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Hundreds flock to Detroit foreclosure hearings

To keep your kids away from measles, move here

Article source: http://www.washingtonpost.com/posttv/national/hundreds-flock-to-detroit-foreclosure-hearings/2015/01/30/eae68f4e-1cb6-46e6-94f6-0259b160c844_video.html

Wayne County, Michigan, Begins Tax Foreclosure Hearings

Wayne County Michigan Tax Foreclosure HearingsHearings began Thursday for thousands of homeowners behind on taxes and facing foreclosure in Wayne County, Michigan, at the Cobo Center in Downtown Detroit, according to an announcement from the Cobo Center.

The hearings will continue through Friday and resume Monday, then continue through Friday, February 6.

Last year, Wayne County began an aggressive foreclosure campaign on about 75,000 homeowners who were three years or more behind on their property taxes.  About 62,000 of those homes are located in Detroit, and according to some estimates, only about 37,000 of those homes are occupied. The Wayne County Treasurer’s office is expecting about 21,000 homeowners delinquent on taxes to appear for hearings. County officials will review each case and discuss assistance options and foreclosure alternatives with each homeowner.

On January 14, Michigan Governor Rick Snyder signed off on legislation that allows homeowners in the state who are facing financial hardships to work out a payment plan to satisfy their tax obligations and avoid foreclosure.

“Helping homeowners overcome financial hardship and meet their legal responsibilities will help keep families in their homes in a responsible way, lessen the number of vacant buildings and improve public safety while generating tax dollars to provide vital services to city and county residents,” Snyder said. “Developing a more transparent foreclosure system also ensures previously foreclosed property does not return to the hands of delinquent taxpayers.”

The goal of Wayne County’s aggressive foreclosure campaign was not to remove the homeowners from their homes, however; in fact, it designed to help keep people from losing their homes. Of the 56,000 homes for which Wayne County began foreclosure proceedings in 2013, only about 20,000 of them – about 36 percent – actually completed the process, according to Wayne County Deputy Treasurer David Szymanski.

County officials are encouraging those delinquent on their taxes to attend the foreclosure hearings in order to work out a solution that will allow the homeowner to keep his or her home.

“The earlier in the process we contact a distressed taxpayer, the more likely we are to find a successful resolution,” Szymanski said. “The earlier we contact them, the more options they have available.”

Article source: http://dsnews.com/news/01-29-2015/wayne-county-michigan-begins-tax-foreclosure-hearings

Last-ditch foreclosure hearings draw many Detroit homeowners

Hundreds of Detroit homeowners in danger of losing their properties flocked Thursday to hearings that offered a last-ditch chance to avoid foreclosure and to keep the houses from adding to the city’s already huge glut of vacant dwellings.

The homeowners nearly filled a long conference room in Detroit’s Cobo Center while waiting for their cases to be heard. Many hoped to work out payment plans to ease their tax debts under new laws signed this month by Republican Gov. Rick Snyder.

“Everybody does have a story. Most of them are probably true, because you couldn’t make them up if you try,” said Eric Sabree, Wayne County’s deputy treasurer of land management. Officials expect more than 14,000 property owners to seek help over seven days of hearings that run through Feb. 6.

“We have to collect taxes by law … but we definitely do not want to take the property,” Sabree said. “We want to show options that people have to save their properties.”

More than 60,000 of the county’s 76,000 foreclosed properties are in Detroit, threatening neighborhoods that have yet to recover from the national mortgage crisis.

About $326 million in taxes, interest and fees are owed on the foreclosed homes, lots and other buildings in Detroit. Mapping data shows that about 37,000 of those properties are occupied.

“One of the reasons why we want people to stay in their homes is because when they become abandoned, they get stripped. They become a crime scene. They become a drug house,” Sabree said. “It’s better to let the person stay in the house and collect taxes even if it takes longer to collect the money.”

Mourice Neal was looking for just a little help. His tax bill is $4,900 on a home he bought in 2013 on Detroit’s North End. Paying that amount would dangerously stretch what he receives in Social Security payments.

“It’s a good process. They are looking at my income,” said Neal, who is 46.

But Thomas Jackson left his hearing without knowing if anything could be done with the $27,000 tax bill on his home in northwest Detroit. He said he was told special consideration was needed to get a payment plan. He has another hearing next month.

“They told me they can’t help me here,” said Jackson, 40, who has not paid taxes on his home since 2012, when he lost his automotive job.

He has since found a new job and wants to keep the house he bought in 2009, but said losing it would not be the end of the world.

“I’m working now. I can find somewhere else,” he said.

Regina Lee, 50, went to the hearing ready to pay the $1,200 owed on two lots that sandwich the home she grew up in. She said she was unaware her now-deceased grandmother listed her as owner of the lots until a relative received a foreclosure notice from the county.

“That’s my grandmother’s legacy,” Lee said. “I guess she put my name on them for a reason. I’m hoping that I can pay to keep them or do a down payment.”

Article source: http://www.miamiherald.com/news/business/article8569616.html

Hearings Offer Help To Wayne County Property Owners In Foreclosure

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Article source: http://wdet.org/news/story/013015-Wayne-Co-Foreclosure/

With funding redirected to blight elimination, far fewer homeowners get …

DETROIT, MI — While the Wayne County treasurer’s office this week prepared to hold thousands of hearings for struggling homeowners looking to avoid tax foreclosure, a federal inspector was reporting to Congress on the risks of diverting foreclosure prevention funds to anti-blight efforts.

About $500 million in federal Hardest Hit funds were estimated in 2010 to be able to help about 50,000 Michigan homeowners.

That estimate has since dropped to under 12,000, according to the quarterly report from Christy Romero, special inspector general for the Troubled Asset Relief Program.

TARP, the federal rescue program that aided failing financial institutions as well as General Motors and Chrysler starting in 2008, set aside Hardest Hit funds to help struggling homeowners avoid foreclosure.

The U.S. Treasury Department in 2013 approved using 20 percent of Michigan’s share to demolish vacant houses in Detroit, Pontiac, Flint, Saginaw and Grand Rapids. Another 15 percent was added in a 2014 approval.

As of September 2014, the state had used about $8.7 million of the $175-million pot for demolition and greening on 816 blighted properties, according to the report.

“Previously, Treasury used HHF to make payments to homeowners or to mortgage servicers to help keep homeowners in their homes,” Romero wrote in her report to Congress.

“Treasury’s Blight Elimination program allows for substantial payments of TARP funds to land banks, non-profits, and other parties, including demolition contractors, in cash and mortgages that can be forgiven over time. For example, the HHF Blight Elimination program in Michigan provides up to $25,000 per property. Through September 30, 2014, the latest data available from Michigan, Michigan reported that it had paid an average of almost $11,000 in HHF funds per property to remove 816 properties.”

Blight elimination is new to the Treasury Department, and more difficult to track, Romero warned, urging stronger oversight measures.

“Given the nature of this TARP program, the limited performance history, and the very different set of risks involved in making large payments of taxpayer dollars to individual contractors and other parties not previously participating in a TARP program, Treasury cannot conduct the same type of oversight that it has used for programs that provide assistance to homeowners and mortgage servicers,” she wrote. “Treasury must develop and implement new and appropriate oversight tools to monitor its Blight Elimination program.”

She also told WDET in a Thursday radio segment that the steep drop in actual homeowners receiving help from the federal funding adds to her concerns.

“The number of homeowners estimated to be helped with these federal bailout dollars has dropped 77 percent (in Michigan),” Romero said.

“… Homeowners should have had access to these funds a long time ago,right when they needed it, at the heart of this as they were struggling back in 2010, 2011, 2012… If Treasury is going to allow the use of this money for this, we’re very concerned that there’s not enough checks and balances.”

City and state officials have repeatedly called the use of TARP funds for anti-blight initiatives a key part of efforts to restore the state’s hardest-hit neighborhoods.

As of September 2014, the program funded the demolition of 201 structures in Detroit, 266 in Flint, 298 in Saginaw and 51 in Grand Rapids.

Meanwhile, the Wayne County treasurer’s office this week was holding hearings at Cobo Center for as many as 21,000 property owners who could seek payment plans on taxes owed from 2012 through 2014.

The county lists about 62,000 properties in Detroit alone facing tax foreclosure this year, according to the Associated Press.

Related: Detroit property tax assessments to decline as 62,000 properties face foreclosure

Article source: http://www.mlive.com/news/detroit/index.ssf/2015/01/with_funding_redirected_to_bli.html

Last-ditch foreclosure hearings draw hundreds to Detroit

Hundreds of homeowners in danger of losing their properties flocked Thursday to hearings that offered a last-ditch chance to avoid foreclosure and to keep the houses from adding to the city’s already huge glut of vacant dwellings.

The homeowners nearly filled a long conference room in Detroit’s Cobo Center while waiting for their cases to be heard. Many hoped to work out payment plans to ease their tax debts under new laws signed this month by Gov. Rick Snyder.

“Everybody does have a story. Most of them are probably true, because you couldn’t make them up if you try,” said Eric Sabree, Wayne County’s deputy treasurer of land management. Officials expect more than 14,000 property owners to seek help over seven days of hearings that run through Feb. 6.

“We have to collect taxes by law … but we definitely do not want to take the property,” Sabree said. “We want to show options that people have to save their properties.”

More than 60,000 of the county’s 76,000 foreclosed properties are in Detroit, threatening neighborhoods that have yet to recover from the national mortgage crisis.

Laws signed earlier this month by Republican Gov. Rick Snyder allow homeowners facing financial hardship to seek a payment plan.

About $326 million in taxes, interest and fees are owed on the foreclosed homes, lots and other buildings in Detroit. Mapping data show that about 37,000 of those properties are occupied.

“One of the reasons why we want people to stay in their homes is because when they become abandoned, they get stripped. They become a crime scene. They become a drug house,” Sabree said. “It’s better to let the person stay in the house and collect taxes even if it takes longer to collect the money.”

Mourice Neal was looking for just a little help. His tax bill is $4,900 on a home he bought in 2013 in Detroit. Paying that amount would dangerously stretch what he receives in Social Security payments.

“It’s a good process. They are looking at my income,” said Neal, 46.

But Thomas Jackson left his hearing without knowing if anything could be done with the $27,000 tax bill on his home in northwest Detroit. He said he was told special consideration was needed to get a payment plan. He has another hearing next month.

“They told me they can’t help me here,” said Jackson, 40, who has not paid taxes on his home since 2012, when he lost his automotive job.

He has since found a new job and wants to keep the house he bought in 2009, but said losing it would not be the end of the world.

“I’m working now. I can find somewhere else,” he said.

Regina Lee, 50, went to the hearing ready to pay the $1,200 owed on two lots that sandwich the home she grew up in. She said she was unaware her now-deceased grandmother listed her as owner of the lots until a relative received a foreclosure notice from the county.

“That’s my grandmother’s legacy,” Lee said. “I guess she put my name on them for a reason. I’m hoping that I can pay to keep them or do a down payment.”

Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Article source: http://www.freep.com/story/news/local/michigan/2015/01/29/tax-foreclosures-wayne-county/22518185/

ACLU: Group Improperly Barred Protesters From Detroit Park

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By COREY WILLIAMS/Associated Press

DETROIT (AP) – A nonprofit group that maintains a popular downtown Detroit park improperly barred groups from protesting there, a lawsuit filed Wednesday alleges.

The American Civil Liberties Union names the Detroit 300 Conservancy and Guardsmark security in its lawsuit filed in federal court in Detroit.

The lawsuit contends that a security guard asked four members of the anti-foreclosure group Moratorium NOW! to leave Campus Martius as they began petitioning last February against cuts to city pensions in Detroit’s bankruptcy plan. The guard told the group that the public park was in fact private and that they risked arrest, according to the lawsuit.

About 15 members of Women in Black-Detroit, an anti-war group, also were prohibited in June 2013 from marching through the park, the lawsuit said.

“Campus Martius belongs to the city of Detroit and its people,” ACLU staff attorney Brooke Tucker told reporters Wednesday. “Regardless of who manages our public assets, no private organization’s rules will ever trump the freedoms enshrined in the U.S. Constitution.”

The ACLU is seeking a preliminary injunction to stop the banning of petitions and marches at Campus Martius, and an admission from the conservancy that the actions violated First Amendment rights, Tucker said.

Campus Martius is considered by many as downtown Detroit’s public square. Musical programs, Christmas tree-lighting ceremonies and other events are held there. The park is turned into an ice-skating rink in the winter.

On its website, the Detroit 300 Conservancy lists itself as successor to Detroit 300 Inc., which funded construction of Campus Martius. The conservancy says it is “responsible for management, maintenance and operation of the park” under an agreement with the city.

The organization said in an email that it would review the claims but that before Wednesday it was unaware of concerns about the events cited in the lawsuit.

“The conservancy takes the diverse and inclusive stewardship of Detroit’s public spaces very seriously and has a long history of working with our public and civic community partners,” it said.
Guardsmark didn’t immediately respond to a message Wednesday seeking comment.

Mayor Mike Duggan’s office said the lawsuit is being carefully reviewed.

“The city will appropriately respond in court,” city attorney Melvin Hollowell said in an email. “Of particular note is that the two alleged events giving rise to the lawsuit occurred a year ago and almost a year and a half ago, respectively. The city of Detroit respects the constitutional rights of all our citizens, and our policies reflect that.”

Duggan took office as mayor in January 2014.

Some types of demonstrations may need local permits, but First Amendment rights would apply for people in public parks anywhere whether the parks were managed by a city or a private entity, said Peter Scheer, executive director of the First Amendment Coalition.

The nonprofit is based in San Rafael, California, and focuses on protecting rights under the First Amendment and public access to information about government.

Detroit, which emerged in December from the country’s largest municipal bankruptcy, has entered into public-private partnerships as a way to improve some public amenities without using money the city doesn’t have available.

The ACLU says in 2013 it urged another nonprofit – the Detroit RiverFront Conservancy – to stop preventing demonstrations along the Detroit RiverWalk.

“As privatization becomes more widespread (there is concern) that people will somehow lose their rights,” said Michael Steinberg, ACLU legal director. “Campus Martius is a public park owned by the city of Detroit for the people of the city of Detroit, and they should be able to express their views on matters of public importance just like at any other public park.”
© Copyright 2015 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.

Article source: http://detroit.cbslocal.com/2015/01/28/aclu-group-improperly-barred-protesters-from-detroit-park/

House of Cards: A DC Real Estate Column – The Intercept

In October of 2014, former Democratic Senator Majority Leader Tom Daschle and his wife sold their seven-bedroom, seven-bathroom house on Foxhall Road for $3.25 million.

It was not an unusually large haul for a member of Washington’s political elite, but it was a big step up from his financial circumstances in 2003. Daschle’s financial disclosure form—filed a year before he lost a race to John Thune, marking the first time in more than half a century that a Senate party leader failed to win reelection—showed his net worth to be between $400,000 and $1.2 million. It was a pitiful amount by congressional standards and led CNN to disparage him as a senator of “modest means.”

After leaving office, however, Daschle immediately began making millions by advising corporations. During the two years prior to his failed nomination to head Health and Human Services he netted $5.2 million, mostly from healthcare, energy, private equity and telecommunications companies. That included big compensation for speaking appearances (he is, according to his speakers’ bureau profile, “a tireless fighter for the common man”) and for authoring such works as, Getting It Done: How Obama and Congress Finally Broke the Stalemate to Make Way for Health Care Reform, which was subsequently found to induce narcolepsy in laboratory rats.

There’s a common perception that government doesn’t work and that “partisan gridlock” has made things worse than ever. But when it comes to fundamental economic questions, there is no partisan divide in Washington and the system is “broken” only if you’re part of the growing slice of the population that’s poor or middle class, for whom average income has been stagnant for decades.

For those at the top of the economic pyramid, like Tom Daschle, government is ruthlessly efficient at funneling money upward via tax cuts and loopholes, corporate subsidies, deregulation and other business-friendly policies. The richest 400 Americans now own more than the bottom half of the population combined and inequality “is greater now than it has been at any time in the last century, and the gaps in wages, income, and wealth are wider here than they are in any other democratic and developed economy,” historian Colin Gordon writes in “A Political History of American Inequality.” Meanwhile, a new report by Oxfam predicted that, by next year, the world’s richest 1 percent will command more wealth than everyone else.

One of the reasons that government works well for the wealthy is that so many elected officials are wealthy themselves, and directly benefit from the economic measures they pass. The median net worth of the current Congress is slightly north of $1 million, according to the Center for Responsive Politics, and that surely understates their wealth because it’s based on financial disclosure forms that don’t require the listing of real estate holdings.

Our millionaire politicians depend overwhelmingly on campaign contributions from their class comrades to win and hold office. Only 0.18 percent of Americans donate $200 per year to political candidates and only 0.03 percent give the legal maximum of $2,600. Washington has about 646,000 residents, just .02 percent of the U.S. population. But in 2014 thus far people using DC home or business addresses have collectively contributed $237 million to federal candidates, PACs, political parties and outside spending groups, about 17 percent of all individual donations. More political money flows out of the 20005 zip code—the heart of the capital’s lobbyist/PR complex—than from each of 19 states.

(For an unbelievably nonsensical take on why rich people don’t have inordinate political influence, read this opinion piece from the Washington Post Outlook section—naturally—by Darrell M. West of Brookings. He writes, for example, “Conservative financiers didn’t defeat President Obama in 2012, despite spending hundreds of millions of dollars to do so.” Note to West: There are plenty of billionaires who supported Obama.)

A political system that transfers wealth upward didn’t happen by chance, but was the willful creation, and decades in the making, of our corporate and political overlords.

The process began in the early-1970s, amid the twin political crises of Vietnam and Watergate and an economy showing signs of stagflation, when business began a campaign to smash the post-war agreement that tolerated unions and offered wages allowing millions of workers to join the middle class and, at the lowest end, escape poverty. Between 1947 and 1979, the share of income going to the top 1 percent fell by about 27 percent. Then the effects of the corporate campaign began to kick in. Between 1980 and 2012, the share going to the top 1 percent rose by 120 percent.

The corporate campaign created a political consensus that churns out business-friendly policies no matter which party is in power. It also changed the nature of government employment. Fifty years ago, people came to Washington drawn by a sense of public service, however they defined it, and they often stayed in the public sector over much of their careers. Now working in government is a brief way station on the road to better things. Many of those who come to DC with little wealth leave in a position to become rich, and those who come rich are able to become richer.

After he went to prison for bribing public officials, lobbyist Jack Abramoff claimed in his memoir, Capitol Punishment, that he controlled around 100 members of Congress. In addition to offering them and their staff free meals at his high-end restaurant, Signatures, Abramoff handed out luxury box tickets to sporting events and junkets to the world’s most exclusive golf destinations. But his most effective tactic was simply to float the suggestion to congressional staffers that he’d hire them when they left the Hill. Abramoff would then effectively “own” the staffer, who would perhaps even unconsciously start making decisions that benefited his future employer. “His paycheck may have been signed by the Congress, but he was already working for me, influencing his office for my clients’ best interests,” Abramoff wrote. “It was a perfect–and perfectly corrupt–arrangement.”

In this environment it’s misleading to use the term “revolving door,” because that falsely suggests that there are sharp lines separating corporate America, government and the influence peddling complex.

Linda Daschle stands with her husband, Tom Daschle, former majority leader, during the 15th Annual Mark Twain Prize for American Humor at the Kennedy Center in Washington D.C., U.S., on Monday, Oct. 22, 2012. Photographer: Stephanie Green/Bloomberg via Getty Images

Linda Daschle stands with her husband, Tom Daschle.

For the political class, cashing in doesn’t require brains, hard work, dedication or talent, but merely a willingness to sell to the highest bidder the Rolodex you compiled while in government. That brings me to a topic I’ve been writing about a lot, namely the incredible wealth being compiled by former politicians and hangers-ons, with a focus on their real estate holdings.

Over the past month or so, I’ve written about a former FBI director’s beachside penthouse (co-owned by his wife, and a client he “cleared” of wrongdoing), an Iraq War-financed McMansion, and a lavish Virginia property owned by a CIA torturer. I like writing about real estate because it’s hard to get people’s bank account records, but you can roughly track their wealth through their property holdings.

Consider, for example, Daschle, and his wife, Linda. Tom now lobbies for America’s biggest corporations but avoids registering (and disclosure laws) by calling himself a “strategic adviser.” He was Barack Obama’s first choice to be Secretary of Health and Human Services but had to withdraw due to a number of embarrassing ethical lapses, like failing to pay taxes on a chauffeured limousine provided to him by a friend and political donor. His second wife Linda, a former Miss Kansas, advertises herself more honestly and is considered to be one of the most powerful lobbyists in Washington.

The pair met in 1980 when Tom was a freshmen House member and Linda held a low-level position with the Civil Aeronautics Board, which is supposed to help regulate the airline industry. He had stopped by her office as part of a congressional visit and wedding bells rang swiftly (as soon as Tom dumped his first wife, who in 1978, according to this story in Washington Monthly“had helped him ring 40,000 doorbells and go on to unseat an incumbent by 14 votes”).

Soon after their marriage, Linda landed a lobbying job with the Air Transport Association and in 1993 Bill Clinton appointed her to a senior position at the FAA. Four years later she tired of public service and returned to lobbying (at a firm founded by former senator Howard Baker).

Linda emerged as a lobbying powerhouse by representing clients (mostly aviation firms), whom her husband helped out while in the Senate. For example, she helped American Airlines get bailouts, even after the carrier had worked to “water down safety and security regulations that might have helped foil the World Trade Center attacks.” There’s no way to track Linda’s lobbying income, but she’s assuredly a mega-millionaire in her own right.

When Tom was a senator the couple owned a comfortable home in DC, but in 2011 they bought the seven-bedroom house at 2830 Foxhall Road NW. The year before, the Daschles bought two plots of land for $1.3 million in Bluffton, South Carolina, near the resort town of Hilton Head Island. By 2013, they had started building a house on them. It’s a perfect spot for this ardent champion of the “common man” and his superlobbyist wife. Bluffton has been proudly described by southernnationalist.com as the Antebellum birthplace of Southern secession that made its name by “embracing inequality as a positive good and rejecting democracy as a destructive evil.”

Representative Richard Baker, a Democrat from Louisiana, asks a question at a House of Representatives Financial Services Committee hearing titled Sarbanes-Oxley at Four: Protecting Investors and Strengthening Markets, in Washington, D.C., September 19, 2006.  Photographer: Dennis Brack/Bloomberg News

Representative Richard Baker, a Democrat from Louisiana.

Because I’m bipartisan, let’s now turn to former Congressman Richard Baker, a Democrat turned Republican in 1986. While representing Louisiana in congress between 1986 and 2008, Rep. Richard Baker was a reliable voice of right-wing hackery (in one of his last official acts he sponsored a resolution that “calls attention to…the contributions of Christianity to the foundation of the United States”) and evil (“We finally cleaned up public housing in New Orleans,” he was overheard telling a group of lobbyists soon after Hurricane Katrina. “We couldn’t do it, but God did.”).

Baker long served on the House Banking Committee and chaired a subcommittee that was supposed to police Wall Street, but instead worked to repeal the Glass-Steagall Act, which was passed during the Great Depression and separated commercial and investment banking. This was Wall Street’s wettest dream and led directly to rapid consolidation of the financial industry and the economic crash of 2008 that cost Americans $22 trillion and left millions unemployed and in foreclosure.

As a token of gratitude for such service, the financial industry contributed nearly $1.6 million to Baker’s congressional campaigns; his three single largest career donors were JPMorgan Chase, the American Bankers Association and Bank of America.

Baker resigned in 2008 and moved directly to Wall Street’s payroll as chief lobbyist for the Managed Funds Association (MFA), the voice of the hedge fund industry. Since then Baker has helped his patrons defeat stricter regulation of derivatives trading and higher taxes on hedge funds and their executives.

Enriching Wall Street firms (like JPMorgan, which sits on the MFA’s board) and destroying the American middle class has netted big returns for Baker. By congressional standards he was poor when he left office; financial disclosure forms show his total net worth at the time was $75,000 and that his biggest single asset was K’s Louisiana Market, his wife’s catering firm. Back then he resided in a modest home in Baton Rouge.

Life improved dramatically when Baker went to work for the Managed Funds Industry. According to the group’s latest IRS tax filing, he took home $2.3 million in 2011, which included a bonus of $700,000 and represents a 1,500 percent raise from his tawdry congressional salary of three years prior.

While Baker cleaned up, his financial sponsors were systematically ripping off his former constituents. For example, in 2012 Wells Fargo—a major campaign contributor to Baker and member of the MFA—settled a federal housing discrimination complaint over charges that it had allowed properties it foreclosed upon in minority neighborhoods of New Orleans to fall into neglect and disrepair, while carefully maintaining its stocks of foreclosed homes in white neighborhoods (Wells Fargo, as part of the settlement, agreed to pay $234.3 million in relief and compensation).

Such Louisiana woes don’t appear to have affected Baker. He currently owns three properties in his home state, among them a waterfront lot. (The real estate advertisement for the lot read: “Are you looking for the ultimate in elegant, private, and classy river front property but haven’t found it yet? Stop!!!!”). He paid $237,000 for it, a mere month’s pay on his current salary. It’s not a mansion, but it does come with room to dock two forty-foot boats.

But don’t worry–the “Waterfront Sanctuary” isn’t Baker’s most impressive property. In 2010, already flush with hedge fund cash, he bought a shiny new home in Baton Rouge for $2.27 million.

Coming next on House of Cards: Code Ridge

[Author’s Note: I’ve been writing about these issues for a very long time. Some parts of the above were adapted from my prior articles, which have appeared previously in Harper’s, and other publications.]

Photo: David Zalubowski/AP; Stephanie Green/Bloomberg/Getty; Dennis Brack/Bloomberg/Getty

Article source: https://firstlook.org/theintercept/2015/01/29/house-cards-dc-real-estate-column/

The majority of consumers have subprime credit scores, report says


(Andrew Harrer/Bloomberg)

The job market may be growing at the fastest clip in 15 years, but many consumers are still trying to clear nasty scars from their credit reports.

The majority, or 56 percent, of consumers have subprime credit scores, according to a report released Thursday by the Corporation for Enterprise Development (CFED), a nonprofit that advocates for policy changes to help low- and moderate-income households. As a result, these consumers are often locked out of the lending markets. And if they are borrowing, chances are they’re missing  out on the lowest rates being offered to consumers with stronger credit.

“There are millions of Americans who are being excluded from the financial mainstream,” says Jennifer Brooks, director of state and local policy at CFED and lead author of the report. “They’re relegated to using fringe, often high cost financial products that trap them in a cycle of debt.”

Credit experts say the report is a reminder that even as many Americans are returning to work and earning steady paychecks for the first time in a while, repairing credit takes time. Late payments and delinquent accounts that are sent to collections, such as defaulted credit cards or a foreclosure, can stay on your credit report for up to seven years. Bankruptcy filings can stay on there for up to 10 years.

“In the world of consumer credit scoring, if you mess up, it’s a seven to 10 year penalty,” says John Ulzheimer, president of consumer education at CreditSesame.com, a credit management Web site.

It’s been seven years since the Great Recession officially started. But many of the people who fell behind on loan payments, lost their homes or filed for bankruptcy may still be waiting for those results to clear out of their credit reports, Ulzheimer says. “I think most people were able to keep their job for some period of time — they fought the fight,” he says. “If they did eventually lose their home, they probably didn’t do so for a few years.”

The researchers at CFED analyzed credit data from TransUnion, one of the major credit reporting agencies. The credit score information was based on the TransRisk score, which ranges from 100 to 934. Anyone with a credit score of 700 or lower was considered to be near prime or subprime, says Kasey Wiedrich, director of applied research for CFED.

The consequences of having a subprime credit score vary. For some consumers, it will mean having to pay higher interest rates for mortgages, auto loans and credit cards, Wiedrich says. Other consumers may not qualify for conventional loans at all, requiring them to turn to riskier and more expensive ways of borrowing, such as payday loans or car title loans. “There is a big range,” she says.

Some consumers who have thin credit files because they haven’t taken out many loans in the past were not included in the report. It’s also important to note that there are many types of credit scores and the TransRisk score is not the most commonly used by lenders, Wiedrich says. Banks and financial institutions can use different standards when assessing potential borrowers and setting the terms on loans, she adds.

Many of the people who fell behind on loans during the crisis may now be making steady payments and are on a path to rebuilding their credit scores, says Ulzheimer. Some of the issues that held them back initially, such as late payments or delinquent accounts, will count less toward their credit scores as time goes on.

People working to repair their credit scores should focus on making their payments on time each month, since recent payments will have a bigger effect than older payment records, says Gerri Detweiler, director of consumer education for Credit.com. Reducing the overall debt load will also make a difference.

“The two things that are going to have the greatest impact on your score are going to be your payment history and the debt that you’re carrying,” she says.

Consumers should also watch how much of their available credit is in use. Using less than 10 percent of available credit is ideal, but if that’s not attainable, people should use less than 25 or 30 percent of their credit.

It may also hurt someone’s credit scores if any one credit card has a high balance, Detweiler says, so consumers should try to keep individual credit card balances to below 30 percent of available credit. And people should be selective about how many credit cards they apply to, since credit inquiries can ding a person’s credit score and stay on their credit reports for up to two years, she says.

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Article source: http://www.washingtonpost.com/news/get-there/wp/2015/01/29/the-majority-of-consumers-have-subprime-credit-scores-report-says/

Gas blast at Mexico City children’s hospital kills at least 4, injures dozens – Florida Times

MEXICO CITY — Injured and bleeding, mothers carrying infants fled from a maternity hospital shattered by a powerful gas explosion on Thursday, and rescuers swung sledgehammers to break through fallen concrete in hunt for others who may have been trapped.

At least three adults and one baby were killed, said Claudia Dominguez, spokeswoman for the city’s civil defense agency. She said she could not verify a report by a local borough chief, Adrian Rubalcava, that seven had died. Federal Interior Secretary Miguel Angel Osorio Chong said there was no official count so far of dead and injured.

City officials said 54 were injured.

Felicitas Hernandez, 35, cried as she waited outside the mostly collapsed building hoping for word of her month-old baby, who had been hospitalized since birth with respiratory problems.

“They wouldn’t let me sleep with him,” said Hernandez, who said she had come to the city-run Maternity and Children’s Hospital of Cuajimalpa because she had no money.

The explosion occurred when the tanker was making a routine, early morning fill-up in the hospital kitchen and gas started to leak. Witnesses said the tanker workers struggled frantically for 15 or 20 minutes to repair the leak while a large cloud of gas formed.

“The hose broke. The two gas workers tried to stop it, but they were very nervous. They yelled for people to get out,” said Laura Diaz Pacheco, a laboratory technician.

“Everyone’s initial reaction was to go inside, away from the gas,” she added. “Maybe as many as 10 of us were able to get out … The rest stayed inside.”

Workers on the truck yelled: “Call the firefighters, call the firefighters!” said 66-year-old anesthesiologist Agustin Herrera. People started to evacuate the hospital, and then came the massive explosion that sent up an enormous fireball and plumes of dust and smoke.

Herrera saw injured mothers walking out under their own power carrying babies. He said there had been nine babies in the 35-bed hospital’s nursery, one in very serious condition before the explosion.

“We avoided a much bigger tragedy because the oxygen tanks are right beside (the area) and they didn’t explode,” Herrera said. The most affected parts of the hospital were the neonatology, reception and emergency reception units, he added.

The driver and two employees were hospitalized but are also in custody, said a Mexico City government spokesman, who could not be named because she was not authorized to speak to the press.

Mayor Miguel Angel Mancera earlier told the Televisa network that at least 54 people were injured, 22 of them children. Most of the injuries were relatively minor, he said, many caused by flying glass.

The explosion sent a column of smoke billowing over the area on the western edge of Mexico’s capital and television images showed much of the hospital collapsed, with firefighters trying to extinguish fires.

“The truck must have had some failure, the hose and that’s what caused the explosion,” Mancera said. He said that fire continued burning because firefighters recommended that they allow the truck’s remaining gas to burn off. He said there was no risk of another explosion.

Ismael Garcia, 27, who lives a block from the hospital, said “there was a super explosion and everything caught on fire.”

Garcia ran to the hospital and said he and others made their way to the nursery. “Fortunately, we were able to get eight babies out,” he said.

Rafael Gonzalez of the Red Cross said one 27-year-old man arrived at the agency’s hospital with burns over 90 percent of his body, and he was transferred to another hospital.

President Enrique Pena Nieto expressed his sadness and support for the victims through his official Twitter account.

The hospital, located in a middle class neighborhood, is next to a school.

Article source: http://jacksonville.com/breaking-news/2015-01-29/story/gas-blast-mexico-city-childrens-hospital-injures-dozens