California Advocates Attend National Community Reinvestment Conference in Washington, DC

Representatives from member organizations of the California Reinvestment Coalition traveled to Washington DC last week to attend the National Community Reinvestment Coalition conference.  The theme of the conference was “A Just Economy: Ideas, Action, Impact.”

The conference is a gathering of NCRC’s diverse membership base from around the US, including CDFI’s, fair housing organizations, housing counseling organizations, consumer advocates, credit counselors, small business lenders, community organizing and civil rights groups, and more.

Speakers at the conference included Shaun Donovan, the Secretary of Housing and Urban Development (HUD),Thomas Curry, Comptroller of the Currency, Steven Antonakes from the Consumer Financial Protection Bureau, Martin Gruenberg, Chairman of the Federal Deposit Insurance Corporation, and more.

Shaun Donovan

Secretary Donovan spoke about potential reforms to Fannie Mae and Freddie Mac and recognized the conference participants for their work to help people during the foreclosure crisis and to also help with rebuilding afterwards.  He also spoke about the ongoing crisis of a lack of affordable housing in communities across America and cited NCRC’s work to ensure that reforms to Fannie and Freddie don’t leave low-income communities behind.


Wednesday night included a screening of “Fleeced”, a documentary about elder financial abuse which was a big draw with a packed room. A panel discussion included Kim Jacobs, the producer of the film, Anita Gardner, a consumer in the film who faced an uphill battle with her bank when she sought assistance with her mortgage after health problems, as well as Robert Zdenek, the Director of National Neighbors Silver at NCRC, and Dory Rand, president of the Woodstock Institute. The film was commissioned by NCRC, with support from the Atlantic Philanthropies.  A screening will also be held in Sacramento on April 15th at 5:30pm, as part of the Housing California conference and Annette Smith, a consumer featured in the film will also be one of the panelists who speaks after the screening.

California delegates flew into Washington DC early to meet with our elected officials as well as banking and housing regulators.

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On Thursday, as part of NCRC’s Hill Day, CRC Members headed to Capitol Hill to meet with their senators and representatives.  There were a number of topics to discuss, a few of the topics the California delegation discussed included:

  • Payday lending and the upcoming rule-making by the Consumer Financial Protection Bureau
  • The need for more investment in affordable housing in California, especially since the dissolution of redevelopment agencies that funded affordable housing
  • GSE reforms (and ensuring that low-income communities aren’t left behind)
  • A recent proposal for the USPS to offer financial services through a prepaid card
  • Effects of private equity firms and other investors buying up homes
  • The Permanently Protect Tenants at Foreclosure Act of 2013
  • Extension of the Mortgage Debt Forgiveness Act
  • Transparency around foreclosure reporting (to see if mortgage modifications and other assistance is getting to communities equally- a topic recently addressed in a February 2014 GAO report (read more here)
  • Small business lending (especially to minority business owners- read our December report about this issue here)
  • Future mortgage settlements, and concerns about transparency of who is receiving modifications, and whether modifications are getting to communities hit hardest
  • Bank mergers and the impact on rural California- For more on why this is such a pressing matter, see CRC’s “Down in the Valley” 2013 report, or our recent protest against the proposed acquisition of Sterling Bank by Umpqua Bank.
  • Issues faced by widowed homeowners who are facing foreclosure instead of receiving assistance from their bank or mortgage servicer. See this December 2013 article that explains why improvements, monitoring, and enforcement are still needed: “Bank might foreclose on home because late husband isn’t residing there

After meeting with their senators and representatives, attendees were especially excited by the lunchtime speaker: Senator Elizabeth Warren, (D-MA), an outspoken advocate who was paved the way for improvements in policies and programs affecting the same communities and people that NCRC’s members serve.

On Friday afternoon, CRC’s new Executive Director, Paulina Gonzalez spoke at a session: Winning Public Benefits for Your Community, with other advocates including Ernest Hogan, Executive Director of Pittsburgh Reinvestment Group, and Mitria Wilson, from NCRC.

Friday night closed with a bang!  The Rev. Dr. William Barber II was awarded the Senator William Proxmire award, which recognizes the individual whose life’s work exemplifies the spirit and work of Senator Proxmire’s contributions to economic mobility.  Dr. Barber gave a rousing speech about the need for organizations to work together to stop disinvestment in communities.  Senator Proxmire was the author and lead sponsor of the Community Reinvestment Act.

Kevin Stein, Associate Director at CRC, was also confirmed to the National Community Reinvestment Coalition board of directors.

A big thank you to our CRC members who joined the meetings, including:

It was another excellent conference put on by NCRC- See you next year!

Wall Street Investors Buy Up Neighborhoods

Rental Homes: Next Wall Street Idea?

Wall Street is at it again

Have you read the recent media reports about Wall Street firms buying up homes in order to create rental portfolios and then securitize the rental payments?

If it sounds familiar- it is.  This is the same strategy that backfired so miserably when Wall Street sliced and diced mortgages.

This week, the Center for American Progress released a report, “When Wall Street Buys Main Street” that more closely examines the first mortgage-backed security supported by income from single family rental properties.  The authors note that the bond is set to mature in two to five years.  If Invitation Homes (a subsidiary of Blackstone) is unable to pay back the bond holders, there could be negative consequences. For example, Invitation Homes could be forced to sell all of the rental homes to pay back the bond.  This sudden flood of homes onto local housing markets would hurt property values, and tenants would also be impacted.

The California Reinvestment Coalition, Housing and Economic Rights Advocates, and other advocates will be calling on federal regulators next week to address this issue.  In the mean time, if you’re interested in learning more about how this new strategy could affect current tenants, homeowners, communities, and prospective homeowners, here’s a few selected articles and resources:

  1. Home Loan Servicing Solutions Ltd. buys mortgage servicing rights from Ocwen and then hires it to collect loan payments. Altisource Residential Corp. (RESI:US) purchases delinquent loans, including some from Ocwen, to turn into rental homes. It’s managed by Altisource Asset Management Corp. And Altisource Portfolio Solutions provides services to Ocwen’s portfolio. “If a mortgage goes into foreclosure and you lose those servicing fees, so what,” said Christopher Wyatt, a housing consultant and former vice president at Goldman Sachs Group Inc.’s Litton Loan Servicing. “You can funnel it to one of your other businesses and still make money from it.” Billionaire Erbey Fails to Halt Ocwen Slide on Probe: Mortgages  (BloombergBusinessweek)
  2. Over the last year and a half, Wall Street hedge funds and private equity firms have quietly amassed an unprecedented rental empire, snapping up Queen Anne Victorians in Atlanta, brick-faced bungalows in Chicago, Spanish revivals in Phoenix. In total, these deep-pocketed investors have bought more than 200,000 cheap, mostly foreclosed houses in cities hardest hit by the economic meltdown.  How Wall Street Has Turned Housing Into a Dangerous Get-Rich-Quick Scheme—Again  (Mother Jones)
  3. Doretha Johnson, 59, had rented a home near North Graham Street and Interstate 85 for nearly four years when her landlord sold it to a subsidiary of Blackstone, a Wall Street private equity giant. The house’s new owner, Invitation Homes, raised the rent by a third, beyond what she said her fixed income would bearCharlotte’s Wall Street landlords move quickly to evict renters (Charlotte Observer)
  4. The report by the Oakland-based Urban Strategies Council entitled “Who Owns Your Neighborhood?” said that 62 percent of the 10,508 completed foreclosures in Oakland since 2007 are either still owned by a financial institution or acquired by an investor. It said that as of October 2011, investors had acquired 42 percent of all properties that went through foreclosure in the cityReport Finds Investors Buying Up Foreclosed Oakland Homes (CBS San Francisco)
  5. Fitch’s concerns are further heightened by the number of operators concentrating their investments in a handful of states and metropolitan statistical areas (MSAs), which, based on most business models, are at the neighborhood level. Because of the specific demographic targeted by these institutional buyers and the inelasticity of rents, transactions are highly vulnerable to unknown variables that could potentially impact the cash flows and yields. Among them include repair and maintenance expense, capital expenditures, rising property taxes, homeowners association restrictions, or the potential for municipality involvement. Unlike other asset classes, SFRs do not have the benefit of historical performance over several business or housing cycles that would otherwise flush out some of these uncertaintiesRPT-Fitch: Too Soon for ‘AAA’ on Single Family Rental Securitizations (Fitch Press Release)
  6. Nicole Borden, a real estate agent with Coldwell Banker in Atlanta, said she was told this month by representatives from Invitation Homes and American Homes 4 Rent that the companies aren’t offering any of the homes on the market to Section 8 voucher holders. “This is not homeownership,” Borden said. “I don’t understand how so many people are being turned down from rentals.”  Wall Street’s Rental Bet Brings Quandary Housing Poor (Bloomberg)

Tenants Rights After a Foreclosure Upheld by California Court of Appeal

LeaseAgreement Photo

Last week, the California Court of Appeal reversed a trial court’s earlier decision and instead ruled in favor of Rosario Nativi, and her son Jose Roberto Perez Nativi, two tenants who were evicted when their landlord was foreclosed on.   The mother and son had been renting the garage of a house for several years in Sunnyvale, and then in 2009, the property was foreclosed.  The Nativis did not realize their landlord had stopped paying the mortgage, and had continued dutifully paying their rent.

After the foreclosure, Deutsche Bank became the owner of the property, and hired American Home Mortgage Servicing, Inc to service the property.  American Home Servicing, Inc, then hired XL Advisors Inc. dba Advisors Real Estate Group (Advisors), to prepare the property for sale and remove the tenants.

Despite the fact that the Nativis had a lease, representatives of Advisors Real Estate Group removed all of  their belongings and put them outside where they were ruined. Advisors Real Estate Group also called the police when the Nativis tried to regain access to the garage they had been renting.  The tenants sued, and a trial court ruled in favor of Deutsche Bank.  However, the California Court of Appeal reversed that decision on January 23, 2014.

Madeline Howard, who helped initiate the case while at Bay Area Legal Aid and is currently a staff attorney with Western Center on Law & Poverty, explained the significance in a press release: “Because of this decision, tenants like the Nativis, who were locked out of their apartment and left homeless, have recourse in state court.”

The story of a bank becoming the owner of a home after a foreclosure trustee sale is common in California.  Unfortunately, so is the experience of these two tenants who had continued paying their rent and should not have been evicted.  After a trustee sale, some real estate agents will try and get the current tenants out of the property as quickly as possible, offering cash for keys, making illegal threats, or even calling the police.  Tenants may or may not know their rights, and the real estate agents may take advantage of this and try and force them out quickly.

Kent Qian, from the National Housing Law Project, explained the decision is an important victory for tenants under the Protecting Tenants at Foreclosure Act (PTFA), for three reasons:

1) The court ruled that bona fide leases “survive” foreclosure under the PTFA;

2) Tenants in illegally converted garage units are protected under the PTFA; and

3) State law claims can be brought to enforce the PTFA.

As the WCLP press release explains, “the federal Protecting Tenants at Foreclosure Act requires post-foreclosure owners, including big banks, to step into the shoes of the former landlord when they acquire a rental property.”

To read more about the case, visit:

Western Center on Law and Poverty Press Release: “Court of Appeal Rules that Big Banks Step into Shoes of Foreclosed Landlords When Trying to Evict Tenants” 

Law 360 “Calif. Leases Survive Foreclosures, Appeals Court Says

To read the decision, visit this link: Court Opinion.

If you are a tenant who is losing your housing because your landlord is being foreclosed on, you may want to visit the Tenants Together Action Guide for California Tenants in Foreclosure Situations  or call their Tenant Rights Hotline.

The Western Center on Law and PovertyBay Area Legal AidAlborg, Martin & Buddle LLP, and Jenner and Block represented the Nativis.

An amicus curiae brief, drafted by the National Housing Law Project and AARP Foundation Litigation, was filed on behalf of the National  Housing Law ProjectNational Law Center on Homelessness and Poverty, the AARP Foundation Litigation, the National Fair Housing Alliance, and the California Reinvestment Coalition in support  of the Nativis.

Homeowner Bill of Rights Training for Attorneys Representing Homeowners and Tenants

Are you a consumer attorney who works with homeowners or tenants affected by foreclosure?

The HBOR Collaborative presents:



This free training will be held at:


2672 E. Alluvial Avenue, Fresno, CA



Update:  A training has also been added in Ontario, CA, on March 3rd and 4th at the University of La Verne, College of Law.  There is a one-day training for attorneys who work with tenants (Monday) or two-day for attorneys who work with homeowners: Registration.

The HBOR Collaborative presents a free all-day training on the nuts and bolts of representing tenants and homeowners under California’s Homeowner Bill of Rights (HBOR). The training will cover HBOR basics and provide practical tips for representing clients. HBOR became effective on January 1, 2013 and codifies the broad intentions of the National Mortgage Settlement’s pre-foreclosure protections. It also provides tenants in foreclosed properties with a host of substantive and procedural protections. The training will cover the interplay of HBOR with NMS, CFPB servicing rules, and the Protecting Tenants at Foreclosure Act. We will also discuss HBOR’s attorney fee provisions.  Registration information will be available soon.

5 Hours of MCLE Credit

Lunch will be provided.


Watch your inbox for a save the date for our next training in the Inland Empire—coming soon.

The HBOR Collaborative, a partnership of four organizations, National Housing Law Project, National Consumer Law Center, Tenants Together and Western Center on Law and Poverty, offers free training, technical assistance, litigation support, and legal resources to California’s consumer attorneys and the judiciary on all aspects of the new California Homeowner Bill of Rights, including its tenant protections. The goal of the Collaborative is to ensure that California’s homeowners and tenants receive the intended benefits secured for them under the Homeowner Bill of Rights by providing legal representation with a broad array of support services and practice resources.

To contact the HBOR Collaborative team or for more information on our services for attorneys, please visit

The HBOR Collaborative and its services, including this free training for attorneys, are funded by a grant from the Office of the Attorney General of California from the National Mortgage Settlement to assist California consumers.

Appointment of Representative Mel Watt Important Step Forward for Housing Recovery

Rep. Mel Watt is Confirmed to lead FHFA

December 10, 2013–In response to today’s Senate vote to confirm Representative Mel Watt as the next director of the Federal Housing Finance Agency, Kevin Stein, Associate Director of the California Reinvestment Coalition, released this statement:

“The California Reinvestment Coalition applauds the confirmation of Representative Mel Watt to head the Federal Housing Finance Agency, the regulator of Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac. For years, California tenants, homeowners and communities suffered because of the policy positions of the outgoing acting director of the FHFA, Ed DeMarco.  Mr. DeMarco set policy for how banks and servicers are required to service loans held by Fannie Mae and Freddie Mac, including how to provide assistance to homeowners facing foreclosure.  Instead of using this important position to keep more Americans in their homes, he continued policies that greatly worsened the foreclosure crisis.

These policies included:

  • Fighting against the enactment of California’s landmark Homeowner Bill of Rights, a law widely applauded for protecting homeowners and which has already been duplicated in Nevada and Minnesota;
  • Not maintaining sufficient protections for tenants negatively impacted when the homes they were renting were foreclosed on;
  • Refusing to offer favorable principal reduction loan modifications to families struggling to pay their GSE loans;
  • Selling foreclosed Fannie and Freddie homes to private investors instead of residents and nonprofits who could have used the homes to promote community stability; and
  • Aggressively working against local governments who are considering using tools to stem the foreclosure tide, including eminent domain.

In light of these polices, CRC organized a letter (link to letter) in 2012, which 96 organizations signed, calling on Acting Director Ed DeMarco to either resign or change policies at Fannie Mae and Freddie Mac.   CRC is hopeful that FHFA Director Watt will right these, and other, wrongs, and lead the GSEs to finding their way back towards helping all qualified families attain and maintain homeownership, or access much needed affordable housing. We also are pleased Mr. Watt will be in place to ensure that any reform of the GSEs will not leave behind low income tenants, homeowners, and communities.”

Additional background

Since the beginning of the foreclosure crisis, the California Reinvestment Coalition has conducted an annual survey of housing counselors and nonprofit attorneys about their experiences working with banks and servicers.

In CRC’s 2012 survey, (link to survey) housing counselors and nonprofit attorneys reported:

  • 81% reported “mixed or negative” experiences in trying to escalate cases to help homeowners when the loans were held by Fannie or Freddie.
  • 66% of counselors rated loans serviced on behalf of GSEs as either “terrible” or “bad” when asked how likely the servicers were to help borrowers save their homes when they thought that outcome was possible.


Senate Blocks Confirmation of Mel Watt- 97 California Orgs Likely Disappointed in Today’s Vote

Fannie and Freddie

The Wall Street Journal reports that Mel Watt’s confirmation to lead the FHFA was blocked by Republican Senators today.

This vote was important because of the considerable market space occupied by Fannie and Freddie (overseen by FHFA), and the current director’s stance against helping homeowners.

To learn more about why homeowners, housing counselors, and housing advocates have been calling for new leadership at the FHFA, read CRC’s March 2012 letter to Acting Director Ed DeMarco:  97 California Organizations Demand Immediate Foreclosure Policy Changes from FHFA