HUD and Gary Human Relations Commission
Team Up to Save the Home of Gary Family
We will call her Mrs. X. She and her late husband had managed,
after many years, to pay off the mortgage on their tidy home in
Gary, Indiana. But huge medical bills from her husband's final illness
and her own medical expenses caused Mrs. X, a sixty year old with
diabetes and limited eyesight, to take out a new mortgage. That
is when the trouble began. The new mortgage payment based on an
interest rate of nearly 16 percent was too much for her to handle
while getting by on her modest Social Security income and caring
for her daughter and granddaughter.
She filed for bankruptcy, but she also filed a discrimination complaint
with the Chicago HUD Office of Fair Housing, alleging that the lender,
Bank One, and Loan Servicer, Liberty Lending, had discriminated
against her based upon race. It was during the course of an investigation
by HUD and the Gary Human Relations Commission (GHRC), (a HUD Fair
Housing Assistance Program Partner) that HUD investigator, Robert
P. Sullivan, and GHRC investigator Melody Tukes, discovered that
the family was about to lose its home to foreclosure.
Sullivan negotiated with Bank One and Liberty Lending to find a
solution to Mrs. X's dilemma, brought on by the fact that she never
understood that the high costs of the new loan were way beyond what
she could afford on her fixed income. Tukes and Sullivan convinced
the lenders that keeping Mrs. X in the family home would be the
right thing to do. They accomplished this, by reducing the loan's
principal by $10,000, dramatically reducing the interest rate to
6 percent, forgiving overdue interest charges of some $10,000, and
waiving fees on the new mortgage. Mrs. X remains a homeowner today
because of the work of HUD's Chicago Fair Housing Office, the Gary
Human Relations Commission, and the willingness of the two lenders
to take another look and do the right thing.