Posted on 01/07/2009 9:55:23 AM PST by SmithL
City Council members on Tuesday approved a resolution authorizing the city to file suit against national lenders who they say created a foreclosure crisis in Memphis and Shelby County that disproportionately affected African-Americans.
The resolution alleges lenders engaged in "deceptive" and "discriminatory" lending practices targeted at the black community and "other select groups" that caused "substantial" and "irreparable" harm to neighborhoods and the governments.
The Shelby County Commission recently approved a similar resolution, claiming the foreclosure epidemic has devastated neighborhoods, slashed property values, eroded the tax base and drained local government coffers because of a host of direct and indirect costs.
"They have caused property values to plummet," said Webb Brewer from Memphis Area Legal Services, which is working with the city and county on the lawsuit. "As the property values go down, the property taxes go down. There are a lot of increased costs, like police and fire protection."
City attorney Elbert Jefferson would not divulge which clients the city and county would be suing. Jefferson said council members would be informed of the defendants during a closed meeting before the suit is filed. Brewer said he could file the lawsuit within 30 days.
Some council members questioned authorizing a lawsuit against defendants who have yet to be identified.
"It's the vagueness to this I find a little troubling," said councilman Shea Flinn. "We don't know who we're suing."
The resolution, which also includes authorizing $125,000 for legal expenses, says the goal of the suit would be to recoup the losses the governments have suffered and temporarily put a halt to foreclosures going forward.
Some council members wondered what happens if the cost of the lawsuit escalates beyond expectations.
"What happens when it become $1 million, or $5 million or $7 million?" asked Wanda Halbert.
But other council members said the cost to homeowners in trouble and governments dealing with the crisis demanded action.
"I believe this issue is so critical to the citizens of our community that we can't afford to not move forward," said Barbara Swearengen Ware.
Brewer said he likely would seek injunctive relief for homeowners facing foreclosure early on in the case, which would force lenders into mediation before they could foreclose on a home.
"If we can stop some of the foreclosures before they happen it would help," said Brewer.
The resolution specifically mentions African Americans and "other select groups" because attorneys may want to argue the lenders violated the fair-housing act, which requires proof that a minority group was targeted.
"All the data shows the communities that have been hardest hit by this crisis have been African-American communities," said Brewer. "But certainly it is a problem that cuts across all communities."
Council members Bill Boyd, Joe Brown, Janis Fullilove, Edmund Ford Jr., Myron Lowery and Ware voted to approve the lawsuit. Council members Kemp Conrad, Shea Flinn, Jim Strickland and Halbert abstained. Council member Reid Hedgepeth recused himself because of his membership on the board of a local agency. Council members Harold Collins and Bill Morrison did not vote.
THey are absolutely right. Lenders targeted african-american communities with loans the people couldn’t qualify for.
I guess I should be outraged, but these two groups are made for each other. The mortgage lenders got greedy with sub-prime, so my sympathy meter for them is busted. And you can probably guess what I think about these minority pressure groups.
So, what were the discriminatory lending practices in question? Did they do that sneaky banking trick of giving you money, but then expecting all of it and even some extra back in the future?
Man. This gets more FUBAR with each passing day!
The government tells lenders, “You must target minorities with achievable mortgages at reduced risk levels”.
Now the government accuses lenders of “targeting minorities, offering mortgages at reduced risk levels”.
Sadly, the courts will not see the idiocy at such a simplistic level (nuanced, donchyaknow) and side with the municipalities.
The lenders will use their “bailout” money to defend themselves from legal procedings brought by those who have provided the bailout money!
Give them a loan, and your preying on them.
EXACTLY! You’re damned if you do and damned if you don’t make loans to the “community.”
Millions of comedians out of work and now gov't wants to get in on the act.
"On November 4, the final bill resolving the differences was passed by the Senate 90-8 [7] and by the House 362-57.[8] This legislation was signed into law by Democratic President Bill Clinton on November 12, 1999.[9]"
Banks were the ones involved in red lining!!!
“But, but, we’re VICTIMS!”
I call bushit! You signed a contract.
No it was illegals they went for:
American Dream For Illegal Immigrants
Tue, 11/14/2006 - 15:03 — Webmaster
Officials at the government agency in charge of preserving and promoting public confidence in the country’s financial systems are encouraging banks nationwide to offer services to illegal immigrants and many have obliged.
The Federal Deposit Insurance Corporation (FDIC) has succeeded in getting several large lending institutions to offer a variety of banking services to illegal aliens, including home loans. Headquartered in Washington D.C., The FDIC insures more than $3 trillion of deposits in U.S. banks and is managed by a five-person board of directors appointed by the President of the United States and confirmed by the Senate.
It’s ironic, then, that agency officials would promote programs that would aide those who have broken U.S. federal laws by entering and subsequently living in the country without appropriate documentation. The chairman of a Tennessee bank (Bank of Bartlett) that recently launched a mortgage program for illegal aliens said the federal government gave him the idea.
Thanks to this type of encouragement from federal officials, several other banks across the country offer such incentives to those in the country illegally. The special programs, endorsed by the federal agency, allow local and national banks to grant home loans to people without Social Security numbers.
Last year, Wells Fargo proudly launched a lending program - called Celebrate Home—for illegal immigrants and the bank even issued a press release claiming the bragging rights of being the first major lender to offer undocumented aliens home loans. Years ago, Wells Fargo became the first U.S. financial institution to accept so-called foreign consular identification cards, in lieu of a Social Security card, to open bank accounts.
Bank officials don’t see anything wrong with helping those in the country illegally obtain the American dream of owning a home. In fact, they say that they are not required to ask the immigration status of their customers since that is the responsibility of the federal government.
Hello, Hello, Hellooooo
Is anyone home?
Can we talk?
What about the White people who had to put a down payment on a mortgage? They were discriminated against.
Sure, that's an ingenious business strategy. Give away your money to people whom you know can't give it back to you. Then as your lending institution goes so deep into the red that you go bankrupt, you simply ask the government for a 700 billion dollar bailout and hope and pray they give it to you. Anyone who believes this s#it was calculated belongs in the looney bin.
One thing I know, banks and lenders don't like getting into real estate repossession and sales, and they don't like going out of business through too much debt either. This was a government created fiasco from the very beginning; the liberal bastards in D.C. thought of America as a perpetual welfare nation with an infinite supply of money. They would order the lenders to give high risk loans and then simply write them checks when the borrowers reneged on them. The whole thing is traced directly back to Bahny Fwank, the rump ranger pervert from Massachusetts who told the Senate panel, (again and again), that Fannie and Freddy were on stable financial ground. He, and the other libs like him, involved the government in a ponzy scheme that was to give homes to the poor while the working class American paid for those homes with their taxes. That's all Freddie and Fannie ever were, just a way for the liberals to give away free stuff to their base, in exchange for votes.
Wait a minute - isn't that EXACTLY what Barney Frank et al. insist happen? Rules were relaxed for the express purpose of giving loans to minorities in low income areas who otherwise could not comply. This is ridiculous and outrageous.
Can we talk?
Regarding?
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