Foreclosure Victims’ Blog — Foreclosure Law

We will read your complaints regarding Scam Artists, Fraudulent Lawyers, Law firms and Scam Mortgage consultants and publish the list (Foreclosure Lawfirm Dot-com Scam Artists Database) here on the Foreclosure Victims Website FreeForeclosureLawyer.com. Prevent Loan Scams.org, created by HUD, let’s foreclosure Scam Victims report the scam artist. It would be an even better resource if they could share their information with the public. Being they are a government resource, they have extensive rules governing the way they disseminate the reports. On the other hand, review website, all over the planet allow their end users to publish their findings and reviews. We at FreeForeclosureLawyer.com will be the direct link between Foreclosure victims and the world. There are too many special interest groups wanting to blur the true story of foreclosure victims for many, many reasons. That is how we are unique. We have only one SPECIAL INTEREST: YOU, the foreclosure victim.

There are businesses created around the hardship of others: Like mushrooms growing on a dead tree. And when we are dead trees, that’s a good thing for the environment. But while our hearts are still managing to go pitter-pat, that’s heinous.

Search for a specific type of lawyer on line and you’ll find Google Masters who intercept your searches and sell the leads to law firms. But do you know that in many cases, lawyers purchasing these leads from distressed homeowners are in violation of the State Bar. And certainly a lawyer who has no regard for the law is not one who can help you understand it.

Rules of Professional Conduct Applicable to Attorneys Providing Services to Distressed Homeowners. Why are foreclosure consultants and attorneys teaming up to defraud homeowners experiencing mortgage-related distress? Individuals acting as “foreclosure consultants” are not entitled to receive payment until their loan modification work is completed. However, attorneys are permitted to accept advance fees for providing typical legal services. As a consequence, some foreclosure consultants and others offering foreclosure prevention services may partner with attorneys in an effort to get around laws that prohibit them from receiving payments from homeowners before providing the foreclosure prevention services. Homeowners should know that these partnering arrangements may violate the ethics rules governing attorneys’ professional conduct in YOUR State. To date, the many State Bar offices have not instituted specific loan modification scam regulations or initiatives. However, the following examples of attorney misconduct related to foreclosure prevention activities are typical of what may be prohibited by the State Bar: Here are some possibilities: Lawyers often cannot split fees they earn from distressed homeowner clients with foreclosure consultants, or the consultants directing or regulating the lawyer’s professional judgment. Lawyers often cannot aid a foreclosure consultant in the unauthorized practice of law. For example, Oregon lawyers may not form partnerships with foreclosure consultants if any of the activities of any such business would involve providing legal services. Lawyers often cannot contact distressed homeowners referred to them by foreclosure consultants unless the lawyers have a family or prior professional relationship with the distressed homeowners so contacted. Lawyers often cannot accept fees for little or no work.

People ask: Can I get a loan modification. Looking at the numbers below, it looks like about  only 2.3% of borrowers who need help actually get it from permanent  loan modifications:

More than 5 million U.S. households are behind on their mortgages, and a government-sponsored program in which banks reduce monthly payments voluntarily has, by all accounts, foundered.

Only about 116,000 homeowners have had their monthly burden permanently lowered by the Obama administration’s Making Home Affordable Modification Program. About another million are enrolled in trial modification plans.

Many mortgage borrowers are underwater, meaning they owe more than the property is worth. In the Bay Area, about 27 percent of mortgage holders are underwater. In California, that figure is 35 percent.

Government payments are central to the new strategy. If lenders agree to certain guidelines and a short sale is completed, $1,500 goes to homeowners who move out, $1,000 to the servicing bank and another $1,000 to any second lien holders.

The program imposes new demands on banks. They must fully release homeowners from future liability for their first mortgage. They also must work with those homeowners who despite help from the government loan modification program are delinquent on their mortgages.

As a society we learn to point fingers at social injustice around the world. And that’s not a bad thing. But it is when the person pointing fails to see his own faults. From shark fin soup to the movie The Cove, we pride ourselves on our good taste in fashionable morals. How we decide which animals to grind up for our tacos and which ones to spend billions of dollars protecting. And we have a sense, in the whole scheme of things that there is an underlying selfish motive to not letting dolphins, for instance, disappear from the face of the earth. Something tells us, like Marty from Back to the Future, that messing with things that are way over our head means trouble beyond our ability to fathom. And among scientists of all genres it’s hard to find any who do not agree with this principle. And the same principle applies to the health of the economy and the health of our society.

The theme of The Cove, for instance, essentially tells how sometimes a few people with special interest and instant gratification, quietly and effectively slaughters to satisfy their personal insatiable appetite. Enter the hungry bank… And the damage and cost their behavior inflicts not only on the foreclosure victim, but the financial impact each foreclosure has on each of the foreclosure victims neighbors. What the PR departments of the banks would never want you to consider and calculate is this: Keeping foreclosure victims in their homes with modified mortgages is cheaper than throwing them onto the streets. And because we are all motivated by a touch of self interest, that particular view of how banks become experts at procrastinating and NOT very often successfully and permanently  mortgage loans, costs us more than if they simply lowered the homeowners’ interest rates and put aside their greed.

In an ideal world sliding scales would exist to help people afford what they are willing to work hard for. But when several people in a family working for poverty level wages is forced to pay more each month for the same mortgage principal as a family with a high FICO score, than maybe doing something nice for these people can mean some good karma in the process.

All of the bills in the world will never do any good if they remain voluntary no more than telling people that eating dolphins is a “no-no”. Without penalties, legal recourse, societies intervention, financial penalties or at least good old fashioned accountability expectations on the part of the way banks deal with foreclosure situations, is the ONLY way things will change significantly. Mortgages are legal contracts and protecting interests in a contract is a legal battle. And with all the bills in the world saying pretty things about what banks “should and shouldn’t” do, nothing will change unless foreclosure victims are treated like humans and there are legal ramifications for abusing their rights. For the time being, no one has made the movie called the Foreclosure Cove. But we need one! And the predatory practices are every bit as savage but the victims have two legs instead of tails. And the victims range from infants who will be excluded from a safe and clean place to live simply because he or she was born into a family with financial woes. And the curse placed upon these infants will be tenacious as their parents, who face foreclosure, will not be ably to shed the after-effects of the damage to their credit until these children are big enough to work on their own. Their parents will be rejected from apartment rental applications, and pay more for every purchase made on behalf of their growing children for years and years in the form of exorbitant  interest.

In keeping with our metaphor of food and predatory practices, here is omeFood for thought… Maybe this is worth pondering… and observing to see if there is any evidence of a pattern. Is it possible that lenders, during the review process for a pending application for a loan modification, base their decision in part on how much progress the trustee company is making in finding potential buyers. Advertising the property on a website throughout the entire modification process, never deleting the listing and accepting inquiries. It would be a great way for a bank to test the waters to determine whether it pays to reduce an interest rate or just simply sell if the bank knows there is a buyer or two ready. In the meanwhile, the current owner maintains the property while the trustee company advertises it for sale. All along, telling the buyer they need to send in the same documentation 6 times: drivers licenses, marriage certificates, utility bills… (Typically things that have been in the banks possession for many months.) This drags the process on and on. There is something to be gained from procrastination or the process would be expedited! Just as the process is expedited when interest rates are soon to fall and lenders become the Guinness Record holders for fastest paperwork processors. And when the interest rates are promising to rise, well, it… sure… starts… to… mysteriously… slow… down… doesn’t… it…?

Watch the Video Now: (Speech text below)

Barack Obama announced his plan to reduce foreclosures at Dobson High School in Mesa, Arizona Wednesday. The $75 billion plan could prevent up to 9 million Americans from losing their homes.

Blog administrators comment: The amount of money being invested in inciting fear regarding Obama’s efforts across the board to help provide the hard-working poor with bare minimum life support basics, points to the obvious source of the revenue. The speech eloquently points out that each completed foreclosure cost the entire nation more in lost revenue than the cost of avoiding it. And in the process, little children can have roofs over their heads rather than shopping carts. Who else would fear such an approach except those financial sectors who feed off the poor: Those who set the policies that make the poor pay more than the rich for every needed credit-related purchase: From cell phones, to car payments, to mortgage payments to credit card interest rates. If you add up the difference between what the average poor family pays for all of these, and what the average rich family pays for these same necessities, and you return a little of that lost income to these hard working families, those families would be able to afford their monthly mortgage payments! Obama’s plan uses a different door to get us to the same room: Give poor, hard working homeowners an affordable interest rate. Don’t make them pay more for the same houses for which the wealthy pay less. Nothing for free, but remove some of the reciprocal nature from the equation: poor people = higher payments for exactly the same things!

I’m here today to talk about a crisis unlike any we’ve ever known - but one that you know very well here in Mesa, and throughout the Valley. In Phoenix and its surrounding suburbs, the American Dream is being tested by a home mortgage crisis that not only threatens the stability of our economy but also the stability of families and neighborhoods. It is a crisis that strikes at the heart of the middle class: the homes in which we invest our savings, build our lives, raise our families, and plant roots in our communities.

So many Americans have shared with me their personal experiences of this crisis. Many have written letters or emails or shared their stories with me at rallies and along rope lines. Their hardship and heartbreak are a reminder that while this crisis is vast, it begins just one house - and one family - at a time.

It begins with a young family - maybe in Mesa, or Glendale, or Tempe - or just as likely in suburban Las Vegas, Cleveland, or Miami. They save up. They search. They choose a home that feels like the perfect place to start a life. They secure a fixed-rate mortgage at a reasonable rate, make a down payment, and make their mortgage payments each month. They are as responsible as anyone could ask them to be.

But then they learn that acting responsibly often isn’t enough to escape this crisis. Perhaps someone loses a job in the latest round of layoffs, one of more than three and a half million jobs lost since this recession began - or maybe a child gets sick, or a spouse has his or her hours cut.

In the past, if you found yourself in a situation like this, you could have sold your home and bought a smaller one with more affordable payments. Or you could have refinanced your home at a lower rate. But today, home values have fallen so sharply that even if you made a large down payment, the current value of your mortgage may still be higher than the current value of your house. So no bank will return your calls, and no sale will return your investment.

You can’t afford to leave and you can’t afford to stay. So you cut back on luxuries. Then you cut back on necessities. You spend down your savings to keep up with your payments. Then you open the retirement fund. Then you use the credit cards. And when you’ve gone through everything you have, and done everything you can, you have no choice but to default on your loan. And so your home joins the nearly six million others in foreclosure or at risk of foreclosure across the country, including roughly 150,000 right here in Arizona.

But the foreclosures which are uprooting families and upending lives across America are only one part of this housing crisis. For while there are millions of families who face foreclosure, there are millions more who are in no danger of losing their homes, but who have still seen their dreams endangered. They are families who see “For Sale” signs lining the streets. Who see neighbors leave, and homes standing vacant, and lawns slowly turning brown. They see their own homes - their largest single assets - plummeting in value. One study in Chicago found that a foreclosed home reduces the price of nearby homes by as much as 9 percent. Home prices in cities across the country have fallen by more than 25 percent since 2006; in Phoenix, they’ve fallen by 43 percent.

Even if your neighborhood hasn’t been hit by foreclosures, you’re likely feeling the effects of the crisis in other ways. Companies in your community that depend on the housing market - construction companies and home furnishing stores, painters and landscapers - they’re cutting back and laying people off. The number of residential construction jobs has fallen by more than a quarter million since mid-2006. As businesses lose revenue and people lose income, the tax base shrinks, which means less money for schools and police and fire departments. And on top of this, the costs to a local government associated with a single foreclosure can be as high as $20,000.

The effects of this crisis have also reverberated across the financial markets. When the housing market collapsed, so did the availability of credit on which our economy depends. As that credit has dried up, it has been harder for families to find affordable loans to purchase a car or pay tuition and harder for businesses to secure the capital they need to expand and create jobs.

In the end, all of us are paying a price for this home mortgage crisis. And all of us will pay an even steeper price if we allow this crisis to deepen - a crisis which is unraveling homeownership, the middle class, and the American Dream itself. But if we act boldly and swiftly to arrest this downward spiral, every American will benefit. And that’s what I want to talk about today.

The plan I’m announcing focuses on rescuing families who have played by the rules and acted responsibly: by refinancing loans for millions of families in traditional mortgages who are underwater or close to it; by modifying loans for families stuck in sub-prime mortgages they can’t afford as a result of skyrocketing interest rates or personal misfortune; and by taking broader steps to keep mortgage rates low so that families can secure loans with affordable monthly payments.

At the same time, this plan must be viewed in a larger context. A lost home often begins with a lost job. Many businesses have laid off workers for a lack of revenue and available capital. Credit has become scarce as the markets have been overwhelmed by the collapse of securities backed by failing mortgages. In the end, the home mortgage crisis, the financial crisis, and this broader economic crisis are interconnected. We cannot successfully address any one of them without addressing them all.

Yesterday, in Denver, I signed into law the American Recovery and Reinvestment Act which will create or save three and a half million jobs over the next two years - including 70,000 in Arizona - doing the work America needs done. We will also work to stabilize, repair, and reform our financial system to get credit flowing again to families and businesses. And we will pursue the housing plan I am outlining today.

Through this plan, we will help between seven and nine million families restructure or refinance their mortgages so they can avoid foreclosure. And we are not just helping homeowners at risk of falling over the edge, we are preventing their neighbors from being pulled over that edge too - as defaults and foreclosures contribute to sinking home values, failing local businesses, and lost jobs.

But I also want to be very clear about what this plan will not do: It will not rescue the unscrupulous or irresponsible by throwing good taxpayer money after bad loans. It will not help speculators who took risky bets on a rising market and bought homes not to live in but to sell. It will not help dishonest lenders who acted irresponsibility, distorting the facts and dismissing the fine print at the expense of buyers who didn’t know better. And it will not reward folks who bought homes they knew from the beginning they would never be able to afford. In short, this plan will not save every home.

But it will give millions of families resigned to financial ruin a chance to rebuild. It will prevent the worst consequences of this crisis from wreaking even greater havoc on the economy. And by bringing down the foreclosure rate, it will help to shore up housing prices for everyone. According to estimates by the Treasury Department, this plan could stop the slide in home prices due to neighboring foreclosures by up to $6,000 per home.

Here is how my plan works:

First, we will make it possible for an estimated four to five million currently ineligible homeowners who receive their mortgages through Fannie Mae or Freddie Mac to refinance their mortgages at lower rates.

Today, as a result of declining home values, millions of families are “underwater,” which means they owe more on their mortgages than their homes are worth. These families are unable to sell their homes, and unable to refinance them. So in the event of a job loss or another emergency, their options are limited.

Right now, Fannie Mae and Freddie Mac - the institutions that guarantee home loans for millions of middle class families - are generally not permitted to guarantee refinancing for mortgages valued at more than 80 percent of the home’s worth. So families who are underwater - or close to being underwater - cannot turn to these lending institutions for help.

My plan changes that by removing this restriction on Fannie and Freddie so that they can refinance mortgages they already own or guarantee. This will allow millions of families stuck with loans at a higher rate to refinance. And the estimated cost to taxpayers would be roughly zero; while Fannie and Freddie would receive less money in payments, this would be balanced out by a reduction in defaults and foreclosures.

I also want to point out that millions of other households could benefit from historically low interest rates if they refinance, though many don’t know that this opportunity is available to them - an opportunity that could save families hundreds of dollars each month. And the efforts we are taking to stabilize mortgage markets will help these borrowers to secure more affordable terms, too.

Second, we will create new incentives so that lenders work with borrowers to modify the terms of sub-prime loans at risk of default and foreclosure.

Sub-prime loans - loans with high rates and complex terms that often conceal their costs - make up only 12 percent of all mortgages, but account for roughly half of all foreclosures.

Right now, when families with these mortgages seek to modify a loan to avoid this fate, they often find themselves navigating a maze of rules and regulations but rarely finding answers. Some sub-prime lenders are willing to renegotiate; many aren’t. Your ability to restructure your loan depends on where you live, the company that owns or manages your loan, or even the agent who happens to answer the phone on the day you call.

My plan establishes clear guidelines for the entire mortgage industry that will encourage lenders to modify mortgages on primary residences. Any institution that wishes to receive financial assistance from the government, and to modify home mortgages, will have to do so according to these guidelines - which will be in place two weeks from today.

If lenders and homebuyers work together, and the lender agrees to offer rates that the borrower can afford, we’ll make up part of the gap between what the old payments were and what the new payments will be. And under this plan, lenders who participate will be required to reduce those payments to no more than 31 percent of a borrower’s income. This will enable as many as three to four million homeowners to modify the terms of their mortgages to avoid foreclosure.

So this part of the plan will require both buyers and lenders to step up and do their part. Lenders will need to lower interest rates and share in the costs of reduced monthly payments in order to prevent another wave of foreclosures. Borrowers will be required to make payments on time in return for this opportunity to reduce those payments.

I also want to be clear that there will be a cost associated with this plan. But by making these investments in foreclosure-prevention today, we will save ourselves the costs of foreclosure tomorrow - costs borne not just by families with troubled loans, but by their neighbors and communities and by our economy as a whole. Given the magnitude of these costs, it is a price well worth paying.

Third, we will take major steps to keep mortgage rates low for millions of middle class families looking to secure new mortgages.

Today, most new home loans are backed by Fannie Mae and Freddie Mac, which guarantee loans and set standards to keep mortgage rates low and to keep mortgage financing available and predictable for middle class families. This function is profoundly important, especially now as we grapple with a crisis that would only worsen if we were to allow further disruptions in our mortgage markets.

Therefore, using the funds already approved by Congress for this purpose, the Treasury Department and the Federal Reserve will continue to purchase Fannie Mae and Freddie Mac mortgage-backed securities so that there is stability and liquidity in the marketplace. Through its existing authority Treasury will provide up to $200 billion in capital to ensure that Fannie Mae and Freddie Mac can continue to stabilize markets and hold mortgage rates down.

We’re also going to work with Fannie and Freddie on other strategies to bolster the mortgage markets, like working with state housing finance agencies to increase their liquidity. And as we seek to ensure that these institutions continue to perform what is a vital function on behalf of middle class families, we also need to maintain transparency and strong oversight so that they do so in responsible and effective ways.

Fourth, we will pursue a wide range of reforms designed to help families stay in their homes and avoid foreclosure.

My administration will continue to support reforming our bankruptcy rules so that we allow judges to reduce home mortgages on primary residences to their fair market value - as long as borrowers pay their debts under a court-ordered plan. That’s the rule for investors who own two, three, and four homes. It should be the rule for ordinary homeowners too, as an alternative to foreclosure.

In addition, as part of the recovery plan I signed into law yesterday, we are going to award $2 billion in competitive grants to communities that are bringing together stakeholders and testing new and innovative ways to prevent foreclosures. Communities have shown a lot of initiative, taking responsibility for this crisis when many others have not. Supporting these neighborhood efforts is exactly what we should be doing.

Taken together, the provisions of this plan will help us end this crisis and preserve for millions of families their stake in the American Dream. But we must also acknowledge the limits of this plan.

Our housing crisis was born of eroding home values, but also of the erosion of our common values. It was brought about by big banks that traded in risky mortgages in return for profits that were literally too good to be true; by lenders who knowingly took advantage of homebuyers; by homebuyers who knowingly borrowed too much from lenders; by speculators who gambled on rising prices; and by leaders in our nation’s capital who failed to act amidst a deepening crisis.

So solving this crisis will require more than resources - it will require all of us to take responsibility. Government must take responsibility for setting rules of the road that are fair and fairly enforced. Banks and lenders must be held accountable for ending the practices that got us into this crisis in the first place. Individuals must take responsibility for their own actions. And all of us must learn to live within our means again.

These are the values that have defined this nation. These are values that have given substance to our faith in the American Dream. And these are the values that we must restore now at this defining moment.

It will not be easy. But if we move forward with purpose and resolve - with a deepened appreciation for how fundamental the American Dream is and how fragile it can be when we fail in our collective responsibilities - then I am confident we will overcome this crisis and once again secure that dream for ourselves and for generations to come.

Thank you, God Bless you, and God bless America.

－－－－

This speech has generated some controversy in what The New York Times called in a Friday article (http://www.nytimes.com/2009/09/04/us/04school.html?emc=tnt&tntemail1=y) “a revolt among conservative parents, who have accused the president of trying to indoctrinate their children with socialist ideas and are asking school officials to excuse their children from listening.”

With so many so-so presidents over the years. And too many notoriously less than so-so presidents over the years. If we can just squint a little, strain our eyes a bit, see through the smoke and mirrors you’ll find the puppet strings of the Tea Party Investors. (And they may very well be the same investors you’re waiting for to approve your loan modifications:)) And they are investing very heavily in undermining everything Obama has been trying to do since he got into office. They are investing many, many dollars in instigating and feeding the flames of this “Tea Party” that’s spreading faster than the swine flu. If you are familiar with the movie “The Island”, than it’s Obama’s turn to win the lottery! Because he has seen through the smoke and mirrors and is not willing enough to play the game. If you’re not familiar with The Island, suffice to say Obama is playing the role of Winston Smith from George Orwell’s 1984. In any case, the powers that be (making the big buck) don’t want Obama to succeed. So this man’s biggest crime: Being the first president in my memory who has tried so hard (failure is acceptable, effort is what’s given the grade) to do somethin that is apparently not part of the real reason for electing a president: Really doing (Snicker… Gulp! Yikes!) what he promised to do in his campaign. That was (apparently) not what we were planning when we passionately put him into office. Apparently we look for a “Go to church on Sunday so we can sleep better after being a bad dude all week” magic elixir. But if this crazy president doesn’t understand the plan, how are we going to continue to drain the last drop of blood out of the poor to support the fat of the tiny minority that control all the wealth in this world. So they incite the very people who Obama is trying to help to accuse him of being everything from a Maoist to an illegal alien. Well, alien he may very well be! He apparently doesn’t understand how to rub shoulders with the people in the $10,000 suits. Let’s not fall for this trick. A bro has nothing to do with the color of a person’s skin. It has to do with loyalty. And Obama, in that sense, is the best “bro” we’ve had in a long time. I am the dog on the side of the road that got hit by a car. When someone pulls over to help. I won’t bite him, I’ll bite the guy who ran me down! Let’s find an appropriate level of respect for a president who may very well be one of the most ethical and sincere this country has ever scene!

The fact that big bucks are being invested in discrediting Obama is testament to his threat to the people who control the money and make the big bucks by squeezing the little people. Everyone forgets that the poorer you are the more you pay every month for everything: Mortgages, interest rates, credit cards, car payments… Obama, the Harvard man he is, sees through this and thus poses a threat to the Buffalo Bill feast on the poor that has been en vogue for all these years. And health care, well insurance companies are sweating and money is pouring into sabotaging any effort to really make health care affordable to poor people. We live in a society that makes good people seem like criminals and makes Buffalo Bill look like Ghandi. The poor father who buys a car for $250 but can’t afford liability insurance. Every time he drives to work to feed his kids, he is a criminal! What a world! What if we paid at the pump for basic liability insurance. Than if he bought $2.00 worth of gas to put food on the table, he could legally drive to work and feed his kids!

What if we encouraged thinking instead of expecting the status quo. Let’s think out of the box. Because the box is made out a a familiar pine and we are having a Good Ole Boy Tea Party driving nails into our own coffins!

The house thing took a turn for the worse… After the trial loan modification, (9/09 through 11/09) Chase informed us that they declined our transition from trial to permanent, with a whole bunch of strange reasons and then ultimately after asking a half dozen representatives, they provided one logical reason The reasons for denial they read us over the phone included: income too high (ha!); borrower docs not submitted (more ha! ha! ha!); income insufficient (makes most sense and they confirmed that)… With a sole proprietorship, a 4-month snapshot of a P&L depending upon the luck of the draw, can be off a lot if month one no checks actually arrive, month two and three normal, and month 4, let’s say, you have more work and contracts than ever in the year 2009 but the actually deposits before the 31st are very low. That’s what happened. And Decembers deposits were good… The bank auction sale date on my home is still scheduled for this Friday, while they ponder the new docs and they can call us on Thursday afternoon and say “No way, sorry!” and the house won’t be ours by Friday at noon! The ironies and foolishness on the part of the bank to sell this property at auction are astronomical and no-brainers… But logic doesn’t enter into play. Nor is there anything beyond an optional participation on the part of the bank when it comes to the Making Home Affordable Obama put into play. Nor is the bank really made to be accountable, since they can do anything they decide based on their own benefit or inconvenience, and there is no rule book in place: “If the borrower does this; the bank NEEDs to do this…”  I wouldn’t be surprised if the house gets sold! If we pay a reduced interest rate for x number of years, when we sell, we still owe the bank $352,000. If they sell it at auction (2% chance) they won’t pocket more than $150,000. More likely it will become a bank property, a vacant liability for them. No income, upkeep required, etc.

I just did a search online and Chase as of Dec 10 has 136,686 customers in trial mods, 4,302 have become permanent mods. 3% The plan on the surface looks as if  Gandhi and Mother Theresa have taken control of the banks, but when you look under the hood, it’s really buffalo Bill! With all the default notification period of 120 days long since past and desperate and distressed borrowers willing to jump through emotional, clerical, financial hoops at the bank’s snap of their fingers, sometimes to the tune of 20 hours per month dedicated to providing docs the bank requires… the buffalos foolishly wait to become someone’s dinner. But the punchline is, you call the bank and ask: “I have all kinds of documentaion submitted that show verifiable income improvements and projected business growth, can you postpone the auction sale date on my home my children, my wife and I can sleep at night and make life-preserving plans and don’t get ill from stress? …And the bank can turn around and say: “We are reviewing your material and the sale “can not” postponed yet. We can’t postpone the sale date unless we can not arrive at a decision prior to the sale date”. So with no notification requirements in place, Buffalo Bill picks his nose and scratches his tummy and watches us jumping through hoops in the field as he decides which tasty treats to feast on today! It’s an ingenious plan to have poor, abused families pick up where Obama left off and invest monthly into keeping the buffalos fat and when the local market shows signs of being able to show a slightly better ROI for the bank’s repossession, they simply pull the trigger. So the poor carry the costs of the homes for the banks for months and months with probably very little genuine intention to permanently grant more than just a few permanent modifications to feed to the banks’ PR department so they can continue to tell the world how they help the poor and bathe the lepers. The banks save carry each month, the look like Gandhi instead of who they are, and it’s a big-ass scam! Knowing how it works, like so many things in life, only serves to destroy the beauty and benefits of ignorant bliss, because there is not a damned  thing a buffalo can do except play the game, keep to the middle of the crowd and hope that Buffalo Bill is considering Jenny Craig!

The process is a lot like the car salesman that has a whole bunch of tricks up his sleeve: “Wait here, I will go ask my boss what the best price he could do for you on this. I’ll put a little pressure on him. I’ll be right back… “  Whether or not  there is a “boss” in the back room,  or a TV, or just a phone and an opportunity for the salesman to call his girlfriend, we may never know… But in the loan modification world, the statement goes like this: I will get your information to the processor, she’ll review it and forward it to the negotiator, who like the Wizard of Oz always needs to be behind the curtain to keep us faithful. “But remember, Dorothy, even the negotiator is powerless and impotent, for he or she can check your paper work and documentation and the ultimate “investor” can pull the trigger or spare you for a day or two depending upon where the itch is at that particular moment:)”

It’s NOT rocket science. It’s not compassion. It’s not common sense. It’s the wolf in grandma’s clothes: “Oh grandma what Big Greed you have!” Better to Chase you with my dear! Right up the WaMu!

If you are working to arrange a loan modification with your bank, you may notice a severe lack of respect in the communication process. Mortgages are all based on contracts. That is simply contract law. If the intention is to honor the commitments between all parties, documentation of all communications is always welcomed. But when great efforts are in place to AVOID any mechanism that provides the consumer with a documented record of what was promised, said or how questions are answered, it doesn’t take a rocket scientist to realize that the game has been manipulated to exploit and abuse one party and shift all the advantage into the lenders court

• The lender can record conversations, but if you tell them you are recording, they disconnect you (JP Morgan Chase — even with government supported mortgage consultant company calls.)
• Letters that say one thing, and phone calls that say the opposite. Loan modification requires many documents to be sent to the lender. There are numerous situations where borrowers are sending in all the required documents and the lenders send out letters threatening to cancel the modification because some documentation required is missing. The letters are often form letters and and typically say something like “One or more of the following items are missing and must be received to proceed with processing your loan modification request: (Then it lists eight or so items - with check marks - none of which are checked.) Naturally, a responsible consumer will pick up the phone and call: “I sent in all the items listed on that letter, can you tell me which ones you say are missing”? The answers are provided by your only point of contact: Credit / collection agents working for the lender. They simply don’t have access to the information you require, and their answers need to evade the question. If you pressure them, they tell you to just re-send everything. Sometimes that could be 30 to 50 pages of documents you may need to assemble and resend every time they send out a vague letter? There is no accurate record keeping of your calls or the responses made. One agent may tell you “We have everything, don’t worry…” But call back in five minutes, the next agent will have no record in your “NOTS” file that documents what you were told! The policy seems to be to notate what the consumer says: NOT WHAT THEY TELL YOU. Boy is that a scam! (Again most of these reports center around JP Morgan Chase. Please send your emails to alert us to other situations!)

If you are entrusting a lending institution with the most critical investment of your life, maybe you should get to know more about your lender? When  you apply for a loan, lenders do credit checks, well let’s do a “character check” on some lender. If they can’t be trusted, and we are depending upon them for our future, are we in trouble!

WASHINGTON (CNN) — If you hold a Discover credit card, you’re in luck — the company has decided to freeze interest-rate hikes until a new credit card consumer protection bill takes effect in February.

Chuck and Jeanne Lane of Ohio have excellent credit, but their monthly credit card bill more than doubled.

Bank of America was the first company to freeze its rates. Both moves come after outrage over credit card companies jacking up rates, increasing minimum payments and raising penalty fees before the new consumer protection law — which would bar sudden increases — is phased in.

Rep. Betsy Markey, D-Colorado, and 17 other lawmakers sent letters to credit card banks asking them voluntarily to freeze their rates while Congress decides whether to move up the phase-in date for the new law to December.

Markey said a CNN report about Ohio couple Chuck and Jeanne Lane inspired her to act. The Lanes said they did everything right but felt bankrupted by a sudden change in their credit card payments. Watch more on the credit card outrage »

The Lanes have a low-interest Chase credit card that was sold as a way to consolidate large debts and pay them down responsibly over time. The Lanes showed CNN that they have excellent credit, have never been late with a payment and in the last two years cut their outstanding balance in half. They said they were shocked when Chuck opened their online statement to discover Chase had driven up their monthly payment from $370 to $911.

“I was devastated,” Chuck Lane said.

When Lane called the bank to complain, he was told he could continue to make his old payment if he agreed to an ever-increasing interest rate

“I told them this was the worst economic time in history practically,” he said. “I work for a small company. We have laid off 30 percent of our work force. I just took a 10 percent pay cut this morning, and this is what you are going to do to us?”

A Chase spokeswoman said the higher rate had nothing to do with the Lanes’ credit or payment history, but rather that the company doubled the minimum payments for more than 1 million cardholders in August because it wants them to pay down more of their principal.

In a statement to CNN, the company said tens of millions of Chase loans “have been paid back in less than 24 months” but a small percentage of customers have not made as much progress and “our desire is to have these balances paid back in a reasonable period of time.”

Joe Ridout, an advocate with Consumer Action, said, “Truly, this is the the single most abusive credit card change in terms that I’ve ever seen.”

Ridout described the tactic as bait-and-switch because Chase sold the cards as low interest and now is making the card unaffordable to many customers unless they switch to a higher interest rate.

“This is a very bogus compromise, and what the bank should really do is honor their original promises.” Ridout said.

Chase told CNN it has no plans to follow Discover’s lead. Wells Fargo plans to raise credit card interest rates 3 percent.

Consumer Action is fielding hundreds of complaints from consumers who are seeing their banks raise rates, minimum payments and penalty fees before the new law takes effect.

“It’s really touched off a chase to the bottom among credit card banks,” Ridout said, “because they know that after that date it will be much more difficult to change the terms when a cardholder pays on time and commits no infractions.”

But the industry insists it’s not trying to skirt the new law.

Scott Talbott, vice president with the Financial Services Roundtable, said the companies he represents are “struggling in a tough economy and trying to provide credit for consumers.”

The reasons the rates are going up or credit lines are decreasing are based on two factors: a change in behavior — a missed or late payment, or exceeding credit limits; and the economic times.

“We’re in a recession, so the general risk of nonpayment has increased across the board, so credit card companies are adjusting to that risk by increasing interest rates or decreasing credit lines, even if the customer has a perfect history,” Talbott said. “A very small percentage may see an increase in their interest rate or a decrease in their line of credit.”

Besides the letter from Markey and her colleagues, Congress is looking at taking other action.

Reps. Barney Frank, D-Massachusetts, and Carolyn Maloney, D-New York, have introduced legislation that would move up the date when the new protection laws take effect from February 22 to December 1.

Banks said they need more time to update their computer programs to comply with the regulations. And the Federal Reserve — which decides the fine points of how the companies should comply with the law — has yet to issue the final regulations.

Earlier this week, Sen. Carl Levin, D-Michigan, and three other lawmakers asked the Federal Reserve to begin collecting data on credit card practices so changes can be monitored and so Congress can see if card companies comply with the new law. Some of this basic data — such as the different terms offered to consumers, what credit costs consumers and how available is it — has never been systematically collected.

And Congress will have another chance to beef up consumer protections when it takes up financial regulatory reform this year. Lobbying by the financial industry is intense.

And Frank’s committee already has excluded a provision that the Obama administration proposed, which would have guaranteed consumers clear, simple options to choose from when they’re shopping for credit cards, mortgages and other credit products.

The Lanes said they’re deciding between paying the new minimum on their Chase card, or paying for surgery Jeanne needs next month and supporting Chuck’s son in college.

Jeanne Lane said she feels taken advantage of.

“I’ve had this card since the early ’90s, and I’ve never missed a payment. I have excellent credit,” she said.

She said she’s angry with her bank: “They have no respect for the American people. All they think about is the almighty dollar for themselves.”