HOUSTON — Chinese food and lively music helped local members of ACORN, the Association of Community Organizations for Reform Now, beat the Texas heat June 25. They gathered at the Julia C. Chester House in the historic, predominantly African American 5th Ward to celebrate the passage of Texas House Bill 1823.
The new bill allows homebuyers to convert their contract-for-deed loans into traditional mortgages, a measure widely hailed as a victory for workers and consumers.
A spokesperson from Democratic Rep. Sheila Jackson Lee’s office presented the enthusiastic crowd with a “Certificate of Congressional Recognition” for their efforts to protect working-class neighborhoods from ruthless exploitation.
Under the contract-for-deed system, buyers do not own their homes until they completely pay off their loans. Unlike traditional mortgages, buyers do not accumulate equity or possess titles, leaving them unable to sell their homes or to use them as collateral for home improvement or emergency loans. In addition, legal protections afforded homeowners against foreclosure are not extended to contract-for-deed buyers.
Predatory lenders frequently target low-income workers and immigrants for such loans. Since the buyers are not the technical owners, and since insurance and property taxes are rolled into a monthly loan payment, many buyers see their payments rise substantially with only vague, if any, explanation.
If buyers default on their house payments, they lose the property. Many are unaware that they do not own their homes until they are forced out. Heartbreaking stories of families losing their homes just months before the contract is paid up make the passage of this bill a bittersweet victory, coming none too soon.
ACORN members mounted an aggressive, grassroots campaign against the lenders, including marching into their offices demanding meetings, making loan payments in pennies, and making frequent trips to the state Legislature in Austin. While their success is a testament to the people’s power to make their voices heard and affect government, members know there is much left to accomplish.
Staff organizer John Everett says the local members of ACORN are committed to continuing their work as a “watchdog, community action group” to force the city of Houston to be accountable for “abandoned lots, affordable housing and chemical spills” from the nearby railroad yards that plague the community.
Speaking to a Houston Chronicle reporter, City Councilwoman Ada Edwards said ACORN is “holding the light.”
“This is the only movement in the country right now where you’re not only dealing with activism, but dealing with policy,” she said. “And when you can merge the two, that’s when you get some changes in our society.”
ACORN operates nationwide, representing 175,000 families in 51 different cities. House Bill 1823 is scheduled to take effect Sept. 1.