The Boston Globe’s Front-Page Story Describes the Predatory Practices of BlueHub
(formerly known as Boston Community Capital)
(Boston) – Tuesday Feb. 18th at 1:00 p.m. at BlueHub’s headquarters, 10 Malcolm X Boulevard in Roxbury, homeowners victimized by Bluehub’s practices will personally deliver a class action lawsuit to CEO Elyse Cherry and other BlueHub executives. The many homeowners want Elyse Cherry and other company executives to understand the personal price of the company’s predatory practicesm (click here for Boston Globe article).
BlueHub claims to help homeowners in low income communities keep their homes, and that its SUN program infuses money into these communities. Our lawsuit shows that this tax-exempt organization sucks money out of these communities by taking for itself a significant portion of the only savings most of the homeowners have, the value in their homes. BlueHub buys their homes, and then, for a significant profit, flips and sells them back to the homeowners. The mortgages on the homes are at above market rates and will never be paid off, even if the homeowners make their mortgage payments on-time every month for thirty years. They will have to pay BlueHub for its share of the home’s appreciation, which can be fifty percent or more and require additional unaffordable financing.
The homeowners believed that BlueHub, one of the nation’s largest CDFI non-profits, would protect their interests. In fact, they engaged in the same and worse predatory practices as the lenders and investors that caused the financial crisis. BlueHub takes in tens and hundreds of thousands of dollars in profits with the Shared Appreciation Mortgage which is unprecedented and unconscionable. Nardella Thomas, one of the homeowners in the lawsuit, states: “I came to them looking for assistance in keeping my home. Instead of a helping hand-up, I have been handcuffed to an oppressive mortgage for BlueHub’s profit.”
Homeowners came to NACA a year ago asking NACA’s support after reading the Boston Globe article written in October of 2014 (click here for article) predicting the consequences of BlueHub’s predatory practices. NACA committed to support these homeowners, including financing of their lawsuit because they lacked the funds necessary to pursue justice. Bruce Marks, NACA’s founder and CEO, states. “In over 35 years of fighting predatory lending, I have never seen this “Shared Appreciation Mortgage” and the huge profits it generates.” He continues, “Elyse Cherry’s response is typical of a predatory lender or loan shark where they blame the homeowners as being high-risk, unappreciative borrowers. We call on all of BlueHub’s financial backers to investigate, terminate the predatory practices of this purported non-profit company, and restore justice to these homeowners.”
About NACA (www.naca.com):
NACA is the largest HUD certified non-profit home ownership and community advocacy organization. NACA is the most effective organization in modifying mortgages and provides the best mortgage in the country. NACA CEO Bruce Marks was named Bostonian of the Year for 2007 because of his work in getting the major lenders and servicers to modify homeowner’s mortgages. See Bostonian of the Year. He testified before Congress on numerous occasions including September 12, 2000, being one of the first people to sound the alarm of the pending mortgage crisis. For more information go to www.naca.com.