Risky Home Loans Trigger Crisis

The Seattle Urban League continues with its groundbreaking "To Own and Keep Your Home" counseling workshops – just in time, as it turns out.
Observers still don't know how many at-risk homeowners will be affected by the events of the past week, as one of America's biggest financial institutions lurched into bankruptcy in part because of their over-reliance on sales of subprime home loans, and reports surfaced in Michigan of plans by the Republican Party to challenge voters at the polls by culling their names from home foreclosure databases.
The Barack Obama Presidential Campaign Tuesday filed a class action lawsuit against the Michigan Republican Party to prevent them from using home foreclosure databases as the basis for voter challenges on Election Day, Nov. 4.
Meanwhile, locally, the Seattle Urban League's series of free events helping homeowners make sure their assets are secure continue Sunday, Sept. 28, with counseling, educational materials and support.
This is the second of two counseling-based sessions helping mortgage holders learn the specifics of their financial contracts and — with the help of professionals in the field — documenting any possible financial complications they may face in the coming months.
The third, and biggest, event is planned in October, when representatives from many home mortgage lenders who will meet with their clients to work out their financial problems and conflicts on the spot.
The idea is to make sure local residents weather the national financial crisis without losing their homes to subprime lenders – many of whom are going bankrupt themselves.
"The majority of people who call us don't know what type of mortgage they have," A. Linda Taylor, Seattle Urban League housing director, told The Skanner earlier this summer.
The League's workshops were created to support local residents with sub-prime loans, interest-only loans, or Adjusted Rate Mortgage loans – the same risky financial deals that contributed to the collapse of Lehman Brothers.
In Congress, the House Oversight and Government Reform committee is planning a hearing Sept. 25 analyzing what it calls "regulatory mistakes and financial excesses" that pushed the company into bankruptcy.
According to The Michigan Messenger newspaper, until this week, the chairman of the Republican Party in Macomb County, Mich. planned to keep a list of foreclosed homes at voting sites around the state as an aid to challenging Democratic Party voters. Reports indicate that more than 60 percent of all sub-prime loans in Michigan were made to African Americans.
The Urban League's homeowner events are set for Sunday, Sept. 28, from 1 to 5 p.m. at the Kent Senior Center, 600 East Smith St., in Kent; and Saturday, Oct. 11 from 10 a.m. to 3 p.m. at the WaMu Cedarbrook Leadership Center, 18525 36th Ave. S. near SeaTac.
Experts will talk about changes to the mortgage lending laws, reverse mortgages, different mortgage options and how to recognize foreclosure rescue scams. Information also will be provided on the City of Seattle's mortgage relief funds of up to $5,000 per household.
"If you've been a victim of fraud, we'll have people there from the Attorney General's office to take some of those complaints and help you facilitate a remedy," Taylor said.
Taylor said legal help will be available, in addition to federal housing agency representatives ready to hear consumers' testimony.
 "The main goal of that third session is we will have loan servicers there – we will actually have a lot of your home mortgage companies there – to help you work out any issues or problems you have with your home financing," Taylor said.
"There is so much paperwork involved that you need to set it up right and know what your rights are — you really need to know your rights because a lot of the lenders don't."
Childcare is available for each session, and meals will be served. To sign up, or find out more, call 1-800-368-1455, or email [email protected].
"Its really important that homeowners take advantage of workshops like this to assess their own situation, especially people who feel like they might be suffering some exposure on their own mortgage situation," said Elliott Bronstein of the Seattle Office for Civil Rights.
"We view this in the broadest sense as a civil rights issue, as a human rights issue – financial security is important," Bronstein said.