Nutter testifies on the foreclosure crisis

April 7, 2008 6:15:23 PM PDT
A federal effort to find solutions to the foreclosure crises made its way to Philadelphia today. The Senate Banking Committee heard testimony from Mayor Nutter and local victims of predatory lending. The Mayor says his city is facing a deluge of requests for homeowner assistance during the subprime mortgage crisis.

Nutter testified before Senators Bob Casey and Chris Dodd, saying the city needs federal dollars to help pay for expanded counseling and legal services. "The city of Philadelphia is committed to dealing with this crisis. I will be proposing putting additional funds into our budget to provide relief to homeowners facing foreclosure."

Nutter says cities could even see lower property taxes from reduced assessments as home prices continue to fall.

Dr. Ira Goldstein testified on behalf of the Reinvestment Fund, which reviewed 15,000 mortgages in the city. He said in some neighborhoods 30-percent of the homeowners were victims of predatory lending, which can lead to foreclosures.

He says, "It's not only depressing the property value of the person whose home is in foreclosure, but everybody around them. And then that has implications for the city to fund our schools and police and basic public services."

Chairman Chris Dodd, a Connecticut Democrat, says it was the first time the committee's mortgage foreclosure hearing was held outside of Washington, D.C.

Dodd says a foreclosure bill currently before the Senate just "doesn't do enough."

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