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Meanwhile, in the crashed economy, many families could no longer afford karate lessons. The final blow was the March 2009 fatal shooting of two police officers near his school. "We lost ten families that day, and it also had a ripple effect," said Owens.
Owens couldn't make the payments, and eventually the bank foreclosed on his business. He said he was "embarrassed" about what happened, so he didn't tell the students until two weeks before the sale date. When he finally announced that the school would close, however, "the students said, 'No, that's not gonna happen.' That's when I realized what community meant."
Students and ex-students organized fundraisers. One contacted ACCE, which organized a phone-call campaign to the bank and got the story on TV and in newspapers, generating a new wave of support. More students enrolled. Then-Assemblyman Sandré Swanson became involved. "They got the bank listening," Owens said.
The bank finally lowered Owens' interest rate and forgave the overdue payments. "Here was a bank about to take the building," Owens noted. "They wouldn't listen. But because of community, they totally turned around."
The resistance movement is not batting 1,000, however. "In individual cases, some we win, some we lose," said Nell Myhand, who heads the Causa Justa/Just Cause homeowner clinic, and is currently fighting foreclosure of her own house. "But we're building a movement. More people now understand that the foreclosure crisis is not because bad people took out loans they couldn't repay, but because banks targeted people, especially black and brown people, for subprime loans."
But not everyone views the pressure tactics as effective. Jim Foley, Wells Fargo Greater Bay Area Regional President, acknowledged that community groups sometimes help in "bridging the gap between customer and bank," but denied that protests affect bank actions. "We talk to any community leader who sends us the name of a customer they feel hasn't gotten a fair shot," he told me. "Whether they protest or not, we treat them the same way." Activists "barging into" banks, he said, just "terrorize our customers and our tellers."
Most of the mortgages Wells Fargo services, Foley explained, are owned by government agencies, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). "Protests and calls are not going to make Fannie Mae change its guidelines," he said.
Some people, he pointed out, just can't afford mortgage payments. He mentioned a woman who lost her job and ran out of unemployment insurance. "Her income was $200 a month. I called her and said, 'You need to get a job. I don't have a program for $200 a month.'" Activist groups, he charged, sometimes give such people false hope that protests will prevent their eviction.
But Swanson, now Oakland's deputy mayor, believes local activists have been instrumental in helping people stay in their homes. Community-based organizations, he said, "have played a valuable role in pushing banks to be more responsive and in educating homeowners."
And, at the state level, community-based organizations have been "very persistent and aggressive in communicating the rights of homeowners and making sure they are reflected in the law," Swanson added.
A statewide coalition of community organizations including ACCE and Oakland Community Organizations (OCO) as well as policy groups, union locals, and the online Courage Campaign mounted a major push last year to get the Homeowner Bill of Rights passed. They held mass lobbying days in Sacramento, publicized information about legislators' contributions from banks, and targeted swing voters. ACCE prepared a "report card" of likely votes on the bills and reported that legislators "were calling us to say, 'Please don't list me as a 'no' vote.'"
Locally, Oakland City Councilwoman Desley Brooks, who has focused on the issue of foreclosure over the years, said grassroots organizations helped make Oakland a leader in anti-foreclosure efforts. Oakland's new Foreclosure Prevention and Mitigation Program, adopted unanimously by the council on October 16, is only the latest in a series of measures to protect neighborhoods and residents. The city's anti-foreclosure specialist, Margaretta Lin, said she often fields calls from other cities wanting to learn from Oakland's programs.
Oakland's foreclosure plan devotes city resources to increased outreach, counseling, and legal advice for struggling homeowners and tenants in buildings threatened with foreclosure. It mandates city staff to monitor implementation of the Homeowner Bill of Rights and the February 2012 state-federal "Attorney General Settlement" with the five biggest banks — and refer violations to state Attorney General Kamala Harris. According to the plan, in "challenging cases where there should have been a workout and banks didn't provide it," said Lin, city officials will "escalate" negotiations by intervening directly with the bank.
In addition, a new city database will produce quarterly reports on each bank's performance by tracking data on notices of default, foreclosures, blight mitigation, and affordable loan modifications, Lin said.
A few years ago, state and city laws requiring banks to maintain foreclosed properties weren't being implemented. So ACCE put city officials and other leaders on buses and took them on "blight tours" of bank-owned properties. "The blight tours helped put a face on the issue," Brooks said. "I heard city officials say things like, 'I finally get it.'"
That led to the development, in 2010, of a program requiring banks to register vacant properties. The city started regular inspections and imposed fines on banks that failed to clean up blighted properties.
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