The League of California Citieswill explore causing some banks a lot of pain in San Jose on September 16-18. The League will discuss possible plans of banking warfare designed to protect city tax dollars against banks who need to improve their loan modification efforts in order to keep people in their homes.
The League is a banking force to be reckoned with. As a unit, they have billions of dollars in California banks. Their idea is to simply pull their money our of banks who are performing poorly in helping homeowners modify their mortgages and thus exasperating the foreclosure crisis.
Here is a copy of the RESOLUTIONS PACKET that was written by Los Angeles City Council member Richard Alarcon. Alarcon introduced the proposal in LA earlier this year, and now he plans on getting the other 480 city league member to join in on his noble cause. Collectively, they could cause some of these banks to possibly fail.
Alarcon said some cities will do it, some won’t. But he said, “If you count up the money that cities have in banks that’s an amazing amount of power. We have never tried to seize it. I am trying to seize it.”
2. RESOLUTION URGING CITY GOVERNMENTS AND OTHERS TO DIVEST FROM
BANKS THAT FAIL TO COOPERATE WITH FORECLOSURE PREVENTION
EFFORTS
Source: Richard Alarcón, Council Member, Los Angeles
Referred to: Revenue and Taxation Policy Committee
Recommendation to General Resolutions Committee:
WHEREAS, there is currently a financial crisis in our nation, where people are losing their jobs and homes and no longer have the financial security that was once possible and which contributed to the growing prosperity of our economy; and
WHEREAS, this crisis is affecting communities at all levels, with working class communities the most severely affected, as they were often explicitly targeted and preyed upon by lenders and brokers offering unconventional loans and financing options; and
WHEREAS, as the local, state, and federal governments work on resolving the current foreclosure crisis, one of the key factors that must be addressed is the modification of loans that are “upside-down,” and which need to be modified to the current market value of the home, not the original loan amount, so that homeowners facing foreclosure receive true relief from the burden of the loans they were unjustly pushed into by aggressive lenders and brokers; and
WHEREAS, currently, there is active pressure on financial institutions to modify loans for homeowners susceptible to foreclosure by reducing the principal to the current market value and many financial institutions are not inclined to do this, particularly with no financial incentive; and
WHEREAS, as with local government, financial institutions have an obligation in assisting their customers to preserve the American Dream; now, therefore, be it RESOLVED, by the General Assembly of the League of California Cities, assembled in the Annual Conference in San Jose, September 18, 2009, that the League support the City of Los Angeles, and other member cities, to explore the potential divestiture of all deposits in banking and other financial institutions that fail to cooperate with foreclosure prevention efforts that include temporary moratoriums on foreclosures, renegotiation of mortgage principles to reflect current values, and good faith negotiations with mortgagees;
Great idea and we hope you achieve your aim. What you are doing is what millions of individuals need to do. We seem to have no collective anger over the destruction these banks are getting away with. The lack of anger and action is puzzling. Thank God you are leading the way.
When the banks destroy the homeowners, they also destroy the next generation in that the children of these foreclosed homeowners can no longer qualify for student loans. This is a tragedy of unprecedented proportions when we allow the banks to destroy the middle class as well as consign our youth to poverty by denying the only viable means to an education.