Philly Residents Save Their Homes—For Now

By Randy LoBasso
Add Comment Add Comment | Comments: 2 | Posted Jan. 12, 2011

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Under water: James Tyson, a member of the Philadelphia Unemployment Project, is struggling to save his home from foreclosure.

Philadelphia homeowners are waiting for some bailout money from the feds. In fact, they’ve been waiting for 175 days. But hey, it’s the nature of the beast, right? It’s a known fact that government action is slow. Unless, of course, that action is bank bailouts; it took just 25 days after President Bush put his ink to the Troubled Asset Relief Program bill in October 2008 for Citigroup, Goldman Sachs and Wells Fargo to get help. It’s a confusing message to send to the American people.

Luckily, there is hope that the federal funds for Philly homeowners are still coming. Which is why sheriff’s sales for nearly 1,500 residential properties in foreclosure have been delayed a month.

More than $105 million is owed to Pennsylvania as part of the Emergency Homeowners Loan Program, which was signed into law by President Obama in July as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Members of the Philadelphia Unemployment Project believe the funds were supposed to be available in October 2010, when the EHLP officially took effect. But the U.S. Department of Housing and Urban Development still hasn’t released those funds and likely won’t by the end of January. Which may be why Judge Pamela D. Dembe, the president judge of the Court of Common Pleas of Philadelphia, was on board with the moratorium.

“We did good,” says PUP member Jacqueline Aponte at a meeting last week. “I’m thankful for organizations like this one that’s able to give us the opportunity to have our voices heard. We have rights and we’ve been given the opportunity to pay up when we get the money.”

Aponte lost her North Philadelphia home during the 2008 mortgage crisis, when she was laid off from her real-estate job. She has since moved in with her sister in Kensington and does volunteer advocacy work for PUP while representing her sister in court to keep from losing the home they now live in together.

Like many members of PUP, James Tyson could have lost his home after the 2008 mortgage crisis. He’d been working in the residential mortgage business for the past 20 years and watched most of his lenders go out of business by the end of 2008. Since then, he’s struggled through periods of unemployment and underemployment. PUP helped him gain modifications on his home loan as well as two forbearances, each consisting of three months. Luckily, says Tyson, Dembe seemed on board with the moratorium “as soon as I walked through the door.”

While out of work, Tyson and Aponte have made it their cause to help others in danger of losing their homes, volunteering with the organization and advocating in Philadelphia, Harrisburg and Washington, D.C., for themselves and others facing tough times. On Jan. 13, they and other advocates will be back at City Hall to discuss further sheriff’s sale delays.

According to the yet-to-be enacted EHLP law, up to $50,000 is being allocated in zero-interest loans for each homeowner who qualifies, or who is behind on their mortgage payments due to unemployment, underemployment or medical bills. They’ll also be given up to 24 months of monthly payments on required expenses.

When asked about the arrival of the more than $105 million, HUD spokesman Brian Sullivan sounded flabbergasted by the notion that Philly residents have been waiting for help since October. “You mean when we announced the allocations? Why would they think that?” he says.

Maybe because a HUD press release dated Oct. 5, 2010, said so: “It is HUD’s intention for the program to begin taking applications from eligible homeowners by the end of the year.”

“I know at the time we indicated it was the intent of the program to begin taking applications from eligible homeowners by the end of the year,” Sullivan says. “But as time went on it appeared that that just was not going to happen so now the target is the first quarter of this year. Certainly not in October. Nobody ever said that.”

One of the reasons for the delay in funding, Sullivan says, is the creation of a loan program from scratch. “We, like everybody, are keen to get this program up but there’s a million moving parts to a brand new loan program,” he says. “We haven’t operated a loan program, I don’t know, not in my 10 years here … Maybe back in the day they did but I think everyone here at HUD has never done this. But Dodd-Frank put a billion dollars into our program and said, ‘HUD, operate a loan program.’ And so we have to stand one up and that’s what we’re doing.”

That’s not all that’s standing in the way of Philadelphians and their homes. There are a bunch of new politicians in Washington who believe they were brought in to downsize government, stop spending and prevent more handouts. Somewhere in this mix are several parts of the Recovery Act, a common foe amongst Tea Party types.

Delivering on the funding this year “may be even harder to obtain with Republicans vowing to cut spending as they take control of the House of Representatives and boost their roles in the Senate,” according to a recent Reuters story. Another common train of thought among Republicans who’ve taken over is to slow down the process of instituting the Dodd-Frank Wall Street Reform and Consumer Protection Act in order to “study whether the spending is warranted,” Texas Rep. Randy Neugebauer, head of the House Financial Services oversight subcommittee, told Reuters. The delay, while perhaps forthright, has been lobbied for by several big Wall Street banks and financial companies, from Goldman Sachs to BlackRock, who are afraid of the imposition of a new rule book for the financial sector.

Meanwhile, the homeowners are still waiting.

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1. Gregory Wilkerson said... on Jan 13, 2011 at 02:03PM

“I beleive that everone shoukl be able to save there homes in have the oppertunity to have a safe place to live our goverment should be apart of that”

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2. Anne Beauregard said... on Jan 18, 2011 at 09:10AM

“Strongly support keeping people in their homes.”

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