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FEBRUARY 17, 2012
Siate Sen. Chip Shields fights for foreclosure reforms in a divided Salem
BY JOANNE ZUHL
dual-track violation from prosecution under the
unfair trade practices act, an action that Shields
or the tens of thousands of Oregonians and
says would water down the law, remove any
their families who have lost their homes in
remedy to victims and prevent the state attorney
the past four years, the recent
general from pursuing ju s tic e on an is s u e that now
announcement of the national mortgage settlement
dominates concerns among his constituents.
is of small comfort compared to their loss. The
49-state settlement will stretch over three years,
Chip Shields: I’d say four years ago, 70 percent
and divide the $25 billion pound of flesh from the
of my constituent case work was helping people
five major lending institutions down to about
who were having problems with government
$1,800 per victim in Oregon.
agencies, department of human services, etcetera.
But for the tens of thousands who are in the
Now, 70 percent of our constituent work is people
pipeline of foreclosure today, an ounce of
who are just complete at wits end about how inept,
prevention is still worth a pound of cure.
either on purpose or by accident, their lender or
In Salem, two bills are wending their way
their mortgage company is. People in situations
through the Oregon Legislature that seek to give
where they’re going along with the modification
Oregon homeowners protection against the
process in good faith, and then, wham, they get the
predatory lending practices that contributed to the
notice right in the middle of it that the bank is
housing crisis and the avalanche of foreclosures it
foreclosing on them for no good reason — when
caused. Championing that cause through the
they’ve been following the advice of the person on
Senate committee process is State Sen. Chip
the other end of the phone. So it’s a huge problem,
Shields, D-North/Northeast Portland, who chairs
and we’re not just hearing from homeowners, we’re
the General Government, Consumer and Small
hearing from Realtors who are amazed at how
Business Protection Committee.
poorly their clients are being treated.
Shields’ committee has cleared Senate Bills
1552 and 1564 that would install protections for
J o a n n e Z uhl: H ow are these bills going to help
consumers when they go to modify their loans to
people now in the throes o f foreclosure? What will it
avoid foreclosure, and do away with the dual-track
do to those who are teetering toward it?
process that allowed banks to blindside
homeowners with foreclosure even while they were
C .S.: Unfortunately, it’s going to be prospective.
in the process of modifying their loan. The
It is not going to help people who are currently in
measures echo the national mortgage settlement
foreclosures. It will help people who are
overview, the details of which are still unkown.
threatened by foreclosure. There’s a huge massive
(See a rundown of the national mortgage
wave coming. It will do a significant amount of
settlement terms on page 7.)
good for a significant amount of people.
However, the bills face an uphill battle in the full
Regarding the dual-track bill, people have been
legislature. House Republicans snuffed four similar
working with their lender, only to find out that
bills by denying hearings in the committee process.
their bank was working to foreclose on them while
And there’s a Republican proposal to remove the
they were in the modification process. This will
S T A F F W R IT E R
F
end the dual track nonsense that banks have been
doing. People have been thinking they are doing
the right thing, working with their lender, and then
the banks hit them with foreclosure regardless of
whether there is any type of
stumble at all.
On the modification
efforts, I’ve heard incredible
stories of Bank of America
customers who are never
talking to the same person
twice, or being told the bank
never received the
paperwork. This would bring
in a third party arbitrator,
which I think will make the
process more fair and
honest and allow people that
kind of face to face
negotiation.
J.Z.: H ow do these compare
to regulations that are part o f
the national settlement in
which Oregon participated?
D o we need this locally?
C .S.: This will definitely
complement the national
settlement. As I understand
State Sen. Chip Shields
it, the final settlement
D-North/Northeast Portland
hasn’t been signed off by all
the parties. This will still
allow the Oregon attorney general to go after the
banks that engage in fraud. And that was the
promise the Oregon attorney general made to me,
that he would never agree to a settlement that
See SHIELDS, page 7
Inside
‘We’ll have to
come together
and do our best’
A conversation with
City Commissioner
Dan Saltzman
Page 5
Amanda Fritz,
Mary Nolan and $
The dollars and
cents behind the race
for City Council,
Position 1
Page 8
Europe’s
homeless fall
under grips of
devastating cold
A report from street
papers abroad
P age 10