‘Outraged’ Lansing city officials mobilize to assist foreclosed homeowner facing uncooperative lender

LANSING — Mayor Virgil Bernero on Monday called for a foreclosure moratorium and said he plans to marshal the resources of the city to assist a woman whose foreclosed home is slated to hit the auction block on Thursday morning in a sheriff sale, the first step toward losing her home.

Bernero said he was taking action after reading Michigan Messenger’s recent examination of the situation facing Melody Stratton, who is dealing with a lending company often unresponsive to the 51-year-old’s persistent and patient efforts to get payment processing errors resolved. The mayor said he was “outraged” by Stratton’s plight and on Monday morning, directed his staff to reach out to the city resident and assist however they could.

By Monday night, Stratton had received calls from members of the mayor’s staff and by Lansing City Council Member-at-Large Carol Wood. But it was a call from Assistant Attorney General Jessica Danou that got Stratton’s attention.

“I don’t mean it in a disparaging way, but it’s like you’ve gone down the third time and then suddenly everyone on the shore says ‘Oh, we know about that. She’s drowning, we should help,’ ” Stratton said. “The satisfying thing is action. It’s kind of what it felt like today. People are finally paying attention.”

Danou specializes in foreclosure prevention and hosts foreclosure workshops across Michigan sponsored by the attorney general’s office. According to Stratton, Danou asked her to come to such a gathering scheduled for Tuesday night in Detroit. Danou told Stratton her lender, JP Morgan Chase — which bought the original lender, Washington Mutual — would have a representative at the event. Danou contacted Stratton after learning of her plight from a call from a staffer in Bernero’s office.

“She told me that she would take me over to them and force them to talk to me,” said Stratton, referring to Danou, who she said made it clear she was not promising a silver bullet or Hail Mary moment, just the assurance that Stratton would be able to meet face to face with the lender she has been struggling to talk with for nearly a year.

Mayor: ‘We need a foreclosure moratorium’

Bernero, a Democrat, called Statton’s story a “wake up call” in an interview with Michigan Messenger on Monday night at the Lansing City Council’s weekly meeting. “It refocused me on the issue.”

On top of directing his staff to assist Stratton, Bernero, a former state representative, state senator and Ingham County commissioner, said he will be taking other steps to address the foreclosure crisis consuming the state capital, which he said was “losing 10 homes a week.”

“We need a foreclosure moratorium,” the mayor said, noting he’s supporting foreclosure reform legislation sponsored by State Sen. Hansen Clarke, a Detroit Democrat. The mayor said he will begin lobbying hard for that bill, not only in the state legislature, but also with municipal organizations like the Michigan Municipal League, the Michigan Township Association. Bernero said he has brought the issue up before the Municipal League and the Mayor’s Conference, but he “didn’t sense a level of outrage.”

Bernero said the lack of broader attention on foreclosure was in no small part to the economic crisis facing many states and cities. “I think they are all deluged. They are suffering from economic battle fatigue,” he said. “You don’t know what fire to run to.”

Bernero said he took his eye off the foreclosure moratorium issue to help in lobbying efforts aimed to help the state’s ailing auto industry, an important employer in Lansing.

“I haven’t been able to lead a charge,” he said.

In addition to supporting Clarke’s moratorium legislation, Bernero said he will also speak with Ingham County Sheriff Gene Wrigglesworth to see if he was willing to take actions to suspend sheriff sales.

“I will ask him if there is anyway he can do something,” Bernero said. “I would hate to ask the sheriff to do something against the law, since he is sworn to uphold the law.”

At least two other county sheriffs in Michigan have temporarily suspended sheriff sales. Last October, Genesee County Sheriff Robert Pickell suspended sales for two weeks. And this February, Wayne County Sheriff Warren Evans announced he was suspending sheriff sales. He has since reinstated them on a limited basis.

Bernero said he would also direct the city attorney to investigate what other actions the city government could take to address the crisis.

Wood, who plans to challenge Bernero for mayor, said she is pleased that there has been a quick response by the city and hopes the impasse can be resolved. She lamented the fact that the Stratton situation had to devolve to such a state of crisis. The city council member said it was time for the city to take swift action because foreclosures end up costing the city thousands of dollars because bank-owned properties end up falling into disrepair, requiring city-contracted mowing and snow removal, and adding hundreds and thousands of dollars in assessment cost to the properties.

“Banks do not want to own property, they want to own paper,” Wood said. “Isn’t there a way, if [homeowners] have a job and the ability to pay, to make overdue payments at the end of the loan so they are caught up? How do we address that?”