Number of underwater mortgages in Seattle by zipcode.
Yesterday afternoon, Reset Seattle—a coalition composed of 37 organizations seeking to end the foreclosure crisis in Seattle—held a community meeting to kick off their new campaign to keep people in their homes. Their solution, which was plastered on a banner behind a crowd of 30 some representatives from different organizations, is principal reduction.
Karen Hart, the president of the Service Employees International Union Local 925, explained that principal reduction would reduce the payment obligation on underwater mortgage loans to match the market value of the house, thus bringing the mortgage out from underwater. As a result, Seattle's 42,000 underwater homeowners will save an average of $771 per month on their mortgages. Reset Seattle is asking for the Seattle City Council to take action, while others in their ranks expect the legislature to step in.
The risk of foreclosure disproportionately affects people of color, says Pastor Willis, a speaker at yesterday's meeting and a leader in the United Black Clergy of Washington, but he also emphasized the impact of foreclosures on seniors. "We have seniors sleeping in their cars," he said. "We have to do something about this crisis, this epidemic. We need to demand in Olympia, to our mayors and governors, that they do something about this."