AFL-CIO Executive Council Outlines Steps to Address Mortgage Crisis

by Mike Hall, Mar 4, 2008

The mortgage foreclosure crisis, fueled by years of unchecked predatory lending practices, has resulted in a disaster for millions of America’s homeowners. Not since the Depression of the 1930s have so many U.S. homeowners owed more on their mortgages than their homes are worth.

The current mortgage crisis, says the AFL-CIO Executive Council,

is threatening the American Dream of homeownership for millions of families. Predatory lending practices and slumping real estate markets threaten the jobs and incomes of hundreds of thousands of workers as well as the financial stability of state and local governments.

In a statement approved today in San Diego, the Executive Council outlines several steps to address the mortgage and foreclosure crisis, help bring affordable housing within reach of middle- and lower-income Americans and re-prime the job pump in the housing construction industry.

The statement reads in part:

We are working with Congress on the Homeownership Preservation and Protection Act of 2007 (S. 2452). This would establish new consumer protections and will allow state attorneys general to enforce the provisions of the law. The AFL-CIO also is supporting the Emergency Home Ownership and Mortgage Equity Protection Act (H.R. 3609) and Helping Families Save Their Homes in Bankruptcy Act of 2007 (S. 2136), which will prevent hundreds of thousands of Americans from losing their homes by allowing them access to bankruptcy relief.

The council’s statement says President Bush’s proposals are nothing but “Band-Aids” and calls for:

• A six- to 12-month moratorium on mortgage foreclosures.
• A change in bankruptcy laws to allow mortgages to be modified so families can keep their homes.
• An end to servicing agreements that reward mortgage companies for foreclosing on homes rather than encouraging refinancing or other workout strategies.
• Strong new rules for the mortgage and financial markets that hold the industry accountable.

The Executive Council statement also references the Union Plus Save My Home Hotline, which has provided foreclosure prevention counseling to more than 1,500 members. The Union Privilege program is the only one in the country to provide assistance to members facing financial hardship.

Click here to read the entire Executive Council Statement, “Affordable Housing and the Foreclosure Crisis.”

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