Community Demands Responsible
Stephanie Delaney was sick of rats and roaches invading her home at 2275 Morris Ave. in Fordham Bedford. She was tired of getting heat and hot water only sporadically. And she was fed up with her landlord ignoring her complaints. So she took her case to the bank that held his mortgage.
Brooklyn resident Ruben Curry was at risk of losing his home of 40 years, after he took out a few loans that had heavy fees and interest rates. Deep in debt, he turned to a nonprofit housing group which helps seniors get out of debt and takes on culpable banks.
These testimonies were presented to federal bank regulators at a Nov. 30 meeting sponsored by the Northwest Bronx Community and Clergy Coalition, to demonstrate the need for more responsible lending among banks. The event was one of seven national meetings set up for community organizations to provide input to regulators of the banking industry.
"We started all this because we felt that we were shut out," said the coalition's president, Myra Goggins. "We asked if we could be involved in reshaping and revising [regulations]."
Topping the agenda, community leaders demanded that banks ensure that buildings under their mortgages are in good condition. They also urged regulators not to allow banks to include loans made to slumlords as part of fulfilling requirements under the federal Community Reinvestment Act, an anti-redlining measure which mandates that banks reinvest in the communities in which they receive deposits.
After bank inspectors saw the poor conditions of Delaney's building for themselves, the bank and city courts pressured the landlord to make repairs. But the building had been so bad for so long that Delaney thought action should have come sooner. "We shouldn't have to get to that point before action is taken," she said.
In Curry's case, he was able to save his home from foreclosure only after the Parodneck Foundation, a nonprofit housing group, stepped in and helped refinance his loan. But Howard Banker, who works for Parodneck, said Curry was just one of many low income homeowners, including many seniors, who fall victim to high cost "predatory" loans.
Community leaders want regulators to take a more active role in preventing bank abuses by conducting a selective audit of banks to examine their properties and loan-lending practices.
Other concerns raised at the meeting included overinflated real estate and rental costs and the lack of affordable banking services. Meeting participants complained they end up paying high fees at check-cashing outlets and ATMs because of the lack of banks in the northwest Bronx.
The five bank regulators in attendance, from the Federal Reserve, the Office of Thrift Supervision, and the Office of the Comptroller of Currency, didn't commit to any concrete changes, but agreed to consider community concerns. Community input will be factored in to the revision of the Banking Modernization Act in 2002.
"We've made them aware of these conditions," Goggins said. "It was an eye-opening experience for them to see what really happens ... It will bring about positive change in revisions in the future."
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