Not even Olympians are immune from America’s homeownership crisis. The Associated Press reported that the parents of U.S. Olympic swimmer Ryan Lochte are facing foreclosure in Florida, while the mother of gold medal gymnast Gabby Douglas filed for bankruptcy in Virginia last year, she said, “to protect my home.”
I don’t know the circumstances behind these families’ financial challenges. But the fact that families who had the discipline, commitment, and drive to raise Olympic gold medalists did not have the systems or information needed to remain successful homeowners reaffirms that the promise of American opportunity is at grave risk.
Roughly four million American families lost their homes to foreclosure between the beginning of 2007 and early 2012. Some 11 million are struggling with “underwater” mortgages, meaning that they owe more than their home is worth. That’s just under a quarter of all U.S. homes with a mortgage. For most, a perfect storm of financial industry misconduct, inadequate consumer protections, falling home prices, and record unemployment are at the core of the problem.
The Lochte and Douglas families are fortunate. Their kids are now stars who will soon be paid millions in endorsement proceeds—Gabby’s already on the cover of a Corn Flakes box.
But for most Americans, the solutions require broader action. An alliance of consumer protection, fair lending, and housing experts have developed a Compact for Home Opportunity, with over two dozen practical, tested solutions for preventing needless foreclosures, restoring neighborhoods, and rebuilding the American dream. The Compact is powered by Home for Good, a national campaign driven by people concerned about the enduring foreclosure and housing crisis.
The Compact’s solutions range from increased access to housing counseling, to reducing loan principal to fair market value, to increased fair housing and lending protections. Some states, notably California, have adopted important elements of the Compact. But a more robust, national approach is needed.
Home for Good is pushing housing issues back into the presidential contest, and onto the national agenda, demanding that candidates and policymakers take a stand on the causes and solutions to the crisis. With foreclosures and bankruptcy intruding even into the Olympic games, their call is increasingly hard to ignore.
Previously posted on Rooflines by Alan Jenkins on August 9, 2012.