NAACP Calls for Protection Of Homeowners and Foreclosure Victims in Economic Bailout PackageDecember 31, 1969
The NAACP calls on Congress and the White House to guarantee that American families are protected as Congress and the Bush Administration debate the $700 billion bailout proposal that uses taxpayers’ money to salvage the nation’s biggest investment firms and banks.
“If politicians are going to bail out Wall Street they have an obligation to also help the true victims of this financial crisis – the homeowners and their families who have either lost or are about to lose their homes because of unscrupulous predatory loans,” said NAACP President & CEO Benjamin Todd Jealous.
The NAACP supports provisions that would require lenders to modify loans allowing homeowners to pay sustainable, reasonable market rate mortgages and stay in their homes. “Congress must include assistance and relief for homeowners facing foreclosure in any legislation that bails out major financial services companies. Anything less is unacceptable,” said Jealous.
The nation’s financial instability – driven largely by the high number of predatory loans made within the last few years—has resulted in epidemic foreclosure rates, which disproportionately affect ethnic minorities in America. According to numerous studies, African Americans of all income levels were more than twice as likely to receive high-cost sub-prime loans.
“Blacks and other minorities were the ‘canaries in the mine shaft’,” said Hilary Shelton, Director of the NAACP Washington Bureau. “The NAACP called for a moratorium on home foreclosures over a year ago when we spotted this frightening trend. Instead, the Government elected to wait for the market to adjust,” added Shelton.
For years, the NAACP has testified before Congress warning against predatory lending practices. In July 2007, the NAACP took its discrimination claims to court filing a groundbreaking lawsuit against many of the same lenders seeking relief through the bailout. “We’ve lead this fight and will continue fighting to ensure that the courts hear our claims, even as they consider bailing out the worst offenders,” said Angela Ciccolo, NAACP Interim General Counsel.
In addition to pending lawsuits, the NAACP is calling on the White House and the Congress to supports federal legislation that would:
- Allow bankruptcy courts to supervise loan modifications on primary residences, effectively mediating between lenders and homeowners;
- Place a moratorium on home foreclosures for at least 9 months to allow homeowners to find and take remedial action;
- Require a homeowner or servicer to pursue specific loss mitigation activities such as waiving late fees and other charges, establishing an affordable and sustainable repayment plan or loan modification or forbearance before a home may be foreclosed;
- Protect renters who may reside in homes or apartment buildings going through foreclosure; and
- Require comprehensive oversight and regulation to protect American mortgage consumers.
Lastly, the NAACP is strongly opposed to any legislation that would provide immunity to any financial service provider from lawsuits that address years of racially discriminatory actions.
Founded in 1909, the NAACP is the nation's oldest and largest civil rights organization. Its members throughout the United States and the world are the premier advocates for civil rights in their communities, conducting voter mobilization and monitoring equal opportunity in the public and private sectors.