Bank CEOs Gain as Millions Lose Dreams, Retirement to Foreclosure | Common Dreams

Bank CEOs Gain as Millions Lose Dreams, Retirement to Foreclosure | Common Dreams

Bank CEOs Gain as Millions Lose Dreams, Retirement to Foreclosure

by John Cavanagh and Scott Klinger

Inside and outside of Wells Fargo’s annual meeting in San Francisco yesterday, thousands of angry protesters decried the bank’s leading role in the loss of millions of American homes to foreclosure.Demonstrators march and block a side entrance to the Wells Fargo shareholders meeting in San Francisco, Tuesday, April 24, 2012. (AP Photo/Marcio Jose Sanchez)
If you want to know why the protesters are so angry, consider this double standard. For most Americans, retirement security lies in the value of their homes. Millions of these people have been losing that security as the nation’s largest banks have foreclosed on them. Yet the CEOs of these banks are reaping giant pay packages and padding their own retirement security with profits squeezed from ordinary people.
For many American families, a paid-off home is part of the dream of a secure retirement. The roof over their heads has long comprised the largest element of most families’ net worth. The housing crisis brought to us by the country’s biggest bankers has stolen the dreams of the nearly 4 million families who have lost their homes to foreclosure since the housing crisis began in 2007.
Of those who continue to live in their homes, more than a quarter have lost so much equity that they now owe more on their mortgage than their residence is worth. Even those who have never missed a payment on these underwater mortgages have found it all but impossible to refinance their loans to take advantage of record low rates that would cut hundreds of dollars from their monthly payments.
As American families struggle with their shrinking equity, Wells Fargo is enjoying record profits. Its earnings clocked in at more than $4 billion during the first quarter of 2012.
Wells Fargo and Bank of America are the country’s two largest mortgage servicers. Over the past three years, the number of homes foreclosed upon by the two giant banks has steadily grown. At the end of 2011, they reported to federal banking regulators that they held $22.5 billion and $19 billion worth of foreclosed houses, respectively.
While foreclosures have devastated the financial security of millions of American families, the CEOs of Wells Fargo and Bank of America have seen their retirement packages balloon