Cohen Chairs Hearing on Wells Fargo Lawsuit, Bankruptcy and Foreclosure Issues

MEMPHIS, TN – Congressman Steve Cohen (TN-9), Chairman of the House Judiciary Subcommittee on Commercial and Administrative Law (CAL), today chaired a hearing at the University of Memphis Cecil C. Humphreys School of Law on the Wells Fargo fair housing lawsuit filed by the City of Memphis and Shelby County, bankruptcy issues as they relate to home foreclosures, and the overall foreclosure problem in Memphis.

Memphis Mayor A C Wharton and Congresswoman Sheila Jackson Lee (TX-18) participated in the hearing.

"Today's hearing provided us with valuable insight into the Wells Fargo lawsuit, and bankruptcy and foreclosure issues in Memphis," said Congressman Cohen. “Our city has been hit hard by foreclosures. Foreclosures evaporate middle class wealth. We must do everything in our power to help families keep their homes and avoid the stress and difficulties of foreclosure.”

Last week Congressman Cohen authored legislation to establish a grant program for state and local governments to help provide mediation between homeowners and lenders in an effort to help prevent foreclosures. The Associated Press recently reported that more than 1 million American households are likely to lose their homes to foreclosure in 2010.

Congressman Cohen’s legislation -- the Preventing Homeowners from Foreclosure Act of 2010 -- would create a grant program to help local communities establish foreclosure mediation programs. Foreclosure mediation would postpone Sheriff sales of all owner-occupied residences until the homeowner has had an opportunity to meet with a housing counselor to explore viable alternatives to foreclosure.

The program would also establish an outreach program to raise homeowner awareness of the mediation program. Any state or local government that receives help from this grant program would be required to keep a record of each mediation carried out, including the nature of any loan modification.

The measure comes at a time when the U.S. Department of the Treasury's anti-foreclosure program -- the Home Affordable Modification Program -- is not living up to its potential. A report released in May showed more than twice as many homeowners were kicked off the Home Affordable Modification Program as were granted relief.

The following is a list of witnesses who testified at the field hearing:

• The Honorable A C Wharton, Mayor, City of Memphis
• Webb Brewer, Brewer & Barlow PLC
• The Honorable David Kennedy, Chief Judge, U.S. Bankruptcy Court for the Western District of Tennessee
• The Honorable Jennie Latta, Judge, U.S. Bankruptcy Court for the Western District of Tennessee
• Dr. Phyllis Betts, University of Memphis
• Sapna Raj, Memphis Area Legal Services
• Beverly Anderson, Director of the Memphis Housing Counseling Network
• Steve Lockwood, Frayser Community Development Corporation
• Scott Bernstein, Center for Neighborhood Technology