April 13, 2012

HUD Secretary Shaun Donovan Addresses 2012 National Action Network (NAN) Convention

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HUD Secretary Shaun Donovan Addresses National Action Network (NAN) Convention in WDC

Today, Housing and Urban Development Secretary Shaun Donovan addressed 2012 National Action Network (NAN) Convention attendees at the Walter E. Washington Convention Center in Washington, D.C. The annual meeting brings together leaders in civil rights, government, business, media, and within the church to discuss issues of civil rights. NAN, founded more than 20 years ago, works within the spirit and tradition of Dr. Martin Luther King, Jr. to promote a progressive agenda that includes the fight for one standard of justice, decency and equal opportunities for all people regardless of race, religion, national origin and gender.

Similarly, the U.S. Department of Housing and Urban Development’s (HUD) mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. Through working to strengthen the housing market, bolster the economy and protect consumers, HUD strives to meet the need for quality affordable rental homes and utilizes housing as a platform for improving quality of life – building inclusive and sustainable communities free from discrimination.

In essence, HUD and NAN’s missions are one in the same – to ensure that all Americans get a fair shot, their fair share, and fair deal. And, today Secretary Donovan discussed HUD’s leadership in that fight.

Since President Obama took office, foreclosures have dropped by almost 50 percent, nearly six million families have received the help they needed to stay in their homes, and more than four million jobs have been created. What’s more, because of the President’s leadership more than one million people have been saved from homelessness and eight million families have benefit from HUD-approved housing counseling.

HUD is committed to putting the Urban Development “UD” back into HUD and has taken bold steps to create and Economy Built to Last for all Americans:

  • Keeping Responsible Families in Their Homes. Since the President took office, over 400,000 African American families have bought or refinanced their home using FHA-backed loans.  In 2011, FHA financing was used by 29 percent of all homebuyers, but approximately 55 percent of African American families.
  • Helping Minorities Purchase Homes. The latest data shows that 60 percent of all African-American and Hispanic homebuyers using mortgages relied upon FHA financing and more than 30 percent of all FHA-insured homebuyers are minorities. And, since the President announced critical changes last fall to help more families with loans backed by Fannie Mae and Freddie Mac to refinance, about 300,000 families have already filed applications for refinancing and stand to save on average $2,500 per year – the equivalent of a good-sized tax cut.
  • Investing in Hardest Hit Neighborhoods. HUD is investing $7 billion through the Neighborhood Stabilization Program to increase affordable housing and stabilize neighborhoods hardest hit by foreclosures, of which 60 percent is dedicated to communities of color.
  • Protecting Residents of Affordable Rental Housing. 80 cents of every dollar in HUD’s 2012 budget will be used for renewing homeless and rental assistance for current residents of HUD-assisted housing, and providing capital needs funding for HUD’s public housing stock.
  • Fighting Predatory Lending and Housing Discrimination. Since the Obama Administration took office, FHA has taken action against more than 1,700 lenders who don’t play by the rules, shutting down their ability to do business with FHA.  In December, the Obama Administration announced a $335 million settlement against Countrywide for their discriminatory practices against thousands of African Americans and Latinos. And, in February, U.S. Attorney General Eric Holder, Secretary Donovan and 49 state attorneys general reached the landmark $25 billion agreement that will provide significant financial relief to homeowners and establish meaningful new homeowner protections for the future. This is a watershed moment for the country and for American communities hit hardest by the housing crisis. And, it not only demonstrates the Obama Administration’s commitment to the taking necessary steps to help struggling homeowners, but creates homeownership built to last for all Americans.

Below find Secretary Donovan’s 2012 NAN Convention remarks as prepared for delivery:

Remarks of Secretary Shaun Donovan at the 14th Annual National Action Network Convention

Walter E. Reed Washington Convention Center, Washington, D.C.

Friday, April 13, 2012

As Prepared For Delivery

Thank you, Reverend Sharpton, for that kind introduction, and for your extraordinary lifetime of leadership.

For more than four decades, Reverend Sharpton has brought a powerful moral voice on behalf of the most vulnerable Americans – and in the wake of the worst economic crisis since the Great Depression, that voice has never been more important.

And so, it’s an honor for me to once again speak to all of you at the National Action Network. You’ve been a remarkable partner to those of us in the Obama Administration as we work together to push back against the crisis – and I’d like to recognize and thank Dr. Richardson and Tamika Mallory for their hard work, as well.

You’re the ones who see the impact of the crisis up close – in the eyes of the families you serve, and on the streets of the communities where you live.

And make no mistake – President Obama sees it, too.

He’s seen the shock and pain felt by families who have lost a home.  And he’s seen what this crisis has done to what were solid, middle-class neighborhoods only a few years ago – some of which had spent decades fighting their way back.

That’s why with his leadership, this Administration has refused to stand still.  And today, I want to share with you some of the progress we’ve made – and the work that still lies ahead.

I want to discuss what we’ve done to keep families in their homes, the steps we’ve taken to hold the banks that created this crisis accountable for it, and the work we’re doing to lay the foundation for an economy built to last.

And most of all, I want to talk to you about how with your help—and with a leader in the White House who understands what American families are still going through—we’re going to finish the job.

Our Progress So Far

Obviously, we have a long way to go.  But let’s not forget how far we’ve come.

When President Obama took office, we were losing 753,000 jobs a month.  Home prices had plummeted for 30 straight months.  And foreclosures were rising to record levels month after month.

Some said then that we should let the market hit bottom.

But not President Obama.

Because he refused to stand still, nearly 6 million families have received the help they needed to stay in their homes.

Half as many families are getting foreclosure notices.

And most important of all, 4 million jobs have been created.

Now, that’s progress.  But this President knows the work isn’t done until every community has a chance to be a part of that progress.

That’s why I’m so proud nearly 8 million families have been helped by HUD-approved housing counselors since President Obama took office.  These are folks with proven track records of stopping foreclosures – and because you helped us make the case, their work is continuing in communities across the country.

Or FHA, part of HUD.  Over the last three years, more than 400,000 African American families used a loan backed by the Federal Housing Administration to buy or refinance their home.

Think about that – 400,000 families who otherwise may not have had anywhere else to turn in this crisis turned to the FHA.

While we’re not out of the woods, I’m deeply proud of the work we’ve done to preserve this pathway to the middle class.

And we’re not done.  Last month, we made it easier for more families with FHA loans to refinance at today’s record low interest rates.

Since the President announced critical changes last fall, 425,000 families with loans backed by Fannie Mae and Freddie Mac have already applied to refinance – and stand to save on average $2,500 per year.

And as this audience knows, in an economy like this, that can be the difference between sending your child to college and a dream deferred.

But this audience knows something else, too.  Foreclosures don’t just tear apart families – they can overrun whole communities.

Well, there is good news to report there as well.  Because we provided $7 billion in Neighborhood Stabilization funds to some of our hardest hit places, vacancy rates are down and property values are up in communities devastated by the economic collapse.

As the families there know, that’s progress, too.

A Historic Mortgage Servicing Settlement

But perhaps the biggest step we’ve taken in recent months is the historic, $25 billion mortgage servicing settlement reached by the Obama Administration and an unprecedented bipartisan coalition of attorneys general from 49 states.

You know the appalling way banks have treated families throughout this crisis – from lost paperwork when people were applying for help, to dropped calls to signing thousands of foreclosure documents that banks never verified or bothered to read.

Our investigations at HUD revealed even more.  We found homeowners—some of whom were only 30 days behind on their mortgage—never got a call from their lender about options that may have been available to them.

Think about it: over and over, folks who never should have gotten into trouble—and who should have been able to get some help early on that was both good for them and for the lender—never got that help – help that in many cases banks were legally obligated to provide.

Allowing some of our largest and most powerful institutions to play by a different set of rules than everybody else—to commit forgery and perjury against ordinary families—is not only appalling…

It’s also illegal.  And it’s not what this Administration—and this President—believes we stand for as Americans.

And so I’m proud to stand before the National Action Network and say that this settlement makes them pay for that behavior – and not just by cutting a check, but by forcing them to help homeowners once and for all.

Providing tens of billions in direct relief for families, it forces lenders to reduce the size of exploding, unaffordable loans.  It forces them to refinance loans for homeowners who are underwater.  And it forces them to pay billions of dollars to states and consumers to provide other forms of relief like housing counseling services.

And with a federal court giving final approval to the settlement just last week, families will begin to see these benefits soon.

And that’s not the only victory President Obama secured for families in this settlement.

Just as importantly, it also provides clear and fairer customer service standards that build upon the new protections introduced when the President announced the Homeowner Bill of Rights.

That means, at the same time the new Consumer Financial Protection Bureau is putting in place a single, straightforward set of commonsense rules that families can count on when they’re buying a home, the standards in this settlement will give people the confidence that lenders and servicers are following a comprehensive list of rights should they ever lose a job or have a medical emergency that puts their home at risk.

No more lost paperwork.

No more runaround.

And no…more…excuses.

The Work Ahead

Still, our work is far from over.

First, we can’t let families fall victim to the kind of scams that got us into this crisis in the first place.

Before the ink was even dry on the servicing settlement, we began hearing stories about folks calling people and saying that for a couple thousand bucks they can qualify for help.

And as leaders in your communities, we need you to tell those families that help from a HUD-approved housing counselor is available free of charge, with no exceptions.  Tell them to go to HUD’s website to find a housing counselor they can trust.

We also need to help families who believe they never should have lost their home in the first place, and could be owed hundreds of thousands of dollars in damages from their banks.

Families need to know this settlement protects their right to get the compensation they are entitled to – every last cent.

Federal regulators have set up a hotline for families who think they may have been wrongfully foreclosed on.  Already, this process has found potential flaws in some 138,000 foreclosures.

And if families call 1-888-952-9105, they can have their foreclosure included for official review – at the banks’ expense.

In each of these efforts, this Administration is here to help – but your partnership will be critical.  As activists and community leaders, no one is better positioned to articulate the concerns of families to Washington than each of you here today.

And whether it’s getting Congress to pass President Obama’s plan to give every responsible homeowner in America the chance to refinance at today’s record-low interest rates…getting them pass Project Rebuild to build on the success of Neighborhood Stabilization and create 200,000 jobs across the country…or ensuring as many dollars as possible in the settlement go to helping homeowners, we can’t be silent.

We need you to make your voices heard – and let Washington and your local leaders know that support for homeowners, community revitalization and housing counseling is a top priority for the families you represent.

Finally, as we celebrate Fair Housing Month this month, we know we still need to get to the bottom of the housing crisis – and justice for the families who were harmed the most.

That is why President Obama announced in his State of the Union that he was charging Attorney General Holder with investigating financial servicers that may have broken the law – not just during the foreclosure process but when they packaged and sold loans to families.

Indeed, that’s what our recent $335 million settlement with Countrywide was about – holding them accountable for charging African American families higher fees and interest rates and steering them into risky subprime mortgages.

Indeed, whether it’s the servicing settlement or his work to secure the Countrywide settlement—the largest fair housing discrimination settlement in the history of our country—I’ve been proud to work side-by-side with Eric Holder.

And with his leadership, and the President’s commitment, we will get to the bottom of this crisis, and hold those who created it accountable – once and for all.

A Fair Shot for Every Family

Ultimately, all these efforts are about the same thing:

Not just turning the page on this crisis, but ensuring that families across the country have a fair shot in this economy – something too few people have had….for far too long.

I mentioned earlier what was on this President’s plate when he walked into the Oval Office.  It wasn’t just the hundreds of thousands of jobs being lost each month, or even the foreclosures piling up.

In many ways, those were just the consequences – of a decade of deepening wage inequality.

Of 25 years of America’s middle class being hollowed-out, one community at a time – and taking good-paying jobs with them.

Of people saying that no matter how many folks were being taken advantage of, government had no positive role to play in righting those wrongs.

I’m proud to work for a President who believed this crisis was an opportunity – not just to rebuild, but to set things right.

And he did it from the very beginning when he passed the Recovery Act – that “failed stimulus” you hear so much about.

Well, we’ve got news for those critics.  That “failed” stimulus created over 3 million jobs, prevented 6 million people from falling into poverty – and saved more than 1.2 million people from homelessness.

Instead of letting the housing markets in our poorest communities hit rock bottom, as some suggested—and continue to suggest—President Obama said we’re going to invest in those homes, rebuild that housing, reform the schools there, and give those families a chance to open a small business.

And as we speak he’s fighting to ensure no millionaire and billionaire ever again pays a lower tax rate than his secretary.

But for all the progress we’ve seen under President Obama’s watch—keeping families in their homes, rebuilding communities, and creating jobs—let’s be honest – he’s gotten credit for virtually none of it.

The media doesn’t talk about it. And, plenty of folks in Washington are trying their hardest to talk about anything else.

So why did he do it?  Why has all of this work been such a priority for the President, and everyone in his Administration?

Because he knows what you know:

He knows what it’s like to walk the halls of public housing, because he’s worked there.

He knows what it’s like to walk the streets of some of our cities’ poorest neighborhoods because he’s lived there – what it’s like to take a subway or a bus just to find a grocery store.

He knows what it’s like to wonder if he’ll ever be able to afford a college education or health care.

And he knows what it’s like to be judged – not on your merits or your talent but because of where you come from, what your name is, or even what you look like.

These are the kinds of challenges the families we serve at HUD experience every single day of their lives.

That’s why the President has fought so hard not just to grow America’s economy – but the ability of every family to be a part of it.

And I’ve seen that commitment for myself.  I’ve seen him fight for HUD’s budget – not because it was popular, but because he believes in an America where we don’t leave families earning $10,000 a year to fend for themselves.

I’ve seen him provide troubled cities like Detroit, Memphis, and New Orleans with support they need to rebuild – not because it was popular, but because he knows we can’t rebuild America until we rebuild the communities that built America and its great black middle class.

And I’ve seen him forge an economic policy that creates real pathways to opportunity—to working, to getting an education—because he understands that we can’t end the cycle of poverty if we don’t start creating opportunity.

Now listen, you know and I know that all these problems won’t be solved in a year, in four years, or even 8 years – though I certainly hope we have the chance.  But we both know that change can come when you least expect it.

If President Obama’s own life story demonstrates anything, it’s that we may not know when change will come – but it will come.

Bringing that change to all our families and communities is why I’m so proud to be here today – and to represent this Administration.

And in the months to come, I look forward to realizing it together.  God bless you all – and thank you for this opportunity.

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