HUD is working to put an end to lending fraud The Sun's...

LETTERS TO THE EDITOR

July 28, 2002

HUD is working to put an end to lending fraud

The Sun's editorial "An epidemic of defaults" (July 16) correctly identifies some of the serious problems homeowners have faced in Baltimore, but it fails to recognize the forceful approach the U.S. Department of Housing and Urban Development (HUD) has taken to correct existing problems and prevent others from happening in the future.

However, last year, Baltimore received a special $5 million Neighbor Initiatives grant primarily to prevent predatory lending and provide direct assistance to victims of the despicable loan fraud schemes The Sun cites. And, for more than two years, HUD has played a key role in the Baltimore Predatory Lending Task Force, identifying predatory lenders and helping their victims.

The Federal Housing Administration (FHA) loan program's default rate in Baltimore has never reached the 17.8 percent mentioned in the editorial, but Baltimore's current 8.6 percent default rate is above average. And that's why we are paying special attention to helping people keep their homes through our loss mitigation program.

Lenders must now offer delinquent homeowners a repayment plan to make up their deficiency within one year in any case where there's a reasonable chance they can do so.

We agree completely with The Sun's ideas on sanctioning lenders and appraisers - in fact, they already are established HUD policy.

Our Credit Watch program excludes lenders from FHA programs if they have high numbers of defaults soon after they originate loans (we have removed 132 such lenders in the last three years, including seven in Baltimore, and put 219 on warning, five of them in Baltimore).

We have also begun the regulatory process to establish a new Appraiser Watch system that would be similar to Credit Watch. Right now, we are analyzing loan data for 25,000 appraisers who examine FHA mortgages to identify those with high default rates.

We also agree with The Sun's observation that community awareness is the best defense against fraud, and President Bush has asked for a 75 percent increase in funds for housing counseling.

There is more to be done, but we believe our dual approach - helping educate the public about "flipping" and predatory lending while undertaking an aggressive campaign to prosecute or sanction unscrupulous individuals or companies - will help make Baltimore a place where it is safer and easier for a family to buy a home and truly live the American dream.

John C. Weicher

Washington

The writer is assistant secretary for housing/federal housing commissioner for HUD.

Numbers don't tell us how kids are doing

About Rep. Robert L. Ehrlich Jr.'s attack on Lt. Gov. Kathleen Kennedy Townsend's juvenile crime statistics, I say: Where's the beef? ("Crime numbers stir dispute," July 20).

His numbers don't give us much to work with as city voters, since they fail to include a breakdown specific to Baltimore City, which is the state's biggest crime producer.

Let's hear more about what programs are working, how they are held accountable and how this accountability ties them to other numbers we're hearing about - such as the 28 percent drop in juvenile arrests for violent crime.

And, importantly, let's hear more about the unmet needs of kids in the juvenile justice system - not faceless numbers, but Baltimore kids, many of whom have dropped out of school, have mental illnesses or learning disabilities, and are substance abusers or addicts or come from dysfunctional communities and families.

Can't we debate what might be best for the kids, and for the state and city? To do so, we must use statistics wisely - to target failing programs and policies and expand those that are effective.

Bridget Muller

Baltimore

Bring slots' proceeds home to Maryland

I'm a confused and slightly angry taxpayer. I'm confused about the fact that our state government constantly tells us it needs money or programs will suffer. And I'm angry because every time the issue of slot machines comes up, state officials beat it down.

I cannot understand why there is such opposition to slots. I feel their rewards outweigh the drawbacks.

Slots would create many jobs and raise much revenue. Concerns about crime are ridiculous - all the gambling establishments I've been to have great security in and around them. And the moral issue is just bunk. The state lottery seems to have a new game coming out every two weeks.

I'm tired of having to drive for hours to give my money to other states. It would be nice to give my money back to Maryland, and not have to make a day trip out of it.

Darrell Harris

Baltimore

Criticizing Israel is hypocritical

I am appalled that the Bush administration publicly condemned Israel's missile attack on the leader of Hamas' military wing as "heavy-handed" ("Mideast's bitter cycle of attacks renewed," July 24).

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