Op-Ed
A Boost for the American Dream
By Charlene Crowell
NNPA Columnist
About 800,000 homeowners whose mortgages were backed by the Federal Housing Administration (FHA) could save $900 annually on mortgage costs, due to a small reduction in mortgage insurance (MI) premiums. President Barack Obama made the announcement in a recent speech in Phoenix, one of the cities hardest hit by the nation’s housing crisis.
By reducing the MI rate by only a half-percent, the move is also expected to enable 250,000 new homebuyers to afford an FHA mortgage. Administration officials predict that in coming years, the fee reduction will save borrowers with similarly-financed mortgages billions of dollars and also boost the housing market’s long-term recovery.
In his address, the president connected the financial concerns of everyday people to his new initiative designed to spur broader housing recovery.
“It’s not just the economy turning around,” said President Obama. “It’s turning around the lives of hardworking people. . . . Buying a home has always been about more than owning a roof and four walls. It’s about investing savings, and building a family.”
The move is also likely to benefit consumers of color who tend to secure FHA-backed mortgages far more than private, conventional ones.
In 2013, the most recent mortgage data available from the Home Mortgage Disclosure Act, although conventional mortgage originations rose slightly from the previous year, 2012, Black consumers nationwide received only 2.3 percent or 36,903 loans. In 2012, the same data point was even smaller, with only 26,500 such loans.
To add some context to this low number of private, conventional mortgages, the Chicago suburb of Calumet City with a population of 37,240 is larger than the number of loans made to the nation’s Black homebuyers last year.
Typically, 30-year conventional mortgages are free from mortgage insurance premiums when home down payments are 20 percent or larger. Over the course of the loan, these are the mortgages that wind up costing borrowers less money.
By contrast, borrowers who can afford a monthly mortgage payment but only have a low down payment have frequently turned to FHA. One term on these government-backed loans is to charge a mortgage insurance premium.
Housing and consumer advocates were swift to praise the president’s announcement.
Mike Calhoun, Center for Responsible Lending (CRL) president said, “This decision is financially sound, socially responsible, and good policy all at once. Homebuyers, homeowners and taxpayers will all benefit.”
Similarly, Julia Gordon, Director of Housing Finance and Policy at the Center for American Progress, noted, “The president correctly observes that owning a house is about far more than putting a roof over your head. It’s also about stability and community for you and your kids – creating a place to call home. What’s more, for many families, homeownership builds wealth that can be passed down for generations.”
Yet, not all housing stakeholders were in agreement. In a prepared statement issued on the heels of the president’s address, the U.S. Mortgage Insurers issued a statement that, in part, said, “Mortgage insurers putting their own capital at risk should be preferred to government risk taking, consistent with the principles put forward by the Administration for housing reform. The MI industry has the capacity and capability to further reduce taxpayer risk and lower costs for many home buyers while expanding access to mortgage credit.”
While this segment of the housing industry may have the capacity to lower costs for many prospective homebuyers, the post-recession consumer experience did not translate into more mortgage access. The combination of higher pricing for lower-wealth borrowers, along with historically-tight credit standards dramatically limited access to homeownership for low to moderate-income borrowers and continued to pose a serious challenge to the mortgage market as a whole.
Limiting home purchase opportunities also has larger economic consequences. New homeowners fuel consumer spending, especially on big-ticket appliances. These major purchases then enhance local governments’ ability to deliver services as a result of higher sales tax revenues.
Most importantly, lost opportunities for homeownership means fewer families will have the opportunity to have that investment build wealth to pass down across generations.
As President Obama observed, it is time to help “more families afford having their own piece of the American Dream.”
Charlene Crowell is a communications manager with the Center for Responsible Lending. She can be reached at: Charlene.crowell@responsiblelending.org.
###
Activism
Oakland Post Endorses Barbara Lee
Barbara Lee will be able to unify the city around Oakland’s critical budget and financial issues, since she will walk into the mayor’s office with the support of a super majority of seven city council members — enabling her to achieve much-needed consensus on moving Oakland into a successful future.
As we end the celebration of Women’s History Month in Oakland, we endorse Barbara Lee, a woman of demonstrated historical significance. In our opinion, she has the best chance of uniting the city and achieving our needs for affordable housing, public safety, and fiscal accountability.
As a former small business owner, Barbara Lee understands how to apply tools needed to revitalize Oakland’s downtown, uptown, and neighborhood businesses.
Barbara Lee will be able to unify the city around Oakland’s critical budget and financial issues, since she will walk into the mayor’s office with the support of a super majority of seven city council members — enabling her to achieve much-needed consensus on moving Oakland into a successful future.
It is notable that many of those who fought politically on both sides of the recent recall election battles have now laid down their weapons and become brothers and sisters in support of Barbara Lee. The Oakland Post is pleased to join them.
Activism
Actor, Philanthropist Blair Underwood Visits Bay Area, Kicks Off Literacy Program in ‘New Oakland’ Initiative
These community activations were coordinated with the San Francisco-based non-profit program “Room to Read.” Ray said he is also donating his time to read and take pictures with students to encourage their engagement and to inspire them to read more. The inspirational book “Clifford Ray Saves the Day” highlights Clifford Ray’s true story of saving a dolphin.
By Paul Cobb
New Oakland Series
Opinion Part 3
The Post mentioned three weeks ago that a number of our local luminaries were coming together to support the “New Oakland” movement. As this current national administration continues to eliminate our “legacy” institutional policies and programs left and right, most communities find themselves beyond “frozen” in fear.
Well, esteemed actor, long-time Bay Area supporter, and philanthropist Blair Underwood returned to Oakland this week to speak with city leaders, community trust agents, students, the Oakland Post, and local celebrities alike to continue his “New Oakland” initiative.
This week, he kicked off his “Guess Who’s Coming to Read” literacy program in some of Oakland’s middle schools. Clifford Ray, who played the center position of the 1975 World Champion Golden State Warriors, donated close to 1,000 books. Ray’s fellow teammate Charles “The Hopper” Dudley also gave Converse sneakers to students.
These community activations were coordinated with the San Francisco-based non-profit program “Room to Read.” Ray said he is also donating his time to read and take pictures with students to encourage their engagement and to inspire them to read more. The inspirational book “Clifford Ray Saves the Day” highlights Clifford Ray’s true story of saving a dolphin.
Underwood also spent quality time with the Oakland Ballers ownership group and visited the amazing Raimondi Park West Oakland community revitalization site. In the 1996 TV film Soul of the Game, Underwood played the role of the legendary first Black Major League Baseball player Jackie Robinson and commended the Ballers owners.
“This group of sports enthusiasts/ philanthropists needs to be applauded for their human capital investment and their financial capital investment,” Underwood said. “Truly putting their money and passion to work,” Underwood said.
Underwood was also inspired by mayoral candidate Barbara Lee’s open-minded invitation to bring public-private partnership opportunities to Oakland.
Underwood said he wants to “reinforce the importance of ‘collaborative activism’ among those most marginalized by non-empathic leadership. We must ‘act out’ our discomfort with passionate intentions to create healthy change.”
Activism
Councilmembers Ramachandran, Kaplan, Unger Identify Funds to Save Oakland Fire Stations
Our budget crisis – one of the worst in Oakland’s history – is compounded by the fact that people do not feel safe coming to Oakland due to our public safety crisis. By investing in our fundamental public safety resources today, we can send a signal to the world that Oakland is open for business. We have such a rich and vibrant culture, arts, and food scene that is worth celebrating – but we can only showcase this if we are able to keep our neighborhoods safe. Having fully functioning fire stations are absolutely essential to these efforts.
By Janani Ramachandran
There is no greater concern to the people of Oakland today than public safety. Fire stations are the bread and butter of essential city services – and every day that we have stations shuttered, we imperil the lives of our community members. In response to widespread outcry over the current and planned closure of stations, myself, along with Councilmembers Kaplan and Unger, have painstakingly worked to identify millions of dollars of new funding to save our stations. The legislation we introduced on Thursday, February 13th, will amend our budget to prevent the closure of four fire stations that are currently on the chopping block due to our budget crisis and will re-open two closed stations that have already been closed – Station 25 and 28 – in the near future. The resolution that will provide the funding to keep our stations open will go before the full City Council for a vote at our meeting on Tuesday, March 4th at 3:30 PM – and we invite you to join us at City Hall to share your perspective on the topic.
Our budget crisis – one of the worst in Oakland’s history – is compounded by the fact that people do not feel safe coming to Oakland due to our public safety crisis. By investing in our fundamental public safety resources today, we can send a signal to the world that Oakland is open for business. We have such a rich and vibrant culture, arts, and food scene that is worth celebrating – but we can only showcase this if we are able to keep our neighborhoods safe. Having fully functioning fire stations are absolutely essential to these efforts.
With the devastating Los Angeles fire at the top of people’s minds, terrible memories of Oakland’s own wildfires are re-surfacing from the 1991 Oakland Hills Firestorm to the Keller fire just a few months ago – and how essential fire stations are to mitigating these catastrophes. But in Oakland, our fire stations don’t just fight wildfires – they also provide emergency medical services to our most vulnerable constituents, put out structural fires and encampment fires, and much more.
We recognize that there are a number of competing interests and important initiatives fighting for sparse City resources. But from my perspective, core safety services are the most pivotal functions that a City must spend its resources on – especially given the outcry we have heard around fire stations.
The fight to save our stations is not over. The resolution we introduced is a critical first step, and there are hurdles to overcome. If you support keeping our fire stations open, we invite you to be a part of the solution by making your voice heard at the March 4th City Council meeting at 3:30 pm.
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Op-Ed
A Boost for the American Dream
By Charlene Crowell
NNPA Columnist
About 800,000 homeowners whose mortgages were backed by the Federal Housing Administration (FHA) could save $900 annually on mortgage costs, due to a small reduction in mortgage insurance (MI) premiums. President Barack Obama made the announcement in a recent speech in Phoenix, one of the cities hardest hit by the nation’s housing crisis.
By reducing the MI rate by only a half-percent, the move is also expected to enable 250,000 new homebuyers to afford an FHA mortgage. Administration officials predict that in coming years, the fee reduction will save borrowers with similarly-financed mortgages billions of dollars and also boost the housing market’s long-term recovery.
In his address, the president connected the financial concerns of everyday people to his new initiative designed to spur broader housing recovery.
“It’s not just the economy turning around,” said President Obama. “It’s turning around the lives of hardworking people. . . . Buying a home has always been about more than owning a roof and four walls. It’s about investing savings, and building a family.”
The move is also likely to benefit consumers of color who tend to secure FHA-backed mortgages far more than private, conventional ones.
In 2013, the most recent mortgage data available from the Home Mortgage Disclosure Act, although conventional mortgage originations rose slightly from the previous year, 2012, Black consumers nationwide received only 2.3 percent or 36,903 loans. In 2012, the same data point was even smaller, with only 26,500 such loans.
To add some context to this low number of private, conventional mortgages, the Chicago suburb of Calumet City with a population of 37,240 is larger than the number of loans made to the nation’s Black homebuyers last year.
Typically, 30-year conventional mortgages are free from mortgage insurance premiums when home down payments are 20 percent or larger. Over the course of the loan, these are the mortgages that wind up costing borrowers less money.
By contrast, borrowers who can afford a monthly mortgage payment but only have a low down payment have frequently turned to FHA. One term on these government-backed loans is to charge a mortgage insurance premium.
Housing and consumer advocates were swift to praise the president’s announcement.
Mike Calhoun, Center for Responsible Lending (CRL) president said, “This decision is financially sound, socially responsible, and good policy all at once. Homebuyers, homeowners and taxpayers will all benefit.”
Similarly, Julia Gordon, Director of Housing Finance and Policy at the Center for American Progress, noted, “The president correctly observes that owning a house is about far more than putting a roof over your head. It’s also about stability and community for you and your kids – creating a place to call home. What’s more, for many families, homeownership builds wealth that can be passed down for generations.”
Yet, not all housing stakeholders were in agreement. In a prepared statement issued on the heels of the president’s address, the U.S. Mortgage Insurers issued a statement that, in part, said, “Mortgage insurers putting their own capital at risk should be preferred to government risk taking, consistent with the principles put forward by the Administration for housing reform. The MI industry has the capacity and capability to further reduce taxpayer risk and lower costs for many home buyers while expanding access to mortgage credit.”
While this segment of the housing industry may have the capacity to lower costs for many prospective homebuyers, the post-recession consumer experience did not translate into more mortgage access. The combination of higher pricing for lower-wealth borrowers, along with historically-tight credit standards dramatically limited access to homeownership for low to moderate-income borrowers and continued to pose a serious challenge to the mortgage market as a whole.
Limiting home purchase opportunities also has larger economic consequences. New homeowners fuel consumer spending, especially on big-ticket appliances. These major purchases then enhance local governments’ ability to deliver services as a result of higher sales tax revenues.
Most importantly, lost opportunities for homeownership means fewer families will have the opportunity to have that investment build wealth to pass down across generations.
As President Obama observed, it is time to help “more families afford having their own piece of the American Dream.”
Charlene Crowell is a communications manager with the Center for Responsible Lending. She can be reached at: Charlene.crowell@responsiblelending.org.
###
Activism
Oakland Post Endorses Barbara Lee
Barbara Lee will be able to unify the city around Oakland’s critical budget and financial issues, since she will walk into the mayor’s office with the support of a super majority of seven city council members — enabling her to achieve much-needed consensus on moving Oakland into a successful future.
As we end the celebration of Women’s History Month in Oakland, we endorse Barbara Lee, a woman of demonstrated historical significance. In our opinion, she has the best chance of uniting the city and achieving our needs for affordable housing, public safety, and fiscal accountability.
As a former small business owner, Barbara Lee understands how to apply tools needed to revitalize Oakland’s downtown, uptown, and neighborhood businesses.
Barbara Lee will be able to unify the city around Oakland’s critical budget and financial issues, since she will walk into the mayor’s office with the support of a super majority of seven city council members — enabling her to achieve much-needed consensus on moving Oakland into a successful future.
It is notable that many of those who fought politically on both sides of the recent recall election battles have now laid down their weapons and become brothers and sisters in support of Barbara Lee. The Oakland Post is pleased to join them.
Activism
Actor, Philanthropist Blair Underwood Visits Bay Area, Kicks Off Literacy Program in ‘New Oakland’ Initiative
These community activations were coordinated with the San Francisco-based non-profit program “Room to Read.” Ray said he is also donating his time to read and take pictures with students to encourage their engagement and to inspire them to read more. The inspirational book “Clifford Ray Saves the Day” highlights Clifford Ray’s true story of saving a dolphin.
By Paul Cobb
New Oakland Series
Opinion Part 3
The Post mentioned three weeks ago that a number of our local luminaries were coming together to support the “New Oakland” movement. As this current national administration continues to eliminate our “legacy” institutional policies and programs left and right, most communities find themselves beyond “frozen” in fear.
Well, esteemed actor, long-time Bay Area supporter, and philanthropist Blair Underwood returned to Oakland this week to speak with city leaders, community trust agents, students, the Oakland Post, and local celebrities alike to continue his “New Oakland” initiative.
This week, he kicked off his “Guess Who’s Coming to Read” literacy program in some of Oakland’s middle schools. Clifford Ray, who played the center position of the 1975 World Champion Golden State Warriors, donated close to 1,000 books. Ray’s fellow teammate Charles “The Hopper” Dudley also gave Converse sneakers to students.
These community activations were coordinated with the San Francisco-based non-profit program “Room to Read.” Ray said he is also donating his time to read and take pictures with students to encourage their engagement and to inspire them to read more. The inspirational book “Clifford Ray Saves the Day” highlights Clifford Ray’s true story of saving a dolphin.
Underwood also spent quality time with the Oakland Ballers ownership group and visited the amazing Raimondi Park West Oakland community revitalization site. In the 1996 TV film Soul of the Game, Underwood played the role of the legendary first Black Major League Baseball player Jackie Robinson and commended the Ballers owners.
“This group of sports enthusiasts/ philanthropists needs to be applauded for their human capital investment and their financial capital investment,” Underwood said. “Truly putting their money and passion to work,” Underwood said.
Underwood was also inspired by mayoral candidate Barbara Lee’s open-minded invitation to bring public-private partnership opportunities to Oakland.
Underwood said he wants to “reinforce the importance of ‘collaborative activism’ among those most marginalized by non-empathic leadership. We must ‘act out’ our discomfort with passionate intentions to create healthy change.”
Activism
Councilmembers Ramachandran, Kaplan, Unger Identify Funds to Save Oakland Fire Stations
Our budget crisis – one of the worst in Oakland’s history – is compounded by the fact that people do not feel safe coming to Oakland due to our public safety crisis. By investing in our fundamental public safety resources today, we can send a signal to the world that Oakland is open for business. We have such a rich and vibrant culture, arts, and food scene that is worth celebrating – but we can only showcase this if we are able to keep our neighborhoods safe. Having fully functioning fire stations are absolutely essential to these efforts.
By Janani Ramachandran
There is no greater concern to the people of Oakland today than public safety. Fire stations are the bread and butter of essential city services – and every day that we have stations shuttered, we imperil the lives of our community members. In response to widespread outcry over the current and planned closure of stations, myself, along with Councilmembers Kaplan and Unger, have painstakingly worked to identify millions of dollars of new funding to save our stations. The legislation we introduced on Thursday, February 13th, will amend our budget to prevent the closure of four fire stations that are currently on the chopping block due to our budget crisis and will re-open two closed stations that have already been closed – Station 25 and 28 – in the near future. The resolution that will provide the funding to keep our stations open will go before the full City Council for a vote at our meeting on Tuesday, March 4th at 3:30 PM – and we invite you to join us at City Hall to share your perspective on the topic.
Our budget crisis – one of the worst in Oakland’s history – is compounded by the fact that people do not feel safe coming to Oakland due to our public safety crisis. By investing in our fundamental public safety resources today, we can send a signal to the world that Oakland is open for business. We have such a rich and vibrant culture, arts, and food scene that is worth celebrating – but we can only showcase this if we are able to keep our neighborhoods safe. Having fully functioning fire stations are absolutely essential to these efforts.
With the devastating Los Angeles fire at the top of people’s minds, terrible memories of Oakland’s own wildfires are re-surfacing from the 1991 Oakland Hills Firestorm to the Keller fire just a few months ago – and how essential fire stations are to mitigating these catastrophes. But in Oakland, our fire stations don’t just fight wildfires – they also provide emergency medical services to our most vulnerable constituents, put out structural fires and encampment fires, and much more.
We recognize that there are a number of competing interests and important initiatives fighting for sparse City resources. But from my perspective, core safety services are the most pivotal functions that a City must spend its resources on – especially given the outcry we have heard around fire stations.
The fight to save our stations is not over. The resolution we introduced is a critical first step, and there are hurdles to overcome. If you support keeping our fire stations open, we invite you to be a part of the solution by making your voice heard at the March 4th City Council meeting at 3:30 pm.
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