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More than 100 Austin residents gathered in late August to meet with HUD Regional Director Charles Gardner and discuss a new FHA foreclosure moratorium and reforms that they have been seeking for years. HUD agreed to the moratorium on foreclosures for the Chicago neighborhoods hardest hit by FHA fraud, but Austin residents demanded more.

Besides Chicago, selected zip codes in Atlanta, Los Angeles, and New York are also subject to the 90-day moratorium.

Stekeena Rollins, whose mother lost her home in an FHA scam several years ago and who recently testified at Senate hearings in Washington on fraud and waste in FHA programs, and Norris Boston who also bought a house in an FHA-backed real estate scam, chaired the meeting in Austin.

The reforms announced Wednesday night included a 90-day moratorium on foreclosures for every homeowner with a troubled FHA loan on most of the West and South sides, investigations of all FHA-insured mortgages currently in default or foreclosure; re-appraisals and mortgage restructuring for over-appraised mortgages; penalizing and in some cases terminating the appraisers, realtors, and lenders involved in fraudulent practices; and issuance by HUD of letters of credit repair on behalf of families who have bad credit as a result of fraudulent lending practices.

During the course of the more than two-hour-long meeting in Austin, Gardner also agreed to the following: in addition to re-appraisals, inspections may be necessary in some cases to determine the true value of resident's homes; HUD will consider helping families acquire the homeowners' insurance that they have been denied due to the serious structural problems overlooked by in the original FHA appraisals; and a Homeowner Rehabilitation Fund may be necessary to assure that families can afford to make the repairs necessary to keep their homes up to code.

Gardner also agreed to attend a second meeting in Austin at the end of September to evaluate the moratorium and reforms.