Occupy Homes MN and Neighborhoods Organizing for Change along with a coalition of other housing policy advocates and organizations packed the hearing room at the State Capitol today as a new bill addressing foreclosure was introduced before The Minnesota House Committee on Housing Finance & Policy. The committee held an informational hearing on H.F.83, aka, "Minnesota Homeowners’ Bill of Rights." Powerful testimony began inside the press conference room as foreclosure fighter and dual-tracking victim, Rose McGee shared her support of this bill, "I want to see this particular bill passed so that people who don't even know yet that they're going to have to deal with something like this, won't have to deal with something like this. People who are poor, people who are renting, people who are being kicked out on the street because their particular dwelling is being foreclosed...this is not just my fight, this is a fight for people of all classes. This is something that is about humanity."
Since 2006, more than 150,000 Minnesota homeowners have lost their homes to foreclosure ravaging our communities while thousands more sit vacant. In 2012, there were three times more foreclosures in Minnesota than in 2005.[i] Amidst a continuing housing crisis, Minnesota would be the second state in the nation, after California, to pass this kind of legislation. California passed the "California Homeowner Bill of Rights" last year. The committee heard from several community members including a powerful statement from Rabbi Michael Adam Latz directly addressing legislators. "You have the power to stop such unnecessary suffering, to liberate our neighbors from the shackles of the foreclosure crisis and uncertainty, desperation and financial ruin. You can end this immoral and outrageous behavior of dual tracking by proclaiming what it is: an illegal depraved toxic scam destroying the soul of the Minnesota we love!" The hearing ending with a testimony from Vietnam War Veteran Doug Drews who built his family's home himself over the course of three years. "Three years ago Agent Orange got me and so I can't continue to run my business that I'd built up since 1975...the bill here is great, the only thing that's not in this bill is a law requiring, especially for military personnel and retired veterans, is to renegotiate a lower interest rate. Many foreclosures could have been solved by dropping the interest rate, so pass the damn bill and the rest of it is a waste of time."
We agree that this current draft of the bill is a great start but as Mr.Drews stated today the bill does not go far enough to protect all Minnesotans. Occupy Homes understands that the foreclosure crisis goes beyond the scope of individual homeowners. We see it on the ground everyday. While we were excited by today's great work at the Capitol, we will continue to fight for legislation that protects all Minnesotans including renters, children, veterans, farmers and those experiencing homelessness. We'll see you on the ground.
See below for the current list of what's included in the bill.
A Minnesota Homeowner’s Bill of Rights would protect homeowners during the foreclosure process by:
Implementing a foreclosure mediation program. There is growing recognition of the effectiveness of foreclosure mediation programs in preventing unnecessary foreclosures by bringing lenders and homeowners together for a face-to-face conversation about the homeowner’s situation and available options. There are now jurisdictions in 25 states that use foreclosure mediation. Around the country, more than 70 percent of mediated cases reach a settlement – usually one that means a family stays in their home. Those for whom paying a mortgage is not a sustainable option also benefit by negotiating a “graceful exit” in how and when they move out.
Banning dual tracking. The law would prohibit mortgage companies from pursuing foreclosure while a homeowner is seeking a loan modification, a process known as “dual tracking,” that has resulted in numerous foreclosures of homeowners who were actively working to stay in their homes. Modification departments at banks like Wells Fargo and Bank of America, for instance, often instructed homeowners to stop making payments in order for them to get assigned to the loan modification program. However, when the homeowners followed these directions, the banks often foreclosed on them anyway.
Requiring a single point of contact. The law would require that mortgage companies assign struggling homeowners a “single point of contact – an individual who knows about the homeowner’s loan, has access to decision makers, and will handle the flow of documentation between the homeowner and the mortgage company. The law would also require mortgage companies to explicitly approve or deny a modification, verify foreclosure documents, and provide such documentation to homeowners upon request.
Allowing homeowners to sue their bank following a dual tracking loss. Homeowners would have the right to seek damages, including attorney’s fees, if they incur a loss as a result of dual tracking. This private right of action has been extremely valuable for homeowners in other states. A judge in Louisiana, for instance, awarded a homeowner $3.1 million in damages because of “reprehensible actions” from Wells Fargo, which serviced the loan.
[i]Minnesotans for A Fair Economy; Minnesota Legislature Begins Process to Address Statewide Foreclosure Crisis