Tenants Left In Limbo by Missing Condo Owners; Advocates Call On Banks To Help Create Housing Coops

BOSTON/Roxbury – Wanda Castle does just about everything the owner of a Boston triple-decker would do to maintain her property including basic repairs and paying for water and electricity in common areas of the building. And if this were a normal situation Ms. Castle – who has lived in this building on the Roxbury/Jamaica Plain border as a tenant for two and a half years - would be paying a regular stable rent to live there. But the situation is anything but normal. Wanda Castle her fourteen year old daughter and her neighbor Inell Mendez are living in limbo as the banks and mortgage service companies that own the three separate condo units of this triple-decker figure out what to do with these properties sitting on the edge of foreclosure; known in banking parlance as “non-performing assets.” The mortgages apparently are in default but according to Ms. Castle she and her neighbors have not received an official notification of foreclosure or eviction. “I really don’t know what’s going on. The only time when anyone has come by is when a realtor from a limited license corporation came by which was a month ago and they said our building was number 28 but it’s not. As far as I know I live at 24; that’s where my mail goes that’s where my lease is.” Even the building’s address is in dispute. The US Postal Service delivers to 24 Cobden Street. But the city assessor’s office has no record of that street address; only recognizing 28 Cobden as the address of record. Several neighbors along Cobden Street told reporters they opposed the construction of this building approximately four years ago because they feared that condominiums would be hard to sell and would possibly become abandoned properties. The situation appears even more convoluted. No one seems to know exactly who owns the current mortgages on these condos. On the web page of the City of Boston Assessor’s office the owner of Wanda Castle’s unit is listed as HSBC Bank USA of Orlando FL. According to Neil Brazil HSBC North America Vice President of Public Affairs his bank serves as trustee for a set of properties but doesn’t actually own this unit. In an email Brazil promised to track down the name of the responsible service company. In the meantime he provided the following statement: “As trustee the bank has only a nominal role with respect to the properties owned by the trust. Under the agreements that establish the trusts other companies are designated as servicers to handle matters such as mortgage foreclosures loan modifications evictions and sales of foreclosed trust properties. "As HSBC acts only as trustee for the trust that owns the mortgage in this case it is inappropriate for us to comment.” Update: Since we published this story Neil Brazil of HSBC wrote in email that GMAC was the mortgage service company for Wanda Castle's house. The following day he wrote again: "I am writing to let you know that I gave you the name of the servicer of the property in error. It is in fact Ocwen. Please see below the name and number of someone at the company to call if you wish...Neil Brazil." Ocwen Vice President and Assistant General Council of the West Palm Beach Florida company William C. McBride also responded: "HSBC has asked me to respond to your inquiry regarding the above referenced property. While it is generally not Ocwen’s policy to comment on individual loans I can tell you that the property in question is an REO property which Ocwen services on behalf of HSBC." REO is shorthand for "Real Estate Owned " basically a "non-performing real estate asset" that is in or near foreclosure." All of which does not sit well with local housing activists such as Melonie Griffiths of the Jamaica Plain based social justice organization City Life/Vida Urbana. “It’s about having a place to live it’s about community it’s about doing what’s right. And the bank needs to sell these properties so that something can be done. These families ” she said at a recent Saturday rally “could have had some sort of resolution over a year ago. They’ve been going through this two years some of them...most of the homeowners in this neighborhood have been taken advantage of and it’s time for us to take back our communities and to fight.” Herself a beneficiary of assistance from City Life Ms. Griffiths was forced from her family home last year following foreclosure proceedings. This year members of the organization’s Bank Tenant Association have participated in at least three eviction blockades as activists try to forge a strategy that bridges the financial and political gaps between mortgage holders city officials tenants and homeowners. Despite the angry language directed at banks on a recent Saturday in Roxbury Griffiths says City Life’s refusal to back down from the group’s public intervention tactics helps convince banks and other mortgage holders to negotiate with homeowners and tenants in distress. “And in terms of exposure the only thing that seems to be really working is what we’re doing: refusing to leave and forcing the bank to negotiate because if we didn’t do that the bank wouldn’t negotiate. We’re open to the government helping us find other alternatives but for right now in order to keep families sustained and keep our communities together this is what we’re gonna do.” A relatively new strategy outlined publicly at the City Life sponsored demonstration in Roxbury would have the banks sell these units and other residential properties to non-profit organizations which in turn would establish cooperatives. This say activists would allow people to stay in their homes. Housing coops typically provide residents an ownership stake in a limited liability corporation or other legal entity recognized by the city. Member residents agree to share the management and upkeep of the entire property. While no formal coop proposals have been made by City Life organizers yet to any of the banks with pre or post foreclosure properties in Boston activists have been working with non-profit groups to develop a variety of progressive financial models. One such organization is Boston Community Capital. Pat Hanratty Director of Foreclosure Programs says while she and her colleagues in community development are receptive to the idea of coops the immediate concern is to identify owners and to buy the homes. “What we’ve been doing is to work to help people either pre or post foreclosure to stay in their homes and prevent abandonment and vacancy and therefore prevent neighborhood blight. We also have bought a couple of condo units that were vacant and had been foreclosed upon quite a while before.” Ms. Hanratty said Boston Community Capital has not met with the tenants on Cobden Street but emphasized “one of the things we would be looking at is trying to buy the property the individual condos or multi-family units to enable people to stay in their homes and to figure out the best possible solution. We haven’t done a coop before but we are certainly open to learning about it and seeing if that’s an appropriate solution for these buildings." Ms. Hanratty came out of retirement to join Boston Community Capital. A former executive with Fleet Bank she says the majority of people she has helped were victims of predatory lending practices. “And this was particularly true in the neighborhoods of Boston in the lower to moderate income neighborhoods of Boston. There were a substantial number of mortgages that were written that were in fact predatory loans. And we’ve done a good deal of research on this and we’ve looked at the Federal Reserve Bank of Boston data. If you look at where the highest incidence of foreclosure is today and you look back several years to where the Federal Reserve Bank of Boston said there was high levels of predatory lending going on what you’re going to find is an amazing coincidence in terms of the overlays of the map [between lower income neighborhoods and foreclosures in Boston.]” One institution in particular that has been singled out by housing activists is the Bank of America. Several times this year including a Valentine’s Day “Break Up With the Bank” protest in February local branches were picketed by City Life and other organizations. Activists say Bank of America officials have told them they do not want to act as landlords in cases where accepting rent from homeowners in default or tenants could be an alternative to forced evictions. Members of the Bank Tenants Association also have accused the bank of offering foreclosed owners small reductions in the principal they owe but in most cases eventually selling the mortgages on these properties to other companies at great losses. In an email response to an Open Media Boston inquiry about Bank of America’s position on selling distressed properties to cooperatives Senior Vice President for Media Relations Colleen Haggerty wrote that “The bank does not have a strategy to sell non-performing notes to non-profit cooperatives. The majority of loans we service are not owned by us and are in securities which preclude such sale of non-performing assets. Instead Bank of America is committed to the success of the new Making Home Affordable (MHA) program and helping homeowners avoid foreclosure whenever possible. Since July we have modified or provided rate relief for mortgage loans to 150 000 customers…” The Making Home Affordable Program is a federal program established by the Obama administration to according to its website “stabilize our housing market and help up to 7 to 9 million Americans reduce their monthly mortgage payments to more affordable levels.” Still sharp criticism of the government and it’s nearly trillion dollar bailout of banks and insurance companies continues to be heard in cities such as Boston where the high price of everything is driving people to leave the state in large numbers. This exodus in fact may lead to the loss of a Massachusetts Congressional seat following the U.S. census in 2010. Boston City Councilor Chuck Turner who is fighting federal bribery and conspiracy charges continues to speak out against what he sees as a long history of complicity between elected officials and large corporations. “Fifteen twenty years ago there was a housing crisis in this community as well as across the nation. Who created that housing crisis: the same financial institutions that created this housing crisis. And why were they able to create another housing crisis twenty years later based upon greed? They were able to do it because the government bailed them out. It didn’t bail out the families twenty years ago ” Turner said “who found themselves going from their sense of ‘I’ve finally made it ’ to ‘they’ve done it to me again.’ Those families didn’t get bailed out but the banks got bailed out. Twenty years later we’re in the same situation…and who’s left to suffer we are.” Several Councilors attended the City Life rally including Michael Flaherty and Charles Yancey. Flaherty who is running for Mayor this year said the City Council recognizes the impact the national housing crisis has had on local residents. “It’s a significant issue that pains our city we need to do a better job. It’s attending events such as this. It’s letting the people that you [elected officials] represent know that we’re in this together and that we need to be a little more creative in how we solve these problems. Giving bailouts to banks and to corporate CEOs clearly does not resonate with this crowd or with those in local government…so we need to work together to identify funding mechanisms to keep people in their homes.” Charles Yancey who represents Dorchester on the Boston City Council also criticized the bail-out first ask questions later approach taken by Congress and the administration. “We have the culpability of many of the most prestigious and well known national and international financial institutions who have turned their backs on working people for too long. How unfair it is for you to bailout all the banks in the United States some of which participated in exploitative practices and then come home to find you’re facing homelessness. There’s something not right about it. It’s like saying the economy is fixed when we have massive unemployment.” Councilor Yancey has served on the City Council for more than twenty five years. In the last 2 years he’s seen the council reject an ordinance that would have established collective bargaining rights for tenants but support several home rule petitions establishing a foreclosure mediation program and a moratorium on foreclosures within the city; something state legislators have been debating the last few years. The difference it seems is that everything has changed - from politics to the economy - following the global financial meltdown in 2008. OMB Audio of this report Photos by Elise Filo. © Elise Filo 2009 Bookmark/Search this post with: Delicious Digg StumbleUpon Reddit Newsvine Facebook Google Yahoo Technorati