American nightmare

Detroiter Donna Martin admits she never should have borrowed against the house she bought in 1975. But, after paying off the original loan, she re-mortgaged her home on the city's east side eight years ago to pay off mounting bills.

Earlier this year she fell three payments behind. She says she sent two payments to her mortgage company with a promise to pay the third by the end of the month, but the mortgage company didn't cash the checks, and started the foreclosure process.

"I'm trying to stay in the house," says Martin, 61, a foster parent until the state cut her payment rate last year. "I don't want to leave."

Martin's case isn't unique. According to Realty Trac, a company that tracks foreclosure rates nationally, Michigan had a 70 percent increase in foreclosure activity from December to January; only Nevada had a higher rate. In Wayne County, according to Realty Trac, the number of new foreclosure filings doubled in January compared to December, giving the area a rate of one new foreclosure filing for every 124 households. That's seven times the national average.

All of which explains why ACORN (Association of Community Organizations for Reform Now) is trying to help. The group is providing advice to people not yet in foreclosure, and those already in a hole can get help negotiating the process.

"We're honest about the fact that not everybody's situation can be saved," says David Lagstein, head organizer for Michigan ACORN.

Town hall forums and meetings with community and labor groups are part of the effort. There's also a national help hotline: 1-866-67ACORN.

Another part of ACORN'S effort focuses on home buying and refinancing.

"People don't know what they're signing on to. If it's an adjustable-rate mortgage, then their rate will change. They think you can sign on to this adjustable rate and you can always go back and refinance. They might not have the equity or the ability to refinance and they get stuck," Lagstein says.

The city of Detroit is getting involved in the issue as well, hosting a "financial literacy home ownership workshop" on June 2 at Wayne County Community College, says James Canning, spokesman for Mayor Kwame Kilpatrick.

"It's going to be bigger than just foreclosure," says Canning. "It's going to take people from buying their first home and the details of the issues of foreclosure to the importance of credit," he says.

Following the June 2 event, there'll be at least three other community workshops in different areas of the city, Canning says. Exact dates are not yet available.

News Hits is edited by Curt Guyette. Contact him at 313-202-8004 or [email protected]