When Vanessa and Richard Bulnes got an eviction notice, it felt sadly ironic. The Bulneses were unable to pay the rent because their corporate landlord took three years to remediate high levels of lead in the backyard soil, which caused Vanessa to lose her business -- a family home child care that she had run for more than 20 years.
"There were nights where I would wake up and think, 'We're squatters.' And we felt really bad about that because it was never our intention to not pay rent," Vanessa said. "Because after you lose a house for not paying your mortgage, we knew that’s not the way to go. This was like a second chance. We didn’t want to be at the mercy of somebody saying, 'You gotta get out' again."
It was the latest in a string of injustices that happened to the Bulnes family: first, loan modification fraud, then foreclosure, now the threat of eviction. Their story is emblematic of a bigger problem: the disproportionate loss of African-American and Latino wealth during the foreclosure crisis and the obstacles to build up that wealth again. Between 2007 and 2013, so many African-American and Latino homeowners in Oakland were wiped out by foreclosure that entire neighborhoods were transformed. Many of the homes that were lost ended up in the hands of corporate investors, who then rented them out, sometimes to the same families who had lost their own homes. And that put those families, like the Bulneses, at risk of much more loss.
Richard and Vanessa met at church in Oakland. Richard is Latino and grew up in San Francisco. Vanessa is African-American and grew up in North Carolina. They bought their house on 104th Avenue in East Oakland in 1992, shortly after they got married. It cost $141,500, and Richard’s sister was kind enough to give them the money for a $20,000 down payment.
For them, this house is where they became a family. It's where they brought their third baby, a daughter, home from the hospital. It's where they took prom photos of their kids and all their friends when they were in high school. It was also where Vanessa started her own child care business, planting collard greens in the backyard with the kids in her care.
Their financial troubles all started one morning in 2008. Richard woke up early, as he likes to, took a shower and began to comb his hair.
"I pride myself on my hair, because so many people are bald-headed now, especially at my age. But I am not," said Richard, 68, with a wry smile. "[But] as I tried to comb my hair, I couldn’t lift up my right arm. I came in the bedroom, woke up my wife and told her, 'I think you need to take me to the hospital.' "
Losing a home often begins this way: A family hits a hard spot, a health crisis or a loss of income. At the time of the stroke, Richard was working at Meals on Wheels. The family lost about $2,000 a month in income, about the same amount as their mortgage payment at the time, which had ballooned after they refinanced. They still had Vanessa's income from her child care business, but they decided their best option was to try to modify their loan.
The Bulneses, though, were caught up in a bigger web. Oakland and other cities across the country are now suing big banks for targeting African-American and Latino homeowners with loans that had abusive rates. At the same time, many banks weren't playing fair to help homeowners modify their loans.
"It seemed like at every point, when we got to where we thought we were going to get a modification, they needed another piece of paperwork, they needed another bank statement," said Vanessa, who is 58. "There was always something else they needed, and when we gave them that, 'Oh we lost that, could you send something else?' "
What Vanessa describes sounds really familiar to Maeve Elise Brown, director of the statewide organization Housing and Economic Rights Advocates. In 2009, President Barack Obama had introduced the Home Affordable Modification Program to help struggling homeowners modify their loans, but homeowner advocates, researchers and news organizations like ProPublica found that banks often broke the rules.
"Mortgage servicers were telling people to turn in paperwork over and over and over again. They weren’t looking at it, they would shred it. They would deny people instantly," Brown said. "Not everyone qualified, but a whole bunch of people could, but were prevented from accessing that relief by the mortgage servicing companies."
Latino and African-American neighborhoods, like the Bulneses', were hit the hardest by the foreclosure crisis. These are the same neighborhoods that were redlined decades ago, with residents denied mortgages simply because of where they lived. Across the country, African-American and Latino neighborhoods lost three to four times more homes than white neighborhoods during the recent mortgage crisis, according to Cornell University research. On the Bulneses' six-block street alone, at least 35 properties were foreclosed between January 2006 and December 2012, according to the website PropertyRadar, which tracks foreclosures.
"Our neighbors right next to us, they both work for AC Transit, and we saw them lose their house. So we started praying harder. Then we saw the neighbor next door to us on the other side lose their house," Vanessa said.
Foreclosure seemed almost like a virus that Vanessa and Richard Bulnes could catch. They decided to pay an attorney to help them. Other companies began circling them. Vanessa called them vultures.
"We would get all kinds of letters in the mail saying, 'Call this number,' and you’d call that number, and they’d say, 'Are you behind on your mortgage?', and we’d say, 'No,' and they'd say, 'We can help you. The first thing you do is stop paying your mortgage,' " Vanessa said.
She was skeptical. But one letter from "The Gordon Law Firm" had a logo that looked like it was from the U.S. Department of Housing and Urban Development, or HUD. On this firm’s advice they stopped paying their mortgage. But the firm was lying. They weren’t HUD, and they couldn’t modify Vanessa and Richard’s loan. Years later, through a class-action lawsuit, the Bulneses won $3,500 back, but that’s just a fraction of the wealth they lost.
In September 2012, the foreclosure was final. The house Vanessa and Richard owned on 104th Avenue was no longer theirs.
"I cried like a baby," said Richard, remembering when he and his wife lost their home to foreclosure. "A grown man, crying like a baby. We had lived here 21 years. I raised three kids here. So, this is what we knew."
Vanessa knew they had to find a place by Christmas, so her daughter would have a place to come home to during winter break from her freshman year at college, and so the kids at her day care could transition easily while school was out.
"My wife, because she’s so practical, she said, 'Babe, you gotta wipe the tears out of your eyes,' " Richard remembered. "I said, 'Man, I ain’t finished crying yet.' She said, 'Well, whether you’re finished or not, we got to find another house.' "
Many families who lost their homes were forced out of Oakland, but Vanessa and Richard Bulnes were able to find a new place to rent. What they didn't know is that they were now at risk of losing a lot more.
Renting from a Wall Street Landlord
Vanessa and Richard were paying more to rent their new house than they had been paying on their mortgage before their first home was lost to foreclosure, but in many ways, the rental was perfect. It only had one level, so Richard didn’t have too many steps to climb, which was hard after his stroke. And the house was spacious, with lots of room for Vanessa's day care, Tender Arms Family Child Care. She had a contract with Head Start to care for low-income children.
Vanessa wanted to plant greens with the kids in the backyard as she had at her old home, so in the fall she called a group to come out and test the soil. That’s when she ran into a big problem: The level of lead in the soil was 1,350 parts per million, right in the area that the kids used for the playground.
The amount of lead in the Bulneses' backyard was more than three times the amount the federal Environmental Protection Agency considers a hazard in play areas, and almost 17 times the amount California's Office of Environmental Health Hazard Assessment considers a health risk.
When Vanessa got the lead results back, she called Head Start immediately, and they came out and put a temporary rubber cover on part of the patio. But they emphasized a permanent solution had to be found if she wanted to keep her contract. Alameda County has a financial assistance program to help low-income residents remove or fix lead problems, with priority for family child care providers like Vanessa. If Vanessa still lived in a home she owned, she would have had it done right away. But now, she was renting.
"Because we’re not the owners, we couldn’t apply to have the work done. We needed the owners to give us consent, and that’s where we didn’t get any cooperation with the property owner," Vanessa said.
The owner of the Bulneses' new home wasn’t just any landlord. It was a corporation: Waypoint Homes. It merged in 2016 with another top real estate investor, Colony American Homes, to become Colony Starwood Homes. Co-chairman of the board, Thomas Barrack, is a billionaire who helped raise $35 million for President Trump’s campaign and chaired his inaugural committee. The company owns more than 30,000 single-family homes across the country and close to 4,000 in California. On the company website, Colony Starwood boasts, "We recognized the unique opportunity created by the housing crisis and acted upon it in a bold way."
The Urban Strategies Council found that in Oakland, 42 percent of foreclosed homes between 2007 and 2011 were snapped up by corporate investors.
In Oakland, corporate takeover of homes happened mostly in low-income neighborhoods, essentially shifting ownership from the hands of largely Latino and African-American residents to the hands of Wall Street corporations. Latino and African-American buyers are still largely locked out of home loans in the city. One report found that in 2013, the top 12 lenders financed only four homes for African-American buyers and only seven for Latino buyers, compared with 40 for white buyers.
Not only did investors snap up homes. They also decided to keep them and make money off them by renting them out. Since single-family homes are exempt from limits on rent increases under California's Costa-Hawkins Rental Housing Act, for the most part, property owners could charge higher rents for them. It was a new moneymaking venture.
A 2015 survey conducted by the group Tenants Together found that 40 percent of Californians renting from the top three Wall Street real estate investors reported that these landlords weren’t repairing or maintaining homes as they should. The three companies included both Waypoint Homes and Colony American Homes. Now, Vanessa Bulnes had to rely on them to get the lead fixed, so she could keep her contract with Head Start.
"So I’m on the phone, my husband and I, we’re calling Waypoint, and emails and everything like that," Vanessa said. "Here we are, the clock is ticking. I’m like OK, I’m taking pictures, this is the area, this is how big it is, this is what we need you to have done."
Vanessa first contacted Waypoint in 2013, when the lead was found. But she says property managers came and went, and each time she had to start the process again. In June 2016, almost three years after the lead had been found, Head Start told Vanessa they couldn’t renew for the next school year if the lead wasn’t fixed by September.
"And I’m like, 'OK, this is affecting my income.' I give all these red flags about what’s going to happen if nothing is done. Still no urgency on their part," Vanessa said.
In one email in August 2016, a regional manager for Waypoint Homes wrote, "Unfortunately, we are not in a position to work with this program at this time."
It wasn’t until November that someone from Waypoint Homes finally came to walk through the property with an Alameda County representative. When questioned why it took the company so long to fix the lead problem, a spokesperson did not respond, instead stating that the company finished the work on Nov. 28, 2016.
By that time, three years after Vanessa's initial request, it was too late. The school year had already begun, and Head Start had canceled her contract. The family’s main source of income, which had gotten them through the stroke and the foreclosure, was gone. They had to apply for assistance for food, and Vanessa had to change her health insurance from Covered California to Medi-Cal. They began to fall behind on their rent.
Even before they started working on the lead remediation, Colony Starwood Homes had already begun trying to evict the Bulneses.
The Ripple Effect
It would take a protest at the headquarters of Thomas Barrack's real estate investment company Colony NorthStar in Los Angeles, organized by the Alliance of Californians for Community Empowerment, legal help, and financial support from their church for the Bulneses to finally get their corporate landlord to back off. In January, Colony Starwood Homes agreed to cancel the eviction, plus four months of back rent. Vanessa now has a job at an outside day care and is trying to make due off her hourly salary of $17. She says that amounts to about a third of what she brought in when she had her own child care business at home. She can pay the rent, but she says she's behind on other bills.
Their precarious situation could now affect their children's financial future. When you don't own a home and are one step away from eviction, you're a lot farther behind people who can help their children with a down payment or pay for college. In fact, there are data showing that black college graduates have lost wealth over the past generation, while white college graduates’ wealth has grown.
The Bulnes family's youngest daughter is about to graduate from a historically black college in Texas. Vanessa says her daughter has had to call on other relatives and friends from church to help out when she needs money at school. Still, she says, there are other lessons she's passing on to her daughter.
"When she has a day that’s trying and she thinks she can't make it, she’ll text me, and she’s like, 'Mom, this is so hard,' and she’s really down and sorry for herself. I’m like, 'But think about your mom, what you’ve seen me go through, what you’ve seen us go through. You came from me,' " Vanessa said. "Those are the kinds of things we’re passing on to our kids. It may not be money. It may not be a house. But there’s so much more that we want to pass on."
Some of that is financial advice, learned the hard way. And then there's this: Vanessa is now an active community organizer, helping other Oaklanders try to fight off their landlords and stay in their homes.