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					Sharing the Learning
A special publication from Neighborhood Connections and Grassroots Grantmakers




Fighting Foreclosure:
What you can do in your neighborhood

If “home is where the heart is,” then it’s easy to understand the
profound sense of loss that occurs when a home moves into
foreclosure. A growing problem in communities around the
country, foreclosure affects the stability of entire neighborhoods.

In some neighborhoods hit hardest, as many as one in 10 homes
can lie vacant – so what does that look like?

The value of surrounding homes decreases, and abandoned proper-
ties become magnets for crime and vandalism. Fewer residents
also translate into the loss of a valuable tax base for improvement.
Ultimately whole communities can be labeled as “risky.”                  What’s Inside
Some cities like Cleveland, Ohio, have dealt with the foreclosure        Page 2-3 Foreclosure 101
problem long before it became a national epidemic. Residents, public
                                                                         Page 4-7 What you and your neighbors
officials, key organizations, and institutions found new ways to work             can do: Practical ideas
together to counteract the negative impact. Individuals at the                    and resources for
grassroots level have played an essential role, lacing communities                neighborhood groups
back together one step at a time.                                        Page 8   How can grassroots groups
This guide is a snapshot of the community-level response to the                   make a difference?
                                                                                  Interview with Cleveland City
foreclosure epidemic in Cleveland. The valuable insights, information,
                                                                                  Councilman Tony Brancatelli
and examples provided are a resource for community residents,
community-based organizations, public officials, and place-based
funders who are dealing with similar issues in their own communities.
It demonstrates how much residents can accomplish when working
together to tackle complex issues like foreclosure, and the important
role grassroots groups can play in a strategic, big-picture approach.




 1
     OVERVIEW

Foreclosure explained
By its simplest definition, foreclosure is a process that allows a lender
to recover the amount owed on a defaulted loan.
Homeowners fall into foreclosure for a number of reasons.
Some homeowners have adjustable rate mortgages, where the amount of
their monthly payment might vary from year to year depending on interest
rate fluctuations. Also, if they miss or are late on a payment due to financial
hardship, steep penalties might make the payments more unaffordable.
Also, many homeowners refinanced to relieve financial stress, but worked
with a predatory lender and started a new mortgage with an adjustable rate.


The foreclosure process can end in several ways:
1. The owner reinstates the loan by paying off the default amount
   during a grace (preforeclosure) period that is determined by state law.
2.       The owner sells the property to a third party during this grace period.
3.       A third party may buy the property at a public auction held at the
         end of the grace period.
4.       The lender may take ownership of the property, usually with the                  Cleveland’s foreclosure rate hit 16 percent in 2009 as more
         intent to re-sell it on the open market.                                         homes became vacant, other neighborhood issues, such as
                                                                                          crime and vanalism, moved in.




What is the neighborhood effect?
A growing problem are homes termed ”walkaways”,according
to Claudia Coulton and Kermit Lind, professors at CWRU and
Cleveland State University, respectively. Walkaways result
when a bank begins to foreclose on a property, the home-
owner moves out, but the bank never follows through with
the foreclosure. The property still belongs to the homeowner,
who is often unaware that they still own the home. The house
is in limbo and very little action can be taken toward
demolition or rehabilitation.
When homes are empty they can quickly become vandalized
by scrap collectors who strip the home of aluminum siding,
copper piping, and other valuable items. These homes, often
standing open, become easy prey for squatters, drug dealers,
wild animals, and other unwanted elements. As the homes
remain abandoned they fall into dangerous disrepair and
become a danger to children, and even adults, in the
neighborhood.
Even one foreclosed or abandoned home in a neighborhood                Each dot on the map represents a foreclosed home.
reduces the value of every other home on the street.



     2
  FOR FUNDERS

Why an investment in active neighborhood
residents makes sense
By Janis Foster Richardson                                           Consider how you can use small grants as a tool to encourage
Executive Director of Grassroots Grantmakers                         residents to take a more active role in neighborhood stabilization.
                                                                     How can you use the power that you have as a funder to connect
                            Think about what happens in the
                                                                     residents in foreclosure-stricken communities with others who
                            four hours after the tornado, the
                                                                     are at work on this crisis? What can you learn from this experi-
                            earthquake, or the flood – those
                                                                     ence about proactively using the “we begin with residents”
                            hours before rescue efforts are
                                                                     approach that is central to grassroots grantmaking?
                            mobilized to bring relief. It’s people
                            helping people, energizing the           This report shares some examples of what residents are doing
                            spider web of relationships that         in Cleveland with the hope that their story and the practical
                            they have with each other in their       wisdom that comes from their work will be helpful to other
                            community and a personal sense           foreclosure-stricken communities. I hope you will use this report
                            of “I can do something” to               to spark some creative thinking about how you can build on what
                            provide the first wave of help.          you are already doing and how to use your position as a funder.
                                                                     And I hope that you will share your work with our network so that
Now think about the foreclosure crisis that our communities
                                                                     we can continue to learn about the role that grassroots grant-
are now experiencing. The experts are saying that like a
                                                                     making can play on big issues such as the foreclosure crisis.
natural disaster, this disaster has physical, economic, and
psychological dimensions. Once foreclosures destabilize              For more “Big Thinking on Small Grants,” please visit
a neighborhood, destabilization cannot easily be undone by           Janis Foster Richardson’s blog at http://janisfoster.blogspot.com.
dealing with the foreclosure issue alone. A comprehensive
approach will be needed to tip the scales from destabilizing
to stabilizing events – and the people in the neighborhoods            Neighborhood Progress, Inc., a community development group in Cleveland
are an essential part of that approach.                                Ohio, developed a comprehensive strategy to address the foreclosure issue.
                                                                       NPI created a partnership with other nonprofits in the area to help prevent
Residents are much stronger when they act collectively in              families from losing their homes and to rehabilitate others.
challenging times. Together residents in neighborhoods                 Here are some of the strategies they have implemented through
that are being hit hard by the foreclosure crisis can shore            these partnerships:
up confidence that both their financial and their psychological           • Prevention of foreclosure through counseling, organizing,
investments in their neighborhood are secure. They can pull                 and advocating for families in distress.
together in a spirit of mutual aid and help manage the fear that          • Rehabilitating homes in six neighborhoods hit hard by foreclosure.
can so quickly escalate. They can work on the code issues,                • Created a Neighborhood Stabilization Team that does research on
and neighborhood appearance and safety issues that come                     individual properties and helps make decisions on which ones to
with vacant property. They can communicate in a way that                    acquire, which to demolish, and which to rehabilitate.
no one else can that lets house and apartment shoppers                    • Worked with the county to create a county land bank, to hold vacant
know that this is a good neighborhood that got caught in                    land and property, and to decide the future fate of these properties.
a tidal wave but is basically sound.                                      • Developed and implemented a pilot receivership program for vacant
                                                                            property, where nonprofits take ownership of properties to rehabilitate
For funders who are engaged in grassroots grantmaking –                     or demolish.
who believe that small grants can make a big difference, who
                                                                       For more information on this work, visit www.neighborhoodprogress.org
invest in active citizenship, who approach their work through          or call Frank Ford at 216.830.2770.
an asset lens rather than a deficit lens – this is the moment
to think as creatively as possible about what you can do to
position residents as critical players in foreclosure-stricken
neighborhoods.

                                                                                                                                          3
  NEIGHBORS WORKING TOGETHER

Residents in Cleveland’s Slavic Village
create change by being bold, taking action
Challenges are nothing new for Barbara Anderson.                   Fighting neighborhood foreclosure
A series of fires were set intentionally on and around her home    Anderson wanted to use her skills to improve Slavic Village,
in Slavic Village shortly after she and her family moved to the    which was struggling in the aftermath of predatory
once predominantly Czech-Polish, middle-class neighborhood,        lending, primarily in the form of foreclosures.
south of downtown Cleveland.
                                                                   Each foreclosure in Slavic Village brought more devastation.
She sought help through the police with little recourse.           Property values in the neighborhood were sinking, and in
To get money for the ongoing repairs, she refinanced her           turn, revenues for services in Slavic Village were dwindling.
mortgage, unknowingly signing with a predatory lender.             Drugs and neighborhood crimes were gaining firm footholds.
“Interest rates kept going up,” Anderson says.“                    Anderson realized that these housing struggles went beyond
I tried to work with the lender, but they wouldn’t talk to me.”    the personal, but were now a shared problem. “One loss
                                                                   affects everyone else, she says”. When you sign that mortgage
Anderson and several other neighbors who were struggling
                                                                   agreement, your neighbor is right there with you,” she says.
with their mortgages started to work with a local community
organizing group called the East Side Organizing Project (ESOP).   Not your mother’s street club
They began to educate themselves about loans, lenders,             “We looked at the stripped properties and the decline,
and finance.                                                       and we decided to band together,” Anderson says.
ESOP members opted for a more confrontational approach             In 2004, Bring Back the 70s Street Club (BB70) was formed to
to get lenders into negotiations, marching up and down in front    address the problems that came with so many neighborhood
of their homes in protest. Organizers were eventually able to      foreclosures, with Anderson as president.
negotiate with lenders for better contracts and the elimination
                                                                   To tackle a tough set of neighborhood issues she continued
of fees.
                                                                   to use the organizing principles that she learned through
“We saw best practices in organizing transform into proven         ESOP, and developed a direct and efficient meeting style
practices,” Anderson says.                                         that kept momentum on projects moving forward.
                                                                   To combat neighborhood drug activity, the club installed
            “One loss affects everyone else.                       security cameras in high traffic areas, chasing dealers away
       When you sign that mortgage agreement,                      through exposure by turning tapes over to police. The club was
         your neighbor is right there with you.”                   also able to designate a street one-way to eliminate drug trade
                 ~ Barbara Anderson.                               traffic. Male members of BB70 dress in leather jackets and
                                                                   regularly patrol the streets for additional security.
                                                                   “This is not your mother’s street club!” Anderson jokes.
                                                                   Employing a philosophy that “no issue is too big to take on,”
                                                                   BB70 is currently working to acquire an abandoned building
                                                                   to transform into a neighborhood center. Space would
                                                                   be used for BB70 meetings, a community garden, a youth jobs
                                                                   skills program, and a youth theatrical group.
                                                                   BB70 also focuses on developing a wide range of partners,
                                                                   proclaiming city officials, bankers, and business owners
                                                                   “honorary members” as a way to open opportunities to
                                                                   dialogue around different issues. “We have to have partners
                                                                   in this work, because there is no way we can handle these
                                                                   issues alone,” Anderson says.




 4
 NEIGHBORS WORKING TOGETHER

Practical ideas for neighborhood groups
Maintaining Vacant and Abandoned Property                        Improving Safety
What can you do about these vacant and abandoned homes?          Living with vacant and abandoned homes on your street
Here are a few ideas:                                            may lead to an increase in crime and vandalism. Here are
                                                                 a few examples of how neighborhood groups have
   • Cut back shrubs and maintain the lawns.
                                                                 improved safety on their streets:
   • Paint the boarded windows and doors to improve the
                                                                    • Install lighting projects around both vacant and
     appearance of the house.
                                                                      occupied housing.
   • Create artwork that can be placed in the storefront
                                                                    • Placed security cameras around vacant homes
     windows of vacant buildings.
                                                                      to deter unwanted guests.
   • Call the bank or the electric company to keep the lights
                                                                    • Create a “Neighborhood Watch” to help neighbors
     on and put curtains in the windows.
                                                                      keep on eye out for each other.
   • Park cars in the driveway to make it appear that
                                                                    • Get your neighbors out of the house and into their
     someone lives there.
                                                                      front yards and sidewalks by hosting walking clubs,
   • Shovel snow, rake leaves, and clean up the yard of               front porch parties, and block parties.
     the property.
                                                                    • Organize to keep children safe. A number of groups
   • Place signs on the front lawns stating that the house            of parents created a walking school bus to walk all
     has plastic plumbing and no copper.                              of the children in the neighborhood together to school.
   • Provide youth with a skill. A few local carpenters and         • Work together. Residents of one street agreed to sit on
     electricians have worked with neighborhood youth to              their front porches in the morning when children walked
     rehabilitate homes.                                              to school and again when they walked home to keep an
                                                                      eye on children as they walked past vacant homes.
   • Invite your local building and housing inspectors to your
     street to show them houses that are open, vacant, and          • Pay dues to pay for professional security to patrol
     vandalized to get them secured.                                  your neighborhood.
                                                                    • Survey your streets and rate homes based on their
                                                                      overall condition. Many vacant homes are beyond
                                                                      repair and may be condemned. Meet with your city
                                                                      council person and the city’s building and housing
                                                                      department to push for demolition of these homes.




Neighborhood groups have been central to the recovery in
Cleveland’s neighborhoods. As residents have banded together,
communities have come back to life.




                                                                                                                            5
   NEIGHBORS WORKING TOGETHER

Knowledge is power for neighborhood groups
It’s a weekly ritual for Fay Harris. On Saturdays, she gets up,       Tom O’Brien, program director of Neighborhood Connections,
drives down to Ohio City’s neighborhood farmers market for            admires Harris’ initiative. “She really thinks about marginalized
some fresh produce, and then slowly canvasses the                     people – older adults and low-income people who are often
neighborhood as she makes her way home.                               ignored – and has stepped up to reach out to them,” O’Brien says.
If she sees a house that needs painting, she’ll stop and tell         Natural qualities like her confidence and extroverted nature, he
the owner about a program that can help cover the cost.               says, help her “approach someone and strike up a conversation
If an elderly resident is struggling to care for their lawn, she’ll   - whether it’s at a meeting or in the neighborhood.”
let them know about an opportunity that helps them maintain it.
                                                                      “Fay has a fantastic ability to transform anger into positive
In one of Cleveland’s most diverse neighborhoods –                    action,” O’Brien says. “She takes active steps to do something
both ethnically and economically – and Harris has become              about a problem, rather than just complain.”
recognizable to many. “But it’s not like I get home from work
and go put on a super heroe’s cape,” she jokes.
                                                                         Preventing Foreclosures Neighbor to Neighbor
A chemist by trade, in her off-hours Harris is a member of
                                                                         Some of your neighbors may be in danger of losing their
her block club, on the board of a local community development
                                                                         home. A trusted neighbor may be the person to help them
corporation, and serves on the Neighborhood Connections
                                                                         find the assistance they need. Here are a few things you
grantmaking committee. She wants to share what she can
                                                                         might consider doing to be proactive in your neighborhood:
with others who may not have as much.
                                                                           • Develop meaningful relationships with your neighbors
Harris felt homeowners were missing vital information about
                                                                             so you can help each other out when someone faces
their rights regarding foreclosure To solve the problem she
                                                                             foreclosure.
identified those who were at risk, and gave them information
about a community organizing group that offered support.                   • Find out what people care about in the community.
                                                                             Many may want to work on a common
When crime was an issue on her street, she helped to secure
                                                                             concern together.
a small grant to install porch lights, went door to door to help
people select the model they wanted, and then arranged for                 • Organize a group to reach out to older adults to
an electrician to install it. Twenty-seven fixtures were installed,          maintain their homes.
and the neighborhood saw a noticeable drop in crime.
                                                                           • Create a “welcome wagon” where new residents are
From the success of her street’s porch light program, she                    greeted by longtime residents and provide them with
offered to help another block club write a grant for their own               a host of information on the neighborhood, including
effort. Anytime Harris learns something new, she passes it                   information on predatory lending and mortgage
on and encourages others to do the same.                                     assistance programs.
“It’s encouraging when someone calls me and tells me                       • Identify people on your street in danger of foreclosure
that they helped three people with weatherization,” she says.                and reach out to them to connect them to a nonprofit
“My father taught me that when you help people, it comes                     that can renegotiate their mortgage. You may get
back around.”                                                                assistance from a local nonprofit housing agency or a
                                                                             local research institute. (The Center for Urban Poverty
                                                                             and Community Development at Case Western
                                                                             Reserve University is one.)
                                                                           • Research predatory loans in your neighborhood and
                                                                             find information on questionable loans. You may be
                                                                             able to find a lot of information through your city
                                                                             government. You may be able to see patterns emerge
                                                                             and similar names associated with many of these
                                                                             transactions. This information can be passed on to the
Resident leaders like Fay Harris, center, take a proactive stance            local prosecutor.
in their commununties.
                                                                           • Connect with a community organizing group to organize
 6                                                                           against subprime lenders.
   WHERE TO GET HELP

Resources available to avoid foreclosure
This is, by no means, an exhaustive listing of foreclosure resources. You may refer some of your neighbors to this
information, or you may reach out to some of these organizations for assistance in your work on foreclosures.
LOCAL RESOURCES                                                       Research/Data

City of Cleveland                                                     To get data on the foreclosure crisis in your neighborhood,
                                                                      visit the Case Western’s Poverty Center website or call them.
  • Building and Housing Department, 216.664.2282
    www.city.cleveland.oh.us/                                           • Center on Urban Poverty, 216.368.6946
                                                                          http://povertycenter.case.edu/
Credit Problems/Financial Asset Building Programs
                                                                      Tenants Rights
These organizations help with credit problems, help to build your
financial assets, or get low interest loans for home repair.          If you are a renter in a home that has been foreclosed on or
                                                                      you suspect that the property may be facing foreclosure,
  • Cleveland Action to Support Housing, 216.621.7350
                                                                      you have rights. Here’s an organization that can help.
    www.cashcleveland.org
                                                                        • Cleveland Tenants Organization, 216.432.0617
  • Cleveland Saves, 216.325.0556
                                                                          www.clevelandtenants.org
    www.clevelandsaves.org
  • Consumer Credit Counseling, 216.231.5322
    www.cccservices.com                                               NATIONAL RESOURCES
  • WECO Fund, 216.458.0250                                           National Resources on Foreclosure Prevention
    www.wecofund.com                                                  Foreclosure-Response.org
Community Organizing/Advocacy                                         www.foreclosure-response.org

These two organizations are involved in community organizing (ESOP)   An online guide to foreclosure prevention and neighborhood stabilization
and advocacy (CNDC).                                                  developed and maintained by the Center for Housing Policy, KnowledgePlex,
                                                                      the Local Initiatives Support Corporation (LISC), and the Urban Institute.
  • Empowering and Supporting Ohio’s People, 216.361.0718
                                                                      Sections include:
    www.esop-cleveland.org
                                                                        • Getting Started: Gives basic information about foreclosure prevention
  • Cleveland Neighborhood Development Coalition,
                                                                          and neighborhood stabilization
    216.928.8100, www.cndc2.org
                                                                        • Policy Guide: Provides tools in six categories, each reflecting state
Foreclosure Assistance
                                                                          and local roles in different stages of foreclosure and neighborhood
These are legitimate organizations                                        stabilization processes
that are working on refinancing
                                                                        • Maps and Data: Provides access to downloadable data that communities
mortgages for homeowners in danger
                                                                          can use to target their foreclosure prevention and their neighborhood
of foreclosure. You can refer people
                                                                          stabilization efforts.
 to one of these for assistance.
                                                                      Stable Communities
  • Cuyahoga County Foreclosure
                                                                      www.stablecommunities.org
    Task Force, Call 2-1-1
                                                                      The centerpiece of NeighborWorks® America’s Stable Communities initiative,
  • Empowering and Supporting
                                                                      a national response to the local challenges that arise when foreclosed homes
    Ohio’s People, 216.361.0718
                                                                      remain vacant or abandoned. The purpose of the site is to provide community
    www.esop-cleveland.org
                                                                      development practitioners with information and strategies to stabilize and
  • Neighborhood Housing Services,                                    revitalize communities in the wake of the foreclosure crisis.
    216.458.4663
                                                                      HousingPolicy.org’s Online Forum
    www.nhscleveland.org
                                                                      http://forum.housingpolicy.org/
Small Grants
                                                                      HousingPolicy.org is an online guide to state and local housing policy
  • Cityworks, 216.664.2000                                           developed and maintained by the Center for Housing Policy, the research
    www.city.cleveland.oh.us                                          affiliate of the National Housing Conference. The HousingPolicy.org
  • Cleveland Colectivo                                               forum is a place to pose questions, exchange ideas, and learn from
    www.clevelandcolectivo.org                                        the experience and expertise of others.

  • Neighborhood Connections, 216.393.4640
    www.neighborhoodgrants.org
  • United Black Fund, 216.566.9263
    www.ubfogc.org
                                                                                                                                                  7
    INTERVIEW

How can grassroots groups
make a difference?
Five minutes with Cleveland City
Councilman Tony Brancatelli
Neighborhoods in Tony Brancatelli’s ward have been hit particularly hard by the
foreclosure crisis. Read how he is partnering with neighborhood groups to fight back.

What does an ongoing crisis like this do to
a neighborhood and the individuals in it?
First there is the overall economic impact.
There are good, hard working, honest people who
have worked their whole lives whose homes are
devalued and dropping incredibly. People who would
like to sell can’t. Historically we had one foreclosure
a week – now it’s two a day. When you look at the
impact on the market, one foreclosure a week gets
absorbed into the market – but two a day cannot be
absorbed, and the massive stripping of wealth                                           Would you like to start a conversation on foreclosure
makes a crisis.                                                                         solutions in your own community? To help, a free,
                                                                                        customizable PowerPoint presentation is available
What are the strengths of Slavic Village that keep you optimistic?
                                                                                        at www.grassrootsgrantmakers.org
Our residents are our biggest strength. When I first took office they weren’t
pointing at me saying, “How are you going to fix this?” Instead they were
asking, “How can we work on it because we like the neighborhood and
want this problem to go away?”
I have a long reputation of working with the block clubs, social groups and
civic groups who have been working on this. We did a number of initiatives
together like the Mr. Blue program where we painted houses. Residents were              www.grassrootsgrantmakers.org
doing volunteer work, painting over houses, cutting back shrubs, clearing
around houses to make them more secure and to make the houses look better.              361.798.1808
They work with the city as a partner.                                                   Grassroots Grantmakers’ mission is to strengthen
                                                                                        and connect the funders that strengthen and
What is on the horizon?
                                                                                        connect residents where they live.
As we look through the crisis we can revision the neighborhood in a proactive
way. Could we instead do a public garden in a certain area, or look at doing
business expansion? Can we do a yard expansion in an area where there is
an open lot? This would make a house more valuable. That’s exciting because
residents are also beginning to see this. They want to be part of this rather than
just expect the city to maintain things.
How can small, grassroots grants be meaningful                                          www.neighborhoodgrants.org
in the midst of such a big crisis?                                                      216.393.4641
We can give millions to corporations and not see a street level result –                Neighborhood Connections’ mission is to
but a few dollars to local residents can make a huge and noticeable difference          help improve the quality of life in Cleveland
in your community. Planting, painting, helping a neighbor next door – the most          neighborhoods by assisting grassroots groups
important part is the opportunity to create community with neighbors working            that work to strengthen the social networks in
together. When you do these projects, residents come out and meet each                  their communities while creatively addressing
other, and generate a lot more pride and support in their neighborhood.                 their neighborhoods’ most important concerns.
         To contact councilman Brancatelli, feel free to
         e-mail him at tonyb@slavicvillage.org
8

				
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