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Robb Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 09:51 AM
Original message
Housing plan offered help to (only) 15% of borrowers
Source: AP

WASHINGTON Only 15 percent of homeowners eligible for the Obama administration's $50 billion loan modification program have been offered help so far.

In its first monthly progress report on the plan launched in March, the government on Tuesday detailed big disparities among the 38 companies that have signed up. Several loan servicing companies including American Home Mortgage Servicing and PNC Financial Services Group Inc. have yet to modify a single loan.

(snip)

For each homeowner who makes regular payments for three months, the loan servicer collects $1,000 from the government. If the borrower stays current for three years, the servicer gets a maximum of $4,500.

(snip)

Housing advocates say the plan has been a big disappointment so far. They cite numerous cases in which companies haven't followed the program's rules. And when borrowers are denied, they often aren't told why.

Read more: http://www.google.com/hostednews/ap/article/ALeqM5hH6jB...



The banks are also, I hear, continuing the foreclosure paperwork behind the scenes during the three-month program -- and then returning to original loan terms after -- including fees for not paying in full during those three months. Then foreclosing anyway, selling the home cheap, going after the borrower in collections for the difference (in most states) and collecting the LMI/PMI.
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Wizard777 Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 10:44 AM
Response to Original message
1. So basically this program is only being used as a rest stop on the road to foreclosure.
:banghead: Until that damned wall falls.
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WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 10:50 AM
Response to Original message
2. American Home....
is almost exclusively Prime loans after they got rid of their Subprime assets after their recent bankruptcy so that is almost no surprise.
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Riley18 Donating Member (883 posts) Send PM | Profile | Ignore Tue Aug-04-09 11:29 AM
Response to Original message
3. I have been waiting for Bank of America to process my loan for HASP since the
beginning. Now, with the 125% loan to value I have been waiting since July 1st when it was started. BofA is still "waiting" for further instructions from ??? who knows who. The ONLY way this program is going to work for the people it was intended to help is for the government to nationalize the banks or to somehow allow the people to go directly to Freddie Mac and Fannie Mae for the new mortgages. Why would Bank of America or any other financial institution do these HASP loans? So they would get $7,500 from me over the next 3 years...big deal. They get around $24,000 every year from me in interest. If they were to modify my loan according to Obama's plan, they would take a huge hit. They just keep stalling me and calling me to say "If only you were late with a payment, then we could help you." They are "so helpful" that it makes me want to puke.
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Lance_Boyle Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 11:32 AM
Response to Reply #3
4. Freddie Mac is not interested in modifying your loan
They are now buying existing (performing) loans to build their portfolio. I refinanced a few months ago and received notice this week that Freddie Mac bought my mortgage. That doesn't help ANYBODY but Freddie Mac and its investors.

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WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 11:51 AM
Response to Reply #3
5. 125% percent is bad loan...
Did you take out a 125 initially?
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Riley18 Donating Member (883 posts) Send PM | Profile | Ignore Tue Aug-04-09 12:05 PM
Response to Reply #5
6. No, I initially took out a loan for $180,000 and put $80,000 down. My payment
was supposed to be $1,200 including taxes. Then a year later the bank sent a form letter to raise my mortgage to close to $1,600 per month because they had miscalculated the taxes. Trouble was that I put a pool in because I thought I could afford it. The next year they made the same "mistake" and then the mortgage went to close to $2,000 per month. I then had problems with credit and they suggested I create a new mortgage. Which I did with the thought of selling the house in a few months. This was right before the bottom fell out, and values plummeted. So I cannot sell for what I currently owe, and the HASP loan would have solved the problem. Unfortunately, the banks aren't really participating in the program because they make more money the way it is now. Without government's strict intervention the TARP money will likely remain with the banks.
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WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 12:11 PM
Response to Reply #6
7. Escrow accounts can be a killer....
Unfortunately, a servicer calculates the escrow based on the previous years taxes so if there is any rise in taxes then it can result in some pretty large payment increases.

Servicers never "make" money on foreclosures so that is a fallacy. They generally take a minimum of a 60% loss on average and in your area it is likely more. Even if a foreclosure goes through, a servicer can only collect the UPB and interest owed and any additional amount gets sent to the homeowner.
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Riley18 Donating Member (883 posts) Send PM | Profile | Ignore Tue Aug-04-09 12:14 PM
Response to Reply #7
8. Thanks for your interest. Do you have any ideas as to why the banks are dragging
their feet in processing these HASP loans?
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WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 12:18 PM
Response to Reply #8
9. I don't work in the industry anymore...
But from what I've heard, they are a bear to deal with. There are very specific criteria that need to be met and then government approval needs to be sought. I've heard that the # of people who actually qualify is quite low. Since servicers are paid to make the HASP or HMP loans happen, there is no lack of interest in doing so.

You live in a tough area so I wish you the best.
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Riley18 Donating Member (883 posts) Send PM | Profile | Ignore Tue Aug-04-09 12:23 PM
Response to Reply #9
10. Thanks again. Yes, our area took a huge hit in home value. I'll be lucky to
qualify because the current value of my home is now around $251,000 according to BofA's internal calculations. I meet all the other qualifications so we'll see what happens. I have thought about paying down the principle by a few thousand dollars to help with the loan to value, but am afraid to put out what is left of my cash just in case.
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WriteDown Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 12:25 PM
Response to Reply #10
11. My advice...
Hold onto your cash. Better to have liquid assets than put it into something that may continue to lose value. I can tell you that BofA/CW is notoriously slow when it comes to EVERYTHING.
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Riley18 Donating Member (883 posts) Send PM | Profile | Ignore Tue Aug-04-09 12:34 PM
Response to Reply #11
12. Thanks, that is what we thought. I have a finally gotten a person at the bank
in the refinancing department who promises me he will call as soon as they know what to do with the loans. I called him this morning, and he said they may know more in a day or so.
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Xithras Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 06:02 PM
Response to Reply #3
15. Welcome to the BofA Wait..
I received and submitted a short sale offer on a BofA mortgaged property I own in APRIL. The offer is about 20% more than the property is worth today (cash offer) so it's a good deal. I can clearly show where I lost my primary job last February and my income is about 60% lower than it was last year...meaning that there's NO WAY I can keep this home.

Still, it's August and I don't have an answer yet. If it weren't for the fact that the buyer REALLY wants this property (it's a beautiful newly renovated 4br in an awesome neighborhood), they'd have bailed long ago.

BofA doesn't care.

I had an entertaining discussion with one of their "home retention experts" a few weeks ago about my "alternate" plan to keep the home if the short sale doesn't go through. I told her that my alternate plan was to part the house out on Craigslist and sell all of its cabinets, copper, and internal pipe to finance my lawyers fees in my bankruptcy proceedings. She didn't find the comment nearly as funny as I did. :evilgrin:
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Betty Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 02:19 PM
Response to Original message
13. My asshole bank (Bank of America) won't lift a finger to help me
I called back in January to see if I could get a lower rate (I got a loan back when you could do no-doc, because I am self employed and it was the only option at the time). I am at 7%, I would like to pay in the 5's like everyone else. They said no because I "don't make enough" so I have to pay more, which makes no sense.

Then after I heard about the Making Homes Affordable program, I tried again. The guy I talked to took all this info from me, plugged it into his computer, and then said that the"system" says I don't qualify. I said what does that mean? I spend over 30% of my pre tax income on my mortgage, but this time, it seems I don't qualify for some mysterious reason only "the system" knows. The office drone on the other end of the line couldn't give me an actual reason why I can't get in on this program. Clearly, the got. is going to do nothing to actually help individuals, you have to be a wall street scum bag to get any govt. assistance.

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TheCoxwain Donating Member (1000+ posts) Send PM | Profile | Ignore Tue Aug-04-09 02:51 PM
Response to Reply #13
14. I initiated a loan under the HASP program in March ..The loan was all set to close on wednesday ..I
get a call today from Bank of America ( after months and months of waiting) saying that my original loan ( also from Bank of America) was taken incorrectly against a 'Single family attached' ..and my dwelling is a 'Condominium'..


So my loan is being denied because As per HASP rules the new loan has to be the same as the old loan..


All this for a mistake they ( Bank of America) made on my original loan .. I am so upset.. I feel so violated .. I hope Bank of America comes burning to the ground


:cry:
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