Fannie/Freddie Concede Limited “Buybacks” to Foreclosed Detroiters Fannie Mae and Freddie Mac are finally implementing the first steps in the Detroit “Neighborhood Stabilization Initiative” (NSI) that Mel Watt, Director of the Federal Housing Finance Agency (FHFA), announced in May. The first stage makes a small concession to our campaign to “Save Detroit—Save Our Homes” (list of endorsing organizations attached) with a restricted program of buybacks for homeowners who have gone through mortgage foreclosure. So far, it is a very low-profile and very limited roll out of a program that doesn’t stop foreclosures and doesn’t yet include mortgage modifications that will keep people in their homes with principal reduction. For now, the NSI is limited to buybacks of foreclosed homes. The National Community Stabilization Trust (NCST): Fannie and Freddie have handed off implementation of the program to the NCST, a non-profit organization. Since there is not a lot of publicly available information about program details, what we know is gleaned from individual staff of the NCST, the FHFA, and local non-profits. We’ll update and correct our understanding of the NSI as we learn more. The Upside: In mid-July, the NCST began what’s called a “Quick Look” program for transferring homes foreclosed by Fannie and Freddie to local non-profits for sale or donation back to the foreclosed families. The positive step taken here is that Fannie/Freddie will transfer repossessed homes to the NCST that are still occupied by the foreclosed owner— previously, the standard policy was to move to eviction first and afterwards dispose of the vacant property. The NCST will list the home on their “REOMatch” website for sale to a local non-profit at a price ranging from market value down to $1. The local non-profit can then grant or sell the home back to the family at market or less. These are also positive steps— previously, the standard policy was to prohibit any kind of buyback at market value to the foreclosed owner, who could only redeem the home by paying the entire balance of the inflated mortgage. The Downside: These are positive steps as far as they go, but they don’t go very far given the severe limits placed on the program. We are told these limits may be amended— and we will push for the needed changes— but for now they put a real damper on the program: 1) Only Homes in Redemption. Quick Look only applies to homes still in the 6 month redemption period after the Sheriff’s Sale. As yet, there is no provision for the many foreclosed homes in Detroit where the occupant families are hanging on and fighting eviction long after the redemption period. 2) A Narrow Window. The homes are only listed on REOMatch for 3 days in the case of homes repossessed by Fannie Mae, and 7 days for Freddie Mac. This will make it very difficult for non-profits to assess the situation and make a decision on taking the home. 3) No Access to Home. It’s all the more difficult for non-profits given the stated prohibition on contacting the family or inspecting the home. 4) Non-negotiable price. It may be only $1, but it could be “market value,” which Fannie and Freddie have consistently overestimated in the past. 5) Detroit Only. The program applies to Detroit only and doesn’t include the many suburbs—and other metro areas across the country— where families in hardship are struggling to save their homes. 6) Approval of local non-profits. Only approved non-profits can participate. This makes sense from the standpoint of excluding organizations fronting for investors, but it can be a problem when unwarranted restrictions exclude non-profits with a proven track record of helping homeowners. So far, the approved non-profits include U Snap Back, Grandmont Rosedale Development Corporation, National Faith Homebuyers, Southwest Housing Solutions, Habitat, Christian Development Corporation, and New Hope. United Community Housing Coalition is applying for inclusion in the process. Listings on REOMatch will be sent to each non-profit for its specified area, either city-wide or neighborhood. 7) What Happens After Quick Look? If there is no bid on the home by a non-profit during “Quick Look,” the house will— as we understand it— be put up for sale on a listing of occupied homes open to all bidders. Without a right of first refusal on buying the home, the occupant family is at risk of being out-bid and evicted by the new owner. If Quick Look is amended in ways that address the above concerns, and if the Neighborhood Stabilization Initiative is expanded to include mortgage modifications with principal reduction, then hard-pressed families will have a far better chance of saving their homes. If there is no amendment and no expansion, then “Quick Look” will amount to little more than window dressing on policies that punish homeowners and de-stabilize neighborhoods. We need to keep the pressure on Fannie, Freddie and Mel Watt! Organizations Endorsing “Save Detroit— Save Our Homes”: Stop Foreclosures & Evictions by Fannie Mae and Freddie Mac (Contact Person) Labor United Auto Workers (Cindy Estrada) UAW Local 600 (Bernie Ricke) American Federation of Teachers, Michigan (Nikhol Atkins) Metro Detroit AFL-CIO (Rick Blocker) United Steel Workers District 2 (Al Cholgar) USW Local 1299 (Jim Allen) Michigan Regional Council of Carpenters (Lisa Canada) United Food and Commercial Workers (Chris Michalakis) Unite Here, Detroit (Joe Daugherty) Jobs With Justice, Metro Detroit (Jackie Dick) American Postal Workers Union 480-481 Area Local (Roscoe Woods) Utility Workers Union of America, Michigan Local 223 (Mike Smith) Coalition of Labor Union Women (Millie Hall) Jewish Labor Committee (Selma Goode) A. Philip Randolph Institute, Detroit Downriver Chapter (Andrea Hunter) Community/ Social Action NAACP, Detroit (Wendell Anthony) United Community Housing Coalition (Ted Philips) Fair Housing Center of Metropolitan Detroit (Margaret Brown) Detroit Eviction Defense (Steve Babson) Michigan United (Lee Gaddies) Michigan Coalition for Human Rights (Kim Radigan) Latin Americans for Social and Economic Development (Jane Garcia) Moratorium Now (Mike Shane) National Action Network (Rev. Charles Williams II) Westside Mothers (Selma Goode) Mary Turner Center for Advocacy (Mary Turner) Team for Justice (Dr. John Telford) Detroiters Resisting Emergency Management (Tom Stephens) Sugar Law Center (John Philo) MOSES (Ben Washburn) James and Grace Lee Boggs Center (Rich Feldman) Democratic Socialists of America, Detroit (David Green) Doing Development Differently in Detroit (Dave Reynolds) Jewish Voice for Peace (Barbara Harvey) Faith Based Central United Methodist Church (Rev. Ed Rowe) St. Peter’s Episcopal Church (Rev. Bill Wylie-Kellermann) Greater King Solomon Missionary Baptist Church (Rev. C. Williams Jr.) St. Elizabeth Roman Catholic Church, Detroit (Fr. Norm Thomas) Sacred Heart Roman Catholic Church, Detroit (Fr. Norm Thomas) Temple of Praise International Church (Bishop John Pitts) Church of the Messiah (Pastor Barry Randolph) Holy Hope Heritage Baptist Church (Rev. William Revely) Old St. John’s United Church of Christ (Don Geppert) St. Ignatius Church (Fr. Tom Lumpkin) Detroit Catholic Pastoral Alliance (Sister Cathy DeSantis) Greater Philadelphia Tabernacle, Highland Park (Elder James Cook II) Spirit of Hope (Rev. Matthew Bode) Gesu Catholic Church (John Hooper) Detroit Interfaith Outreach Network (Rabbi Dorit Edut) Pax Christi Michigan (Kim Redigan) Greater Mt. Tabor Baptist Church (Rev. Maurice Rudds) Neighborhood Associations 12th Precinct Neighborhood Coalition (Alicia Biggers) Bagley Community Council (Lee Gaddies) Bethune Community Council (Carolyn Valentine) Brightmoor Alliance (Kirk Mayes) Cornerstone Village Association (James Grenwick) Creekside Community Development Corporation (Sharon Meadows) District 1 Abandoned Homes/Blight Committee (Winonah Handschu) East English Village Association (Bill Barlage) Eden Gardens Block Club (Kalena Knox) Grandmont #1 Improvement Association (Oliver Cole) Grandmont Community Organization (Earlene Hall) Grandmont-Rosedale Development Corporation (Bill Frey) Greater Sandhill Community Association (Mary Price) Greenacres-Woodward Neighborhood Association (Karen Hammer) Indian Village Association (Tim Mahoney) Lower East Side Action Plan (Maggie De Santis) Malvern Hill Neighborhood Association (James Kyle Beeler) Minok Park Block Association (Vicki Holmes) MorningSide Community Organization (O’Dell Tate) Neighbors Building Brightmoor (Riet Schumack) North Rosedale Park Civic Association (Cheryl Buswell) Northwest Alliance of Block Clubs (James Kyle Beeler) O’Hair Park Community Association (Susan Stellar) Restore Northeast Detroit (Karen Washington) Rosedale Park Improvement Association (Jim Dwight) Schoolcraft Improvement Association (Bryan Ferguson) South West Detroit Improvement Association (Anna Ceballos) University District Community Association (Greg O’Neal) Warren/Conner Development Coalition (Maggie De Santis) Winship Community Association (Arthur Divers) Woodbridge Citizens District Council (Elaine Crawford) Copyright © 2014 Detroit Eviction Defense, All rights reserved. You are receiving this because you care about Fannie Mae and big banks trampling peoples lives and because you gave us permission :) Our mailing address is: Detroit Eviction Defense 2120 Russell Detroit, MI 48206
Posted on: Mon, 04 Aug 2014 20:14:56 +0000
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