Big Banks Explain Why They Won't Give You A HAMP Modification ~ Huff Po

[mzmolly]

Lawyers for homeowners who have been denied mortgage modifications under the Obama administration's Home Affordable Modification Program make a straightforward argument when they sue banks.

As a class-action complaint in Massachusetts puts it, "when a large financial institution promises to modify an eligible loan to prevent foreclosure, homeowners who live up to their end of the bargain expect that promise to be kept. This is especially true when the financial institution is acting under the aegis of a federal program specifically targeted at preventing foreclosure."

Under HAMP, a program funded with $50 billion from the Wall Street bailout, eligible homeowners at risk of falling behind on their mortgages can ask their mortgage servicers for a modification that reduces monthly payments to 31 percent of their monthly income. If they make their monthly payments during a "Trial Period Plan" that's supposed to last for three or four months, then the modification is supposed to be made "permanent" for five years. Most trial periods drag on for longer than three months, however, and more homeowners have been bounced from the program than have been granted permanent mods.

...

"Not all mortgage loans are eligible for HAMP, and a participating servicer is not required to modify every HAMP-eligible loan," Bank of America's lawyers argued in August in response to a lawsuit in Arizona. "If borrower eligibility is satisfied, the servicer is obligated to consider the borrower for a HAMP modifiation, assuming it is not precluded from doing so by its other contractual arrangements or investor requirements."

...

Chase's lawyers argue that borrowers should know that even if they qualify for a Chase Trial Period Plan under the most recent guidelines, there's still a trap door: "The cover letter accompanying the TPPs also makes it clear that the borrower may not ultimately qualify for a permanent modification: 'We have enclosed a customized Home Affordable Modification Trial Period Plan ('Trial Period Plan'). If you qualify under the federal government's Home Affordable Modification program and comply with the terms of the Trial Period Plan, we will modify your mortgage loan.'"

More at the HUFFINGTON POST

What Bank of America is arguing is that they only need to "consider" eligible home owners for HAMP, they're under no obligation to finalize the deal. Beyond disgusting.

[crazylikafox]

1. Time to close these guys down

[tridim]

2. 2008 was the time to close these guys down.

That's when most of the illegal shit went down.

Like for instance Chase not paying ANY taxes on their "acquisition" of WaMu's Mortgage Backed Securities. The 2008 tax document on the IRS website is MISSING. To date, nobody can find it.

Where is p938--2008.pdf?
http://www.irs.gov/pub/irs-prior/

[Myrina]

3. LMAO I went thru a 'modification' with Citi ...

... I lost my job in Feb 09 and took a new job, paying $12k/yr less, in June 09. Submitted all the appropriate paperwork and begging to Citi and the result was a new mortgage that lowered my monthly payments by THIRTY FIVE DOLLARS a month, even though my salary had dropped by approximately $1,000 a month. I would have been better off if the Gov't would have just given me the $5k they gave Citi to 'consider' my modification, and sent that in as a mortgage payments.

Go figure.

[Betty]

4. I've been turned down twice

once by BAO and now by the company they sold my mortgage to.. no explanation, even though I am paying around 47% of my income into the mortgage. The new company won't even return my phone calls, I just want an explanation.

[EFerrari]

6. It would be worth it for you to call the local bar association

and get a short telephone consultation for a small fee. An attorney might be able to tell you how to get a straight answer from these people with the right kind of letter.

[mzmolly]

9. Try calling

888-995-HOPE (4673) and explain your situation. I warn you though, do not make any partial trial payments if you're under consideration. Make your full payment even if you end up on a trial plan, until any modification is final. Explain that you're struggling to make the full payment but you've hear to many horror stories.

Best of luck!

[EFerrari]

5. It's even worse than that. There are many borrowers who applied

for a modification BEFORE they were in foreclosure and were told, industry wide, that there was nothing that could be done until they were late with their payments.

They did exactly what borrowers are supposed to do when they see a problem down the road -- contact their lenders.

And they were advised by their lenders to go into foreclosure so they could be helped by the president's program.

It was a honeypot for the banksters who acted in bad faith and are foreclosing legally and illegally on homeowners right and left.

[mzmolly]

7. I've heard this as well.

Absolutely criminal E.

[EFerrari]

8. My mom showed me her paper trail.

After stringing her along for over a year, Chase was still giving her instructions to finalize the mod on the day they filed the default. I've read this same story all over the intertubes. It's unbelievable that lenders, who by law are required to act in good faith, are getting away with this.

[mzmolly]

10. I agree.

I may have been a similar victim had I not insisted on making full payments, on time. My bank took 15 friggen months to finalize and lost my docs about four times. I started communicating by email in case we should ever end up in court.

I hope your Mom will fight back by contacting an attorney and her local reps. Even if she lost her home, she may be eligible for damages of some kind?

:hug:

[EFerrari]

11. I don't know. Suing them would take thousands of dollars.

It's possible that someone would take the case but not likely. There are two big firms in San Francisco that may file a class action in the next week or so but who knows how that will go.

The really crazy part is that all of those mortgages should have been written down, and people should have been able to stay in their homes and by now, the market could be recovering. But these greedy banks want to be bailed out AND they want to cash in on equity that is no longer there. They are making money hand over fist. Regular working people, who bailed them out in the first place, are losing their biggest investment, cushion for their retirements. Criminal. :shrug:

[mzmolly]

12. There are class action suits

that have been launched in a few states. Perhaps the NCLC would advise?

http://www.nclc.org/litigation/case-index.html

Boston Headquarters
7 Winthrop Square, Boston, MA 02110-1245
Phone: [phone]
Fax [phone]
(Directions)

Washington Office
1001 Connecticut Avenue, NW, Suite 510, Washington, DC, 20036
Phone: [phone]
Fax [phone]

[EFerrari]

13. I'm pretty sure she has to join one in California.

She'd up to her eyebrows in something else right now but I'm going to try to get her to at least consult with the lawyer on call at the Board of Realtors today.

That's another thing -- Mom is a real estate broker and a knowledgeable one with 50 years in. If they did this to her, I can only imagine what they did and are still doing to people with no experience in real estate transactions!

[mzmolly]

14. Absolutely.

Your Mom wasn't vulnerable and it still happened to her. They do it, because they can.

Yes, she'd ultimately have to contact someone in California, but the organization I noted may have info on who she can contact in various states. They're surely keeping track of other lawsuits.

Here are some more legal leads in CA to check out.

http://www.dca.ca.gov/publications/guide/legal_index.shtml

Good luck to your Mom E. Keep us posted, ok?