Occupy Wall Street, Homeowners Ally to Fight Foreclosures
Drawing inspiration from the Occupy Wall Street movement, homeowners facing foreclosure are fighting back. Their weapon of choice: protest.
In La Puente, Calif., for instance, Rose Gudiel recently backed down OneWest Bank (formerly known as subprime lender IndyMac) and Fannie Mae (FNMR) after the companies refused to lower the mortgage payments on her family's home and moved to foreclose. As part of the campaign, which drew support from OWS offshoot Occupy LA, Gudiel and hundreds of protesters rallied in front of the Los Angeles home of OneWest CEO Steven Mnuchin.
In Washington, a 71-year-old woman was joined by activists in moving to block loan servicer Ocwen Financial (OCN) from evicting her and her husband, along with their nine children and 50 foster kids, from their Seattle home. She has won a temporary reprieve.
Staying put
Grassroots organizations linking local residents, housing advocates and others are also springing up around the country to resist foreclosures. No One Leaves! of Springfield, Mass., uses tactics ranging from property blockades to legal proceedings in helping residents who have been foreclosed to stay in their homes. And earlier this month a network of groups called Right to the City Alliance mobilized anti-foreclosure protesters to march on Bank of America (BAC)'s Boston headquarters. A similar demonstration this month targeted Wells Fargo (WFC) in San Francisco.
In New York, where OWS protesters continue to camp out in Manhattan's Zuccotti Park, Organizing for Occupation is also encouraging "non-violent direct action" to stop foreclosures. The group earlier this month hit on a novel way to temporarily halt the work of a Brooklyn foreclosure court -- singing:
Theatrics? Of course, but not empty ones. Banks and loan servicers continue to resist modifying mortgages for struggling borrowers. And despite President Obama's announcement today of new debt-relief measures for homeowners, government efforts to slow the foreclosure tide have largely failed. The U.S. Treasury Department's Home Affordable Modification Program and related federal anti-foreclosure initiatives have permanently reduced loan payments for a meager 0.1 percent of homeowners whose properties are worth less than their mortgages.
That's no surprise considering that the feds have willfully let large financial institutions flout federal rules for programs like HAMP. With the government turning a blind eye to such abuses, banks and servicers have continued to falsify foreclosure documents despite a slew of federal and state investigations into these "robo-signing" incidents.
Another factor that may be driving the social resistance to foreclosures -- growing public sympathy for OWS. A recent poll shows that nearly 60 percent of Americans back the protests.
Homes: A pressure point
Foreclosures are a natural hot-button for OWS, which is trying to refine its agenda. First, millions of people remain "underwater" on their mortgages. That represents a large constituency potentially receptive to public campaigns to stop home seizures.
Second, foreclosures harm not only affected homeowners, but entire communities, with abandoned properties diminishing the value of local real estate, eating up local government resources and attracting crime. The broader the problem, the broader the public interest in finding a solution.
Third, as the White House's renewed emphasis on foreclosures makes clear, political leaders are loathe (especially in an election year) to dismiss the issue out of hand. So this is one area where public pressure can make a difference. And as the action of individual homeowners already shows, bankers fear the widespread antipathy that foreclosures provoke.
Fourth, housing debt is perhaps the greatest single obstacle to economic recovery because of how it inhibits consumer spending. As a result, among the best ways to boost the economy is to push lenders to forgive debt.
Finally, as financial pundit Mike Konczal notes, zeroing in on foreclosures allows OWS to make common cause with community, faith-based and other activist groups that have been working on behalf of homeowners since the financial crisis started. He writes:
It also allows Occupy Wall Street to tap into already existing networks of foreclosure fighters. It is a type of demand that is actionable without leaving the movement looking powerless by asking Congress to do anything â€"- these battles can be fought now. And it ultimately gets at the banks in a way occupations normally don't â€"- banks may or may not feel that they aren't appreciated enough by these protests, but they'll definitely be mad if someone is disrupting their foreclosure mills through occupation and refusal to leave.No doubt. Whatever the merits of the government's latest foreclosure plan, it seems many homeowners are no longer content to wait for the feds or banks to cooperate.
Thumbnail and interior image by David Sanger via Wikimedia Commons, CC 3.0
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