Lenders Still Refusing Borrower Loan Modifcation Requests

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While many homeowners have taken the jump from making regular mortgage payments on a monthly basis to a temporary loan modification plan, few of these have been able to make a successful transition to permanent modifications that would allow them to breathe easier. It would appear that the mortgage industry has gotten quite good at holding homeowners hostage in their own homes with their own special brand of firepower. Of course, they don't use real weapons, but nonetheless, they wield enormous control over homeowners who are powerless without the help of their lender or mortgage servicer. 

Some will say it's the homeowner's fault for taking on more than they could handle but more often than not -that's not the case. Many have suffered a health crisis, lost their job due to the mortgage and credit meltdown, or fell behind because of predatory lending and mortgage servicing practices. Though investigative reports point out that a loan modification can be a costly path for a mortgage servicer, the financial industry continues to blame lack of staff, or the borrower and paint themselves as the actual victims. Why? Because that's what some banks do.

Even if the homeowners took on mortgages that perhaps are a bit more than they can handle, many consumers report the lender egged them on with assurances that they could afford mortgages of that size, some report they were told that interest only loans and ARMs are just as viable as fixed loans and others report their loan documents changed. Shouldn't lenders be held accountable for the products they push and the individuals they take on as clients? Shouldn't mortgage servicing companies be held accountable for how they handle -or mishandle the loan?

After all, when consumers purchase a car, they expect it to function properly. When consumers purchase appliances, they expect them to function appropriately. Therefore, shouldn't homeowners be allowed to have the expectation that mortgage lenders know their products sufficiently well enough to only give them out to people who can afford them for the long haul? Maybe this should be the way that it is, but typically it is not.

Essentially, transitioning from a monthly mortgage payment to a temporary loan modification winds up having the homeowner jumping from the proverbial frying pan into the fire. Instead of gaining a reprieve from threats of foreclosure and an abeyance of accumulating interest rates, homeowners continue to receive both of these. Doesn't' it sound similar to getting slapped in the face after going down for the count. Why is that? Because that's what some banks do.

Temporary loan modification is akin to purgatory that place where everyone is in limbo wondering which direction they are going to go. While homeowners might be fortunate enough to achieve this temporary state-of-affairs, they remain in limbo as does their entire life around them. Will they have a place to call home in three month's time? Will they be able to obtain a permanently modified mortgage that they can continue to pay on time every month? Or will they, instead, learn their credit score plummeted further and then receive that final notification that their home is indeed going to be foreclosed upon whether or not they did anything wrong? Why? Because that's what some banks do.

If you think that being held hostage is too harsh a phrase for what the mortgage industry appears to be doing to struggling homeowners, think again. This scenario is similar to that of a loan shark who loans money to needy individuals and then charges so much interest that the borrower never seems to be able to catch up. The lender rakes in the money while the borrower continues to struggle to keep his head above water, barely surviving.

Mortgage lenders provide home loans, sometimes without taking into consideration all of the mitigating circumstances. Then, they offer some hope by offering distressed homeowners temporary loan modifications with the intent of channeling these debts into affordable permanent loan modifications. Unfortunately, somewhere along the way, the process gets stuck in all the red tape, or is simply buried in a sea of paperwork -maybe intentionally, maybe not. Why? Because that's what some banks do.

All of the decisions lie in the hands of the lenders who determine which homeowners are worthy of permanent loan restructuring and which ones are not. In the meantime, the credit ratings of these individuals continue to plummet as their homes are listed as potential foreclosures, their debts continue to rise, and their faith in the American dream begins to waver. I hear from borrowers who pay their payments on time and are told to skip a mortgage payment to qualify for assistance. I hear from other borrowers that they've made all their payments on time, but just like many loan modification application disappear -so do their payments. The borrower's are then forced to prove their innocence and make calls that nobody returns. If they are lucky enough to find an employee that promises to help them, they often learn that person has been fired. Why? Because that's what some banks do.

Banks are now quickly paying back the billions of TARP bailout funds. They report they are doing so as a way to show their debt of gratitude to taxpayers who bailed them out. But many think otherwise. Are banks paying back taxpayers with the very money paid by borrowers in lucrative fees and higher interest rates? Some question, could it be more likely they are rushing to pay back these TARP funds as a way around government regulations that dictate the amount of executive pay? That's what many taxpayers believe. Why? Because that's what some banks do.

We need a strong Consumer Financial Protection Agency charged with watching over financial industry practices.  Why? Because that's what banks do.

For more info, be sure to check out "Banks losing Paperwork! What am I missing?"

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It's been over 9 months for my loan modification with EMC and they initially declined my request because my gross income was too high. I found out they used my bank statements to figure my gross which is impossible to do since all deposits from my job are net. Go figure!! What a bunch of fraudulent crooks at EMC.

I also have heard numerous delays, such as we don't have the software for the calculation, my hardship is not permanent, we need more documentation, we now need your 2007 tax forms and on and on and on.......

I've contacted the FTC, BBB and the state Attorney General. Getting an attorney is my next move.

EMC is so rude and they are not following the new Obama plan like the law states - what recourse do consumers have??

Strategic Comment: There are two ways for you stop foreclosure, sale and eviction dead in its tracks. One is to file bankruptcy under Chapter 13 which is an opportunity for debtors to reorganize their payments to creditors.

•An automatic stay goes into effect immediately upon filing with the Bankruptcy Court. Creditors who say or do anything in furtherance of collecting a debt are committing a federal crime from the moment it is filed, whether they know about it or not.
•However, the payments include fees to the Court and Trustee which exceeds 10% of what you pay into the Court for the benefit of your creditors, so since you are strapped for cash it further impedes your ability to work out a realistic plan.
•Also for secured debts like mortgages, the lender can come into Bankruptcy court and ask the court to lift the automatic stay which in the past has been routinely granted and for the most part still is, UNLESS YOU DO SOMETHING ELSE.
•WHEN YOU FILE YOUR PETITION STATE THE MORTGAGE AND NOTE TO BE CONTINGENT LIABILITIES BASED UPON TILA VIOLATIONS. You will need a full forensic review before or immediately after filing to support your position. Contact Brad at foreclosuredefensegroup@gmail.com or 888-829-4405
•YOU SHOULD ALSO NAME, AS THE CREDITOR, THE ORIGINAL LENDER, and state the amount of the loan as a contingent liability to them. The fact is, in most cases, you have not been presented with proof of transfer of anything, nor seen any assignment, or what rights or obligations were picked up in transactions after your closing by third parties who own the servicing rights, or the mortgage or the note. The Trustee or other party coming into court or posting notices of sale on your property probably is getting his/her marching orders from someone who either doesn’t have or can’t prove they know the amounts you paid, to whom or what is currently due. PLACE THE BURDEN WHERE IT BELONGS — ON THEM.
•Then you should state the present mortgage servicing entity to whom you are now sending your payments (this applies only where the loan has been sold which is true in 95% of the cases) as a contingent liability in an unknown or unliquidated amount.
•Then you should add a creditor “john Doe” as also an unknown unliquidated debt as the possible owner of a security under which he has ownership of the mortgage and note.
•Then you should file an adversary proceeding or action under TILA, RESPA, fraud etc. making all appropriate claims for rescission, refund of interest, points, loss of value in the property etc.
If your case is handled in this way there is a higher probability that you will survive the motion for lifting of the stay as the movant will have to prove the chain of title and authority on the mortgage and note, thus giving rise the the issue of legal standing for them to standing in the courtroom at all.
The second option, if you are faced with foreclosure, sale or eviction is just file the TILA action in Federal court and then go the State Court and ask the State Court to issue a stay because there is pending litigation in Federal Court. Usually State Court judges are more than happy to get the matter off their desks and thus grant your motion for stay, but they might not be under no obligation to do so.
Remember that whether you go straight into Federal Civil Court or Federal bankruptcy Court, which is a different division, and you are NOT represented by counsel, the Judge must do the legal research himself to determine the merit of your claims. If you are represented by counsel you need to make damn sure he knows what he is doing. Most bankruptcy lawyers don’t know an adversary proceeding or TILA action from egg on the wall. They have no experience with it. Very few lawyers or judges know this area since it only became important in the last couple of years.

Hi Denise I would like to tell you what happened to my dad who is 72. A man that has never been late on his mortgage or any other bill. Fema decided to redue flood maps and after 40 some years with my dad in his home he had to get flood insurance. He took the 1 year premium check to his insurance agent. So he would not be short in his escrow account. PNC Bank sent is check back and increased his mortage payment almost $200 more. He lives on Social Security and his pension. So he tried to do a modification to lower the interest rate. In October they sent him a tempory coupon booklet for a much lower payment. Then Dec 12th they sent him another letter saying that he does not qualify and must make up almost $4,0000 immediately or they will start to report his mortgage late. No one told him that if you apply for a modification and never been late on your mortgage accepting the new temporary payment would then be reported to the credit bureau and you would then be considered late. If that was the case he would have never tried for a modificaton. He is now 60 days late on his mortgage and we are trying feaverishly to pay the back difference so he does not loose his home. Which that is the only thing he has left. When talking to the home affordable people for PNC I asked for the paper work they sent my dad or the phone conversations since they have to tape them. They said an outside source has this information (the GOVT) and there is no way that I can talk to anyone. The govt is the one who makes the decision. I think that it is horrible that they mislead a 72 year old man who had never been late on his mortgage and has lived in the same house for over 40 years and now we are struggling to make the back difference and until it is all paid almost $4,000 they are still reporting him late to the credit bureau. Thank you for listening

EMC has messed up 2 loan modifications. On the first one after sending in all the paperwork in May 09 for my investment property, which they said they can do a loan modification, I waited over a month and heard nothing. When I called they said "oh as of 01 Jun we no longer do investment properties". When I said I sent the paperwork in May they said "well it's now June so we can't do it." The 2nd time it took over a month again and I called and was told they never received all the paperwork' I asked why didn't someone call or send me a notice. They claimed they did, but I received nothing. I asked when they sent it and could not find a date. I had to resubmit everything again. After running around for almost 6 months with different people telling me different things I had had enough.How is this helping me when I can't make my payment? I will now do a short sale and to me only the bank will lose as they are getting about 25% of what I owe. All I wanted was to drop my rate!

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