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Get on The Bus

Adam Rust's picture

Posted October 23, 2009

CRA-NC is organizing a tour to the nation's capital.  We're bringing housing counselors from all over the state.  The counselors are angry.  They are tired of getting the run-around from servicers.  They see the press about HAMP's 500,000 loan modifications.  They aren't seeing that on the ground.  Maybe that is because they are trying to get real modifications - not ones that merely extend the life of a loan, or reach a modification agreement that actually results in a higher monthly payment.

We're going to bus people from Durham, Rocky Mount, Winston-Salem, and Rich Square.  The Durham bus holds 55, and the other buses are taking about 15 people.

The Modify This Tour takes place October 29th.

The agenda for the tour

The agenda is solely the message of housing counselors.  The message will be voiced from the housing counselors.  The energy for mobilization is driven not by professional advocates, but by regular people.

They want three things:

  • Housing Counseling:  The housing counselors want new rules for HUD-certified housing counselors.  Housing counseling, which by HUD rules has to be offered for free to clients, is paid for by HUD on a case-by-case basis.  HUD requires counseling agencies to meet a lot of upfront costs.  For example, each counseling session must take place in a private room.  HUD does not fund agencies for fixed costs - rent, support staff, etc.  As well, the paperwork rules are incredibly burdensome.  Most executive directors spend all of their time applying for new rounds of funding, filling out reports, and meeting the implementation rules.  That makes it hard to stay afloat.  Counseling agencies have to meet HUD rules, but inevitably, they have to get additional outside funding in order to meet the HUD requirements.
  • Better implementation of loan modifications.  Again, the counselors are not seeing the results on the ground that match with HAMP reports.  Elizabeth Warren has summarized these shortcomings in a report that came out just this month.  Alys Cohen says much of the same thing.
  • Consumer protections.  Our regulatory agencies are worried about systemic risk rising out of a lack of safety and soundness.  Protection for consumers is relegated to laws like the Fair Lending Act, the Equal Credit Act, and the Housing Act.  Those all require litigation - an expensive means for consumers to get fair treatment.  Moreover, the regulators have made little effort to enforce those rules.  Consider that only one mortgage-making lender was sanctioned for Fair Lending violations in the last four years.  The CFPA and the CRA Modernization Act provide a remedy to these shortcomings.

Lots of Response

The response has been strong.  Groups from California and Chicago have already indicated that they want to send along testimonies from housing counselors to add to the North Carolina and New York experiences.

We have a commitment from one North Carolina Congressman to attend the meeting in person.  Four other North Carolina representatives have promised to have staff there, and the chance remains that those leaders will show up in person.  This week, a Congresswoman from Cleveland called to say that she would like to have staff there to, in order to listen to the concerns of housing counselors.

This is an incredible moment.  People out of power are being given a voice. People in power are listening.

The response has been extraordinary.  The North Carolina buses are filling up fast.  Housing counselors call every day to get their spot.