Gov. Brown should give more help to California homeowners facing foreclosure

Protestors picket a Wells Fargo branch on Capitol Mall during a 2012 rally demanding action to stop foreclosures in California.
Protestors picket a Wells Fargo branch on Capitol Mall during a 2012 rally demanding action to stop foreclosures in California. Sacramento Bee file

This past year, foreclosure rates across the country have slowly declined. Yet there are still many who need help keeping their homes.

Just in California, hundreds of thousands of families have been left out in the cold. The foreclosure rate is estimated at 6.5 percent in Los Angeles County, 12.6 percent in Merced County and 7.8 percent in Sacramento County. This is just a small sampling of an ongoing problem that is afflicting homeowners.

Last March, many predominantly black and Latino churches, joined by the National Asian American Coalition, filed a lawsuit against Gov. Jerry Brown. In it, we urged that he help California homeowners facing foreclosure by releasing a $350 million fund that Attorney General Kamala Harris secured in a national settlement.

Instead, the governor used this homeowner trust fund to cover shortfalls in the state budget in 2012. Today, California has the largest budget surplus of any state in the nation, a projected $3 billion in 2014-15. According to the Legislative Analyst’s Office, it will grow to about $10 billion by 2017-18.

Meanwhile, many homeowners have still yet to benefit from the national mortgage settlement. Our attorney general risked her career by courageously refusing to accept an inadequate settlement and instead fought against “too-big-to-fail-banks,” thereby securing the best settlement in the nation – $12 billion of the $25 billion agreement.

However, the most crucial benefits of this extraordinary settlement were blocked by the governor’s actions since none of the funds went to help homeowners facing foreclosure as Harris intended. Many of us, particularly church leaders, believe that it is unfair that the banks that caused the Great Recession have been bailed out, while homeowners have received little or nothing. This is why we filed the lawsuit.

Now that the budget is balanced and we have a huge surplus, Gov. Brown can voluntarily remedy this situation. He can free the $350 million immediately and allow Harris to provide funding to a broad range of nonprofits that help families in foreclosure. As studies presented to the governor have shown, the likelihood of foreclosure for those in default decreases by 80 percent if they receive just one full day of counseling.

We ask that the governor return the housing trust fund to the attorney general, so that those in need can finally obtain the relief they deserve.

Mark Whitlock is senior pastor at Christ Our Redeemer AME Church in Orange County and CEO of Nehemiah Ministries, an economic development nonprofit for the Fifth Episcopal District of the AME Church.