NACA's Battles Against Predatory Lending

NACA's roots are in advocacy. In 1988, future NACA CEO Bruce Marks became involved with a union of hotel workers in Boston. Marks was concerned that hotel workers didn't have the chance to live in the city in which they worked because housing was so expensive, and he pushed the union to include a housing benefit in their terms. This involved changing federal law. From this successful fight, NACA was born.

The grassroots organization fights for affordable housing for all people by battling big-name banks with predatory lending practices. Predatory lending means exploiting those who can't afford a loan by providing loans with low rates that ultimately become unaffordable. Marks has become known as a "bank terrorist" for how he targets these people he's identified as greedy loan sharks.

The group prides itself on being these institutions' worst nightmare and has proven willing to do whatever it takes to create change. In some instances, NACA has shown up at the schools of bankers' children to picket and harass the children [source: Swidey]. Protestors have interrupted stockholder meetings with megaphones and distributed flyers with information about a CEO's alleged affair [source: Swidey]. NACA argues that foreclosure brought on by predatory lending is painful and embarrassing for all the members of affected families and that CEOs should understand what that feels like.

NACA battled Fleet Bank and its subsidiary, Fleet Finance, for more than four years regarding its ties to underground predatory lenders. NACA staged demonstrations to bring national media attention to Fleet. In 1993, Marks testified before the U.S. House and Senate Banking Committees and brought along more than 400 people who had lost their homes due to Fleet's practices. When the Federal Reserve refused to meet with members of NACA and hold hearings about predatory lending, NACA orchestrated stunts such as publicizing then-chairman Alan Greenspan's direct phone number [source: NACA]. Fleet eventually met with NACA and agreed to invest billions of dollars in affordable lending, including a large amount for NACA, and provide restitution to the borrowers.

NACA's other public battles have included:

• Overturning a class-action settlement involving The Associates, which was then the largest finance company in the United States. The lawsuit would have provided Associates with immunity while providing only fifty dollars to borrowers who had lost homes. The Associates eventually invested in NACA's mortgage program.
• Targeting First Union's CEO Edward Crutchfield to get the bank to work with NACA. NACA referred to Crutchfield as "Fast Eddie" for the way he passed by working people to get to high-income customers. NACA sent postcards and reports to Crutchfield's neighbors detailing his bank's practices. [source: NACA]

Bankers have come to fear Marks and his horde of NACA protestors, outfitted in yellow shirts, who could wreak havoc on everything from an awards ceremony to a quiet night at home. Critics have accused Marks of targeting banks just to get money for NACA, saying that once he has a sizable check, he agrees to leave banks alone [source: Talcott].

Currently, NACA is fighting subprime lending. The organization has committed funds to its Home Save Program to refinance loans for people at risk of losing their home due to a bad deal. The organization has also signed agreements, most notably with Countrywide Financial, to rewrite loans and restructure borrowers' monthly payments to an affordable level [source: Appelbaum].

NACA asks everyone to get involved in the fight by taking part in Predator Watch. An online form on the agency's Web site is available for citizens to report a bank that engages in predatory actions, such as putting a false income on a loan application, changing the loan terms at the last minute or concealing unexpected fees.

Whatever you think of NACA's tactics, the organization does garner the funds that provide affordable mortgages for people who wouldn't otherwise be able to buy a home. To learn more about NACA and home buying, check out the links on the next page.