Chicago Foreclosures: Logan Square Neighborhood Association Helps Turn Mortgages Around

Giving Back: How You And The Chicago Community Can Help Struggling Families

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For the foreclosure prevention team at the Logan Square Neighborhood Association, Adela Gonzalez’s story was all too familiar. She was badly behind on her house payments, and was just days from facing foreclosure. She spoke very little English, making it nearly impossible for her to navigate a financial system that can befuddle even highly educated native speakers. And her documentation was quite unorganized.

“When I told her to bring in her documents, she came in with a garbage bag full of stuff,” LSNA’s Marcelo Ferrer told Huffington Post Chicago with a chuckle. “I was going through light bills from, like, the mid-nineties.”

As chance would have it, though, the better part of a day that Ferrer spent with Mrs. Gonzalez sifting through her documents proved incredibly fruitful. He discovered that her home loan was with Liberty Bank, a community-based institution just down the street on Milwaukee Avenue, within eyeshot of the Logan Square park for which the neighborhood on Chicago’s Northwest Side is named.

For Ferrer, this was a huge break. Most of the people his association helps have loans with big banks, the Chases and Banks of America of the world. In his experience, these banks can be incredibly difficult to engage — “one woman talked to her bank I think 37 times, getting a different person every time, and in those 37 times she talked to the bank they never told her she was foreclosed on.” But LSNA had a relationship with the folks at Liberty. They made a couple of calls, and within days, they were sitting in a room with Mrs. Gonzalez and the bank, negotiating new terms.

“I was going into foreclosure,” said Mrs. Gonzalez, as the organization’s newsletter reported last fall. “They helped me at LSNA, my interest went down to 3.9% and now I’m starting to get on my feet again.”

The case of Adela Gonzalez is a small victory in what’s been an uphill battle — fought by the Logan Square Neighborhood Association among many other organizations — for the rights of residents, the soul of a neighborhood, and, ultimately, for the backbone of the entire city.

LSNA is a multifaceted organization; though they work on housing, immigration, and many other issues, most of their work is done in schools, working with underserved youth populations throughout the neighborhood. It was there, as Ferrer tells it, that the organization first caught wind of the impending foreclosure crisis in 2007. “We have a good pulse of the community through the schools — it’s sort of like the canary in the mine,” he said.

Families were talking about being defrauded, giving money to people who falsely claimed to be able to help them with the terms of their mortgages. “We started wondering, why do all these people need help?”

Soon, he, along with much of the rest of the country, began to realize that mortgage problems weren’t just a blip on the radar. As the foreclosures began to mount in the neighborhood his agency served, Ferrer and others at LSNA banded together to address the issue.

Of particular concern was the effect that the crisis could have on the diversity of the neighborhood. Logan Square underwent a wave of condo development in the early 2000s, and the neighborhood, which was almost monolithically Latino just 15 years ago, has recently seen an influx of gentrification. Still, a good deal of the housing stock is two- to four-unit buildings occupied by Latino families. Ferrer feared that if the owners of those homes were foreclosed on, their tenants might not be able to assert their rights to stay in their homes — or might not realize that they had to keep paying rent.

So LSNA started a door-knocking campaign, trying to use their community bona fides to serve as a bridge between renters in foreclosed homes and the resources available to them that could help them stay in those homes. That program eventually expanded to contact homeowners as well, helping them get into court-sponsored mediation programs and find other resources to help them avoid foreclosure in the first place.

It was through the door-knocking outreach work that LSNA found Mrs. Gonzalez: a volunteer knocked on the door of her sister, who had already been foreclosed on, and while her sister was talking, she chimed in that she could use some help with her mortgage as well.

While Ferrer is proud of what the organization has accomplished on an individual level, for Mrs. Gonzalez and many others like her, he acknowledges that one-on-one interaction isn’t enough to forestall the crisis. There were about 170 foreclosures in the neighborhood alone in 2007; by 2009, that number was up to about 500.

Structural changes are needed as well, he argues. That’s why LSNA is lobbying city and state legislatures for new laws demanding that banks perform upkeep on the properties they foreclose on, and force a portion of the money made from foreclosure sales to go to mediation for the homeowner.

Readers looking to help can start there, by contacting their legislators and demanding action on the issue. “Public pressure has to be parallel to the legislation in order for it to happen,” Ferrer said. He also encouraged readers to visit LSNA’s website and look for ways to get involved, or to find similar organizations in their community, like the Albany Park Neighborhood Council or SWOP on the Southwest Side.

And with the massive state budget deficit leading to crippling cuts in funding for nonprofits, Ferrer said that monetary donations are always welcome.

“Sometimes, we’re waiting for that state money to come through, and we don’t get paid for a long time,” he said.

One more suggestion: in light of Mrs. Gonzalez’s story, Ferrer invoked a Huffington Post initiative from 2009:

“Maybe move your money to a local bank,” he recommended. “Think about where you’re banking.”

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