At 13%, Miami Gardens has the second highest foreclosure rate in Florida, a state with 23% of homeowners either in foreclosure or delinquent on their mortgage. Time Magazine just ran a story on how Miami Gardens City Councilman Andre Williams is taking the Banks to task. Banks targeted borrowers in Miami Gardens with subprime, often predatory loans, knowing their clients could not afford their mortgage payments.
Councilman Williams is demanding lenders do more to help South Florida homeowners avoid foreclosure. If a lender has a branch in Miami Gardens, the new legislation punishes banks that start foreclosure proceedings without offering a loan modification.
There is no jurisdiction for local government to run oversight on banks. Councilman Williams’ ordinance would test whether a lender filed more foreclosure actions in Miami Gardens that loan modifications offers over a period of time. If so, Miami Gardens would pull its accounts or other business from that bank.
To date, Banks have modified only 9% of over 3 million mortgagees at risk of foreclosure. The relief can come in the form of interest rate or principal balance reductions. President Obama’s Making Home Affordable Program made $75 billion available to 38 major home lenders in the US for that purpose.
Councilman Williams is running for U.S. Congress. The Miami Herald editorial said that Banks should help distressed homeowners or Congress should consider changing bankruptcy laws to permit judges to reduce the principal balance of home mortgages. So, if Councilman Williams can’t get his law passed in Miami Gardens, perhaps he can wins a seat in Congress and make it happen.