Conferences focus on unprecedented freclosures and other challenges presented by the subprime, nontraditional mortgage market

For more than a decade the Consumer and Community Affairs (CCA) division of the Federal Reserve Bank of Chicago has worked with community development and governmental organizations to understand and address geographically concentrated foreclosures in lower-income communities. Foreclosure is a continual problem in low-income communities; foreclosures have a more pronounced effect in low- and moderate-income (LMI) communities because foreclosed homes tend to stay vacant longer, and lowerincome families have less savings to fall back on, and accordingly a much more difficult time recovering from the financial impact of foreclosure than middle- and upper-income households (Schloemer et al., 2006). The current crisis has reached into much higher levels of income and wealth, and is the focus of much attention from lawmakers, regulators, consumer advocates, economists, and others. It has also had an even more pronounced impact in communities that already suffered high rates of foreclosure. These communities have few traditional financial institutions, such as banks and thrifts, and must largely rely on fringe and/or less regulated financial service providers, such as payday lenders and mortgage brokers, for credit.