Katie contributes to Woodstock’s policy development, outreach, coalition building, and communications efforts. Katie also contributes to Woodstock's research and analysis, including reports on the effect of demographics and institutional characteristics on student debt, disparate impacts of negative equity on Chicago area communities and racial disparities in FHA/VA lending. Interests include student debt reform, impacts of and solutions to the foreclosure crisis, homeownership preservation, community reinvestment, consumer finance, financial reform, and financial security over the life cycle. Her projects include crafting informative and engaging communications strategies for economic security issues, assisting the convening of the Regional Home Ownership Preservation Initiative, and developing ways to make Woodstock's data and research more accessible and interactive.
“I combine data-driven policy analysis and effective communication strategies to advocate for better policy solutions to issues facing low-wealth communities and communities of color,” says Katie.
Prior to joining the Woodstock Institute, Katie gained experience in research and communications as a reporter and intern at Chicago Public Radio and the Chicago Reader.
Katie received her Master of Public Policy from the University of Chicago and received her B.A. with honors in Public Policy Studies and Latin American Studies from the University of Chicago.
Recent posts by Katie Buitrago
Remember the story of the Grinch? He’s the green creature with a heart two sizes too small who stole holiday presents and good cheer from the unsuspecting citizens of Whoville. We’re kicking off a campaign to warn against a slightly different species of Grinch that poses a danger during the holiday season: the Payday Grinch.
A couple weeks ago, we wrote about some new Treasury data that found that most borrowers whose HAMP modifications were cancelled have not yet lost their homes. We decided to dig a little deeper into the data and look at what individual servicers are doing with borrowers they did not approve for a permanent modification (click for larger chart):
Consumer advocates have presented the underwhelming impact of the Home Affordable Modification Program (HAMP) and the foreclosure “robo-signing” scandal, in which employees of loan servicers allegedly fraudulently signed off on foreclosure documents, as two sides of the same coin: both demonstrate a disregard of due process on the part of the servicers. In one situation, servicers drag out trial modifications well beyond their time limit and give homeowners the run-around by repeatedly losing documents, then deny modifications because of “incomplete files;” in the other, servicers entrust the job of affirming the validity of foreclosure papers to poorly-trained and overworked employees, possibly unjustly risking borrowers’ homes.
The Home Affordable Modification Program continues to putter along this month, with numbers of active trial and permanent modifications in the Chicago region staying largely level (see our previous analyses). There were 32,997 active modifications in the region in October 2010, up 0.36 percent from last month’s 32,880. However, new data from Treasury shows that the large number of homeowners who have been dropped from HAMP—at least 18,000 in the Chicago region—are not yet losing their homes in large numbers.
Our latest report analyzing credit score patterns in Illinois found some troubling facts: 54 percent of individuals in highly African-American communities had credit scores below 620, while that figure is only 16.5 percent in predominantly white communities. Furthermore, 43.3 percent of individuals in highly African-American communities had a credit score below 580, compared to 11.5 percent in predominantly white communities. The concentration of low credit scores in communities of color raises concerns about the prospects for economic recovery in those neighborhoods, since credit scores are becoming increasingly important in more walks of life. Not only will it be more difficult to access affordable home, small business, and car loans, but having low or no credit scores can impact the availability of rental housing, affordable utilities and insurance, and even employment. Given these challenges, what can be done to improve opportunities in Illinois’ communities of color?
As it becomes increasingly clear that voluntary loan modification programs like the Home Affordable Modification Program (HAMP) are woefully insufficient to prevent foreclosures on a meaningful scale, it’s time to consider broader-reaching approaches. The debate on allowing bankruptcy judges to modify the terms of mortgages on primary residences (often referred to as “judicial modification” or “cramdowns”) has quieted down since 2009, when Sen. Dick Durbin (D-IL) introduced a bill that would allow mortgage debt on primary residences to be restructured in Chapter 13 bankruptcy. The bill, called the Helping Families Save Their Homes in Bankruptcy Act (S. 61), didn’t pick up steam. As our president Dory Rand will argue later this week, new analysis has shown that concerns about the negative impacts of judicial modification are likely overblown. Before we take a new look at judicial modification, let’s review what it entails (special thanks to Credit Slips for providing a wealth of information about mortgages in bankruptcy).
The financial crisis resulted in billions of dollars of wealth lost by families across the country, persistently high unemployment, steadily high foreclosure rates, and the highest recorded percentage of people living in poverty. There’s no doubting that the financial crisis was deeply devastating—but was it a crime?
Eighty-year-old Annie Lou Collier had long paid off the Atlanta home that she’d lived in since 1953 when a con man posing as a contractor approached her in 1990, took a look at her roof, and told Collier it needed replacing. Collier balked, saying that she couldn’t afford it on her modest fixed income. That doesn’t matter, the man told her. Collier could simply borrow the money against the value of her home; he would even drive her to the lender to borrow the $6,900 that same day.
Collier, who has a second grade education and can’t read, signed the loan. It turned out to have a whopping 25.3 percent annual percentage rate, and one year later, Collier was in default. The roof was never even fixed.
The number of active trial and permanent Home Affordable Modification Program modifications continues to drop in the Chicago region, according to new data released by Treasury. The past three months have seen active modifications drop to record lows (see our previous analyses). There were 32,880 active modifications in the region in September 2010, down 1.4 percent from last month’s 33,346.
Richard Otero-Cintrón is the kind of person who knows how to seize an opportunity when he sees one. It’s how he became the owner of North Chicago Auto Service after starting out in 1990 as the maintenance man who swept the floors and made sure the windows were clean. Over the course of fifteen years, Otero-Cintrón earned the trust of the shop’s previous owner through his dedication and loyalty. When the previous owner passed away of pancreatic cancer five years ago, he left Otero-Cintrón ownership of 25 percent of the business and the rest to his widow.
Froylan and Amparo Nuñez remember what their block in South Chicago was like back in the day. Good jobs were still available at the steel mills nearby and their son, Froilan Jr., played next door with his friend Hector.
Times have changed. The Nuñezes now have little granddaughters. The steel mills have long closed, and Froylan Sr. ended up working on a garbage truck for nineteen years. And their little bungalow, as Ashley Gross reports for Chicago Public Radio, is an island of stability on an increasingly troubled street. Hector’s old house is now boarded up and tagged by the Latin Dragons, who use it as a drug house. While some of the homes are neatly tended, clusters of boarded-up homes attract garbage and foster gang activity and drug sales.
Completed foreclosure auctions in the Chicago six-county region rose by 44.9 percent over the last year from the third quarter of 2009 to the third quarter of 2010, new data from Woodstock Institute show. The largest increases in completed foreclosures from the third quarter of 2009 to the third quarter of 2010 were in Northwest Cook County (93.7 percent), Southwest Cook County (74.4 percent), and South Cook County (50.9 percent). In the first three quarters of 2010 in the six-county Chicago region, 26,870 properties completed the foreclosure process and went to auction. This is an increase of 37.4 percent from the same period in 2009.
As you likely know, a number of large mortgage servicers are under scrutiny for possibly preparing fraudulent foreclosure papers. You can read our thoughts on the issue here. Since the situation keeps rapidly changing, we rounded up the latest news to help you stay informed:
Advocates for asset-building believe that expanding access to the fundamental building blocks of financial stability—like savings accounts, investments, a home, or higher education—can help individuals make better financial decisions and weather unforeseen crises. The research backs that up: assets encourage individuals regardless of income to save more, expand their aspirations, and encourage their loved ones to do the same.
In recent weeks, the foreclosure processing practices of some of the nation’s largest mortgage servicers have come under scrutiny. If the allegations of widespread fraud are true, this episode serves as yet another reminder that we can’t simply rely on the prudence of servicers to adequately address the foreclosure crisis.
Most everyone knows that the foreclosure crisis is severe, but just how bad is it? Analysts from the Amherst Securities Group recently released their estimates of how bad the crisis could get, barring new government interventions—and the numbers are chilling: “Over 11 million borrowers are in danger of losing his or her home (1 borrower out of every 5),” the report states. The analysts declare that this “conservative estimate” is “a [politically] impossible number.”
Since 1977, the Community Reinvestment Act (CRA) has been an effective tool to ensure that financial institutions live up to their community investment obligations, but many of the opportunities for public input on how a bank served the community’s needs only occur when a bank applies to merge with another bank. The past decade has seen considerable industry consolidation, resulting in fewer merger opportunities for public input. As a result of the ongoing financial and foreclosure crisis, the few large mergers that have occurred were the result of financial insolvency and have taken place on an emergency basis, with no public input for consideration of the merged institutions’ community investment commitments.
Under the American Community Investment Reform Act, a proposal to modernize the CRA introduced by Rep. Luis Gutierrez (D-4), the public would be able to more effectively hold financial institutions accountable for their community development practices and the financial products they offer.
Woodstock Institute President Dory Rand applauded the introduction of the American Community Investment Reform Act of 2010 today by Rep. Luis Gutierrez (D-IL), Rep. Al Green (D-TX), Rep. Eddie Bernice Johnson (D-TX), and Rep. Maxine Waters (D-CA).
New data show that the number of active trial and permanent Home Affordable Modification Program (HAMP) modifications in the Chicago region continues to drop, surpassing last month’s record low (see our previous analyses). There were 33,346 active modifications in the Chicago region in August 2010, down from last month’s 34,576 and November 2009’s 36,208, the first month Treasury released data by metro area.
When most people think of economic insecurity, the first thing that comes to mind is an income that’s insufficient to meet basic needs. Low income is certainly part of the problem, but it leaves out a large and often-overlooked group of people who are one or two unexpected expenses away from an economic crisis: the asset poor. A person who is asset-poor does not have enough assets—home equity, checking and savings accounts, stocks and bonds, business assets, and the like—to cover three months’ worth of basic expenses in the case of an emergency. In a volatile economic climate like today, the asset poor walk an especially tenuous line between security and insecurity.