Happy New Year! This year is going to be momentous, on both policy and personal fronts.

On the policy side, several recent developments give me hope for some significant policy changes in 2012. One of the biggest developments is President Obama’s recess appointment of Richard Cordray as Director of the Consumer Financial Protection Bureau. Even Senate Republicans who refused to confirm him because of ideological opposition to the agency itself have acknowledged that Cordray is eminently qualified for the job. Cordray is already reaching out to consumer leaders across the country, continuing the agency’s culture of inclusion and cooperation. And CFPB is wasting no time using its power to regulate non-banks. For example, the CFPB released Mortgage Origination Examination Procedures for both banks and non-banks on January 11, 2012, and is already investigating PHH, the nation’s largest private mortgage company, for improper reinsurance payments. The CFPB has also launched field hearings on payday lending, starting with one today in Birmingham, Alabama.

Policymakers, nonprofits, planners, researchers, and financial institutions are putting their heads together to try and diminish the negative impacts that vacant properties have on their surrounding neighborhoods. The ordinances passed by the Chicago City Council and the Board of Commissioners of Cook County are two examples of the creative solutions communities have developed to hold mortgage servicers accountable and keep their neighborhoods livable and safe. But just how serious is the vacant property problem in the Chicago region? A look at the data can give us a sense of the scope of the challenges our communities face.

On Feb. 12, Cook County's vacant building ordinance takes effect, intended to help communities get a handle on both the sheer numbers and conditions of vacant properties in their borders. The ordinance requires owners of vacant properties to list a building as vacant on the county registry (if the community where the property is located is unincorporated) or on a municipal registry (if the municipality where the property is located chooses to partner with the county). The ordinance also requires all owners of vacant properties (whether the original mortgagees or new owners) to take responsibility for maintaining that property (mortgagees within 60 days of a mortgage default; new owners within 30 days of vacancy or after assuming ownership).

New data on the Home Affordable Modification Program (HAMP) show that the program is unlikely to reach many eligible homeowners before it expires. Additionally, HAMP is not effectively addressing the problem of negative equity, nor is it likely to while the current conservator of Fannie Mae and Freddie Mac, the Federal Housing Finance Authority (FHFA),  refuses to allow principal reductions on the loans backed by the GSEs. New leadership is needed at the FHFA to effectively address the problems facing the housing market.

Vacant, abandoned properties have significant costs on communities by causing blight , lowering surrounding property values, and attracting crime. The foreclosure crisis continues to add to the inventory of vacant homes, particularly in low-wealth communities and communities of color. Our recent study estimates that  vacant and abandoned homes in the foreclosure process could cost the City of Chicago up to $36 million a year. The best way to reduce the impact of vacant homes on neighborhoods is to keep families in their homes in the first place, but responsible stewardship of the properties is necessary whenever homes become vacant.

CHICAGO—President Obama today announced his recess appointment of Richard Cordray as the director of the Consumer Financial Protection Bureau. Woodstock Institute released the following statement:

Readers, we want to thank you for making this such a great year for the Woodstock Institute blog. Together, we’ve explored new economic security issues that face low-wealth communities and communities of color and examined how long-standing problems continue to be pervasive.

We wanted to know what you thought were the most interesting stories on the blog this year, so we put together a list of the ten most popular stories of 2011. Did your favorite story make it on the list?

Ocwen, one of the leading mortgage servicers, has had success in doing principal write-downs on home mortgages so that families can stay in their homes, reported Ocwen’s Paul Koches at the annual Home Ownership Preservation Initiative conference on December 9. Using a proprietary underwriting system developed by Ocwen, the servicer has been able to modify mortgages in such a way as to reduce the principal amount owed, which helps many homeowners who currently owe more than their home is worth.  For Ocwen loans where principal reductions have been approved, the company claims that only 3 percent of borrowers re-default.

The Zoning and Buildings Committee of the Cook County Board of Commissioners unanimously approved an ordinance proposed by Commissioner Bridget Gainer that would give suburban communities the ability to step up maintenance requirements for vacant properties stuck in the foreclosure process.  The proposal follows a recent ordinance adopted by the Chicago City Council that mandates minimum maintenance standards for so-called “red flag” properties that become vacant during lengthy foreclosure processes.

The Federal Housing Finance Agency, the agency charged with overseeing Fannie Mae and Freddie Mac, has filed a lawsuit in the U.S. District Court for the Northern District of Illinois against the city of Chicago to prevent enforcement of Chicago’s vacant property ordinance.  The agency states that the City’s effort to hold mortgagees responsible for the upkeep of troubled, vacant properties stuck in the foreclosure process infringes on the FHFA’s sole authority to supervise the secondary mortgage market enterprises.