#YESTOBLACK

GOP Targets Programs That Helped Blacks Fend Off Foreclosure

GOP Targets Programs That Helped Blacks Fend Off Foreclosure

A Republican-helmed House panel is set to go after the Obama administration’s project to assist struggling homeowners who are having trouble meeting their mortgage obligations.

Published February 25, 2011

When Republicans took over the House in November 2010, they pledged to cut spending and yank the course of the legislative body rightward. Today they’re making good on that promise, and they’re attacking the African-American community in the process.

Next Thursday, the Republican-helmed House Financial Services Committee is set to go after the Home Affordable Modification Program, the Obama administration’s project to assist struggling homeowners who are having trouble meeting their mortgage obligations. They’re also interested in decimating three other housing assistance programs.

So, what do housing programs have to do with Blacks? A lot, actually. If you’ll recall, America’s recent mortgage crisis has hit everyone hard, but it’s been especially brutal to African-Americans. Fifty-five percent of Blacks were given predatory, high-cost home loans at the height of the housing boom, while just 17 percent of whites were.

The result? Far more Blacks and Latinos lost their homes than whites, the Washington Independent reports:

About 8 percent of Black or Latino homeowners who took out a mortgage or refinanced between 2005 and 2008 lost their homes between 2007 and 2009, compared with 4.5 percent of white homeowners.


Of the minorities who were able to keep their homes, many used Obama’s housing assistance programs to help stay afloat and ride out the recession. But those programs are now in jeopardy.

Republicans say for it's good reason, as do some of the government’s own federal inspectors, who last month said the Home Affordable Modification Program “continues to fall dramatically short of any meaningful standard of success.” Piggybacking off that criticism, House Republicans are gunning for the modification program, which reduces struggling homeowners’ monthly mortgage payments by giving them lower interest rates and longer repayment periods.

Democrats on the committee, however, are not budging. “As we continue to respond to the victims of the foreclosure crisis in a responsible way,” said Massachusetts Congressman Barney Frank, “we will make the case that there are better ways for the federal government to cut spending than by attacking these programs.”

Up to 3 million people are expected to lose their homes this year. And 2.9 million lost their homes in 2010. Though the administration’s modification program isn’t perfect—far from it, in fact—it’s still estimated to ultimately save about 700,000 to 800,000 homes. For those hundreds of thousands of families, the program is probably just fine.

 

Image:  Chris O'Meara / AP Photo

Written by Cord Jefferson

COMMENTS

Latest in news