NCLC’s Executive Director Rich Dubois and NAACP President and CEO Derrick Johnson are calling on Congress and federal regulators to take action to prevent an impending foreclosure crisis in communities of color, in an opinion editorial published yesterday in The Hill.

The op-ed highlights how the cumulative impact of decades of housing policy discrimination on African American homeownership, coupled with the disproportionate economic burdens borne by communities of color as a result of the coronavirus pandemic, have set the stage for a tidal wave of mortgage delinquencies and foreclosures in African American and Latinx communities. A recent survey by the Census Bureau found that while 4% of white homeowners said they did not pay their mortgage in the last month, 13% of African American homeowners and 9% of Latinx homeowners said they missed their mortgage payment. These gaps are likely to widen as unemployment insurance payments wane.

Even more troubling, African American homeowners were three times more likely than white homeowners to say that they could not pay their mortgage, but African American homeowners were only twice as likely to report that their mortgage payments were deferred by their mortgage company. This deferral process is a critical means of assistance that could help homeowners avoid foreclosure, keep their homes, and build generational wealth.

NCLC and its partners have been sounding the alarm on the upcoming foreclosure crisis for months, and yesterday’s op-ed is the latest in our calls for relief for struggling homeowners. While the CARES Act provided some important temporary protections from foreclosure, more action is needed by Congress and federal regulators to prevent a flood of preventable foreclosures and bankruptcies, and to promote racial equity. Specifically:

• The U.S. Senate must expand CARES Act mortgage protections and allow for automatic forbearances to protect delinquent borrowers from foreclosure (which is already included in the HEROES Act passed by the U.S. House). Additionally, there is a desperate need for civil legal aid services, housing counseling, and other targeted interventions into communities hardest hit by foreclosure.
• Federal regulators, such as the Consumer Financial Protection Bureau, must preserve and strengthen civil rights protections, including laws against “disparate impact.” They also should collect data and provide free public reports on developments in the mortgage market, including whether policies result in unfair disparities for African American and Latinx homeowners.
• Mortgage companies should be required to offer affordable repayment options for homeowners catching up on missed payments, and should notify borrowers of their options in English and in notices for borrowers with limited English proficiency.

In short, it is up to America’s leaders to take immediate action to protect African American and Latinx communities from widespread foreclosure and additional loss of wealth, and to begin mitigating the effects of decades of discrimination and disinvestment.

Thank you as always for being in this fight with us, and for all you do to advocate for racial justice and economic opportunity.