Wednesday, February 13, 2008

MECAWI Wins Federal Court Order to Distribute Leaflets on Foreclosure Crisis at the Attorney General's Forum

Judge says 2 may pass out leaflets at today's foreclosure forum

Group demands halt to home losses

February 12, 2008

A federal judged ruled Monday that two members of a group that supports a moratorium on mortgage foreclosures can hand out leaflets during State Attorney General Mike Cox's Avoid Foreclosure forum today.

Members of the Michigan Emergency Committee Against War & Injustice complained that they were told to leave Cobo Hall on Dec. 13 during an Avoid Foreclosure forum that attracted more than 4,000 people. They were forbidden to hand out leaflets demanding that Gov. Jennifer Granholm declare a state of emergency and impose a moratorium to stop foreclosures and utility shutoffs.

U. S. District Court Judge David Lawson, in granting the preliminary injunction, said there is a likelihood that the plaintiffs will prevail in their lawsuit alleging their First Amendment rights were violated.

"A space must be provided for those two individuals," Lawson said.

Robert Norfolk and Judith Thompson, both of Detroit, are restricted to passing out leaflets only at today's forum, scheduled from noon to 7 p.m. at Cobo Hall.

The ruling does not apply to a forum planned in Saginaw on Wednesday or one in Grand Rapids on Thursday.

The lawsuit filed Thursday names Cox, Cobo Hall and the City of Detroit as defendants. Jerome Goldberg, attorney for the plaintiffs, said he expected the damages to be nominal should his clients prevail.

Of Monday's decision, he said, "We feel it's a good ruling."

Adam Purnell and Margaret Nelson, attorneys for the Attorney General's Office, were not allowed to comment on the case. Eric Gaabo, attorney for the City of Detroit, quickly left the courtroom.

Gaabo and Purnell argued that the plaintiffs had the option of passing out leaflets on city sidewalks and along city streets. Goldberg argued that 98% of the attendees at the conference were entering Cobo through the garage.

The Michigan Emergency Committee Against War & Injustice wants to pressure Granholm to declare a state of economic emergency in Michigan and place a moratorium on foreclosures.

The group demonstrated at Granholm's State of the State address in Lansing, but Goldberg said in court that it was not the intention of the group to protest Cox's forum.

In a related action, ACORN, the Association of Community Organizations for Reform Now, says it supports the forums and is challenging Cox to be more aggressive in going after bad servicers and lenders.

"Connecting families with lenders is a critical part of the process, but the attorney general has the power and responsibility to crack down on rip-off artists and he needs to do his job," ACORN board cochair Patricia Hollins of Detroit said Monday in a statement.

ACORN is encouraging anyone who believes they were treated unfairly by their lender to contact the group at 313-963-1840. Contact CECIL ANGEL at 313-223-4531 or

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Thousands seek relief at homeowners forum

Many leave informed, but some still troubled

February 13, 2008

Katherine Wilson sat inside Cobo Hall on Tuesday, clutching a bag stuffed with paperwork about her mortgage loan and fretting about her predicament.

"I'm 67 years old and about to be put out on the sidewalk," she said. "I don't know if they'll be able to help me, but I want to be able to say I tried everything."

Wilson was among about 3,000 people who came to Attorney General Mike Cox's latest "Avoiding Foreclosure" forum. There were dozens of lenders, nonprofit loan counselors and government agencies inside to provide information and counseling for homeowners facing possible foreclosure.

Susan Thiem of the Southfield-based Christian Credit Counselors, one of the nonprofits, said the group used to counsel mostly first-time home buyers.

"Now, it's almost all foreclosure prevention," Thiem said.

At the National City Mortgage table, Deborah Golindano, a loan officer, said the bank "may be able to stop the foreclosure proceeding based upon where they are."

But, she added, there is a catch: "There has to be equity. That's our biggest problem."

And the catch was a problem for many who came to Cobo.

Adam Allen, 34, of Berkley, a carpenter, used to have 15 workers for his company, Allen Building. Times were so good that when his wife, Andrea, 30, had their third child, he got a loan to build an addition onto their house.

Then the recession hit. New-home sales plunged and work dried up, Allen said. Now he's two house payments behind.

"I'm afraid of losing the house," Allen said. "This is really my last hope here. If I can't find a solution, I'm just going to let the house go."

Allen bought his house for $145,000 in 2003. His combined mortgage, insurance and property taxes were $1,200 a month. Then he refinanced to improve his home and the payments rose to $1,575 a month.

His home was appraised at $220,000 when he refinanced, but now similar homes in his neighborhood are going for $180,000. He has a two-year, fixed-rate loan at 8% that will become an adjustable rate mortgage in about eight months -- and his mortgage payment will balloon, he said.

"That's when it will all be over with," Allen said.

The event was an encore to a Dec. 13 forum that attracted 4,200 people. Cox started the forums to give at-risk homeowners the opportunity to speak face-to-face with their lenders and loan service companies about ways to prevent losing their homes.

Six informational seminars also were offered on topics such as state and federal assistance programs and how to avoid foreclosure rescue scams.

Four members of the Michigan Emergency Committee Against War & Injustice also were at Cobo. They passed out leaflets, fresh from their federal court victory Monday that prevented Cox and the City of Detroit from stopping them. The group wants to pressure Gov. Jennifer Granholm to declare a moratorium on home foreclosures.

"That's America -- whatever," Cox said. "We just don't want people getting in the way."

Other organizations that learned about the court ruling also showed up at Cobo. One man handed out a "Home Foreclosure Resource Sheet" on behalf of state Sen. Hansen Clarke, D-Detroit. Some people represented law firms offering to sue banks.

ACORN, a community group that advocates for low and moderate-income residents in housing and education, handed out leaflets urging distressed homeowners to file complaints against lenders with Cox's office.

Lawyers from Cox's criminal and consumer protection divisions were there to take complaints. Cox said his office has done preliminary investigations into predatory lending and other crimes, but has not found enough evidence against anyone to pursue them criminally.

"We have been more proactive than any other" attorney general "in the country regarding this," Cox said of the foreclosure issue.

As people left the forum, their reactions were mixed. Many liked the seminars, but some said they thought the meetings with lenders were unproductive because they didn't produce any relief.

"They're just going to tell you the same thing they tell you over the phone," said Charlene Higgins, 60, of Warren. "Hopefully, somebody will help, but I'm not encouraged."

Contact CECIL ANGEL at 313-223-4531 or

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