Holding Banks Responsible for St. Paul’s Housing Crisis – 12/1/11
COUNCIL MEMBERS PRESS BANKS TO TAKE RESPONSIBILITY FOR MITIGATING
ST. PAUL’S HOUSING CRISIS: Religious and Community Leaders Stand with City in Support of Responsible Banking
ST. PAUL, MN, December 1, 2011 – Members of the St. Paul City Council recently sent a letter to four major banks urging them to use their power and take responsibility to mitigate the impact of the housing crisis that is negatively affecting the well-being of families, neighborhoods, and the entire City. The letter was sent to US Bancorp, Wells Fargo, Bank of America and JP Morgan Chase Bank.
“Banks must be held accountable for their participation in the housing crisis. The letter from our City’s leaders asks banks for principle write-downs and mediation for all homebuyers before foreclosure,” said Eve Swan from Save Our Homes. “With the start of the holiday season, I am reminded of what it would mean to me personally to be without a home, a place to welcome my family and friends. No one should be without a home.”
The City Council agreed to send a letter to the banks during a 450-person community meeting where they heard residents and community groups share their experiences on the devastating impact home foreclosure has had on their lives and on their neighborhoods. A study released by ISAIAH at the meeting, shows that St. Paul’s minority neighborhoods have been overwhelmed by subprime lending, foreclosures, declining home values, and vacant buildings. Almost one out of two vacant homes are located in these neighborhoods, although they contain only one out of five houses in the City.
The letter going to the banks urges that they adhere to a set of six best practices to work toward preventing foreclosure including loan modification and loan counseling services.
This action by the City Council is part of a growing movement across the country for cities to look for ways to increase responsible banking. It is the first of a series of actions ISAIAH and other community groups will be taking to hold banks accountable for St. Paul’s housing crisis.
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