NAACP speaks out on lending

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COLUMBIA --- Even with new lending restrictions proposed this week by the Federal Reserve, the federal government is doing too little to help homeowners already hurt by unfair mortgage practices, civil rights groups said Wednesday.

"This problem is not going to stop because there are people who are greedy out there, and the best people to take advantage of? The needy," said Sue Berkowitz, the executive director of Appleseed Justice Center, a nonprofit organization that represents low-income residents.

Acknowledging that some homeowners were deceived into agreeing to high-interest mortgages, the Federal Reserve this week proposed new rules that would require mortgage lenders to show that would-be homeowners could afford the mortgages and would require the disclosure of hidden fees, among other restrictions.

"When someone goes to a mortgage broker, the last thing you think is that that mortgage broker is going to put you into a bad loan," Ms. Berkowitz said.

But while she applauds the new restrictions, she said they do too little to help those already deceived by mortgage companies.

Ms. Berkowitz stood with the South Carolina chapter of the National Association for the Advancement of Colored People on Wednesday in support of a federal lawsuit that has been filed in California by the NAACP. In the suit, the NAACP says a dozen mortgage lenders have discriminated against African-American homeowners who were steered into high-interest mortgages when, often times, they should have qualified for a better loan.

Asked whether the mortgage-lending problems are a racial or class issue, South Carolina NAACP President Lonnie Randolph said he couldn't differentiate between the two.

"Race is a factor in everything," Mr. Randolph said. "Race is a part of life, just like food, water and air is."

"As much as we want to say that great progress has been made (regarding racism), we're still trickling along," he said.

He said the lawsuit has several goals, including:

- An injunction to stop racially discriminatory lending practices

- Racial-understanding training for mortgage lenders

- Creation of third-party oversight of lenders

- Return of excessive payments to homeowners.

Ms. Berkowitz said she also intends to work with the Legislature this session to strengthen some of the bills that have been proposed to address predatory lending practices.

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Reality
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Reality 12/20/07 - 10:20 am
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The lending practices have

The lending practices have nothing to do with intelligence or economic back round, yea right...........

AugustaGA1
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AugustaGA1 12/20/07 - 03:06 pm
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The mortgage "crisis" has

The mortgage "crisis" has occurred because people who don't need to be homeowners because of low income or bad financial behavior went and bought houses 3-5 years ago when they should have saved a few more years for a conventional 80/20 loan. Let the foreclosures happen, and the market will correct itself. All these "poor" people were given disclosures that forewarned them of inevitable interest hikes and baloon payments. If they didn't read what they signed at closing, why should the government step in and give hand outs? Throwing in race here as an issue clouds the real issue: you have people who tried to make a quick buck doing a flip, or getting into a house they cant afford. These people are from every race, color, and origin under the sun. The one common factor? Race? No, simply put: Stupidity.

Tall1
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Tall1 12/20/07 - 03:48 pm
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Standing Ovation for

Standing Ovation for AugustaGA! I meet all my bills, work my butt off, and get no bailouts. I'm glad people will have to prove they can now afford the new cars and houses BEFORE they get them. Mr Johnson's statement scares me. "Race is a factor in everything," Mr. Randolph said. "Race is a part of life, just like food, water and air is." I just read on another story the Augusta Metro area is 53% black. Does this mean whites are now eligible for minority protections?

godogs
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godogs 12/20/07 - 04:51 pm
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I don't understand why race

I don't understand why race has to come in to play here. Why should anyone purchase something they can't afford and be allowed to keep it when they don't pay their bills. If you can't afford it don't buy it. Live within your means. My lender told me when I went for approval that I could afford a house $80,000 more than what I bought. I knew their would be other living expenses besides a house, food, electricity, cars, gas, etc. Common sense told me what I could and couldn't afford. I am sorry people of ALL COLORS are in this mess but they signed the dotted line and put themselves in these situations. What about the man that loses his job due to layoffs of a company, are we supposed to bail them out as well. This is part of life. We all have unfortunately circumstances in life but we learn from them hopefully. My husband and I bought a house that we could pay for as well as our other bills if one of us got laid off or became disabled. It would be tight but we wouldn't lose what we worked so hard for. COMMON SENSE

a crazy old man
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a crazy old man 12/20/07 - 07:01 pm
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I'm feeling ya Southernmomma.

I'm feeling ya Southernmomma. You go girl.

Semibored
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Semibored 12/20/07 - 08:40 pm
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Got nothing to do with race -

Got nothing to do with race - it has to do with STUPID people making STUPID decisions, doesn't matter what color.

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