Taking on a mortgage giant
reports on a Rochester family’s victory over Fannie Mae.
AS THE housing crisis continues unabated, Catherine Lennon won a small victory against mortgage giant Fannie Mae--thanks to the struggle of her family and the community housing rights group Take Back the Land Rochester.
The victory is even more remarkable given the acceleration of the housing crisis going into 2011--and offers lessons on how to fight a mortgage giant and win.
The Mortgage Bankers Association reported that in the fourth quarter of 2010, the foreclosure rate rose to 4.6 percent, a new high. According to Robert Shiller, co-founder of the Case-Shiller home price index, there "are about two and a half million U.S. homes that are on the verge of foreclosure."
One of the families behind that statistic was the Lennon-Griffens. Over the past two years, their mortgage, originally held by Countrywide Financial, has been passed along and sold, like thousands of others, a typical scenario in the casino world of the financial sector. The trail of this family's mortgage runs through a virtual who's who of bailed-out banks and mafia-like financial outfits.
Countrywide was the recipient of $51.5 billion in loans through the federally backed Atlanta Federal Home Loan Bank in 2007 when the crisis erupted. While teetering on the brink of collapse, Countrywide was purchased by Bank of America (BoA) in January 2008. BoA itself received over $45 billion in bailout money.
In 2010, Countrywide, now a part of BoA, sold the Lennon-Griffen family's mortgage to Fannie Mae. Fannie Mae is a federally backed lending institution created in the 1930s to facilitate home ownership among low-income Americans.
In 2008, Fannie Mae and its twin Freddie Mac, were first bailed out to the tune of a whopping $200 billion, and then taken over by the government outright. Fannie Mae had been a publicly traded company owned by investors (private shareholders get profits) since 1968 when it was converted by President Lyndon Johnson.
Fannie and Freddie, as they are commonly called, back over $5 trillion in home loans. Fannie Mae runs the federal government's Home Affordable Modification Program (HAMP), which allows qualifying low-income borrowers to pay lower monthly payments for up to five years and is funded by the Obama administration to the tune of $75 billion.
However, a recent investigation by National Public Radio and the Center for Public Integrity (CPI) revealed that only "389,021 needy homeowners [were] getting this five-year respite deal as of June 30, 2010." In contrast, CPI reports that there have been 300,000 foreclosure filings every month, for the past 16 months, as well as citing that the rate of home ownership among low-income families has barely budged over the past 30 years.
Taxpayers got a raw deal. All the money seems to have gone into the pockets of private shareholders, and the taxpayers, the ones paying the salaries and dividends, are being pursued like criminals and evicted from their homes. This brings us back to the Lennon-Griffen family.
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FOR THE last seven years, Catherine Lennon and her family of 11 have lived at 9 Ravenwood Avenue in a small working-class neighborhood, Rochester's 19th Ward. After Cathy's husband died of cancer, both Countrywide Financial and its current holder, Fannie Mae, refused to renegotiate, sending the family's home into foreclosure.
They received an eviction notice from the sheriff to be carried out on March 14. A local housing rights group, Take Back the Land, learned of the Lennon-Griffen family's dilemma and took up their case.
On the morning of the 14th, a dozen or so activists and community members lined up in front of the house, sending press releases to the local media and U.S. Rep. Louise Slaughter, who represents the area in Congress, announcing their intent to resist the eviction, even at the threat of arrest, and to demand Fannie Mae negotiate a settlement with the Lennon-Griffen family.
Later that morning, a police car was seen at the end of the street, pausing for a while, then driving off. The eviction order was good for a month, and Take Back the Land began a campaign to mobilize the community.
They set up a constant community presence at the home, from 8 a.m. to 5 p.m. each weekday, working in shifts. At least 30 people signed up for shifts, with two to three people sitting in front of the property at any given time, ready to block any eviction attempts. Two weeks went by without incident.
On the morning of the 28th, the decisive moment arrived. At 9:05 a.m., 13 police cars and a team of police dressed in SWAT gear arrived at 9 Ravenwood Avenue. Take Back the Land issued an emergency call over Facebook, Twitter and e-mail listserves for the community to rush to the Lennon-Griffen home and resist the eviction.
Ryan Acuff, a member of Take Back the Land, described the scene:
Police put up crime scene tape, and a group of movers with a U-Haul showed up to empty the house. Around 10:30 a.m., a group of community members ran through the police crime scene tape and blocked the front door to the house in an act of civil disobedience.
Five community members--Jake Allen, Emily Good, Crescenzo Scipione, Zora Gussow and Ryan Gromkoski--were arrested and charged with obstruction of government administration and trespass.
At 11:15 a.m., two more community members were arrested, including Liz Rich, a 70- year-old neighbor of the Lennon-Griffen family, who was hauled away in her pajamas for disorderly conduct. The police then forced all witnesses to the end of the street and threatened neighbors for walking by the house.
Later that evening, Take Back the Land held a press conference and candlelight vigil outside the now seized home, drawing 45 supporters despite the freezing temperatures, with groups like Rochester Against War, Indy Media, the International Socialist Organization and Social Welfare Alliance of Rochester showing their support.
Cathy Lennon addressed the crowd and thanked everyone for their efforts. Her family, now homeless, left the vigil early to make it back in time for a spot at their new, temporary home, a shelter downtown. Everyone vowed to fight on, but it seemed this case had ended in defeat.
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BUT THE eviction and publicity by Take Back the Land managed to draw the attention of three local news stations and Rep. Slaughter responded to the pleas from the Lennon-Griffen family, saying she was talking to representatives from Fannie Mae. The next day, the fruits of that effort became apparent.
On Tuesday [March 29], Catherine Lennon of 9 Ravenwood Avenue was on a five-way call with three officials from Fannie Mae and staff person from Congresswoman Louise Slaughter's office who arranged the call. According to Ms. Lennon, the dialogue was very positive, and Fannie Mae vowed to work with her to get her home back...
In addition, Take Back the Land Rochester received calls today from both Sen. Chuck Schumer's office and Sen. Kirsten Gillibrand saying that they would also be stepping up efforts to intervene on the family's behalf.
Since the announcement, the activist community in Rochester has been jubilant with messages of support and solidarity coming from local unions, politicians and community members.
Everyone is aware that thousands of foreclosures happen every day in the U.S., far too many for the groups and community associations that do exist to address, but this struggle gives everyone hope.
Their website declares, "Take Back the Land Rochester believes that housing is a human right, not a commodity...As long as housing occurs at the whim of the banks and the market, homelessness and poverty will plague our community forever. In short, housing should be for people not for profit. That's why we're taking back the land!"
The intervention of Rep. Slaughter was definitely decisive, but the public outcry and mobilization clearly pushed her into action. From the very beginning, the Lennon-Griffen family and Take Back the Land Rochester pursued a strategy that relied on publicly shaming the craven decisions of Fannie Mae, mobilizing the neighborhood and broader community support, not backroom deals or reliance on the courts.
It's a strategy that produced results in Rochester and contains lessons for those facing similar situations throughout the country.