Richard Whalen

“August and September were the two highest monthly foreclosure filing totals we’ve seen since we began issuing our report in January 2005,” said James J. Saccacio, chief executive officer of RealtyTrac.  “Although not all areas are being hit as hard as others, the rise in foreclosures is quite widespread, with 45 out of the 50 states documenting year-over-year increases in the third quarter. Given the number of loans due to reset through the middle of 2008, and the continuing weakness in home sales, we would expect foreclosure activity to remain high and even increase over the next year in many markets.”

To add to this nightmare, the Center for Responsible Lending, a nonpartisan research and policy organization, in a December 2006 study, says that more than 2 million people with subprime loans are facing foreclosure this year and nearly 20 percent of subprime mortgages issued between 2005 and 2006 are projected to fail.

Why have our presidential candidates not acknowledged this devastating impact on our communities and businesses?

One Democratic presidential hopeful – Senate Banking Committee Chairman Christopher Dodd – smells the coffee and recently told CNNMoney: “We cannot simply sit back and watch as up to 2.3 million families lose their homes….the Federal Reserve analysts first noticed eroding lending standards from late 2003 through early 2004. At the same time, the Federal Reserve Board was encouraging lenders to come up with more adjustable rate plans ….from 1 percent to 5.25 percent, pushing many adjustable rate mortgages beyond the means of borrowers.”

The House finally decided November 15 to crack down on mortgage lenders by “forcing them to get licenses, making them responsible for discovering whether borrowers can really repay, and fining them for steering people toward risky subprime loans,” reported the Washington Post. The bill number is H.R. 3915 and it passed 291-127. It now goes to the Senate.

Do you remember the Depression-era “Hoovervilles?”  During the Great Depression many families lost their homes because they could not pay their mortgages. These people had no choice but to seek alternative forms of shelter. Hoovervilles, named after President Hoover, who was blamed for the problems that led to the Depression, sprung up around cities throughout the United States.

It is totally irresponsible that the shocking numbers of foreclosure filings including default notices, auction notices and bank repossessions have not been adequately discussed by our presidential candidates in any debate or other venue.

There is one politician who is an exception and remembers -- Mayor Michael Bloomberg.  On September 28, 2007, the New York Post carried a story with the headline: “Housing in Central Park?” Bloomberg  responded: “It [housing in Central Park] is not out of the question if disaster strikes and the city finds itself desperate to find homes for thousands of displaced residents.”

Bloomberg announced a design competition for long-term emergency shelter and added: “Clearly, in an emergency, rather than let people sleep on the streets, you would do that.” Using a grant from the Rockefeller Foundation, the Mayor has invited ideas from around the world to house as many as 38,000 people in a fictional neighborhood called “Prospect Shore.”

Candidates: Listen Up! Mayor Bloomberg sees a crisis and has already thought about how New York City would be able to respond and take care of its residents. What are your plans?