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53 » VISIT US ONLINE @ DSNEWS.COM HELPING HOMEOWNERS THROUGH FORECLOSURE REFORM In October, city residents and lawyers at a Philadelphia City Hall news conference, called on the Pennsylvania Housing Finance Agency (PHFA) to eliminate a policy that often requires homeowners facing foreclosure to first pay off any liens against them before their mortgage can be modified, e Philadelphia Inquirer reports. ese liens, the lawyers said, can include water and gas debts, real estate back taxes, medical bills, or parking tickets. According to housing advocates, homeowners with Federal Housing Administration (FHA) loans administered by PHFA have had a harder time securing permanent loan modification when they have liens and judgments against them. e loans allow homeowners to pay as little as 3.5% of a purchase price for a down payment. "It's a practice that threatens [homeowners] with the unnecessary loss of their homes, and threatens to put people into a market where housing is not affordable [and] is not available," said Irwin Trauss, a lawyer with Philadelphia Legal Assistance. Kate Newton, PHFA's Director of Loan Servicing, told the e Philadelphia Inquirer that the issue boils down to PHFA trying to comply with regulations from the U.S. Department of Housing and Urban Development. Nearly half of the athe PHFA's portfolio is FHA loans, and in the past two years, the PHFA has agreed to permanently modify more than 500 loans in Philadelphia. "Unless [these municipal liens] do a subordination agreement or they get paid off ... we know our modified mortgage would not be in first position," Newton said. "... It would be a lot easier for us if we didn't have to worry about doing all of this, and we don't want to be in this position, either." According to ATTOM Data Solutions, 277 Philadelphia homeowners had foreclosure proceedings filed against them in August 2019. Additionally, Philadelphia holds one of the highest foreclosure rates among cities with at least one million people, at one in every 1,422 housing units as of August 2019. TRACKING HOME EQUITY GROWTH SINCE 2012 Redfin reported that people who purchased homes in 2012 have earned $203 billion in home equity. e buyer who bought a home the year prices reached their lowest point following the Great Recession has earned $141,000, or 261%, in home equity. e average home sold in 2012 has increased $110,000 in value from a median- sale price of $210,000 in 2012 to an estimated value of $320,000 in September 2019. Redfin states that average homebuyer began with $54,000 in home equity and now has $195,000. "e opportunity to build wealth through home equity when prices hit their low point was available only to a fortunate subset of Americans who had enough cash for a down payment," said Redfin Chief Economist Daryl Fairweather. "And now many people who weren't able to buy into homeownership during that window of time find themselves on the other side of the housing market coin: Many areas are just plain unaffordable for people who don't have equity built up to trade in for a new home. And those who are waiting in the wings, hoping to buy a home when the next recession hits, probably won't be as lucky as buyers were in 2012. "Even if home prices do come down slightly, the housing market won't be impacted nearly as much as it was during the Great Recession and home equity gains won't be nearly as big." e study finds that most of the equity growth can be traced backed to expensive coastal markets, mostly in California, where home values have risen by two-thirds. e average homeowners in these markets have earned more than $300,000 in equity since 2012. Los Angeles, California, had the nations' biggest home equity gain at $15 billion. Seattle, Washington, was second at $8 billion and was followed by Oakland, California, at $7.9 billion. San Francisco, California, had the nations' highest home equity growth in dollars at $741,000. Markets with the highest percent increase in home equity includes metros near U.S. military bases: Tacoma, Washington (1,453%); Virginia Beach, Virginia (1,333%). Home values in Tacoma have grown 76% since 2012, adding $165,000 to the homes' value.

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