NACA launches $1b subprime fund

Boston housing activist Bruce Marks, who in the early 1990s led a campaign against commecial banks in protest of the second-mortgage scam, is taking on subprime loans.

Marks, heads of the Neighborhood Assistance Corp. of America, which finances home purchases for working people, announced this morning in Washington, D.C. that he is launching a $1 billion campaign to assist American homeowners in danger of losing homes financed by subprime mortgages.

The loans, which are targeted to people with poor credit, are especially prevalent in some minority and immigrant neighborhoods. Last year, 19,487 homeowners in Massachusetts received notices from their lenders that they had begun the foreclosure process, and the number of auctions in the state is accelerating.

Using funding NACA has secured from banks for low- and moderate-income mortgages, Marks said his agency would refinance subprime loans with high interest rates. NACA's mortgages would carry a 30-year fixed interest rate that is below-market rates. NACA currently is offering 5.625 percent.

Marks is also planning to use what he called the "mushrooming" subprime loan crisis to ignite a national movement to force subprime lenders to help their customers, by picketing their homes and offices and demanding that lawmakers hold them accountable for the crisis, which potentially could throw millions out of their homes.

"Until NACA, no one has stepped up to help the victims," Marks said yesterday in a press statement announcing the new program.
(By Kimberly Blanton, Globe staff)