CA Reinvestment Coalition Demands for Bailout Bill

Dear CRC Members:
As you know, the bailout plan being rushed through Congress will not
solve the economic crisis unless it addresses the root of the problem –
defaulting mortgages and home foreclosures.
The California Reinvestment Coalition (CRC) sent letters today to
leaders of the House and Senate Banking Committees and the Speaker of
the House urging them to approach the Administration’s $700 billion plan to bail out the banking system with caution. Millions of
taxpayers are losing their homes, while the companies who sold them
predatory loans are being let off the hook in this proposal. The bailout plan is being pushed by Treasury Secretary Henry M. Paulson,
who until now denied the existence and impacts of the subprime meltdown.
In California, we are seeing city deficits increase by
millions of dollars as neighborhoods are devastated by foreclosures that
are the direct result of predatory subprime lending. All solutions to
this crisis must aim to stop spiraling home foreclosures and alleviate the impact they are having on cities and neighborhoods.

Three things we hope you will do today or tomorrow (Congress is moving
very fast.):
* Go to the National Community Reinvestment Coalition web site
(www.ncrc.org) to easily register your opinion with your Congressperson.
* Contact the district office of your Congressperson so that they hear
from constituents. You can use
http://www.visi.com/juan/congress/cgi-bin/newseek.cgi?site=ctc&state=ca
to get that contact information.
* Pass this on to your friends and colleagues. This may be the most
momentous, quick decision that Congress has made in decades. They need
to hear our voice

In order to ensure that communities are protected from further
devastation wrought by the current crisis, Congress must not pass
Paulsen’s plan unless it includes measures to:
• Impose a six-month moratorium on foreclosures to allow families to
remain in their homes while working with housing counseling agencies and
their loan servicers to negotiate an affordable
workout plan that will keep them in their homes.
• Reform the Bankruptcy Code to allow judges to modify all home loans.
Judges are allowed to modify the loans on second homes, so there is no
reason why they should not be able to do this
for first-time homeowners.
• Ensure that long-term, affordable loan modifications are given to
borrowers struggling to make their payments, along the lines of what
FDIC Chair Sheila Bair is doing with Indymac Bank, FSB. In addition,
homeowners should have their principal brought down to an amount that
equals the current value of their home (if there is evidence of
predatory lending in the making of their loan).
• Reform our regulatory structure so that financial firms are subject to
meaningful oversight that will deter abusive practices that maximize
profit but destroy neighborhoods.

many thanks
alan

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Alan Fisher
California Reinvestment Coalition
474 Valencia St., Ste. 230, San Francisco 94102
(415) 864-3980