Will the Obama housing plan become a classic case of false compassion that leads to more bureaucracy and more despair? | Marvin Olasky
Greg Kahn/Genesis Photos
FORT MYERS, Fla.—The Fort Myers metropolitan area, lapped by the waves of the Gulf of Mexico, is neck and neck with desert-clime Las Vegas in a race to become the abandoned home capital of America. Almost one out of every eight households in those two areas received foreclosure notes in 2009. When President Obama in his State of the Union address on the evening of Jan. 27 pledged to "step up refinancing so that homeowners can move into more affordable mortgages," people here listened.
Earlier that day, though, the complexities of coming through on that pledge were becoming apparent. The Harborside Event Center here filled up with 1,000 mortgage-troubled homeowners who came for a HUD-sponsored workshop on "making home affordable." Counselors from the Home Ownership Resource Center, a Fort Myers nonprofit that offered individualized help to 711 homeowners last year, spent the day prepping 78 distressed residents on how to talk to lenders. They saw that some may get help, but reported that others have homes far, far "underwater"—worth far less than they paid for them—and "they're extremely angry."
'The whole process is confusing'
Community group claims a disorganized Bank of America is dragging its feet on loan modifications | Alisa Harris
After Ken Kelly saw the value of his California home decline from $600,000 to $350,000, he asked Bank of America (BoA) to renegotiate his loan through the federal Home Affordable Modification Program (HAMP). After bouncing from representative to representative, he sent his paperwork in November, only to be told there was a technical glitch and that he should delay his payments. He says that when he finally received new paperwork, his loan payment had gone up $400 a month to penalize him for the missed payments the bank told him not to pay, and would later increase even more. The new agreement was not a HAMP modification.
"The whole process is confusing," Kelly said. "A lot of the times you don't understand what they're giving you." People Improving Communities through Organizing (PICO), a national network of faith-based community organizations with allies like Sojourners and the Presbyterian Church (U.S.A.), is organizing a national campaign against BoA, accusing it of delaying loan modifications and violating its agreement with the Treasury Department by offering its own modifications instead of using HAMP.
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COVER STORY |
Issue: 
No pious baloney
