Florida county punishes BofA for failing homeowners
Could a mere county government accomplish what the mighty federal government has seemingly been unable to do these past several months: Bring "too-big-to-fail" banks to their knees because of their failure to come to the aid of underwater homeowners seeking some sort of mortgage relief?
Maybe. It's certainly one heck of a try.
Broward County in Florida on Tuesday blocked Bank of America from helping to finance a downtown Fort Lauderdale courthouse, with one gutsy commissioner, Lois Wexler, saying, "I don't think that bad behavior should be rewarded," according to SunSentinel.com
Yet another commissioner, Stacy Ritter, is quoted as saying, "There seems to be an insensitivity to the fact that people are hurting. That type of corporate mentality needs to change."
One business journalist-blogger, however, wonders about whether there isn't just a bit of hypocrisy going on in Broward County? Blogs Alain Sherter, " I'd be curious to know what those Broward County officials were doing all those years, while regional property values were bubbling away in Florida's hot-house real estate market?"
Point well taken.
Still, even Sherter admits, "...this is one brush-fire banks can't ignore. When the grassroots ignite, anything can happen."
Florida, along with California, Arizona and Nevada, has been particularly hard hit by the real estate disaster the country is still trying to get out of.
It's easy to understand the anger directed toward major banks in Florida when you consider this statistic: some 434,000 home mortgages in the Sunshine State were past due by the end of January, while fewer than 15,000 underwater homeowners managed to get permanent loan modifications from any bank -- BofA included.
The Obama administration has tried all sorts of measures to get banks and other lending institutions to play ball with its assortment of plans and schemes aimed at keeping people in their homes. To a large measure, such programs have not worked well; certainly mortgage modification has not. And, new evidence suggests that, while the government tax credit for first-time homebuyers started off with a bang, it appears to be on the way to going out with a whimper.
So, I say to state, city and county governments: all the power to you, if you are able to do what the big guns have not thus far.
Too early to tell, of course, just how effective such moves by county governments against big banks may be. But, damn if it isn't the most interesting possible solution out there at the moment.
Charles Feldman is a journalist, media consultant and co-author of the book, " No Time To Think-The Menace of Media Speed and the 24-hour News Cycle." He has written about real estate related issues for several years.