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Direct action against foreclosures

Most advocates for families with troubled mortgages say some cases are unsalvagable. Not Action Now.

“We accept anyone, even the most difficult cases,” said Madeline Talbott of Action Now, a grassroots membership organization of low-income families based in Englewood, West Englewood, Austin and Little Village.

Calls to the group about mortgage problems “are increasing dramatically,” Talbott said. Action Now refers homeowners to counseling if it’s an option; if not they take a busload of members to the loan servicer’s office and “sit in and raise hell,” she said.

“Sitting in works,” she said. “It gets results.”

If there’s no local office for the loan servicer, the group encourages the Illinois Attorney General’s office to take action.

“Homeowners think it’s a matter of humilitation and shame; we think it’s a huge scandal brought on by lenders,” Talbott said. “We help people see it’s not a personal problem, it’s a public issue.”

Rather than being embarrassed, she says, homeowners in trouble “should be outraged at the injustice.”

The crisis stems from predatory lending, and Talbott lays much blame on the Bush administration, which “opposed any efforts to clamp down on predatory lending” and “completely opened the floodgates. It’s a systemwide failure.”

“You buy a house once or twice in a lifetime,” Talbott said. “How are you supposed to be an expert on all the scams they can run on you?”

“When we started organizing in Englewood in the ’80s there was a huge number of abandoned buildings.” Redlining meant there was no access to credit and it was very difficult to transact real estate deals. “We fought for CRA [the Community Reinvestment Act] and established lines of credit. Things changed and you could start buying and selling property through normal channels.”

Then “the subprimers found loopholes in the regulations, and nobody stopped them. The predatory lenders came in with the line than anybody could get a house.

“Now we’re back to just as many abandoned homes as ever.”

“What we need is an across-the-board solution,” Talbott said, with new federal legislation and regulation. “But for that we may need a new president and Congress, and we’re going to lose tens of thousands of homes in Illinois this year.”

In the meantime, the state should require mandatory mediation before foreclosure. “If you can get to mediation, you can often resolve these issues,” Talbott said.

Action Now has also prepared language for a city ordinance requiring owners of empty properties to pay fines and fees and acquire a license. That would give lenders an incentive to negotiate a resolution with homeowners.

Sit-ins also provide such incentives, and Action Now plans to continue with direct action.

“We really think this is a problem that was caused by bad guys, and we’re going to go after them,” said Talbott.

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Category: Austin, Englewood, foreclosures, housing, Little Village

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