Mortgage Modification Programs:
Are They Saving our Homes or Stealing Them?
"If you are unable to pay your mortgage, contact your lender or the company that collects your mortgage payment as soon as possible. Mortgage lenders want to work with you to resolve the problem, and you may have more options if you contact them early." (Actual text from the Federal Reserve website)
We've all seen and heard variations of this "don't wait, tell us now and we'll help" message in mailings from banks and mortgage lenders, on television and radio and even from the President himself. And a whole bunch of us actually thought if we did the right thing and asked for help, we might get to keep our homes. Unfortunately, it seems that these federal programs are a lot of talk and not much action - at least not in favor of the average person just trying to keep a roof over his head.
My particular nemesis is Wells Fargo Home Mortgage, the company whose co-president says, "We look forward to continually working with all the participants in the housing finance industry to find more solutions that benefit consumers – expanding homeownership and preserving it." But it seems all the big mortgage lenders are playing the same shell game with their customers.
Follow the money: foreclosures beat loan modifications any day…for the bank.
They're profiting from our pain.
Let's see, I'm a big financial institution, part of an industry that through greed and mismanagement has brought the largest economy in the world to its knees. In spite of the billions I got from the Troubled Asset Relief Program, I'm feeling a little short on cash these days. But there are all these annoying people (I won't say "customers;" that might imply I have some responsibility toward them) who are whining about losing their jobs and their businesses and not wanting to lose the roofs over their heads. Now, how do we pretend to help them like the federal government says it wants us to while still lining our pockets?
First, we know they'll be lulled into a false sense of hopefulness by helpful sounding names like Home Affordable Modification Program. Then our managment teams can figure out ingenious ways - like "losing" their paperwork time and time again - to string people along for months and months. This will drive them to give up trying to get help simply to save their sanity or just so they can find the time to do their jobs (if they still have them) and live their lives. Or it will put them in a fake "trial plan" to give them just enough hope of relief that they keep paying their mortgages until they have no money left. Either way, in the end we get to deny them help and take their homes away from them. Yay! More money for us. No money for them. That's what banks are all about these days.
Oh, and don't forget we're aided and abetted in our nefarious scheme by two of the biggest players in the mortgage game, the government darlings Freddie Mac and Fannie Mae. They function as the "investors" in a majority of mortgages in the U.S. and are supposed to administer and monitor the HAMP program to ensure mortgage servicers are following the guidelines and treating homeowners fairly. Yeah, except they don't.
If you're one of the thousands of people who are caught up in the seemingly fruitless cycle of sending paperwork over and over again and getting no resolution on your mortgage modification review, it sure seems like this whole thing is one big scam. The big banks and the pretend "investors" try to blame you. It's not your fault. Don't buy it. And don't be silent and let others around you believe the lies, either.
Underwater Homeowners Aren't to Blame for their Miami Foreclosure
My particular problem is with Wells Fargo Home Mortgage, which services my mortgage loan for Freddie Mac. But it seems like all the big mortgage lenders, either in collusion or by mere coincidence, are putting their clients through the same crazy-making process.
Homeowners Protest HAMP: 'It's Just A Scam And The Banks Are Getting Everything'
Why? Greed, avarice, ego ... I don't know. It makes no practical sense to me. It certainly isn't helping the country get back on its feet - the fabled economic recovery certainly hasn't trickled down to many people in the middle class yet.