Home Foreclosure Crisis Showdown in D.C. Led by San Diego’s Mabuhay Alliance

On Tuesday, November 17th, Mabuhay Alliance and 25 major HUD-approved nonprofit home foreclosure organizations will be meeting with four major banks, Bank of America, Wells Fargo, JP Morgan Chase and Ocwen to present their Magna Carta or Bills of Rights for homeowners facing foreclosure. The press release they will be issuing tomorrow is attached with the six Magna Carta principles. This includes a one-year Foreclosure Moratorium for all unemployed homeowners.

The next day, November 18th, Mabuhay and HomeFree-USA will be joined by 100 homeowners for a protest demonstration and press conference outside the Secretary of the Treasury’s office. They will be criticizing his preference for Goldman Sachs over Main Street homeowners. They will then march to the White House and seek to meet with President Obama’s Chief Economic Advisor, Larry Summers.

Mabuhay Alliance also has meetings on November 16th with the leadership from the Federal Reserve, FDIC, Freddie Mac and HUD on the home foreclosure crisis and its Magna Carta for homeowners.

The Executive Director of Mabuhay Alliance Faith Bautista and Deputy Director Mia Martinez will be available for interviews at their Mabuhay home counseling office at 2:00 pm tomorrow Friday, November 13th. A number of staff members doing home counseling for San Diego residence facing foreclosure will also be available.

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Contact:
Mia Martinez, Deputy Director
Rhea Aguinaldo, Media Outreach
858-444-6293
mia@mabuhayalliance.org

Main Street’s bi-partisan suggestion on Obama’s Health Care Reform

by Robert Gnaizda & Elaine Soliven

 

THIS week (September 9), president obama will address Congresson the need for a controversial health care reform package that maynot achieve his objectives. our message to the president is that thevast majority of American communities are underserved by presenthealth care practices and insurance coverage. Many of these communitiessupported president obama’s election and initially supported his health care reforms.

Many now have concerns that the president’s “heroic” efforts tobring to America what Europe has had for two to four generations may not occur without debilitating compromises that we may all regret.

We have no doubt that health care reform is immediately necessary.However, we are dubious that it will occur in a fashion that willbe satisfactory to the 47 million Americans who are uninsured, the50 million Americans who are underinsured and 300 million Americanswho are contributing close to $2.4 trillion a year for one of theworld’s most inefficient health care systems among developed nations.

From Main Street, we offer to the president and the leaders ofCongress eight practical and possibly bi-partisan suggestions thatwould have the overwhelming support of Americans, even if they opposeuniversal health care coverage. They are likely to sail throughCongress or be implemented by the president without Congressionalassistance by July 4th of next year.

A key suggestion is dump the “sweetheart deal” with the pharmaceuticalindustry. its support for the ill-fated health care reformbill is not worth the price. We can save $1 to $2 trillion over thenext ten years primarily by a series of presidential executive ordersand actions that require no Congressional approval. The easiest actionwould be for the president to use his bully pulpit and executivepowers to demand that the pharmaceutical industry provide to allAmericans prescription drugs at the lowest price offered in any developednation, such as Canada, Great Britain or France. This wouldcut present drug costs from $236 billion annually to below $120 billionsince most prescription drugs sell for one-third or one-half theUS price in other developed countries. over ten years, this wouldproduce a savings up to $1.2 trillion. This is fifteen times more thanthe projected savings from the $80 billion “sweetheart deal.”

Similarly, the president should use his executive powers to convincehis newly-appointed chairs of the FTC and his anti-trust divisionchief to exercise America’s often underused anti-trust powersagainst the pharmaceutical industry during mergers and acquisitions.For example, half or more of many pharmaceutical companiesso-called “research and development” is used for other activities,such as enticing university researchers and physicians into promotingtheir products. The proposed pfizer/Wyeth, and Warner Chilcott/p&G acquisitions would be good places to start.

To further lower health care costs, the president should seek a bipartisanbill, likely to be supported by the highly influential Republican Senator Grassley, that would eliminate the $13 billion a year indirect federal tax subsidies to so-called nonprofit hospital that fail tocare for the poor. A recent study shows that 60 percent of the averageso-called “nonprofit” hospitals with tax subsidies offer less than5 percent of their patients free or low cost service. Many of the mostexpensive problems for the uninsured could be addressed withoutcost if hospitals were required to provide 20 percent of their servicesto indigents in order to be tax exempt.

A fundamental problem in cutting health care costs, which are often twice as expensive in the US as in Canada or Europe, is caused by“fee-for service” physicians who control most of the delivery of our$2.4 trillion health care system. Health care costs could be substantiallyreduced if doctors were on salary, as are virtually all of our 2.9million nurses and as are physicians at many health insurers such as Kaiser permanente. Doctors on a “fee for service” basis should be aluxury, not the standard for 21st century cost efficient practices.

Another major reform that is long overdue is empowering America’s2.9 million nurses, particularly those with advanced training,to perform a wide range of medical services that are now part of anoften unnecessary physician monopoly. This should be a conditionfor any federal funding and is likely to slash physician costs by 25 to50 percent and increase the quality of services.

There are many other cost-cutting devices that the president coulddevelop a bi-partisan consensus on. For example, expenditures fornonprofit health care clinics and a major preventive effort to cut obesityby 50 percent which alone could save over $750 billion over thenext decade since in 90 percent of the cases obesity is preventable.

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Robert Gnaizda is a former California Director of Health and Counsel for the Black EconomicCouncil.

Elaine Soliven is the President of the San Diego Filipino American Nurses Association of SanDiego County, Inc. a part of a national network of 180, 000 Filipino American nurses

Viewpoint: A Foreclosure Option: Tenant to Homeowner

American Banker | Friday, May 1, 2009

By Marcia Griffin and Faith Bautista

Major community home counseling nonprofits are experiencing what virtually every financial institution isnow recognizing: Despite the massive reorganization of the Obama administration’s homeownershippriorities, the number of foreclosures will continue to accelerate, and no end is in sight as declining homevalues and increasing unemployment continue unabated.

We urge a Main Street approach that preserves free-market principles and ensures that we remainlargely a homeownership society.

We, as the presidents of two home counseling nonprofits serving virtually every area devastated by theblight and economic cost of foreclosures (from Arizona to California to Florida to Nevada and Ohio), urgea national “Tenant to Homeowner” program. This could be funded by a combination of Troubled AssetRelief Program and economic stimulus money. We recently raised this idea with Treasury SecretaryTimothy Geithner, Federal Reserve Board Chairman Ben Bernanke, and Federal Deposit Insurance Corp.Chairman Sheila Bair.

This is how our program might work: Wherever a homeowner is facing a foreclosure on a primaryresidence, the financial institution offers the homeowner a speedy, uncontested foreclosure while lettingthe owner remain in the home as a tenant and eventually repurchase it.

This option could save financial institutions 50% or more over a traditional foreclosure, if long-termindirect benefits are factored in. Consider, for example, the impact on home prices of neighborhoodstability and minimizing costs attributable to angry homeowners or subsequent vandalism.

Our proposal, which we hope to quickly refine with Obama administration leaders and major financialinstitutions, would contain the following elements:

  • A one- to five-year lease.
  • A rent of 25% to 31% of the tenant’s net income.
  • The right of the tenant to purchase the home at any time during a five-year period for 90% of its value at the time of foreclosure or the value at the time of the subsequent purchase offer,whichever is lower.
  • Allowing up to two months of rent a year, if paid on time, to be applied as a down payment.
  • An $8,000 tax credit for a tenant who repurchases the home.

It may be necessary to provide substantial incentives to financial institutions. We recommend up to$10,000 could go to any institution that completes a tenant-to-homeowner conversion, including payments of $1,000 a year while the tenant is still on the lease. If funding is an issue, this program could be limited to people with income of up to 150% of the median and/or those residing in areas with aforeclosure rate at or above the national average.

As many as 2 million homeowners facing foreclosure and residing in homes that are substantially underwater might make use of such a bold initiative. After all, every national poll demonstrates that the vast majority of Americans, particularly those who live from paycheck to paycheck, prefer homeownershipover being a tenant.

As to those who are unemployed or in part-time employment (almost 16% nationally and almost 20% in hard-hit areas in America), going from tenant to homeowner is not the entire solution. However, if we betthat our recession will be over in 18 months, we can ensure opportunities for leading these groups to homeownership.

The federal government could create a “homeownership/unemployment grant” where there is asubstantial likelihood that within 18 months the unemployed worker would be fully employed. This isconsistent with President Obama’s commitment to create or preserve 3.5 million jobs.

To those who believe the federal government should not fund trickle-up Main Street proposals, we saythat virtually every Bush/Obama trickle-down effort has either failed or missed its mark by anembarrassing margin.

Marcia Griffin is the president of HomeFree-USA. Faith Bautista is the president and chief executive ofthe Mabuhay Alliance.

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Last San Diego Foreclosure Prevention Clinic Before Foreclosure Moratorium Ends


Saturday, January 9th
10:00 am to 4:00 pm
Mabuhay Alliance Office
9580 Black Mountain Rd., Suite A-B
San Diego, CA 92126

At the request of the Obama administration, a brief foreclosure moratorium was voluntarily instituted by many financial institutions to cover the Christmas holiday season. It ends January 13th, 2010.

Mabuhay Alliance will be holding a foreclosure prevention clinic this Saturday, January 9th in order to beat the foreclosure moratorium deadline. Mabuhay Alliance will also be instituting an innovative health care clinic to address the emotional and physical toll caused to families facing foreclosure.

In 2009, Mabuhay Alliance, in clinics throughout California, has helped 5,000 homeowners facing foreclosure or in default in California and Nevada. Professional assistance will be available

Faith Bautista, CEO of Mabuhay Alliance said, “We disagree with Secretary of the Treasury Geithner in ending the foreclosure moratorium on January 13th. We have urged in our meetings with Treasury, the Chairman of the Federal Reserve and the Chairman of the FDIC that there should be a One Year Foreclosure Moratorium for all families who have lost their jobs or were victims of predatory lending practices.”

“We will continue our efforts to seek a new Foreclosure Moratorium and/or an extension of the present holiday moratorium. But, it is very important that families in Southern California take advantage of this last home counseling clinic before the holiday foreclosure moratorium ends on January 13th.” (See letter to Secretary Geithner attached.)

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