My Foreclosure Story
By: Karen Pettit
I have been documenting my experience as a 52 year old Slidell, Louisiana woman who is disabled and trying to acquire assistance with housing programs from our Federal Government with an eviction looming from GMAC Mortgage.
My husband and I taped an interview with "Action Reporter" Bill Capo from WWL-TV Channel 4 (New Orleans). On Thursday, June 16th, 2010, this feature aired on the 10:00 p.m. news.
We purchased our home in 2003. We had just gotten married in 2002 and were celebrating my promotion to a lucrative management position. And we were excited about the next step--becoming homeowners. However, shortly after we purchased our home, I became ill and it wasn't very long before I just couldn't work anymore. My condition quickly degenerated and eventually, I became permanently disabled.
As a direct result of my new disabled status, our mortgage note became increasingly harder to make. And within a few years, our payment became substantially more, due to increases in taxes and then, Hurricane Katrina. The losses to the local insurance industry had many premium carriers canceling policies and no new policies were being written. This forced many homeowners to turn to government insurance programs--at a much higher premium. Our monthly note was increased a couple of hundred dollars, and we had begun to feel the pinch.
During 2009, we fell behind in our payments. Coincidentally, GMAC raised our monthly payment to a totally unobtainable number for us (twice the original monthly cost). This left no money for food or utilities. And then there was the increasing cost of my medications and the copays for doctor appointments. Every month we had to scramble to keep the utilities on and food on the table. Our church assisted whenever they could, but, in this floundering economy, tithing was down and there were many families in greater need that had children, and of course, they are the priority. Still, our church helped us with groceries whenever they could. Finally, we had to borrow $10,000 from my newly widowed mother to get us through these outrageous payments.
The later part of 2009, I was in hospice care last year, and during this time my husband lost his job. As I was terminal, my husband kept how bleak our financial situation was from me. When my husband notified GMAC Mortgage about our hardship, they said they were sympathetic to our plight, and we had a couple of options. They could tack the amount we were behind to the back of our mortgage, raise our premium until we caught up, or submit us for a loan modification that our government was providing for folks like us to save their homes. To this end, my husband provided GMAC with our current financial information. My husband's mistake, however, was trusting in GMAC to follow through with any of their suggestions.
I became painfully aware of our housing situation when the sheriff came to our door in January of this year with a foreclosure notice from our mortgage company, GMAC. Even with that, when my husband kept calling them, GMAC was always reassuring--that they didn't want the house back, that they were still in the process of submitting us. We kept in contact with GMAC throughout the next several months and the response was always the same--that GMAC hadn't heard back from any of the available programs. Again, our regret is trusting what GMAC said they would do. We were led to believe that one of GMAC's suggested options would remedy our situation, and would keep us in our home.
We also contacted our mortgage company requesting the total amount that we were behind in our payments, and advised them that our church needed this information as they were offering to throw a fundraiser on our behalf and hopefully, at least get us caught up and current while seeking a loan modification.
The sale of our home was set for April 28th, 2010. On the 27th, GMAC asked us to send some additional financial information. My husband scrambled around to fulfill their request, faxed 9 pages to GMAC, and then called to confirm that GMAC had received the information.
The next day, we were told that we were "denied" by everyone and we lost our home. Our foreclosure took place on April 28, 2010, right after we celebrated our 8th wedding anniversary. About a week later, we received a letter from their attorney stating how much we owed in back payments for the church benefit...after they foreclosed. What happened to our "options"?
I was a little suspicious, as GMAC certainly didn't have enough time (literally overnight) to submit us anywhere and receive a response. I repeatedly asked for the documentation of who they submitted us to and why we were denied, to no avail.
I knew that our government had given GMAC a lot of our tax dollars. And, on April 13, 2009, GMAC Mortgage made a commitment to our government to participate in the Home Affordable Modification (HMP) Program and offer this option to their customers suffering from the effects of our economy and falling behind in their mortgage. GMAC Mortgage sent out hundreds of thousands of "financial packages" to their customers who were struggling with their mortgage payments and could benefit from this program. They even stated in their April 15th press release that if they hadn't heard back from those customers that received this financial package within 90 days, they reached out to them and contacted them personally. We never received one of these packets although they claim they sent it. In that same press release, GMAC Mortgage states "We want customers to contact us if they are behind or having difficulty keeping up with payments. The HMP Program offers borrowers more modification options than were previously available, so it is important for customers to reach out to us. It is critical that the customer quickly return the completed financial package and affidavit of hardship to us". And how is the mortgage modification faring? No so good. Only about 1/3 of the homeowners who have successfully completed the trial period of the mortgage modification program have been offered permanent relief. Yet, GMAC Mortgage has proudly stated in another of their press releases "Our foreclosure department is the most successful division". I'll bet.
One day, I placed a call to GMAC's customer service and their representative "Mary" assisted us. With me on one phone and my husband on the other and a tape recorder running, Mary informed us that we were never submitted to anyone...so there was no denial! Conveniently, she did state that they had received the paperwork that we had faxed, but it was dated the 29th--the day after the foreclosure. We knew that we provided this on the 27th and objected--Why then did we receive a denial? Still, Mary insisted that "everything is in the computer...and there were no submissions or denials". We were devastated...and stunned.
This presents a real problem for us. If GMAC had no intention of working with us, they should have informed us so we could pursue programs on our own. Instead of assisting my husband in a timely manner when he called about our hardship, when we were just 2 months behind in our mortgage payment, now, due to their stalling, we were seriously delinquent. And, because of this mortgage company's deception, we were denied the opportunity and right to apply for a loan modification program and possibly save our home. And then there was the issue of the other proposed "options"--what happened to these? Why were we not getting the same assistance that every other United States citizen was entitled to in these difficult economic times? And why were we any different than the thousands of others in our same situation that were sent this mysterious "financial package"? The Obama Administration has estimated that taxpayer losses on the GMAC bailout may be at least 6.3 billion. In theory, we are paying GMAC to discriminate against me.
And the law is clear on treatment of disabled citizens--housing discrimination is unlawful whether it is deliberate and intentional or has the effect of having a greater of "disparate" impact on people in a protected group. GMAC Mortgage was fully aware years ago that I had become disabled and we had lost my income. Yet, even as we had fallen behind in the past due to our economic deficit, they had raised our mortgage payment to an unobtainable amount for us to "catch up". This left no money for food and utilities, and we were constantly "tap dancing as fast as we could" just to keep the lights on and food on the table. We are eternally grateful to our families, friends, and church for "supporting" us so we could exist...but was this living? And in this process, I was dying.
Mortgage servicers have been warned about resisting the urge to collect delinquent payments up front and in the process, stretching their customers too thin. And HUD is imposing greater penalties on residential mortgage servicers that fail to offer loss mitigation options for federally insured mortgages--sometimes up to 3x the claim amount of the mortgage. It is estimated that the majority of foreclosures are fraudulent--why isn't America speaking up? Class action law suits don't really penalize big business enough to hit them hard enough in the pocketbook. However, if every American experiencing a fraudulent or illegal foreclosure would file a personal lawsuit against these crooks, believe me, they'd feel the "crunch"--almost as hard as they turned the screws to us.
As I looked to our government for affordable housing for the disabled, I was told at the time that in the state of Louisiana, there were no housing programs for the non-elderly disabled (the fastest and largest growing group in our homeless population). There are programs for children (and there should be) and seniors (and there should be) and the developmentally disabled (and there should be), but nothing at that time in Louisiana for the non-elderly disabled. Many housing programs were not even taking applications due to their straining waiting lists. However, I did discover one local program being offered by a non-profit organization, but first I have to become homeless and then there is a waiting list. I have a hospital room setting in my home...where will my equipment go?
Not accepting the lack of housing programs as fact, and with newly acquired cynicism after being lied to by our mortgage company, I turned to the internet. And lo and behold, I found a currently open federal program being offered from HUD titled "Rental Assistance for Non-Elderly Disabled Persons". However, for some unknown reason, the State of Louisiana didn't apply for this funding. Consequently, our federal government and state government have identified each other as the culprit and seem more concerned about shifting the blame instead of assisting me and listening to my concerns, and didn't even address the fact that I was being denied access to a federal program. The funny thing is, Mr. Capo the action reporter spoke with the attorney representing our mortgage company, GMAC. She confirmed that our home had been foreclosed on and we will soon be evicted. Mr. Capo asked what will happen to our home, will it be put up for sale? Her answer shocked him--our home is becoming a HUD home! He has suggested to all parties involved that we be allowed to stay put and has now reached out to HUD about this situation. The other day, I received a call from an office that is handling the transition from GMAC Mortgage to HUD. Unfortunately, there is a law that in order for HUD to take possession of our home, it needs to be vacant...huh?
Mr. Capo wants to do a follow up interview and in the interim, asked me to keep fighting to get my voice heard and document my experience. The file I have kept is two inches thick. I hope to compile a booklet for advocacy groups with all the information I have logged since our foreclosure. I have carefully recorded every single person or agency that I have spoken with since that dark day in January when the sheriff came to the door. And besides the television exposure, this email was sent to everyone in my address book, asking for my story to be forwarded to everyone they know. And it was sent to any federal, state and local government offices, and every organization that I could find that deals with advocacy, disability issues, homelessness and consumer affairs. I also contacted our local media, as well as newspapers, magazines, talk shows and news programs nationally. In addition, I have filed formal complaints with the Better Business Bureau, The FHEO, The Federal Trade Commission, House Financial Services Committee, The Department of Justice Civil Rights/Disability Rights, the ACLU, the FDIC, Department of the Treasury, our Attorney General, the Subcommittee on Housing, the Office of Financial Institutions, and HUD,--just to name a few. I am touched by the messages of support from people I've never met and numerous advocates and organizations that really care about this country's disabled citizens.
I've reached out to our President, and Kareem Dale, the President's Special Assistant on Disability Policy. I have not received a response.
I volunteer one day a week at a nonprofit organization working with the severely disabled. Many of them live in group homes. It's difficult to have an "pity party" after spending one hour with these amazing people who give love unconditionally and are so joyously engaged in life. If nothing else, perhaps some good will come out of all this through my tenacity. With the knowledge that I've compiled in my journey, perhaps I can assist other disabled people. And just maybe, GMAC Mortgage and others will adapt a more sensitive approach and position towards the disabled. And maybe our government will enforce their own laws.
I am not someone with any "pull", but I have a voice. And there are so many disabled Americans out there just like me that are frustrated with trying to stay healthy and not stressed while facing chronic illness and/or end of life issues. And some are too tired and sick and just give up after the first 5 "No's"--I've heard 55 "No's" and I'm not going away...at least on my own volition.
GMAC Mortgage fully understood my terminal status. In light of their agreement with our government to offer modification programs, the least they could do is the minimum--we didn't even rate that. And GMAC also knew they were dealing with a legally disabled person that was terminally ill and would be put in harm's way by facing homelessness. My doctor has written a letter describing my condition and how important it is for me to have safe housing and as little stress as possible. I am not looking for special privileges--with what our citizens are facing economically in our country and with so many joining the homeless population for the first time. But I want an equal shot and the same rights as other people to affordable housing.
Where is the heart? Where are ethics? Has our disposable society become so desensitized that people and their lives have so little meaning? And I know if they are doing this to me, that they are doing this to others.
So I did a search online and was shocked by the numerous complaints filed by consumers against GMAC Mortgage. The sheer numbers will speak volumes regarding this mortgage company's business tactics. I've even read several stories that sounded very similar to our experience with GMAC.
To date, we are existing on my disability payment of $800 a month--for both of us. Yet, we have been told on several occasions that we make "too much money" to qualify for Food Stamps or Medicaid.
GMAC Mortgage's position regarding the events leading to our foreclosure changes depending on who you talk to. At first, according to GMAC, our financial information was submitted a day late. Now they are claiming that we never provided our financial information at all--which is it?
I want to thank GMAC Mortgage and our government for making me so mad that I'm just too angry to die. I know realistically, I may not see any results that can help me and my husband, but maybe my legacy will be a catalyst for change and this won't happen to anyone else. But I wouldn't count on it.
My husband is a seminary graduate. If GMAC will lie to a minister and his terminal wife, I guess no one is safe.