All too often, we point blame and shame mortgage companies and banks for the past five years of turmoil in the housing market. The anger and rage are warranted, but often overshadow well-deserved praise for those fighting for consumers.
Advocates who have fought for what is right, and haven’t given up, are too seldom given credit where it’s due.
In the Bay State, one of the most vocal and relentless advocates is Attorney General Martha Coakley. The former district attorney has been out in front of the robo-signing scandal, and even walked away from the national foreclosure settlement to sue five major banks over deceptive foreclosure practices.
No one knows how widespread the crisis is better than Coakley. Just last week, she said her office fielded almost 1,000 calls relating to mortgage and foreclosure-related issues in the last year – quadruple the amount of complaints in years past. Mortgage-related complaints are the biggest source of consumer concerns in the state – even outnumbering complaints against car dealers.
Although U.S. Housing and Urban Development Secretary Shaun Donovan said a deal with banks to fix servicing and help homeowners is imminent, Coakley may still demand more. Just this week, she expressed concern that Massachusetts homeowners receive their fair share of loan modifications.
Donovan, an affordable housing expert, has stepped up to the plate to bring justice after the foreclosure scandal. He’s fighting for homeowners all nationwide – including Massachusetts. He has been working for banks for more than a year after robo-signing and other misconduct in foreclosures was exposed. Using Donovan’s estimate, the settlement could provide roughly a $20,000 reduction for each of the estimated 1 million affected borrowers nationwide.
Previous efforts to mend the housing and foreclosure crisis have been criticized for their leniency and ineffectiveness. The homebuyer tax credits artificially boosted home sales in late 2009 and early 2010 – only to see sales come crashing down again in the second half of 2010 and throughout 2011.
Now, analysts estimate 2011 Massachusetts home sales will come in at the lowest level recorded since the 1990s. With vacant, foreclosed homes flooding the market, it’s uncertain when the word “recovery” will become an actuality.
But thanks to the stringent and relentless work of advocates like Donovan and Coakley, select wayward lenders are being pressed to give homeowners the relief they deserve.
Less than a year ago, JPMorgan Chase CEO Jamie Dimon said principal writedowns for people who could afford to pay their mortgages was “off the table.” This is the same bank that set aside $528 million in the last three months of 2011 to fight lawsuits. It also spent $925 million in the fourth quarter to carry out foreclosures and handle mortgage defaults.
In order to get banks to agree to giving roughly 1 million American homeowners mortgage principal writedowns is no easy feat. But true to her character, Coakley won’t stop fighting until every wrong against every Bay State homeowner is made right.
And we thank her for that.
