Staff Blog
UPDATE: Phila’s Foreclosure Prevention Plan
In June, we wrote about the city's new plan, which has drawn national attention as one of the most innovative — maybe
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| Jean Ruffin, at least, got a break. |
| Isaiah Thompson |
The first phase of the program dealt with a backlog of more than 600 foreclosure cases, a number representing all the houses that would have gone to sale in April, May, or June. Owners were asked to come to court, get paired up with housing counselors and pro-bono attorneys and meet with lenders to try and work out a deal.
As we reported, about half the homeowners did show up, but it was unclear how successful this intervention would be. Few deals were actually struck — most of the meetings were postponed to Aug. 7 to give borrowers and lenders time to work out a plan. And while lenders and housing advocates still expressed optimism, there were clear misgivings on both sides as to whether this would work.
And so, the courtroom filled up again yesterday, as the 140 or so remaining cases were called back in. This time, though, cautious optimism seemed to be giving way to genuine relief, at least on the part of housing advocates.
Of the five or six housing counselors I spoke with, all reported high rates of successful negotiations between their clients, the homeowners and representatives for the lenders.
Pam Kennebrew, a housing counselor for Philadelphia Unemployment Project, had 25 cases — "Basically, they're all reconciled," she reported.
Ian Phillips, Legislative Director for Pennsylvania Acorn, has been highly involved in the program. He said that of the 24 cases in his own workload, most reached agreements.
He was proud of one case in particular, that of Ms. Jean Ruffin (pictured above), a 74-year-old, mostly blind woman who had been scammed into signing a second mortgage by an unscrupulous contractor. Initially, Phillips says, lender GMAC offered Ruffin zero percent interest on her loan. But Phillips fought to have the debt forgiven completely, and succeeded.
All of this, of course, is just the beginning. While foreclosures in Philadelphia are on the rise, the city hasn't had the same crisis that some cities have. Relatively low property values here make lenders less eager to foreclose, as well. Whether they'll continue to be as amenable to bargaining — or whether this will work elsewhere in the country — remains to be seen.
But it's a start, and, apparently, a pretty good one.
I still thing the city ( and the country ) has a long way to go to fix this thing. As for me, I’m just trying to make sure I don’t miss a deal when the govt sells one of these foreclosure properties by keeping track of auctions at http://philadelphiasheriffsales.com/