Homeowners in Chelsea have faced foreclosure at rates among the highest in the region. The explanation is straightforward: the local real estate market’s rapid ascent during the boom years mirrored broader trends, yet Chelsea’s subsequent collapse three years ago proved far more severe than in wealthier communities, where downturns tend to be less catastrophic. Over the past three years, hundreds of Chelsea residents have lost their homes to foreclosure. Behind every foreclosure lies genuine tragedy—borrowers never sought this outcome, nor did the lending institutions that originated these loans. The damage extends beyond individual families and banks; municipalities bear the cost as well. A struggling economy suffers further when foreclosures proliferate like a corrosive toxin throughout the community. The real culpability may lie with mortgage companies that knowingly extended credit to working families for homes they could never afford to keep, doing so while aware that the inflated real estate bubble would inevitably burst and rain devastation upon all involved.
An organized protest and the auctioneer’s good judgment combined to halt a foreclosure auction on Sixth Street Tuesday morning. The family facing loss has appealed for a loan modification rather than surrender of their home, yet GMAC Mortgage has made no substantive response to their situation. Logic suggests both parties would benefit more from GMAC working toward modification than from proceeding with an auction sale. These Sixth Street homeowners, who have owned their property for eight years, are simply requesting another opportunity to remain in their home. GMAC should recognize their circumstances and those of similarly situated families. The company itself came perilously close to failure when the economy nearly collapsed 3 years ago and survives today largely due to assistance it received. How have these major corporations become so disconnected from the struggles of those they have led astray?