Promised Mortgage relief, many instead deeper in debt

[n2doc]

By Jenifer B. McKim
Globe Staff / March 7, 2011

Davidson O. Calfee thought a temporary mortgage loan modification was the break he needed to keep his home. It allowed the Sandwich insurance agent to start saving $500 a month in 2009, when his income was down because of the recession.

But instead of being better off, Calfee is now on the edge of a financial abyss.

After CitiMortgage Inc. offered to temporarily lower his mortgage payment in July 2009, Calfee, 33, said, he was instructed by the company to send in documents verifying his income and other data so the change could be made permanent.

The process was supposed to take a few months, but it dragged on for a year. Calfee’s application was ultimately rejected on grounds he failed to submit the proper paperwork, which he disputes.

Overnight, Calfee was in serious trouble. The mortgage payment reverted to its original level, and he was on the hook for 12 months of deferred principal, interest, and fees — a sum that today tops $12,000.

http://www.boston.com/business/articles/2011/03/07/promised_loan_relief_homeowners_instead_sank_deeper_in_debt/

[badgolfer]

1. Mortgage scams

You need to read 'All the Devils are Here' by Bethany McLean and Joe Nocera. This book details the hidden history of the fianancial crisis.

The whole financial industry from the mortgage loan originators, the bankers, the Congress, the Federal Reserve, and others made a huge amount of money off of the mortgage scams.

It included convincing mortgagees to refinance using some of the subprime products dreamed up by these scam artist such as refinancing a 30-yr to some subprime vehicle that buried them in a few years.

[DiverDave]

2. I just sold ours

AFTER they "lowered" my payments...

We ended up owing 110K...the bank wrote it off after I asked to see the note...they couldnt produce it.

So, I'm renting again, sucks.