Jenny Do started a pro bono foreclosure clinic at her law firm in 2009 after she noticed that many of her clients filing workers' compensation claims were also facing housing troubles.
"I started to look into foreclosure procedures, and realized they were seriously unjust," said Do, an attorney with Efficio Law Group based in San Jose, California. "I stepped in and volunteered to do what I could to help."
Do's sentiments and actions are part of a groundswell of public dissatisfaction and anger with banks over their role in the country's financial and foreclosure crises. As part of the Occupy movement sweeping the country, this Saturday marks national "bank transfer day," a campaign that calls on consumers to switch their money from big banks to credit unions.
But for the most part, Do's efforts were futile. In some cases, homeowners who worked out a trial loan modification with their bank were told they didn't qualify for a permanent one. Other homeowners even had the sheriff show up at their house without warning and were told they had 15 minutes to leave. In one case, Do says, a client's bank promised not to sell their house within 30 days, but did so anyway.
"I'm running out of steam," she said. "The injustice I see, it's to the point you feel you have to do something, or else you feel guilty."
Recently, Do has taken steps to transfer $200,000 from her law firm's two investment accounts at Bank of America to a credit union. She closed one account in October, and has scheduled the other account to transfer next February.
"I believe it is the only power we have left," Do said. "The government is not looking out for our interests. Many nonprofits try to help, but to no avail. The only recourse we have left is to decide if we want to bank with [a particular bank].
For residents in east San Jose, an area particularly hard hit by foreclosures, the desire to divest from big banks took hold long before it was popular.
When the adjustable rate on her mortgage kicked in, Mercy Martinez, who works as an office clerk, could no longer afford the monthly payment on her condo in the east side of the city. She was able to modify her loan with Bank of America (then Countrywide), but her monthly payments still increased by $500.
Fed up, Martinez, who lives with her daughter, says last April she decided to move $40,000 from the bank to a credit union, and has pushed for her local church to do the same.
Last month, Most Holy Trinity Church in San Jose announced it would divest $3 million from Bank of America. They targeted Bank of America, says Martinez, because the church surveyed parishioners, who are mostly Latino and Vietnamese, and found a high number of people in foreclosure who had Countrywide (now Bank of America) as their lender.
Even though her housing situation is still in limbo, Martinez says she's happy the church decided to move its money, and she thinks it will make a difference.
But will withdrawals – even in the millions – cause Bank of America to blink?
Jim Wilcox, an economist who specializes in banking and a professor at UC Berkeley's Haas School of Business, says customer feedback counts for a lot, but such community level divestments won't impact most big banks.
"A few scattered withdrawals of that size do not loom very large at an operation the size of Bank of America, but sometimes large movements can really grow from a small number of voices in the beginning," he said. "Sometimes they peter out and sometimes they swell and become much larger. Withdrawals have the potential to have a high visibility and cause more people to think about their bank."
Case in point, earlier this week Bank of America backed off on a plan to charge customers a monthly $5 fee for debit card use, partly due to a backlash from angry customers and partly because several of its competitors dropped their debit card fees.
"It would be a PR disaster, likely to cost them a lot of customers," Wilcox said. "It was implicit in customer complaints [that] if there's a better deal down the street, I'll vote with my feet and checkbook."
Bank of America spokesperson Colleen Haggerty said the bank has no comment on the Occupy Wall Street movement, and said the bank has made strides to help homeowners during the unprecedented foreclosure crisis.
"Because some in the media have cited foreclosure matters as the reason for closing accounts, they may not be aware of all the efforts Bank of America has made to help keep people in their homes. This includes having made more HAMP (Home Affordable Modification Program) modifications than any other lender, and modifying more than 193,000 mortgages in California since the housing crisis began in 2008," said Haggerty, adding that the bank has also opened 50 Customer Assistance Centers in the hardest hit markets nationwide, including 10 in California.
In California, an estimated 1.2 million homeowners have lost their homes to foreclosure in the last three years. And, with another 800,000 homes projected to receive foreclosure notices in 2012, the need far outweighs the number of homeowners who have been helped.
Jenny Do, who has many Vietnamese Americans visiting her foreclosure clinic, says more education and outreach is needed to help homeowners, particularly those from ethnic communities who face even greater hurdles, such as language barriers, in navigating the convoluted process to successfully modify their home loan and keep their house.
Arthur Bao, an organizer with People Acting in Community Together, an interfaith group that has worked on foreclosure prevention locally, says the organization is working with community members, including Do and Most Holy Trinity Church to use their sizeable and high visibility divestments to win some gains for community members, including principal reductions and speedier loan modifications for specific congregants.
The pastor of Most Holy Trinity, Eduardo Samaniego, or Father Eddie as he is known in the community, was a driving force behind the church's decision to divest from Bank of America. He says the divestment should send a message to the big banks:
"Like Netflix, who pulled a fast one by trying to charge for previously-free movies and then lost over 1 million subscribers, most of whom did not return once the new fees were dropped. So the banks must know that they are here to serve the people and when they do wrong, there are consequences."