On Tuesday, February 12, 2008, the Bush administration announced Project Lifeline. This is the President’s approach to address the crises in home foreclosures. This crisis has rocked the economic foundation of the country.

Senator Charles Schumer, Chair of the Joint Economic Committee, whose letter to me on this subject I recorded in my article on Wednesday, February 6th entitled, “A Letter from Senator Schumer and My Response,” has been diligent in working on the crises. He, along with Representative Carolyn B. Mooney, Vice Chair, “estimate that there will be approximately 1.3 million foreclosures, and loss of housing wealth of more than $103 billion through the end of 2009 (including $71 billion in direct costs to homeowners and $32 billion in indirect costs caused by the spillover effects of foreclosure).” Others project an even higher cost; for example, the Center for Responsible Lending estimated that foreclosures will cost about $164 billion for loans made in the last eight years.

More specifically on the impact as it relates to blacks and Latinos, following are some of the key findings recorded by the organization – United For a Fair Economy:

We estimate the total loss of wealth for people of color to be between $164
billion and $213 billion for subprime loans taken during the past eight
years. We believe this represents the greatest loss of wealth for people of
color in modern US history.

From subprime loans, Black/African American borrowers will lose between
$71 billion and $92 billion, while Latino borrowers will lose between $75
billion and $98 billion for the same period.

According to federal data, people of color are more than three times more
likely to have subprime loans: high-cost loans account for 55% of loans to
Blacks, but only 17% of loans to Whites.

If subprime loans had been distributed equitably, losses for white people
would be 44.5% higher and losses for people of color would be about 24%
lower. This is evidence of systemic prejudice and institutional racism.

Based on improvements in Median Household Net Worth before the current
crisis (from 1982 to 2004), it would take 594 more years for Blacks/African-
Americans to achieve parity with Whites. The current crisis is likely to make
it take much longer.

Homeownership rates for Blacks/African-Americans compared to Whites
are already starting to take back recent gains. At the current rate of
improvement (from 1970 to 2006), parity will not be achieved for another
5,423 years.

The spillover effect of the subprime crisis affects whole communities
negatively, in terms of abandoned houses, increased crime, devaluation of
neighboring houses, and erosion of the tax base, causing revenue shortfalls
that mandate service cuts. The crisis is having a negative impact on property
owners, as well as neighborhoods, and local and state governments.

Rules made the crisis worse, and rule change can make it better via better
policies. Just as many policies in the past and today have supported asset
development for the wealthy, so can new policies support asset development
for those injured by the subprime crisis.

Broad racial and economic inequalities need to be addressed for the success
of any policy solutions to the subprime crisis.

Even closer to home, in 2007, statistics showed that over 2,700 Brooklyn homeowners were refinanced by subprime lenders, over 1,500 of them are now faced with a form of foreclosure action and that of the 1,500 families 80% were non-white.

Several months ago, realizing the gravity of the crises, we commenced having weekly forums to address the issues, including educating and assisting people on how to get a stay on mortgage foreclosures, money management and debt restructuring. We invited bankers, lenders, community activist and governmental officials to provide information and to offer solutions. We channeled the energy, ideas, and concerns into an organization we named Operation Life Line. We then formed committees in the following areas: Legal, Legislative, Education, Financial Literacy, Youth, Court Appearance, and Health & Social Services.

Significantly, the President and his administration has named their program Project Lifeline. We are forced to ask, “Was the President listening to us? Did he get his name, Project Lifeline, from our Operation Life Line?” We received a letter from Senator Schumer recognizing our work in this regard. If our efforts reached Capital Hill, it is reasonable to conclude it also reached the White House. Be that as it may, whatever the source of the idea, the effort to address the foreclosure crises is long overdue.

The President’s program includes a moratorium on foreclosures for those who are 90 days behind on their mortgages. Borrowers will be given a 30-day grace period to confer with their lenders and hopefully working out a plan that will save the borrower’s home.

This program will initially involve six of the largest mortgage lenders: Citigroup Inc., Bank of America Corp., Countrywide Financial Corp., Wells Fargo & Co., JPMorgan/Chase & Co. and Washington Mutual Inc.
It should be kept in mind that this is an emergency plan. It does not address the fundamental problem. But at least it’s something that will help some people. We should accept it while continuing to pressure for more until the issue has been resolved.

For more information, this Thursday, February 14th in the Timbuktu learning Center at the House of the Lord Church, Operation Life Line in its weekly forum will be providing additional information. It is very, very important for those who are in some form of foreclosure to be at this meeting.

Upcoming Events

Attend the Timbuktu Learning Center’s weekly Thursday Night Community Forums. All Forums are held at the House of the Lord Church from 7pm to 9pm.

Join Operation Life Line if you need assistance or know someone who needs assistance with their mortgages as it relates to foreclosures, predatory lending and/or sub prime lending.

Attend NRLAA’s monthly forum Focus on Africa the 2nd Saturday from 2pm to 4pm.

Organizing Meetings regarding Darfur every Thursday - 12noon @ the House of the Lord Church

Keep abreast of our Darfurian activities by checking our web page @ www.holnj.org.

For further Information on all events, contact The House of the Lord Church @ (718) 596-1991.