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Woodstock Developments

A monthly update on new research, analysis, and advocacy from Woodstock Institute

April 16, 2010


From the President: Putting aside for tax time  

Could seasonal savings plans help low-wealth people pay for tax preparation services without using RALs?

Dory RandAs some of us scramble to file our income tax returns, others have long since filed. Unfortunately, many lower-wealth tax filers who need the assistance of tax preparers got ripped off with high-cost preparation fees and refund anticipation loans, or RALs – to the tune of $114 million in Illinois in 2006 alone.   Faster delivery of refunds by the Internal Revenue Service and a little patience by tax filers can eliminate the demand for RALs, but many will still need the assistance of tax preparers to file their returns. How can tax filers pay for tax preparation services without getting caught up in RALs?  Read more...

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Payday loan reform promises to eliminate long-term triple digit interest rates

High-cost credit, extended with no consideration of a borrower's ability to pay it back, has stripped billions in wealth from Chicago region communities since the beginning of the economic crisis.  While lending reform is still being debated in Washington, policymakers in Springfield have finally recognized that at least one form of high-cost credit - payday installment lending - cannot continue to operate in Illinois without a basic set of ground rules.

The Monsignor John Egan Campaign for Payday Loan Reform agrees and publicly supports one proposal, Senate Bill 655, which will finally put an end to predatory payday installment loans with rates that too often top 1,000 percent. Read more...

Related: Urgent: Tell Your Senator to Stop the Cycle of Debt

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Woodstock recognizes three local economic justice leaders at 25th Community Investment Reception

For community investment advocates, it’s been a year of successes as well as challenges. A bill to create a Consumer Financial Protection Agency (CFPA) passed the House and is under negotiations in the Senate. Communities came together to creatively address the foreclosure crisis. Illinois Senate Bill 655 is on the path to create meaningful consumer protections for small consumer loans. However, foreclosure filings continue to rise and badly-needed credit for homeowners and small businesses continues to be scarce. The strength and independence of the CFPA is being challenged in the Senate and industry opponents are working eliminate the reasonable rates proposed in SB 655. The annual Woodstock Institute Community Investment Reception gave more than 100 advocates and leaders a chance to celebrate our accomplishments and prepare for the hard work yet to come. Read more...

Related: Online Community Lending Fact Book Now Available

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New initiatives may ease the pain of foreclosures

The Obama administration recently announced key changes to the Home Affordable Modification Program (HAMP) and Federal Housing Administration (FHA) programs. These changes address key drivers of foreclosure—unemployment and mortgage balances that are worth more than the property value, also known as underwater mortgages. Read more...  

Keeping families in their homes during and after the foreclosure process mitigates the negative impact of vacant properties on communities, reduces lenders’ costs in securing and maintaining properties, and provides stability for families as they figure out the next stage of their lives. A number of promising public, private, and nonprofit models are being tried throughout the country to stabilize communities by keeping families in their homes. Read more...

Related: HAMP modifications on the rise, but slowing every month: February

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Looking for information on the foreclosure crisis in the Chicago metro area?

Visit the Regional Home Ownership Preservation Initiative's website at The RHOPI site is a one-stop shop for foreclosure information in the Chicago region, such as success stories of local efforts to forge solutions to the foreclosure problem, events, resources for homeowners and renters in trouble because of foreclosure, regional and national research, and data and indicators.

New at RHOPI: Thirty percent of Cook County multifamily mortgages at risk of foreclosure, says new report

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In this issue

  Recent Work

File IconGovernment Interventions Have a Limited Impact on Chicago Area Foreclosure Activity in 2009
February 2010 

File IconDiverted Opportunity: Refund Anticipation Loans Drain Wealth from Low Wealth Tax Filers and Communities of Color
January 2010  

File IconCollaborators or Competitors? Exploring the Relationships between Community Development Financial Institutions and Conventional Lenders in Small Business Finance
November 2009 

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