The organization cites concerns about the settlement not being approved by a court, granting civil immunity, and the lack of transparency for the settlement negotiations.
When news of the Chase settlement talks began to leak out in the fall of 2013, the California Reinvestment Coalition, along with 17 members and allies, signed onto a statement asking for the Department of Justice to structure a deal in a way that would benefit communities and homeowners who have been hard hit by the mortgage meltdown.
The organizations who signed onto this letter have helped thousands of California homeowners facing foreclosure, so the recommendations are rooted in their experiences working with these homeowners.
1) The amount of the settlement should have matched the amount of money lost due to predatory mortgages and improper foreclosure practices like robo-signing. Communities of color have been hardest hit by the meltdown, according to a recent report by the Alliance for a Just Society.
2) A settlement should prioritize keeping people in their homes, especially through using principal reductions on people’s first mortgages. In addition, CRC and our allies called on Chase and any other banks entering into settlements to immediately halt any foreclosure processes until they are able to determine who would qualify for the settlement.
3) As homeowners have sought help with navigating their options with the help of housing counselors and legal service lawyers. Unfortunately, funding for organizations offering these services is often limited. Therefore, it makes sense to allocate some funding to the people helping to keep communities strong.
4) Harmful loan servicing practices have to cease. This is self-explanatory, yet as the Washington Post highlighted last week, (Consumers lodge thousands of complaints about firms that service mortgages) the Consumer Financial Protection Bureau is still seeing loan servicing problems.
5) Affordable housing- California was facing an affordable housing crisis before the mortgage meltdown, and this crisis has only been exacerbated by the meltdown and Wall Street investors who are buying up communities.
6) Since the beginning of the crisis, members of the California Reinvestment Coalition have called on regulators, elected officials, banks, servicers, and policymakers to increase transparency of efforts to help homeowners. This includes demographic information so that we could see whether or not communities are benefiting equally from the settlement. This issue was also addressed in a new GAO report titled: “TROUBLED ASSET RELIEF PROGRAM: More Efforts Needed on Fair Lending Controls and Access for Non-English Speakers in Housing Programs” that cited CRC surveys and concerns about unequal access.
7) Strong monitoring and enforcement of the agreement is vital to ensure that the bank actually complies and homeowners actually benefit.
If you’d like to read the more detailed statement and see the 17 other organizations that signed onto the statement, visit the press release: “Lessons from Past Mortgage Settlements Should Guide Department of Justice Settlement with JP Morgan Chase”