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To Larry:

January 14, 2010

BarackObama: The people need your help with loan modifications.

A reader left a comment on my previous post concerning his efforts to obtain a loan modification.  He tells us that it is now one year since he began the process and he is evidently no closer to getting the modification - or any answer at all - then he was when he began.

I also author TheForeclosureDetonatorFORUM and TheMortgageCornerFORUM in which I have reported on this "scam" several times.

Our reader's comment is not a rare case.  In fact, the vast majority of people attempting to get a mortgage loan modification are having the same experience.  The stories are all the same.

1.  You must be delinquent to even be considered for a loan modification they are told.  So people that are not delinquent but want to take advantage of lower rates are told - by their servicers to stop making payments and that after 90 days of delinquency they can apply.  People do that only to find out what our reader says in his commnets.

2.  Home owners are told repeatedly to send in the same paperwork they have sent in the past.  Always being told that their information was never received or it was lost or even destroyed.  they are asked to re send their information time after time.  Again, this is not an isolated incident.  It is rampant across the board.

3.  No one is ever told what the qualifications for a loan modification are and are led to believe that they will qualify.  Truth be known, you must have a good credit score which once you become delinquent on your payments you do not.  Second, you must have a certain debt to income ratio - meaning you must have enough earnings so that a certain percentage (around 42%) can be used for your housing payments.  Third, in order to have a proper debt ratio, you must have a job.  Therefore for the millions and millions of homeowners that are unemplooyed, there simply is no hope - yet they are never told this by the servicing company.

4.  Many who are in foreclosure are told that their foreclosure actions will be stopped during the loan modification.  A bold face lie!  The foreclosure process continues and often is finalized before you can get them to agree to having just received your paperwork.

In other words, loan modifications are a SCAM!

Let's hear your story on loan modification.

Mr. President, are you listening?  I am sure that someone in the White House is monitoring this site.  Let us hear from you as well.

Here is a related story from the Huffington Post:

Record Year For Foreclosures: 2.8 Million Households Threatened In 2009, Up 21 Percent


  1. Sickens my stomach after all the profiteering that has gone on.....

    Winning the trial, losing your house

    Like some others, Bartels complains that the way the Making Home Affordable program is set up, with the government “compensating” lenders for up to 95% of their losses on foreclosed homes, makes it more profitable in many cases for lenders to foreclose as opposed to modify. And that, he believes, accounts for a large percentage of people being turned down when they ask to have their mortgages reworked.

  2. Predatory Lending is a major contributor to the economic turmoil we are currently experiencing.

    Here is an example of what I am talking about:
    Scott Veerkamp / Predatory Lending (Franklin Township School Board Member.)

    Please review this information from U.S. Senator Jeff Merkley regarding deceptive lending practices:
    "Steering payments were made to brokers who enticed unsuspecting homeowners into deceptive and expensive mortgages. These secret bonus payments, often called Yield Spread Premiums, turned home mortgages into a SCAM."

    The Center for Responsible Lending says YSP "steals equity from struggling families."
    1. Scott collected nearly $10,000 on two separate mortgages using YSP and junk fees. 2. This is an average of $5,000 per loan. 3. The median value of the properties was $135,000. 4. Clearly, this type of lending represents a major ripoff for consumers.

  3. WE THE PEOPLE (Have Had Enough)

    Wall Street may effectively own Washington DC and the politicians but they do not own us.



    WE THE PEOPLE have the freedom to associate - or not.

    WE THE PEOPLE have the right to demand legal tender in payment of debts owed us.

    WE THE PEOPLE have the right to demand that these institutions eat their own cooking on each and every one of the loans they securitized and peddled during these years without fair and full disclosure to the buyers that these loans were rife with fraud.

    WE THE PEOPLE have the right - and the ability - to take personal, lawful action with specific, lawful political and business-oriented goals, including permanent structural changes that will end "too big to fail" and "rip off the consumer on demand" policies, including the full reinstatement of Glass-Steagall which will END financial speculation and dealing in all of its forms by firms that have access to Federal Reserve credit and/or any sort of public backstop.

    Make this message - this post - viral. Send it to your associates. Send it to the media. Send it to politicians. Get involved and do it now.

  4. guess if you oppose your radical?

    Got Fascism? : Obama Advisor Promotes 'Cognitive Infiltration'

    Put into English, what Sunstein is proposing is government infiltration of groups opposing prevailing policy

  5. Its always the about marking ALL your assets to MARK TO MARKET and giving up all govt subsidies (direct or indirect)

    JPMorgan on Modifications

    Most completed modifications are bank programs, and not HAMP. It is worth remembering that HAMP is just a subset of all the programs

    Dimon apparently isn't aware of any momentum for a macro principal reduction program

  6. Wow....thank god the banks were saved in a timely manner..the people?...well that all depends on if they have lobbyists to get their points across...whoops no lobbyists..can't you tell....

    Obama modifications help more than 100,000 borrowers
    112,521 loan-modification trials have been made permanent, Treasury says

    Meanwhile, roughly 8 million to 13 million foreclosures are expected to take place over the next five years, according to the Congressional Oversight Panel for the $700 billion bank-bailout program.

    However, Henry Sommer, director at the National Association of Consumer Bankruptcy Attorneys in Philadelphia said that those modifications are generally less beneficial to the homeowner than modifications under the White House program. He added that he worries homeowners eligible for the HAMP program are being steered into less-favorable private modifications set up by lenders.

  7. Big Banks Accused of Short Sale Fraud

    Just as regulators, lawmakers and all forms of financial oversight boards are talking about new regulations to guard against mortgage fraud and another mortgage meltdown, there appears to be yet a new mortgage fraud out there today, allegedly perpetuated by agents of, yes, the big banks.

  8. What's the opposite of transparent?



    The SEC, working hand in glove with AIG, agreed to keep bailout terms sealed, including information on the pass thru to counter parties such as Goldman Sachs at 100 cents on the dollar. This SEC granted “confidential treatment” was agreed to last May, and a “secrecy order” (WTF is that?) will stay in place until November 2018.

  9. How do they put a program together for this(new program to finance home construction) and yet after 1 year they can't figure out a good program for foreclosure prevention...?

    B/C they don't care

  10. Obama mortgage relief program fails to deliver
    Obama mortgage plan doesn't deliver 11 months later; only 66,500 homeowners helped so far

    That's a problem for homeowners like Cindy Rose, 52, of Murietta, Calif. She and her husband have seen their painting business drained by the recession.

    So they went to their mortgage company, Litton Loan Servicing Inc., for help. In August, they were approved on a trial basis for the Obama plan. The couple's new payment was about $1,700 a month, down from about $2,650.

    But a few weeks later, they got a confusing letter in the mail explaining several potential reasons for their rejection.

    A Litton spokeswoman declined to comment on the Rose family's case, but said that the company "is following the program's guidelines."

    They have since filed for bankruptcy and staved off foreclosure so far. But Rose fears she and her husband, who was recently diagnosed with lung cancer, will soon lose their home of 13 years.

    "All these horrible things have happened in the economy," she said. "And there's nobody there for you."

  11. Paperwork Woes Plague Mortgage Plan

    .Look, this should be a ten minute form which could be e-filed on the bank's website.
    Translation? The banks don't want to give these forebearances. This is not rocket science. All they should have to have would be three months bank statements, a copy of their W-2 and a statement of need i.e. whether they are employed or not.
    Neither the government, nor the banks really want to help the little guy forestall foreclosure. And, why should they? The Senators and the Congressmen are not affected. They aren't going to lose their homes.
    Nancy Pelosi is not going to lose her house nor will she lose Air Force 3. Joe Biden is not going to lose his house and Barrack Obama is a mulit-millionare with his own chef that he brought to the White House.
    What do they really care if the average man or woman loses their house or not?
    Sure, they will blow a lot of smoke, and Obama, the master story teller himself with hold up a fun house mirror and say somethingi stupid like: "See it's not that bad, I'm still rich. I still push the button and the butler comes and gives me my meals. What's the problem?"
    These people in power would sell their own mothers if they had the chance.
    Barrack Obama is a Chicago Politician and a disciple of the Reverand Jeremiah Wright who screamed at the top of his lungs "God America!"
    You think these people really care?
    The politicians stand for one thing and on thing only; they want to get elected so they can look good and have all the power and prestige. The electorate (substitute the word "peasants") are merely intruments to their success or lack thereof.
    Politics is a dirty business. And so are the banks.
    A bank can do anything it wants to do and never forget that.
    They could easily give their borrows a moratorium if they really wanted to, but that would cut into their multi-billion dollar bonus packages that they want to give to their employees.
    Think about it. If it weren't for the banks we would never had this mess to begin with. And, if it weren't for the banks we would be recovered a lot sooner, and if it weren't for both the banks and outsourcing we would actually have a great economy.
    The Federal Governmnet closed the banks during the Great Depression by executive degree. The Federal Government could grant a three month amnesty across the board to all mortage holders in danger of default, BY EXECUTIVE DECREE!
    The banks can do whatever they want as well as the government. FDR actively weighed in and put a stop to foreclosure and he wouldn't accept no for an answer.
    Obama really doesn't want this program to work, nor do the banks!
    So, in any case, unless and until we see some dramatic changes, we will be doomed to live under these leaders who care only about one thing, themselves! can belive the master..............story teller himself..................A light goes on in your mind...................and you could I have been so stupid as to vote for Barrack?

    Link Reply to Louis Ciola Track

  12. Jan. 16, 2010: Update on the HAMP (Home Affordable Mortgage Program)

    Now, I’m not a rocket scientist, but it seems pretty obvious to me that you should allow the trial modifications to continue so long as the homeowner continues to stay current on the modified mortgage. Foreclosing on these homes will only exacerbate what is already a disastrous situation in the residential mortgage market by adding to the inventory of vacant houses. Moreover, we know that a significant portion of foreclosed homes are stripped and vandalized as soon as the former owner vacates, leaving a blighted and damaged structure that is of little value to the lender and dragging down property values in the surrounding neighborhoods. It is a far better option to keep someone living in these houses by extending the trial modifications.

    No one benefits by evicting these borrowers. Let them stay--and pay.

  13. Good dialogue here.
    As to the last comment about modifications, maybe having homes vacated and go into disrepair is part of the plan.

    If more homes go into disrepair it does lower the value of the other homes in the neighborhood. If values continue to decline more people will be upside down. For those that need to sell will be unable to and possibly walk away and go into foreclosure themselves.

    More foreclosures mean more Real Estate Owned (REO) for the banks. More transfer of wealth and assets to them.

    This whole economic crisis, I believe, is a planned event.

    Why modify or help prevent foreclosure? That would benefit the people. It is not about the people, it is about continuing to enslave the people.

  14. Did you ever think they might want you to lose your house?

    Short Sale Backlash against Bank of America

    It’s crazy. Agents are Bank of America’s biggest customer. But they treat us like dirt on short sales. It’s like we don’t matter to them at all. However, we do matter and a whole lot more than they realize. Did you know that their mortgage division is one of their largest profit generators? That means when you send them a buyer, you’re actually helping them make more money.