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Sunday, August 30, 2015

WONDERING WHY YOU CAN'T GET A MODIFICATION?


As most of us struggling homeowners already suspect, there are problems within the federal Home Affordable Modification Program (HAMP) which was offered by President Obama in 2009 (two years into the financial crisis/recession) to help four million troubled borrowers.

The main problem - as pointed out in a New York Times article [Aug. 2, 2015 by Gretchen Morgenson] - is that the program 1) was made voluntary for the banks, and 2) allowed the participating banks to run the process on their own. 

Morgenson cites a July report by Christy L. Romero (Special Inspector General of the Troubled Asset Relief Program - TARP), that six  years after the program was initiated, only 887,000 borrowers are participating in loan modifications.

Rather than helping the targeted four million struggling homeowners, these borrowers' requests for help have been rejected:  CitiMortgage had the worst record [i.e., they rejected my application also], rejecting 87 percent of the loan modification requests.  JPMorgan Chase was next, with a denial rate of 84 percent.  Bank of America turned down 80 percent, and Wells Fargo rejected 60 percent.

The lengthy article reveals how the banks often delay requests for modifications in order to be able to charge the borrower more interest and fees, increasing the amount of the mortgage.

Recently I was able to finally make my one missed payment ($1,987.00) to bring my account current.  It has taken me almost two and a half years.  Now I'm looking at having to pay $3,000 in late fees!

For more details and stories on the banks' appalling behavior (and greed), please read her story.  New York Times, "Slack Lifeline For Drowning Homeowners",  Aug. 2, 2015.

Or wait until next week when I have more time to re-read it and relay the stories to you.