, generally using a straw buyer with fake documents, according to authorities. Then, swindlers receive a new loan they don’t pay.
Jacome says that she has received dozens of letters offering cash for her house. On one occasion, a man standing outside her house offered her $100,000, but she rejected the offer because her two-story house was valued at $650,000 before the housing market collapsed, and she, a daughter and a granddaughter are still living in it.
“He offered me $100,000 and I just smiled at him and told him: No, thank you, my house is not on sale. What a nerve he had to offer me $100,000!” Jacome says.
The area councilwoman, Diana Reyna, says that in the 70’s and 80’s, during the decades of poverty and crime following the 1977 blackout, homeowners in the area were also harassed.
“My parents went through the same thing,” Reyna says. “Many homeowners had to put up ‘Not for sale’ signs on their homes so they would be left alone,” she recalls.
Mike Hickey, executive director for CNYCN, explained that swindlers take advantage of the fact that the organizations giving free advice to homeowners are overwhelmed.
“It’s simple math: there will be 20,000 notices of foreclosure in NYC this year, and we are currently equipped to work with maybe 6,000 of those homeowners,” says Hickey.
Hickey explains that another problem is the modest results obtained so far from the mortgage modification plan announced by president Obama last March. The CNYCN estimates that of the 1,800 loan modification packages it submitted, only a quarter has been accepted to begin a trial period of several months before a modification can be final.
“The intention of the program to encourage modifications is really failing lots of people’s expectations,” Hickey says.
De Jesús, of NEDAP, says that housing counselors feel powerless because they can’t compete with swindlers.
“For each homeowner we manage to advise, ten are swindled,” he says.
HARTFORD — The Federal Reserve Bank of Boston, Hope Now Alliance and Neighborworks America are sponsoring a foreclosure prevention workshop at the Connecticut Convention Center this Thursday.
Eric Rosengren, president and CEO of Federal Reserve Bank of Boston will join Gov. Jodi Rell on Feb. 14 from 10 a.m. to 4 p.m to kick off the event.
Rell, citing the state’s unemployment rate, said residents are in need of assistance.
The aim of the workshop, organizers said, is to prevent foreclosures by bringing borrowers and lenders together to find alternative solutions.
The Connecticut workshop is modeled after the successful event held at Gillette Stadium in Foxborough, Mass., in August in which about 2,200 borrowers who met with lender representative received loan modifications or work out offers, organizers said.
HARTFORD – The captial city has been selected to receive up to $2.7 million to purchase and rehabilitate foreclosed properties in the Capital City, according to city officials.
The City’s proposed “Local Action Plan” was submitted by Mayor Eddie Perez to the State Department of Community and Economic Development, for HUD’s Neighborhood Stabilization Program Funding, according to a press release today. The Plan will also be submitted to the Hartford City Council for their review and approval. The Federally funded Neighborhood Stabilization Program is designed to reduce the negative effects of vacant and foreclosed properties.
In keeping with the Mayor’s priorities, the City’s proposed Local Action Plan is focused on homeownership. It is anticipated that 60-70 vacant, blighted, or foreclosed properties will be rehabilitated and then sold to low, moderate and middle-income families.
“Since 2002, we have cut the amount of blight in half and this funding will help ensure that we don’t lose that momentum, that we continue to build vibrant neighborhoods, and most importantly, we grow homeownership in our City,” Mayor Perez said.
The release also said that Hartford “has and will continue to partner with community stakeholders, community development corporations, minority contractors, non-profit organizations, neighborhoods and others to address the sudden influx of foreclosed and abandoned properties and ultimately, help new buyers achieve the dream of homeownership.”
The Program, administered by the Department of Development Services, will focus on projects that can help stabilize those neighborhoods with the highest number of foreclosures, sub-prime mortgages and steepest rise in rate of foreclosures. Those areas include the Asylum Hill, Blue Hills, Behind the Rocks, South End, Southwest, Northeast, and the Clay Arsenal neighborhoods.