Bankers in Chicago are angry with Cook County Sheriff Tom Dart.
Dart announced on October 8 that his office would no longer forcibly remove residents from foreclosed properties, essentially imposing a moratorium on any mortgage-related evictions in the third-largest city in the US and a surrounding county — with a total population of 5.3 million people.
Foreclosures are expected to reach a record high of 43,000 in Cook County this year, and the sheriff's department was expected to conduct 4500 foreclosure-related evictions.
The Cook County moratorium applies to foreclosed homes, condominiums and apartment buildings. Renters will still be evicted for reasons not related to foreclosures.
Still, this is the first moratorium on such evictions in a major urban area — at least in living memory.
Dart cited the cases of renters unjustly thrown out of their apartments as a result of the mortgage crisis — at least a third of such foreclosure evictions affect renters, he said.
"These mortgage companies only see pieces of paper, not people, and don't care who's in the building", Dart said.
"Just in the past month", he continued, "about a third of the people we were asked to evict were under very questionable circumstances. It got to the point that enough was enough."
While renters and homeowners will sigh with relief at the moratorium, the bankers are hopping mad. The Chicago Tribune, acting as a mouthpiece for its friends in the city's business establishment, called the moratorium "curious" and claimed that it might be "confusing" for both homeowners and banks.
The Illinois Bankers Association charged the sheriff with breaking the law and "vigilantism", and insisted that the moratorium "should not be tolerated".
But it is the banks that have repeatedly broken the law.
Chicago recently passed an ordinance that gives renters at least 90 days' notice of an impending foreclosure-related eviction. But lenders haven't been following the rule.
The president of the Illinois Mortgage Bankers Association told reporters that the moratorium "would have a significant impact, because obviously lenders would be hesitant to lend if they knew if someone defaulted, they wouldn't be able to take the property back".
Setting aside the question of why anyone, in the face of the current crisis, should trust anything a mortgage banker says, this argument is absurd on its face.
There is an international credit crunch underway, with banks refusing to lend to other banks and businesses, but this is because of the mountains of bad debts these banks have run up over years, mostly on immense speculative investments in obscure financial markets.
The idea that a few thousand people getting to stay in their homes would make a dent in this crisis is ridiculous.
More to the point, these banks just got an immense bailout for the crisis they created in the first place. Why should there be no break at all for working-class homeowners and renters?
Dart's office may be found in contempt of court if it refuses to carry out court orders to evict. The banks are likely to pursue this in court.
The people in the northside neighbourhood of Albany Park helped start the fight back after one of their neighbours was bullied by a real estate agent trying to get them to move. They then discovered they were victims of a real estate scam when deputies were called to their suddenly foreclosed apartment building to evict them, even though they were all paid up on the rent.
As Dart put it, "The people in Albany Park opened a lot of people's eyes in a hurry".
[Abridged from http://socialistworker.org.]