×

Mayors to Meet About Rising Foreclosures

This city at the heart of an area that is among the nation's hardest hit by rising foreclosures will host a meeting of mayors from across the country next week to address the nation's housing crisis.

The National Forum on Homeownership Preservation and Foreclosures, organized by the U.S. Conference of Mayors, will includes discussions about the state of the mortgage industry, ways homeowners can avoid foreclosure, and strategies to keep foreclosed properties from dragging down the quality of life in neighborhoods.

"We're not talking about legislation," said Detroit Mayor Kwame Kilpatrick, who is hosting the one-day forum Tuesday. "We're talking about finding a local solution to a national problem, and we'll start with the conversation here."

The goal is to create policy recommendations to present at a Conference of Mayors meeting in January, Kilpatrick said.

Next week's gathering is closed to the media, but the mayors plan to release a report on the economic ripple effect of foreclosures on U.S. metropolitan areas, with a focus on cities in Arizona, California, Florida, Indiana, Michigan, Nevada and Ohio, which have some of the nation's highest foreclosure rates.

Mayors expected to attend include Jerry Abramson from Louisville, Ky., and Michael Coleman from Columbus, Ohio, who both are scheduled to speak about ways to prevent foreclosures from hurting neighborhoods. Organizers say Elaine Walker of Bowling Green, Ky., Richard Kaplan of Lauderhill, Fla., Brenda Lawrence of Southfield, Mich., and Douglas Palmer of Trenton, N.J. -- president of the mayors group -- also plan to be there.

The Center for Responsible Lending, a Durham, N.C.-based consumer advocate, is among the groups invited to participate in the forum. Executive Vice President Deborah Goldstein said cities can't afford to wait for action in Washington or at the state level to address the problem.

"The cities are just going to feel the hit from the foreclosures very hard," Goldstein said. "We're already seeing a rise in foreclosures, but it's going to get worse."

Housing Market Slump

The housing market slump has made it harder for financially strapped homebuyers to sell their homes and avoid missing payments or losing their homes in foreclosure. Increasingly, many borrowers who took out adjustable-rate mortgages and other loans with monthly payments that increase after an initial period also are finding they can't afford their payments.

A recently released study by RealtyTrac found homeowners across the U.S. are increasingly having trouble making their mortgage payments on time, with borrowers in metro areas of California, Florida and other once-booming housing markets accounting for the biggest spikes in filings.

The analysis of foreclosure activity in the nation's largest 100 metropolitan areas during the three months ended Sept. 30 found Stockton, Calif., had the highest rate, with one foreclosure filing for every 31 households. The Detroit area was second, with one foreclosure filing for every 33 households.

"This foreclosure issue is the ultimate tsunami, if you will, if we don't get in front of it now," Kilpatrick said. "This is the single biggest economic issue that we're facing today in the city of Detroit."

To address the problem, Kilpatrick's administration is working with mortgage lenders and local nonprofits to get help for people facing foreclosure and get foreclosed properties into the hands of new homeowners. The Mortgage Bankers Association also introduced a public service announcement on the issue starring Kilpatrick.