Why Leadership Pays
Posted by Michael Hickey on January 27, 2012
In previous blog posts (Why Evaluation Stinks), I’ve discussed how the fragmented nature of the nonprofit sector makes it very difficult to impose top-down, comprehensive evaluative frameworks. The primary problem is that even if you have two nonprofit organizations, each working with similar clients and conducting similar programs, the mix of supports from philanthropy, contracts and earned revenues will be such that the way they achieve their results will be unique. The nonprofit sector, operating as it does on the margins of the market economy, is forced to pull together resources higgledy-piggledy, and this mix varies so substantially for each nonprofit (and indeed for each year of its operations), that you really can’t draw comparisons easily between two otherwise similar service activities.
In short, our twinkling field of a thousand lights are all very different.
There is, however, an upside to this. Each organization cuts its own path to achieving its mission, providing us with a diversity of models and strategies. Some succeed by focusing on a specific, artisanal niche where they excel, while others grow through horizontal or vertical expansion. But there’s one thing that all successful organizations have in common: they exhibit strong leadership. And when I say leadership, what I mean is that the manager or managers of the organization are considered trustworthy, intelligent, passionate and capable. They may also be considered tyrannical, obtuse, plodding, or distraught, but in their own way they get the job done and they get it done well.
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Gallup: U.S. Wants Government to Help Fix the Housing Market
Posted by Matthew Brian Hersh on January 27, 2012
Even though some in the House chamber winced at the president's mention of a mortgage investigative unit during the State of the Union, a new poll released today shows that Americans actually support the government's role in fixing the housing market.
The Gallup Poll, based on telephone interviews conducted between January 5 and 8 and again on January 14 and 15, indicates that 58 percent "prefer that the government act to prevent foreclosures, whereas 34 percent prefer the housing market resolve its problems on its own." It will be interesting to see how these numbers change considering the poll was conducted prior to the State of the Union address, which was well-received.
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Mortgage Task Force Moves Quickly as AG Settlement Resurfaces
Posted by Matthew Brian Hersh on January 27, 2012
Eleven financial institutions have been subpoenaed by a new mortgage investigative unit assembled to examine fraud related to mortgage originations and securitizations. The unit was mentioned as part of President Obama's State of the Union address this week.
HousingWire is reporting that New York Attorney General Eric Schneiderman, co-chair of the unit will be joined in the effort by attorneys general Beau Biden of Delaware, Martha Coakley of Massachusetts, Catherine Cortez Masto of Nevada, Kamala Harris of California, and Lisa Madigan of Illinois.
U.S. Attorney General Eric Holder has also indicated that an additional 15 lawyers and investigators are working with the task force, as well as the FBI and SEC.
"We have jurisdiction to go after every aspect of the mortgage bubble and the crash of the financial market," Schneiderman said. "We have jurisdiction over every MBS issued over the last decade with Delaware and New York joining the group."
News of these subpoenas comes at the same time of news that a $25 billion settlement between all U.S. attorneys general, the adminstration, and the country's largest banks may, once again, be in the works. Earlier this week, rumors that a final settlement was imminent and would be announced during the State of the Union were quelled amid a swift call for more bank culpability from advocates. The settlement was not mentioned in the president's address.
The settlement will reportedly involve a release from liability for mortgage servicing issues, including robo-signing, an easiily-identifiable type of misconduct for presecutors. But, in potentially good news for those calling for more punitive measures, banks will not be immune from criminal liability, tax liability, fair lending, fair housing, or other civil rights claims, and more.
Photo courtesy The White House via Flickr
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Schneiderman’s Role in Financial Crimes Unit Is Welcome News
Posted by Matthew Brian Hersh on January 25, 2012
A settlement between attorneys general, federal officials, and the nation's five largest mortgage lenders is reportedly anything but final following push back from advocacy groups and some of those attorneys general who worried the deal was too soft on banks. The $25 billion settlement, stemming from a 2010 effort launched to examine foreclosure abuses, would stipulate principal reduction for many homeowners facing foreclosure, as well as set aside funds for famiiles whose homes were wrongfully foreclosed on.
But news that New York State Attorney General Eric Schneiderman would co-chair a special unit of prosecutors and attorneys general to, as President Obama said in Tuesday's State of the Union address, "expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis," came as a welcome announcement. After the president's address, the Woodstock Institute wrote on its blog that a Financial Crimes Unit "will play an important role in holding mortgage lenders and servicers accountable for how their actions impact families, communities, and the market.
Making it clear that criminal activity in the financial sector will not be tolerated is necessary to restore confidence in the mortgage market and the broader financial system.
The plan could restore confidence, or, as President Obama said, give a chance for banks to "repay a deficit of trust." We like the sound of that.
Concerns remain, however, that the pending settlement with the banks will be light in the way of assigning culpability, and that, as Colorlines' Kai Wright says, this new unit will simply be "window dressing for a get-out-of-jail-free settlement with banks."
Still, advocates are hopeful. The Alliance of Californians for Community Empowerment (featured in the fall 2011 Shelterforce) posted on Facebook Tuesday evening, "This is a great start! Let's make sure they don't let the banks off the hook."
It'll be interesting to see how this plays out. While we would have liked to have seen this type of aggressive approach much, much sooner, this is good news.
Photo by citizenactionny via Creative Commons
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Too Many Bargains With Pending Foreclosure Settlement, Advocates Worry
Posted by Matthew Brian Hersh on January 23, 2012
Housing advocates and many legislators are voicing their concern with an anticipated $25 billion settlement stemming from an investigation by state attorneys general looking into deceptive lending practices. The scope of the settlement, the extent of its effect on lending practices, as well as potential exemptions from prosecution or civil suits have all taken center stage leading up to Tuesday's State of the Union address, when President Obama is expected to make reference of case.
A final deal between the state attorneys general and the banks—Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Financial—could be sealed within weeks, according to The Washingon Post. And while the settlement would fall short in way of assistance to those eligible—only about $1,800 for roughly 750,000 individuals—there could be changes when it comes to a bank's assistance in restructuring a loan:
"Those who lost their homes to foreclosure are unlikely to get their homes back or benefit much financially from the settlement . . . but the agreement could reshape long-standing mortgage lending guidelines and make it easier for those at risk of foreclosure to restructure their loans. And roughly 1 million homeowners could see the size of the mortgage reduced."
However, "the settlement would only apply to privately held mortgages issued between 2008 and 2011, not those held by government-controlled Fannie Mae or Freddie Mac," the government-backed agencies that own about 31 million, or roughly half, of all U.S. home loans—an omission of particular concern for advocates.
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A First Look at Real CFPB Authority
Posted by Matthew Brian Hersh on January 20, 2012
Now that the Consumer Financial Protection Bureau is properly equipped with Richard Cordray as its director, news that it will monitor nonbank entities (independent lenders, brokers, servicers) in the same way it does banks is certainly good news for those wanted to see what an effective CFPB can do and how a robust bureau can establish "a new sheriff with real authority," as John Taylor of the National Community Reinvestment Coalition wrote in Shelterforce in 2009.
In a blog post, Cordray emphasized the role nonbank entities play and that this extension of the CFPB's bank supervision program will "help level the playing field for all industry participants to create a fairer marketplace for consumers and the responsible businesses that serve them":
There are currently thousands of nonbank businesses that offer consumer financial products and services, and consumers interact with them all the time. If you've taken out a payday loan, received a call from a debt collector, or accessed your credit report, you may well have done business with one yourself. These common transactions add up to a big part of the overall market for consumer financial products and services, and the importance of nonbanks has grown substantially over the last few decades.
This is a pretty major development because the nonbank segment of the financial sector "played a huge role in the bad practices—from fee price gouging to sub-prime loan steering—that helped create the crisis in today's housing market," said Dan Kildee of the Center for Community Progress in a statement.
Following his appointment, Cordray released a video outlining the general goals of the CFPB:
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An Opportunity to Talk About the Foreclosure Crisis
Posted by Alan Jenkins on January 19, 2012
As the Republican presidential candidates debate the moral legitimacy of venture capital strategies, and the Occupy movement continues to challenge evictions, we have an important opportunity to elevate the foreclosure crisis and what must be done to address it. It's a moment to remind Americans that the causes of the crisis were misconduct in the lending industry and inadequate governmental rules and enforcement. And it's a chance to identify concrete, workable solutions.
While the current presidential debate may be more about gaining political advantage than about fixing problems, it taps into the experience and emotion of Americans around the country. And a range of available solutions exist. They include immediate steps like mandatory mediation, expanded housing counseling, and lease-to-own programs, but also ensuring that reforms of Fannie Mae and Freddie Mac—another subject of the presidential debates—keep homeownership available to working Americans.
Finally, it's important to raise an issue that has not been discussed by the candidates or by President Obama: the way in which communities of color were disproportionately targeted for risky, subprime loans. Applying equal opportunity rules and rigorous enforcement to our lending and finance systems is another crucial next step.
This moment of public scrutiny and attention will not last long. By speaking out, we can connect it to the real facts about the crisis and real solutions to the problem.
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High speed Internet - Hard to find in rural places
Posted by David Holtzman on January 17, 2012
What's it like not having access to high-speed Internet today? For anyone who is aware of high-speed Internet, not having it is essentially to not have the Internet at all. If time is money, the time spent staring at the useless screen full of information you already absorbed, listlessly awaiting the moment (which may never come) when a new screen loads, is simply a money loser. Why do more people not stay in rural places, or move there to try a new life? There's no Web there.
The lack of Broadband Internet in a large swathe of the American landscape is disturbing, given how much people rely on it today in their personal and working lives. The community that does not have the Web is destined to be shortchanged in the number of people who will be civically engaged; the number of new jobs to replace those that are lost; and in educational opportunities for those looking to lift themselves up.
There is no point dwelling on the romantic virtues of a pre-Internet era, as one might extol the virtues of the plow and harness over the tractor. Progress must come in some form in order for rural places not to stagnate.
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In Case You Missed It: Can Lease Purchase Save Us?
Posted by Matthew Brian Hersh on January 16, 2012
Last week's webinar, "Can Lease Purchase Save Us?," sponsored by NHI/Shelterforce and NeighborWorks America, provided an in-depth look at the lease purchase model that allows potential homebuyers to rent their intended home until they are ready to buy. The hour-and-a-half discussion also pointed to many of the challenges that can stand in the way of an organization that is not necessarily equipped with the proper planning and capacity.
Shelterforce editor Miriam Axel-Lute led the discussion and was joined by Bill Goldsmith of Mercy Housing Inc., in Chicago, Staci Horwitz of City of Lakes Community Land Trust (CCCLT) in Minneapolis, and John O’Callaghan of the Atlanta Neighborhood Development Partnership, Inc. (ANDP). All speakers were featured in Axel-Lute's Winter 2010 article on the subject and discussed critical elements in implementing a successful lease purchase program.
Horwitz, CCCLT's policy director, discussed "Project: Reclaim," a contract-for-deed program and collaborative effort with Urban Homeworks, BuildWealth MN, and Lutheran Social Service of Minnesota. Click here to download her presentation.
Mercy Housing's Goldsmith looked at a decade of doing a lease purchase program, as well as what to do and what not to do to ensure success. Click here to see his presentation.
Finally, O'Callaghan examined the ANDP program, one of the first organizations to use Self-Help’s lease-purchase product, and placed an emphasis on front-end planning and program flexibility. Click here to see O'Callaghan's presentation.
Finally, click here to listen to a recording of the webinar.
Photo by Matthew Brian Hersh
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How Influential, the Voice of Another
Posted by Stephanie Allewalt on January 12, 2012
Milwaukee is about to lose an incredible economic opportunity due to an inability to capitalize on our talents.
To kick off the new year and my inaugural Rooflines blog post, I'd like to begin by outlining an "Opportunity Profile." I intend to incorporate in these profiles in future blog posts to highlight the limitless potential of our existing built environment—those forgotten buildings which have cradled Americans (and have housed creative engines) for decades. My expectation is for subsequent blog posts to follow a similar structure; using Opportunity Profiles will lay a foundation for exploring ties between real estate development, economic opportunity, and community building. I cannot envision a better illustration for this inaugural post than the following Opportunity Profile:
Opportunity Profile
- Six-story structure
- 126,761 square feet
- Victorian Romanesque Revival style
- "Cream City Brick" and Limestone-Trimmed Exterior
- Scheduled for demolition in ~ 2 months
Meet the Schlitz Brew House in Milwaukee: the building that made "the beer that made Milwaukee famous." To too many Milwaukeeans today, this one-of-a-kind diamond in the rough is just another structure to bulldoze in the name of progress. How this surprising dismissal has become mainstream stems from the collective voice of our regional commercial real estate and development community: newer is often better, and 122 years old = undesirable.
We must be kidding ourselves.
National Housing Institute
