Regulation of Lenders Who Discriminate

The foreclosure crisis, the collapse of home values, and the housing market in the United States has been felt everywhere. But no where as strongly as in the urban and outlying suburban areas that are most heavily populated by minority communities.

I work in the non-profit housing sector, specifically in the sale of affordable homes, the collapse of the market has effected my job. It is now much harder for even non-profit developers to be able to compete with the prices of some REO's and Bank Owned units in neighborhoods where we have homes listed.

There is a very cool website http://www.realtytrac.com/ that tells you which homes are in pre-foreclosure or are already bank owned. For us Real Estate enthusiasts it's everything you wanted to know about your neighbors home payments, and how many months late with them they might be. It will also tell you what price the Bank is likely to take for the home. So while good for real estate voyeurs it brings to light the truly disturbing trend of foreclosures by neighborhood, how many people are really in trouble... Check out San Francisco by neighborhood for example, and you can see by the tiny flags listed that predominately minority communities are being hit hardest. Well, it seems that there is at least one likely reason for this.

When Eliot Spitzer was Attorney General of New York (before the hookers) he noticed that a disproportionate number of high interest loans were being given to black and Hispanic families, he filed a lawsuit against Wells Fargo, Citi, and Chase under New York's anti discrimination/consumer protection laws. A Federal District Judge in 2005 and a Superior Court of Appeals in 2007 ruled against New York, after New York and Spitzer were sued by the Treasury Department and Comptroller of the Currency who are in charge of regulating national banks. The judgement essentially said that the states don't have any authority to regulate what banks do. Including committing clearly discriminating and predatory practices against a states own minority population apparently. So flash forward to 2009 and this very issue is being examined by the Supreme Court. Here is a New York Times article with some quotes from justices on the pending decision. http://www.nytimes.com/2009/04/29/business/29bizcourt.html?_r=2&ref=business

The absence of regulations, and the discriminatory practices of banks in this country, that were allowed to go on over the past couple of years, while the market soared to ridiculous heights, as adjustable rate loans were issued to first time home buyers, has been under a great deal of scrutiny under the new administration. The practices that were allowed to go on have been thrust into a brighter spot light by the collapse of the housing market and the impact it has had on big business and individual investors alike.

Deregulation has dangerous connotations, but there has to be some protection for consumers, and if not by states then by who? Home ownership is good for neighborhoods, when you have home ownership you have a decrease in the level of violence on the streets as people's pride in what is theirs is allowed to soar. With the amount of foreclosures now facing traditionally disadvantaged neighborhoods cities are pulling in on themselves again, crime rates are up and this hurts everyone. I'm just saying besides being outrageous it's a damn shame.

Los Banos

Yep, means the bathrooms in Spanish, but it's a town in California, a rural ass town off highway 5 a couple hours outside of the Bay and light years from Los Angeles.

Tucked away in the Bathrooms is an absolutely incredible Frank Lloyd Wright...

Bombing down a dirt road in between a dairy and what might have been an almond farm, a couple of palm trees can be seen and a flat roof. My heart skipped a little, I was going to see my first FLW!, and it was an open house... that means looking in the closets and everything! I wish I could have brought everyone I know to see it, amazing, totally worth the 4 hours round trip, I made with my Mom.

The formal living room had a fireplace inside that a full grown man could stand upright in, and the most exceptional copper detailing's, triangles were a theme throughout, cut into the ceiling with light bulbs inside, even in the cement floors. You can see cement floors everywhere now, but when Frank was doing it, that was cutting edge. Not just windows follow the entire home on both sides but one entire side of the building is just connected glass doors, you can open the entire house up to the outside. Mind Blowing. Really.

Below are some photos we took that day, both Mom and I are armature photographers, but we were so flabbergasted by the house, this is the best we could do. Enjoy!