In a panel discussion at the National Community Reinvestment Coalition’s 2010 National Convention assessing the administration’s mortgage modification initiatives, Gordon Whitman, director of public policy and communications for PICO National Network pointed to as-yet-hesitance of the bigger banks to establish permanent modifications, and encouraged people to “look at their money,” and if it’s the right place to have their money.
“We need to be thoughtful about putting our money into financial institutions that are going to act in responsible ways in our communities.”
Related to that, Whitman expressed a hope to create a “revolution in local government policy” where localities see lending criteria — i.e. sustainable modification rates, a willingness to extend credit to low-income communities and small businesses — as critical to where local governments put their money.
Specifically, Whitman pointed the the PICO/SEIU victory last week when the Los Angeles City Council established an request for proposal process that will determine where the city puts its money, which is currently housed by Bank of America. The move, according to a PICO statement, could save the city and its residents up to $10 million by way of “preventing foreclosures and ending toxic financial deals” and will “probably” result in the city pulling its money from Bank of America.
“We are hoping to see hundreds of local and state governments pass ordinances and laws that move their money — and not just moving the money big to small, but moving it from irresponsible to responsible.
“Homeowners are losing their homes, communities have been devastated, local governments are facing enormous budget crises driven by, in part, by the financial crisis.”