CHICAGO: National People’s Action with support from U.S. Senator Dick Durbin (D-IL) releases a Chicago Foreclosure Report for 2009.
Click here for PDF copy of report.
18 months after reckless and predatory lending took down the U.S. economy, foreclosures are occurring at a record pace and Washington has yet to enact any meaningful reform of the financial industry.
While the minority and low-income neighborhoods that were the main targets of predatory lending continue to bear the brunt of foreclosure, the devastation is spreading. The sub-prime crisis has meant high unemployment and slashed City and State budgets, which in turn has led to foreclosure spikes in virtually every neighborhood in the City of Chicago. Over half of the land in Chicago is within 1/10th of a mile of a foreclosed property. In addition, the average Chicago homeowner has lost $27,000 in their home’s value in the last 5 years. Citywide that adds up to approximately $15 Billion in wealth down the drain.
“The picture we get is that foreclosures only happen in low income and working class communities” said Curtis Smith, a community leader from the Lakeview Action Coalition. “We know that the foreclosure crisis is a wave that is afflicting communities of all stripes. In my community, Lincoln Park, the rate of foreclosures increased 105% in the last year, which is the largest increase in Chicago. It has taken longer to reach us, but the foreclosure crisis is here.”
The escalating rise in foreclosures in Chicago last year shows that the financial crisis is far from over Risky and reckless subprime loans that caused the foreclosure crisis are still legal. Banks and mortgage brokers can still sell option ARMs, interest only, and no doc loans. The U.S. Senate is considering following the House to create a Consumer Financial Protection Agency that would stop the spread of risky and reckless financial products, but it faces stiff opposition from the banking industry.
“Predatory and subprime lending created an unprecedented foreclosure crisis that sent our economy into a tailspin, resulting in millions of people losing their jobs, and spurring even more foreclosures. To keep this from happening again, we need a strong, independent consumer protection agency that will protect all of us from predatory and unsafe financial products” said George Goehl, Executive Director of National People’s Action.
About National People’s Action
National People’s Action is a national organizing, policy, research, and training center for grassroots community organizations dedicated to building power to reclaim our democracy and advance racial and economic justice. For more than 36 years, NPA has worked to build and strengthen people’s organizations, develop indigenous leadership, and advance campaigns for a more just, equitable, and sustainable society.