Despite recent signs of improvement, foreclosures and their lingering effects on families continue to be a crisis in the Ocean State, says HousingWorks RI Executive Director Nellie Gorbea.
From January 2009 through June of last year, 7,722 residential properties were foreclosed on in the state, according to HousingWorks RI. Those single-family and multifamily properties are just the residential foreclosure deeds filed.
The number of individuals and family members living in those properties, which can only be estimated, paints a truer picture of Rhode Island homeowners and renters who have suffered from housing distress, she says.
Two grants to local nonprofits totaling $215,000, announced by Attorney General Peter F. Kilmartin on Feb. 19, are intended to help Rhode Islanders dig out of the foreclosure crisis and get on more solid ground.
Progreso Latino was awarded $155,000 to expand the agency’s Better Living Project with increased financial-literacy programs and connections to available resources.
HousingWorks RI, a coalition of 140 organizations with the goal of ensuring that all state residents have a quality, affordable home, was awarded $60,000 for research and analysis on foreclosures.
January foreclosure starts in the Providence-Fall River-New Bedford area dropped 22 percent and completed foreclosures plunged 61 percent compared with the same period last year, RealtyTrac reported recently.
But there are still countless Rhode Island families still facing foreclosure.
“Rhode Island came into the foreclosure crisis early on because of predatory lending and lack of affordable housing in the state,” said Gorbea. “There was subprime lending, then the wave of issues with adjustable-rate mortgages, then we got hit full-blown with the recession.”
The HousingWorks grant will be used to increase research and data collection on foreclosures to quarterly intervals, up from annual and special reports, she said.
“Foreclosures are really relevant to an economic recovery in our state,” Gorbea said. “The grant will allow us to provide more data for policymakers at the state and local level.”
Minorities have suffered significantly due to the housing downturn, says Progreso Latino Executive Director Mario Bueno.
“The housing market has been underwater for a long time and for Latinos and minorities, everyone banked on housing, so most of their savings were invested in a house,” he said.
The statewide grant will enable Central Falls-based Progreso Latino to partner with organizations in Providence and other communities, he said.
“We have such a high unemployment rate. If you have to pay a high monthly rate for your house and you lose your job, what can you do?” Bueno said.
The December 2012 unemployment rate in Rhode Island was 10.2 percent, tied with Nevada as the highest in the country, according to the Bureau of Labor Statistics. The national unemployment rate for December 2012 was 7.8 percent.
The grant will enable Progreso Latino to help more Rhode Islanders make good financial decisions, Bueno said.
“We’re praying for things to be better, but prayers don’t solve everything,” he said.
Partnering with organizations across the state will also increase the impact of the grant to HousingWorks RI, Gorbea said.
“This $60,000 grant will be leveraged by other resources. For instance, we’ve just entered into a partnership with Roger Williams University and there are faculty and staff there who are able to conduct research and add to the conversation,” she said.
Quarterly foreclosure data provided by HousingWorks RI to state and local policymakers is important to help move from crisis to workable solutions, Gorbea said.
“We have consistently spoken out about the need for affordable housing in Rhode Island. Connecticut and Massachusetts are doing a lot to invest in affordable homes,” she said.
The grants will help in the recovery from the housing downturn, but “it’s going to take a long time for people to recoup,” said Progreso Latino’s Bueno.