Hi there! I'm a bike messenger by day, aspiring actor by night, and this is my blog. I live in Los Angeles, have a great dog named Jack, and I like piña coladas. (And gettin' caught in the rain.)...or something like this:
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Over the past several years, we've reported extensively on the big banks' foreclosure failings. As a result of banks' disorganization and understaffing — particularly at the peak of the crisis in 2009 and 2010 — homeowners were often forced to run a gauntlet of confusion, delays, and errors when seeking a mortgage modification.
But while evidence of these problems was pervasive, it was always hard to quantify the damage. Just how many more people could have qualified under the administration's mortgage modification program if the banks had done a better job? In other words, how many people have been pushed toward foreclosure unnecessarily?
A thorough study released last week provides one number, and it's a big one: about 800,000 homeowners.
The study's authors — from the Federal Reserve Bank of Chicago, the government's Office of the Comptroller of the Currency (OCC), Ohio State University, Columbia Business School, and the University of Chicago — arrived at this conclusion by analyzing a vast data set available to the OCC. They wanted to measure the impact of HAMP, the government's main foreclosure prevention program.
What they found was that certain banks were far better at modifying loans than others. The reasons for the difference, they established, were pretty predictable: The banks that were better at helping homeowners avoid foreclosure had staff who were both more numerous and better trained.
Unfortunately for homeowners, most mortgages are handled by banks that haven't been properly staffed and thus have modified far fewer loans. If these worse-performing banks had simply modified loans at the same pace as their better performing peers, then HAMP would have produced about 800,000 more modifications. Instead of about 1.2 million modifications by the end of this year, HAMP would have resulted in about 2 million.
That's still well short of the 3-4 million modifications President Obama promised when he announced the program back in early 2009. But it's a big difference, and a reasonable, basic benchmark against which to compare the program's failings.
The report does not identify these poor performing banks, but it's not hard to ID them. A "few large servicers [have offered] modifications at half the rate of others," the authors say. The largest mortgage servicers are Bank of America, JPMorgan Chase, Wells Fargo and Citi.
Rick Simon, a spokesman for Bank of America, said the banks' "home retention results are significant and in line with our industry peers to date."
The Home Affordable Modification Program (HAMP) paid subsidies to mortgage servicers on the theory that doing so would convince them to embrace modifications. The authors say that voluntary approach apparently didn't have much effect with the biggest servicers. They weren't very good at modifying loans before HAMP was launched and weren't much better after it launched.
The authors wrote that while they can't be sure why these banks underperformed, they "may not have responded to the program since doing so would involve changing their business focus from processing and channeling payments to actively renegotiating loans. In addition, this may have involved significantly altering their organizational capabilities, such as building appropriate infrastructure and hiring and training servicing staff."
That echoes on our reporting on how ill-suited the big banks were when it came to modifying loans. The result inside the banks has sometimes been chaos. As one Bank of America employee complained, "The whole documentation collection thing has got to be purposely not funded. Like, I can't get a fax. I work for a huge bank that has tons of money, and you're telling me that I can't get a fax?"
Since HAMP's oversight has been lax — the Treasury Department, which runs the program, has responded indulgently to mortgage servicers breaking HAMP's rules — banks haven't had to worry much about their low modification rates. (You can see this explained with a song. It's also a big part of our book on the foreclosure crisis.)
A Treasury spokeswoman, responding to the new report, said HAMP had resulted in "one of the most comprehensive compliance reviews of mortgage servicing operations in the country. Servicers in the Making Home Affordable Program are subject to an unprecedented level of compliance oversight."
The report did have some positive findings concerning HAMP. As we've reported, modifications in the program have been more generous to homeowners than modifications done outside HAMP. The authors also found that the program did boost the number of modifications — i.e. it caused modifications that likely would not have happened if not for the program.
The authors also say that HAMP might have induced more modifications if the program had not required such extensive screening of homeowners seeking a modification. From the program's launch, the administration emphasized that the program wouldn't help the wrong sort of "irresponsible" homeowner. That emphasis led to requirements that homeowners send in lots of paperwork to prove their income, which in turn further taxed the big servicers' inadequate systems.
Despite the recent stabilization in home prices and a drop in the rate of homeowners falling behind on their payments, HAMP's limited impact remains a very relevant issue. Even in the sixth year of the foreclosure crisis, the country remains saddled with an extraordinarily high number of loans in foreclosure — about 2 million. That backlog hasn't improved much in the last couple years, meaning it's still hard to forecast when the foreclosure rate will return to a normal level.This article has been republished from ProPublica, an independent, nonprofit newsroom that produces investigative journalism in the public interest.
Rebuilder, You've probably seen a lot of stories this week about how Mitt Romney just lost the election by choosing Paul Ryan for his running mate. I think those thoughts are dangerously misplaced. Here's why: Ryan is THE most effective weapon the other side has. He makes the argument for austerity with passion, poise and skill. He is a true believer. Vice President Biden better eat his Wheaties before the debate. If they win, they can claim a clear mandate to destroy everything that made the American Dream possible. And even if they lose, they'll shift the debate to the right so that any December ‘grand bargain’ will only cut Medicare a little instead of a lot. They'll have the whole country thinking America is "broke," when the truth is that a handful of the super-rich are bleeding us dry and cutting the net out from under the middle class. Here’s the real truth: America is NOT broke, America is Being Robbed. We can prevail. But we have to bring our A game. We need to defeat their arguments, not push watered-down alternatives. So today, we're launching a BIG campaign to get this message out there: America is Being Robbed. Americans already suspect the game is rigged against them. They're just looking for who to blame, and who has a plan to fix things. We've got a chance to break through. We need to frame the terms of the debate and win the war of ideas. If we don't, even a victory in November won't stop the worst of the 1% from tearing down the American Dream. So here's our plan. From now through the election and on into December, we will: Engage artists to change public opinion. We won't persuade people with more fact sheets and numbers. We need to organize artists and musicians to create inspiring projects that expose how Americans are being robbed every day by banks, corporations and the politicians that they own. Make it an election issue. Get candidates to go on the record on our issues by filling out the 99Elect questionnaire, and use campaigns and in-district events to show which candidates are willing to help stop the robbery (even if they need a push sometimes) -- and which ones are driving the getaway car. Expose the villains and lift up the victims. Expose the people who are dodging taxes, taking subsidies and ripping us off. We'll use advertising and public pressure, and tirelessly work the media to put the heartbreaking stories of their victims front and center. Educate and explain. The right uses complexity as a weapon of deception to hide how a handful of people are robbing America. We're going to share graphics, videos, and stories, and provide you the tools to tell this story in your community with online message trainings led by some of the best progressive communicators in the business. Are you in? We need to raise $100,000 for a multi-month campaign of this magnitude. Even $10 today will help, big time. The most eye-opening part of my job is getting to meet and talk to so many people. We talk in airports, in church basements, in coffee shops. They tell me about losing the homes they raised their kids in. Picking up groceries at the food bank they used to give to. Struggling to make rent because they were scammed into a student loan with all sorts of extra fees. Wanting to work. Begging to work. But finding no jobs because big corporations are hoarding profits instead of hiring and Washington D.C. just doesn't seem to care. Somehow, Washington has made the whole conversation about budget numbers. But it's not. It's about people who are hurting. We can never forget that. We CANNOT back down. Thanks, Van, and the rest of the Rebuild the Dream teamWe're super excited to start telling this story. For more on how America is being robbed check out this video from Van's speech last year at the Rebuild the Dream event in NYC:
"Deep patriots don't just sing the song, 'America the Beautiful' and then go home. We actually stick around to defend America’s beauty -- from the oil spillers, the clear-cutters and the mountaintop removers. Deep patriots don't just visit the Statue of Liberty and send a postcard home to grandma. We defend the principles upon which that great monument was founded -- 'give me your tired, your poor, your huddled masses yearning to breathe free.'" -Van Jones I'm the graphic designer here at Rebuild. I loved that quote so much, I decided to put it on a shirt... and so far, it's a hit! I've got mine, do you want one?
This is the kind of patriotism our country needs right now more than ever. With a big election coming up in just a few months, this is the perfect time to get this message on a shirt for Rebuild members to proudly wear. You can order yours today by clicking here.
Rebuilder, This week Rebuilders in swing states are delivering tens of thousands of your signatures to local Senate offices, demanding that Congress force banks to allow responsible homeowners to refinance their mortgages at today’s record-low interest rates. Homeowners are in serious trouble, while banks rake in record profits and Congress sits on its hands. Our efforts have definitely got their attention, but right now, we’re hearing conflicting reports about Congress's willingness to pass this legislation. So we don’t know for sure what they plan to do. If we can force a vote, it will help make the housing crisis an election year issue. So we need to figure out -- fast -- where the Senate stands, because we only have one week before Congress goes on recess. After that the only thing they will care about is the November election. Can you take 60 seconds to call your senators to find out their position on homeowner relief legislation? Just click here to go to our call page. We have all the information you need, including:
We're sending this message to enough people to get about 5 phone calls per senate office, which should be just enough to get the information we need. And along the way, we'll also send a clear signal that everyday voters really care about this solution. That could be enough to force a vote. This is a commonsense proposal that will keep folks in their homes. There’s no reason Congress shouldn’t pass this -- but we all know how Washington works. If we can just force a vote, however, then the millions of 'Underwater Voters' will know who to hold accountable in November for Washington's inaction. Click here to go to our call page and let us know where your Senators stand on homeowner relief legislation. Speak up today and let them know you're paying attention, that you vote, and that you'll remember what they did (or didn't do) while people were losing their homes. Thanks, Ian and the Rebuild the Dream team
- Your senators' phone numbers
- A quick script for what questions to ask (the whole call should take under a minute)
- A form where you can report back what you found out
"I think about my father. My father was in Memphis on April 4, 1968 when Dr. King was assassinated. He said he felt like they were trying to kill hope in America. And then I was with my father when he was on his death bed in 2008. He'd look up and see Obama and say, 'The hope is back.'"Check out the entire clip on YouTube, and check out Van's op-ed on Obama's Inaugural as a rebuttal to Reaganism at CNN Opinion.
Rebuilder, You hear it again and again. "America is broke." Whenever we ask our elected leaders to do anything, that's what they say. No scholarships for our kids? Bridges falling down and roads crumbling? No jobs program to put Americans back to work? "Well, that's too bad," they say. "We can't afford to fix anything. America is broke." This is a very dangerous lie. It freezes people into thinking there is no solution... when there is. But it gets repeated, and repeated. You start to think you're crazy -- and they are right. So that's where we need to start. Will you commit, right now, to reject this lie and help us spread the truth? Add your name now. In the coming weeks, we'll be following up with everyone who makes this commitment with opportunities to get involved and get this message out there: America is Being Robbed. Our economy today is almost as big and rich as all of Europe's COMBINED -- including economic powerhouses like Germany. Our economy today is almost twice as big as China's. (And we have only one third of the Chinese population.) No other country even comes close to our wealth. If that is so, then how come only some of us are hurting? How come big corporate profits are at an all-time high while people are out of work? Why are Wall Street banks thriving while folks are losing their homes? One reason: global corporations and big banks are hoarding so much cash, refusing to recirculate it in the form of fair taxes and good wages. Instead, they use a few of their extra bucks to buy elections and elected officials -- Paul Ryan is just the worst example, not the only one. Those politicians then try to convince us that we should all accept more misery, while their mega-donors stockpile more cash than the Pharoahs ever dreamed about having. Enough is enough. If someone tells you we're too broke to do anything positive, ask them where the money went. Ask them who got a big bonus last year. Who got a new private jet? Ask about the Bush tax giveaways for the rich. Ask about the bailouts for Wall Street. Ask about tax shelters, subsidies for polluters, Halliburton expense accounts, or the massive bill for two wars. Fighting back starts with each of us making the choice to reject the myth, and committing that we won't sit silent while today's robber barons set the terms of the debate. So say it with me: "We're not broke -- we're being robbed, and I commit to fight back!" Families aren't just "falling" out of the middle class. They're being pushed. I promise I'll be out there pushing this. But this community together has way more power than any one person. Let's stand together, Van and the rest of the Rebuild the Dream team