How the Bank Lobby and Senate Democrats Killed the Homeowner Bill of Rights

The Homeowner Bill of Rights, a bill designed to prevent unnecessary foreclosures, died a sad procedural death this week. We think it’s important you understand how it happened.

DFL Senator Jim Metzen, Chair of the Senate Commerce Committee and a banker in South St. Paul, refused to hear the Homeowner Bill of Rights until all the stakeholders agreed to it: in this case, both foreclosed homeowners and Wall Street banks. This strategy of obtaining consensus among the stakeholders is called “peace in the valley.”

Senator Metzen had these foreclosed homeowners evicted from his office under threat of arrest Monday rather than meet with them. You can see video here.

Of course, no one would ask the mob for approval before allowing a crime bill to advance. No one would ask everyday homeowners for approval before loosening regulations on banks. 

But the DFL’s “peace in the valley” strategy in the Commerce committee means that no bills can advance in the legislature without pre-approval from corporate interests.

Metzen instead agreed to hear a different foreclosure bill that had the approval of the same bank lobbyists who have testified against the Homeowner Bill of Rights at every turn. The foreclosure bill, S.F. 1276, that passed through the Senate commerce committee late Wednesday night was pre-approved by the Minnesota Bankers Association and consisted of the following provisions:

  • A mechanism to enforce federal mortgage servicing rules at the state level.
  • A ban on dual tracking, the process of negotiating with a homeowner and continuing with the foreclosure process at the same time.

A ban on dual tracking was one of our demands in the original Homeowner Bill of Rights. But it will now go into effect in January 2014 in line with the new Consumer Financial Protection Bureau regulations, instead of August of this year as the original legislation stipulated. It is certainly important to regulate dual tracking at the state level as well. But S.F. 1276 serves only to codify existing regulations.

Metzen chairing the Senate Commerce committee Wednesday night. Photo by Chris Juhn.

The new bill is missing these critical protections laid out in the Homeowner Bill of Rights:

  • Mandatory mediation, which would require banks to meet face-to-face with the homeowner and a mediator to discuss alternatives to foreclosure.
  • A private right of action that enforces the ban on dual tracking by ensuring homeowners can go to court to stop or reverse a wrongful foreclosure.
  • A single point of contact, so that borrowers in foreclosure can communicate with one person at the bank through the modification process.
  • Additional protections for tenants renting from landlords in foreclosure
  • Additional protections for military servicemembers facing foreclosure.


The Homeowner Bill of Rights that went into effect in California in January has already decreased new foreclosure filings by over 60%. In Minnesota, foreclosure levels are still three times higher than before the crisis began. It’s well past time for systemic legislative change. 

But Senate Democratic leadership and the bank lobby are holding Minnesotans hostage from the kinds of reforms that could actually slow the housing crisis.

Watching Wall Street’s influence play out at the Capitol has only strengthened our commitment to the struggle. We will keep fighting, in the streets and in the Capitol, until housing is the domain of the people, not the banks. We will fight until all Minnesotans have access to housing with dignity. We shall not be moved.


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