Obama’s Plan Won’t Stop Foreclosure Crisis in San Jose, City Hall Must Act Now

February 25, 2009

                                                                   FOR IMMEDIATE RELEASE                                                                                                                                        

Contact: Margie Marquez, PACT Leader, 408.259.0226
Jenne Wood-Taylor, PACT Organizer, 408.835.670

PRESS CONFERENCE:

Obama’s Plan Won’t Stop Foreclosure Crisis in San Jose, City Hall Must Act Now

When:             Wednesday, February 25, 2009, 1:30 p.m.

Where:              Most Holy Trinity, 2040 Nassau St., San José, 95122

What:      PACT faith and community leaders will challenge the City to use SB 1137 to hold banks accountable for maintaining foreclosed vacant properties.  This should be an incentive for banks to sit down with homeowners and modify loans to prevent more foreclosures and keep families in their homes.

Who:      San Jose Mayor Chuck Reed and City Councilmembers Nora Campos, Rose Herrera, Sam Liccardo, Madison Nguyen as well as San Jose Housing Director Leslie Krutko and Police Chief Rob Davis and have been invited and will be asked to consider action needed at the local level of government.

Why:    Most Holy Trinity (MHT) PACT faith and community leaders are asking the City to use SB 1137 as a local tool to get banks to participate in keeping neighborhoods safe and families in their homes. SB 1137 is a State bill signed into law in July 2008 that allows cities to fine banks $1,000 per day if they do not maintain foreclosed vacant properties. The PACT faith community sees this as an incentive for banks to sit down with homeowners and do loan modifications to keep families and neighborhoods intact.

For some people it’s too late. Julia lost her house a month ago and is living with relatives. After she got the first notice she stayed for a while, but it did not feel like her house anymore, and she left before they put a padlock on her door. Now all of her things are in storage. She works for the school district, so she does not know if she will have a job next month.

Francisca is one of thousands in Eastside San José who is on the brink of losing her home. Last June her bank raised her mortgage payment by $657 dollars per month, and she has been paying it since then, but now her husband’s work hours have been reduced by almost 40%. They would have been able to make regular payments without too much financial restraint, but when the loan adjusted they depleted their entire family savings, including their children’s college funds.

“At this time of economic challenge, it is easy to forget the human tragedy that is devastating our communities. It’s not about collecting $1,000 fines per day… banks need to see that sitting down with homeowners is the best option. Families and neighborhoods throughout San José are feeling the consequences when homes are foreclosed. We’re experiencing the pain. Even those of us who aren’t losing our houses are losing our neighbors, our property values, and the safety in our neighborhoods. Banks can no longer be up on the hill and far away from this pain. They’re part of our communities, too. Banks count on us as their customers, and now we’re counting on the banks as partners to create solutions,” says Steve Rodríguez, Most Holy Trinity parishioner and PACT leader.   

On December 3, PACT asked the City for more support for Neighborhood Housing Services of Silicon Valley (NHSSV) to provide foreclosure counseling.  PACT has partnered with NHSSV to hold foreclosure prevention workshops at two PACT churches. But, while many people have been counseled, the banks are still not cooperating. Now, PACT is asking the City do something more proactive to put pressure on the banks. The City has Code Enforcement officers that already work on blight.  They need to prioritize keeping up vacant bank-owned properties that are blight and growing public safety problems in many San Jose neighborhoods.

“By doing this, we believe the banks will be more inclined to work with homeowners to renegotiate loans,” says Margie Marquez, Most Holy Trinity parishioner and PACT leader.

“President Obama’s plan is moving us in the right direction, but additional action is needed locally. We know that as strong as the plan is, this is going to take a multi-tiered solution. Right now we’re asking for local collaboration,” says Aurora Solis, Most Holy Trinity parishioner and PACT leader.

Preventing a foreclosure is a win-win-win for families who can stay in their homes, for banks that avoid the tens of thousands of dollars to process a foreclosure, and for local communities that avoid the blight of vacant foreclosed property.

PACT: People Acting in Community Together is an interfaith, grassroots organization that has been empowering people and working for change in this valley for 25 years. We represent 21 member congregations and more than 50,000 people in Santa Clara County.

February 25, 2009