Madigan Pledges Continued Scrutiny

Illinois Attorney General Lisa Madigan pledged on Nov. 29 to continue investigating unfair business practices among lenders as the foreclosure crisis continues to unfold.

At a forum hosted by The Chicago Reporter, the Community Renewal Society and the Chicago Urban League in downtown Chicago, Madigan told policy makers, researchers and community leaders that, “High-cost, high-risk loans are clearly fueling the current foreclosure crisis.”

For the last three years, the Chicago region has led the nation in the number of high-cost loans, according to a recent analysis by the Reporter.

Alden K. Loury, senior editor at the Reporter, disclosed that even wealthy homeowners, particularly African Americans, got high-cost loans in 2006. Black homeowners earning at least $100,000 were more likely to get high-cost loans that Asian, Latino and white homeowners earning less than $35,000, the analysis showed.

Loury also revealed that a group of 25 companies—including lending giants Countrywide Financial Corporation and Wells Fargo and Co.—were responsible for 81 percent of Chicago’s 88,315 high-cost loans in 2006. While several other lenders, including well-known lenders like LaSalle Bank and smaller, community-based banks like ShoreBank, rarely, if ever, granted high-cost loans.

Lawmakers, community activists and lenders spoke at the forum about the complexities involved in the lending process, how risk has been shifted from being shared between lenders and consumers to consumers alone and how the current state of foreclosures surprised few who work with consumers.

Click here to download the press release for this event.

Click here to download a .pdf file of the Reporter's presentation.



MEDIA COVERAGE:
Below is a list of other media outlets that covered this news and the Reporter's Nov 29 forum.

Chicago Sun-Times, December 3, “Borrower Beware”

CNN en Español, November 29, interview with Kimbriell Kelly and Fernando Diaz

Medill Reports, November 29

The New York Times, Dec. 13, "Countrywide Subpoenaed by Illinois"

WBEZ-FM, Amplified public meeting archive recording

WLS, November 29

WMAQ, December 3

MSNBC, December 3

WVON-AM, "Cliff Kelley Show"
November 28 interview with Illinois Attorney General Lisa Madigan
December 3 interview with Kimbriell Kelly



RESOURCES:
Click here for a pdf file detailing Illinois Housing Development Authority’s “Homeowner Outreach Days,” in which mortgage loan providers, housing assistance groups and state agencies come together to help homeowners struggling to pay their mortgages.

Click here for a listing of HUD-certified counseling agencies in Illinois.