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The Latest Plan to Save Our Homes

29 Jun

There has been very little activity regarding my case, with the exception of my first civil suit against my lender being dismissed due to “non-payment of filing fees”. It took me and my attorney a few days to figure out what happened. You try going to court multiple times for many months and see if you remember what happened there on a particular day. Note to self: start writing this stuff down on a calendar or a notepad!

Through my life, I have not had much interaction with attorneys. In my experience so far, I find that I have had to constantly remind my attorneys about conversations we’ve had, the facts of my case, and so forth. They don’t whip out my drawer full of files (true fact – my current attorney has a whole drawer in a filing cabinet dedicated solely to me) and review the latest information while talking to me on the phone. Of course, these attorneys don’t have legal secretaries or assistants, or they might be a little better organized. On the other hand, those attorneys with legal secretaries or assistants cost a whole heck of a lot more!

So, it turns out that, while I sent him a check to cover the filing fees, he charged the filing fees to his credit card and the courts only charged him $100.00 of the total $755.00 fee. (Yes, filing fees are that high. I once paid $1,600 to file an appeal.) The receipt he received back via fax did not specify what was charged to him, so until he received his credit card statement, had no idea what occurred. He filed an appeal, and the courts should certainly grant us a reinstatement.

And I’m still anxiously awaiting the ringing of the sheriff…

I just found out on Sunday that the mortgage company has filed a request for an order for eviction. It just makes the sheriff’s visit more imminent. At least I’m prepared.

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The government has announced some good news for homeowners. HAMP2 has been put in place – right on schedule – as of June 1, 2012. It is an expansion on the first version of HAMP, and expands the number of people who may be eligible to qualify, and also covers small rental properties.

I don’t want to enumerate all of the details here, as to who qualifies, but will highlight certain points of interest.

  • “If you are not unemployed, but you’re still struggling to make your mortgage payments, you may be eligible…”

The fact is that many people struggling to make their mortgage payments are unemployed, or at least one person in the household has lost their job. Many others received ARM (adjustable-rate mortgage) loans, sold by scheming loan companies as a way to get more people qualified for mortgages to feed the monster securitized loan pool. When you have an ARM loan, you have low payments initially, but those payments balloon at some point, typically 5 to 10 years into the loan. So, if you got your loan during the height of the housing craze (2004-2006), your payments may be ballooning now. At the time you inked your name on the document, the plan was that you would refinance before the payments went up, because you would have established your good credit by then. With the tanking of the economy, credit terms have become very restrictive and it has become difficult for many people to refinance, virtually ensuring higher rates of default.

  •  “Homeowners who previously received a HAMP trial period plan, but defaulted in their trial payments”…OR… “Homeowners who previously received a HAMP permanent modification, but defaulted in their payments, therefore losing good standing”.
(Find all the details here.)

Unfortunately, more than half of homeowners who received a modification at the beginning of 2009 defaulted again after 9 months. Many believe that this is because the modification didn’t go far enough. Many people just got their original loan principal extended another 10 years to drop the payment. Then again, who could have predicted that this recession would have dragged on as long as it has? Almost six years, with no end in sight. It’s no wonder that, in these uncertain times, so many people would have difficulty maintaining their payments. Fortunately, if you were one of those lucky enough to receive a HAMP modification but unlucky enough not to be able to maintain your good standing, you get a second chance. That’s a rarity.

Martin Andelman wrote a very interesting post last week, and I believe what he is saying is right. He has spent a lot of time interviewing people, trying to make sense of things over the years, and while I’ll let you read the full text here, the point he’s trying to make is that part of the reason there has been such an epic fail on the part of the banks and the government is that none of these actions have ever needed to be taken before. Yes, people have missed payments and been foreclosed on since the beginning of time, but in recent years, there have been different rules for lending that require different rules to deal with the fallout. And those rules were never developed. So why hasn’t anything more substantial been developed by now?

Most effective businesses take some time to ponder the pros and cons, or put together a SWAT analysis before launching a new product. Those businesses know that this is essential to their longevity. After all, they didn’t go into business to make a bunch of money then go out of business as soon as they had made enough. No, they want to continue to bring in the profits. And they know that there is no one out there who will bail them out if they make a bad business decision.

That is the key difference. The financial powers that be knew the government would bail them out, to preserve our economy. They were reminded of it every time they opened a new branch and put up a plaque that said “FDIC Insured”. When the barriers between standard banking and investment firms were dissolved, they became TBTF – Too Big To Fail. With their hands in every financial pot, it became impossible to segregate their influence from the economy as a whole.

I have an extremely difficult time believing that no one involved with the setup of the mortgage loan securitization process never said, “What is the worst outcome that we could possibly create?” or even, “How long can we keep this artificial bubble from popping?” and, even better, “Could what happened to S&Ls and junk bonds in the 80s happen again?” Hindsight is 20/20, as they say. Unfortunately, with so much history to draw on, it’s starting to be more like 20/100. If people would just take the blinders off and recognize that whenever variability exists, provisions need to be made to encounter any situations in which variability becomes the norm, rather than the exception. After all, it’s no secret that this country (and all countries) goes through periods of ups and downs.

So, yay that HAMP 2 is available, and I sincerely hope it helps more homeowners than HAMP 1 did. And not just a band-aid, either – I hope this makes a huge impact. Now, if we could just get Ed DeMarco of Fannie Mae and Freddie Mac to see the light and save us taxpayers some money, we could get some serious help for underwater homeowners!

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Anyone wondering what happened to their request for an Independent Foreclosure Review?

Probably not very many of you. Apparently, only 4.5% of people who were sent the form responded. You have until July 31st to respond. I don’t know how much good it will do, but it certainly can’t hurt to submit your information! You must call to request a form if you haven’t received one yet.

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1 Comment

Posted by on June 29, 2012 in Foreclosure

 

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One response to “The Latest Plan to Save Our Homes

  1. chanel 財布 店舗

    September 21, 2013 at 5:50 PM

    激安ラッシュガード

     

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