Community Activists Hold Rally Against CHASE Bank, San Fernando Valley Sun

Community Activists Hold Ralley Against CHASE Bank, San Fernando Valley Sun, May 12, 2011

By Alex Garcia

Community members and activists rally against CHASE bank during a protest in Sun Valley. They accuse the financial giant of not providing loan modifications to people with mortgage problems. CHASE says that's not the case.

A group of community activists and residents gathered in Pacoima this week to announce a boycott and denounce CHASE Bank, which they claim refuses to modify home loans. The group vowed to close their bank accounts and move their money to local credit unions.

"This is just the beginning," said now former CHASE customer Angel de la Torre, who cancelled the bank account he had with the bank for three years.

"When CHASE offered a loan modification to a member of our parish in Pacoima with a balloon payment of $225,000 after 26 years with $2,000 monthly payments, we knew they were out to take our community."

According to One LA, the group spearheading the effort against CHASE, loan modifications of this kind do little to lessen the danger of defaults and perpetuate an unstable housing market.

As the word spreads and people learn they are better off putting their money in a local credit union, our community will refuse to use CHASE Bank," said Fr. Bill Antone, Pastor of Mary Immaculate Parish, where the group held a press conference to announce their boycott. Another protest was held on Saturday in front of a CHASE Bank branch in Sun Valley.

Representatives from One LA, an organization made up of more than 70 community groups, said they worked Los Angeles City officials to create an innovative principal reduction program that benefits investors, homeowners and the local communities, but that CHASE refuses to use it.

"This is a pilot program where we're going to pay the bank a certain percentage so that they reduce the principle in the house to the current price," de la Torre said. "I know that's difficult for banks to accept, but they're selling them for that price anyways." He said they are still negotiating with Bank of America to accept this arrangement, but that CHASE has flatly refused it.

"We're tired of seeing families out on the street just because CHASE says they should be out," de la Torre said. "I think the day the community unites any institution will feel pressured because we have a lot of power."

CHASE bought Washington Mutual and inherited a retail network of banks in local communities across California. But One LA officials say CHASE won't address the damage WAMU did in targeting immigrant and low-income minority communities with sub-prime loans. They also said CHASE has introduced higher fees on bank accounts of $500 or less, and interest rates on CHASE Credit Cards include teaser rates that draw people in and then increase to exorbitant levels.

"CHASE has a horrible record on foreclosures, recently increased fees, and its CEO Jamie Dimon, received total compensation of $20 million in 2010 even as CHASE foreclosed on thousands of homes," said One LA member Alex Reza.
"The Social Justice Committee of Mary Immaculate Church has held community forums informing the public about the services provided by credit unions and has encouraged CHASE customers to cancel their accounts and do their banking with credit unions," he said, adding that 17 families canceled their CHASE accounts during the protest Saturday.

Los Angeles City Councilman Richard Alarcon, who represents Pacoima and other areas of the Northeast San Fernando Valley, was present at the Saturday rally and announced he would cancel his CHASE account, though he said it was not in direct response to the action on Saturday.

Gary Kishner, CHASE Bank spokesperson, said that he didn't know why they were being targeted when other financial institutions have done the same thing and noted CHASE has dedicated ample resources to help borrowers facing mortgage problems.

"We have gone far and beyond what most of banks have done in providing loan modifications. Since 2009, we have done over a million modifications across the country," said Kishner, who added that "for every house we have to foreclose on, we have been able to save two through modification.

"Since 2009 we have opened 51 home ownership centers, 16 in California and 11 in Southern California. Those centers are opened six days a week where our customers can meet face to face with a loan modification counselor, who can explain to them all the options and resources."

One of these centers is located at the corner of Nordhoff Street and Reseda Boulevard in Northridge.

Kishner said CHASE has refused to participate in the One LA mortgage program because, in most cases, reducing the principle of the loan does not work.

"A person who wants to stay in their homes wants payments that are affordable to them," he said. "That is our primary goal, keep a customer in their home."

One way they do this, he explained, is by reducing somebody's interest rates by 2 percent and extending their mortgage loan for 40 years so "we can get them down to a payment that's affordable to them."

But he also said, "some people have borrowed against their house so much that they can not make any payment."
"We're not in the landlord business. It costs us more money to do a foreclosure than keep a borrower on their home. It's a last resort for us.
Unfortunately, it happens," Kishner said.

He said homeowners are offered other options, including shortsales.
"We educate them what their options are," said Kishner, who added that reducing a principle on a loan is not always possible for them if they are not the owner of the loan.

"There's no way we can participate in every [loan modification] program. It has to make sense. We service the loan on behalf of investors."