Predatory Loan Modifications
“Yes Virginia……………… there is a Predatory Loan Modification.”
For three years, the US has been subjected to all manner of communications from the government, the media, and lenders about loan modifications. For two years, I have, with increasing frequency, been reviewing actual loan modifications granted to borrowers, and loan modification offers. Over the past six months, I have been doing exams with paperwork included about loan modifications. And March 30, I wrote an article about the results of the HAMP loan modifications.
With what I have learned and know, it is time to finally put words to paper (or to the internet) about what is really going on. If attorneys and homeowners are going to fight to save homes, it is time to present to all the facts concerning the loan modifications efforts and offers. Many have seen portions or parts of the whole, but few have actually put it all together. Some have actually used the term Predatory Loan Modification, but they have applied it to companies that were trying to scam homeowners, by offering to negotiate loan modifications for homeowners, but with no real intent. It was those companies that resulted in SB-94 in California being enacted, with a lot of help from the banks, and that put loan modification companies out of business, and stopping large number of attorneys from engaging in loan modification efforts.
Predatory loan modifications come in many disguises and may include the actual offer, or just the negotiations of the loan modification. The purpose of the modification is to whether now or in the future, to cause the borrower to lose the home. It has no other purpose than that. I shall endeavor to explain many different ones, and then I shall offer an insight into where the next “Battle for California” and the rest of the US must take place.
Same Rate – Higher Payment-Taxes Included
Throughout 2008, this was the most common Predatory Loan Modification. It was seen quite often with Sub-Prime loans, but other loans as well. It is still seen today.
The modification featured an interest rate which was the same as the current rate, but a higher monthly payment. The payment increased because arrearages were packed onto the back of the loan which resulted in the payment increasing. To add insult to injury, taxes were included as well.
The net effect of this “modification” was to induce the borrower to walk away from the home because they knew that the payments could never be made. Those that did accept the modification would end up losing the home anyway, since they could not make the payments.
Forbearance Disguised as a Loan Modification
A common practice used in 2008 and also today is to present a borrower with a letter identifying a “loan modification” offer. The terms of the offer are for a period of time, usually from 4 months to a year, whereby the borrower will usually bring in a lump sum to pay a portion of the arrears, and then over a period of time, make higher monthly payments to “catch up” a portion of the arrears and at the end of the term, bring the loan up to date. The lure of this program is that it implies that successful completion would result in a loan modification.
The fact of the matter is that I have NEVER seen one of these plans result in a successful modification. Once the payments are made, the lender denies the modification and demands the arrearages. When the borrower can’t pay, the lender forecloses. With this program, the borrower has “proven” that he could make the payments, so there is no need to modify, in the minds of the lender.
America’s Servicing Company, aka Wells Fargo, is famous for this program.
Option ARM Loan Modification
This is a different loan modification that I have seen offered numerous times, often by First Federal of Ca. The client is in an Option ARM mortgage.
First Federal contacts the borrower, offering to modify the loan. The modification will put the borrower into a 30 or 40 year fixed rate mortgage. The problem is that the interest rate will be 5.5%. In fact, they told a friend that 5.5% was the lowest that they could go by law. This was a portfolio loan that they owned.
Review of the loan revealed that at the time of the offer the borrower was in a loan with a 2.45 Margin. With the Index at 1%, this meant that he was paying a 3.45% interest rate. First Federal would modify his loan to 5.5%, over 2% higher than what he was currently paying. Of course, it resulted in the borrower declining the offer.
BTW, under the FDIC program, the borrower could have been offered down to 3%, and not 5.5%. Glad to see First Federal gone, but since OneWest took them over, it will be just as bad.
Lower Rate – Two Year Term
This is a common offer. With it, the interest rate will be lowered for a two year term, and as low as 2%. However, after two years, the modification ceases and the loan program returns to its original terms. Of course, this only delays the inevitable.
World Savings Modification
World Savings had a “wonderful” modification program. They would contact a borrower and offer a modification for $299. The offer generally dropped the interest rate by .5%. This lasted for one year. At the end of the year, World would contact the borrower with another modification offer. This offer would cost the borrower $499, and would last a year.
HAMP
Surprised to see HAMP in this list? Why should you be? The lenders and Treasury administer the program.
HAMP modifications offer to qualified borrowers a modification of the loan terms. The terms allow for an interest rate as low as 2%, for five years. After the fifth year, the rate will increase by 1% yearly, until it reaches the Freddie Mac rate at the time of the modification. This is usually about 5%. There it stays until the loan is paid off. Other terms are available with the modification, but to keep things simple, I shall not bother with those terms.
Sounds great with this modification, but here is the catch. I recently evaluated the HAMP program and found that the Mean Debt Ratio for all loans as of Feb 2010 was 59.8%. For March, this Debt Ratio was 61.3%. For the non-lending reader, this means the following:
• If a homeowner has a $10,000 per month Gross Income, and he has a great accountant and tax guy, he is in a 33% bracket for Federal and State Taxes, Social Security, Disability and other Deductions.
• After deductions, his income is $6,667 per month, take home pay.
• Subtract out the 61.3% Debt Ratio and he has $537 per month to live on.
• From the $687, he must cover food, fuel, utilities, medical insurance, clothing, phone, cable and other miscellaneous expenses. And, if he has several children, these expenses continue to mount.
Take into consideration now that the Mean Debt Ratio is the midpoint. 50% of all HAMP mods are over that Debt Ratio, and 50% are under. Subprime loans were for the most part a 50% Debt Ratio, and HAMP is approving them at 61.3% and above. Plus, how many are between 50% and 61.3%, we do not know.
The borrowers are going to face a decision relatively early in the payment process. Do they continue to make the loan payment, and end up having to stop making payments on all consumer debt? Or do they abandon the home, and pay consumer debt? Or do they just file bankruptcy and walk away from everything.
The end result is that most if not all of these modifications will likely fail.
Modification Negotiations That Are Denied at the Last Moment
For the purpose of this article, this is the last Predatory Loan Modification that I will present for review. It is one that I am constantly hearing about.
This Predatory Lending Modification never gets offered. It is all about the process of the modification, attempting to fulfill the requirements of the loan modification process. Common complaints of the process include the following:
• Lost paperwork and faxes
• Never enough paperwork
• Unkept promises
• Paperwork never sent to the borrower
• Trial modification offers but never payment offers for the trial
• Trial modification payments made but the modification is denied
• Modification denied before a trial can start
• Trial payments made, but then the “investor” denies the modification.
The end result is that trial modifications are either never entered into, or if they are, then they are denied at the last moment and foreclosure quickly occurs from there. The common theme in these attempts is a lack of “intent” to do a modification.
The continuing stories being told about the lack of cooperation among lenders and servicers to offer loan modifications led me to pursue the reasons for such behavior. There had to be a common cause, if it could be found. Eventually, I found the root causes and it was dependent upon two different issues.
Advances
The first limiting factor in whether a servicer will offer a loan modification is based upon the concept of “Advances”. When a borrower misses a payment, the servicer must “Advance” that payment to the Trust to ensure the payment stream. Only at such time as the loan is determined to be unrecoverable can the “Advances” stop.
The only way that the servicer can recover the advances is one of three ways:
• Offer a forbearance whereby the borrower brings in money upfront for arrearages, then makes a few payments, and then brings in the rest due. (This is America’s Servicing Company’s initial offer.) Of course, if the borrower had that type of money, then they would not be in foreclosure.
• Check the Pooling and Servicing Agreement to see if arrearages can be “tacked” onto the end of the loan and the servicer can recover the advances upfront. If not, they foreclose. ( I have a copy of a Deposition that the servicer foreclosure expert declares just that.)
• Foreclose, and sell the property where they take the advances right off the top of the proceeds.
When the modification is requested by the borrower, the servicer will immediately check to see if there is any ability to recover the advances other than foreclosure. If not, they decide to foreclose. But, what is even worse, the servicer will engage in trial modification actions, usually providing a trial modification whereby the borrower will make payments to the servicer. These payments are less than what is owed, so they are placed into “suspense” whereby the payments are not credited to the account. When the lender denies the loan and forecloses, the payments are kept to offset the advances until the home is finally sold.
This benefits the servicer by allowing them to collect payments, and uses up time until the foreclosure can occur, but also denies the borrower the ability to hire an attorney to aggressively fight the servicer. Furthermore, it removes from the borrower money that will be needed to find a new place to live. (There is possible legal actions to consider which I will address further on.)
The second limiting factor is whether the servicer can in fact offer a loan modification to a borrower.
The Pooling and Servicing Agreement (PSA)
The PSA governs what can and can’t happen with regard to the servicing of a loan. It specifically details what can occur when a loan is in default or is facing default. Loan modification is one option covered.
Dependent upon the wording of the PSA, a loan modification may not be possible. It may not be authorized or it may restrict the ability to offer a modification by stating that such a modification may be offered, only if the loan is purchased back from the investor for the full balance due. Obviously, a servicer will not purchase back a defaulted loan that is “underwater” so they will refuse the modification, saying that the PSA does not allow for modifications.
The servicer knows immediately what the PSA says with regard to loan modifications. Do they immediately deny the modification? No, instead they engage in “sham” negotiations, requesting paperwork, financials and other documentation while wasting time until they can foreclose on the property. Often, they are accepting trial payments, knowing full well that the modification will be denied. Again, it is simply a way of recovering money.
What to do?
At this point, hopefully the reader and the attorney will begin to understand what I mean by Predatory Loan Modifications. I have attempted to show the issues with these modifications, and have spent several months attempting to determine an effective way to fight the servicers. Along the way, I have learned much, and I have also seen some actions filed against servicers, but because the attorneys did not understand the entire lending and modification process, gaping holes were left in the arguments.
The key to fighting the servicers on the modification issue is to attack the modification process, and show lack of intent to engage in a loan modification. In the case of Indymac/One West, you walk into court backed up by a PSA stating that the servicer could not do a modification without buying a defaulted and underwater loan from the lender. Then, you present a quote from Sheila Bair, head of FDIC, saying that Indymac PSA’s do not allow for loan modifications.
At that point, you are not done. You show the Deposition from an Indymac foreclosure expert that states their key determining factor is whether OneWest can recover “advances” from a PSA, and if it is not possible, they foreclose without regard for anything else.
Finally, you back up your arguments showing the communications between the servicer and the borrower, and showing that their modification actions were “sham” negotiations.
Oh, by the way, I have two court rulings, one in California and one being a 5th Circuit decision that states if a lender engages in loan modification negotiations with no intent to actually do a modification, it is fraud.
Think you can make a Court take notice with this type of an argument?
Summary
I have now presented the case for Predatory Loan Modifications and how this is the next stage in the “Crusade for Homeowners”. No longer can the fight be regarding TILA/RESPA where homeowners lose daily. Lenders know how to fight that. Nor can it be the foreclosure process, which only delays a foreclosure.
I propose that you fight the lenders based upon three significant issues:
• Fraud in the origination of the loan at various levels, and using an Agency/Assignee Liability argument to implicate both the lender and the broker. My Predatory Lending Exams show the way.
• Fight the Foreclosure Process so as to delay the foreclosure and to allow time to present actions based upon Predatory Loan Modifications. (BTW, were you aware that CA CC 1095 in California requires that in any Assignment of Deed of Trust signed as Attorney In Fact requires that the party being acted for be disclosed, or the document is void? I see this error quite often.)
• Fight the Lack of Intent in Loan Modification Negotiations.
Now, as a personal and “shameful” plug for LFI, I would wager to say that you have seen nothing like this presented before. That is because most so-called audit firms have not got a clue about what they are doing. They simply buy TILA/RESPA software so as to determine if the disclosure requirements were met. They have NO UNDERSTANDING of Predatory Lending and what can be offered by competent persons doing such exams.
Furthermore, these people have not stepped into a courtroom, testified in front of a judge, or attended a Settlement Hearing. They cannot know what is important and what is not.
None of these firms have ever thought of the concept of Predatory Loan Modifications.
I spend my days and nights, thinking and living what is happening. I have had to make the hard decisions, and I understand what others are going through. Therefore, this is more than just about being a business.
The reality is that using the same arguments that attorneys are using now, foreclosure arguments and TILA/RESPA, we are only delaying foreclosures. And the banks are winning. Now is the time to consider different tactics, including those regarding Predatory Loan Modifications.
Also, we need to put together cohesive Class Actions which are based upon easily identified classes that have sympathetic Class Members. I have two in mind right now, if the right firm will step up to the plate. (Yes, I do understand the issues regarding Class Actions, and I have tailored the Actions to meet those concerns. If you are an attorney that is interested in my proposals, please call. I WANT to talk with you.)
If anyone personally and professionally knows city and county politicians who have “cajones”, please call me. The cities and counties across the country are facing increasing budgetary concerns. I have been attempting to show cities and counties in CA that they have lost tremendous amounts of money from transfer taxes and recording fees, but the politicians just have no clue as to what I am referring to. What I propose is that with the right politician leading the way, we have the cities and counties attack the MERS and Securitization process regarding the avoidance of Assignments. The cities and the counties have the resources to fight this together that individual attorneys do not have. This could lead to millions in fee recovery, and better yet, a good ruling would then allow all attorneys to “piggy-back” off the lawsuits, and maybe could expose the issues with Securitization and Legal Standing.
A final thought about another tactic that I discussed with an attorney last week, and his comments were favorable. Even the lenders have limited resources. I know this because I regularly get comments from attorneys where they have gone to court and the lender’s counsel has failed to show.
Why not conduct an action whereby attorneys from all 50 states target one lender per month. Imagine the first week of a month, 500 lawsuits filed against a single lender for Predatory Lending. Lenders do not have the resources to react in a timely manner to such an action. Some lawsuits are bound to slip by to the next stage. Sure, like Countrywide, the lender might try to have them all consolidated into one action. But, that takes time, and Predatory Lending Actions do not easily offer the opportunity for consolidation. It may be wishful thinking, but at this point, why not try it?
(Patrick Pulatie is the CEO of Loan Fraud Investigations. He can be reached at 925-238-1221, patrick@loanfraudinvestigations.com. His website is www.loanfraudinvestigations.com. Articles written by him can be viewed on www.iamfacingforeclosure.com. Patrick is not an attorney and does not give legal advice.)
Totally agree with the comments.
Now that it appears to be a "done deal", it's quite obviously nothing but a SELL-OUT ...
Can I just say I admire a good rant. Fantastic!
You are correct sir. This whole process has nothing to do ...
If these assholes can't find the culprits call me. This diabolical is disgusting to its core. They have ruined our ...
Comment by pulatie on 6 May 2010:
An error was pointed out to me in this. The 1095 comment was actually meant to be CCC or California Civil Code 1095. Actual text is
When an attorney in fact executes an instrument transferring
an estate in real property, he must subscribe the name of his
principal to it, and his own name as attorney in fact.
Comment by angela on 12 May 2010:
So, basically I was in fax-refax limbo for 6 months…never got trial payment and then got denied because of insufficient paperwork. So, Chase made me default in order to get reviewed and then did not help us modify so now my credit is destroyed…how can this be legal??? We feel like walking away as we have tried to do the right thing and Chase has totally played us!
Comment by pulatie on 12 May 2010:
It was likely not legal. Chase, by indicating that you had to be in default, implied for you to go into default, and that would be unlawful.
Plus, many agreements covering loans do allow for loans at risk of default to be modified. Some do not.
A qualified attorney would need to review your situation, after a determination of whether the agreements allow for modification or not, and then a strategy would need to be developed.
Was this originally a Chase or WAMU loan?
Comment by Carol on 13 May 2010:
I have close to a year’s worth of detailed notes on communication with Countrywide in an attempt to modify 2 home loans. It was APPALLING what they did to me and I ended up losing both homes and declaring bankruptcy!
If you want to have those notes… let me know! I’ll join any class action suit against Countrywide (now Bank of America).
Comment by Gina on 19 May 2010:
We are currently in a lawsuit with Countrywide, BAC Home Loans regarding a foreclosure attempt starting with 2 denied loan modifications, one denied as notary was incorrect but legally done, second one denied because of property being non-owner occupied which should be discriminatory. Have lots of info as we have done lots of research…willing to help anyone but we are pro per as we have not yet found an attorney who would have the time & be affordable to fight this case for us in AZ. Looking for anyone who might want to help or be helped.
Comment by Ajith,S. on 1 June 2010:
Patrick,
Once again very informative piece.I am learning something new everytime I read your very well written articles.Keep up the good work and thanks for educating people like us.Looking forward to working with the attorney’s in LA,recommended by you.
You,April Charney and Carol Asbury are the true heroes educating and waking us up from these massive bank fraud.
Thanks again.
Comment by Joe Bayani on 5 June 2010:
Hello,
Thanks for the infomation. I finally have some information about how things really work with the Loan Modification process. I have been in a Trial Modification for a year now. My loan originated with Wamu and now Chase. I keep getting the run around about more paperwork and so forth. I feel that I am being strung along. I have tried several things to get a permanent loan modification. I had an audit done on my loan paperwork that showed an error that would have me paying $700k more than what was signed for. I talked with the Attorney who helped get me a Trial modification but I do not think he has any idea about Predatory Loan modifications. Also, he told me that audits are no use even though there was and error that large. What is your opinion on that issue. Can you recommend an attorney in San Diego County or Orange County who has great knowledge like your information above who can fight for me in regards to Predatory Loan Modifications to save my home?
Best Regards
Comment by Patrick Pulatie on 5 June 2010:
Joe,
Most “audits” are a pile of garbage. I say this as one of the first people to really develop the concept of examining loan documents. Most of the people claiming to do them have not got a clue about what they are doing.
As to your own audit, the $700k that you mention, was likely one of those errors. What probably happened is the “so-called” auditor took the interest rate cap and calculated the finance charge on that, instead of on the Fully Amortized Rate at loan consumation.
As to using an audit for achieving a loan modification, without the threat of litigation, it is a waste of money. Lenders will usually just ignore what is found, saying that there is nothing wrong with the documents. So unless you are using an attorney, it is not worth it.
For the Trial Mod that you are in, there is likely something else going on. You are probably under HAMP, but if your loan has been securitized, then HAMP does not apply. The Pooling and Servicing Agreememt takes precedent, and the terms of any modification allowed are described in that document. Some PSA’s forbid modifications completely.
I do have a couple of attorneys that I know does good work and could refer you to them. Just send me an email and I can provide you with the info.
Comment by Marta Reinoso on 9 June 2010:
Hello Patrick,
Oh my, finally some answers!!! We’ve been trying to get modified for over a year now and to no avail…Upon our first attempt with Chase (our loan was initially with WAMU) we were quickly put on a trial but after three months were denied. The second time we were denied also for the same reason which was a “lack of income.” Luckily, my husband and I still have an income although it is less than what it was. We’ve now hired a firm to work this out on our behalf and are in “active” review with Chase but we are so reluctant to get excited over the prospect of actually getting a modification because they just seem so infrequent. At this point we are very delinquent but when I asked if we should start making payments our case manager stated that the Chase representative stated to wait…? If you could please comment on our case and PLEASE PLEASE PLEASE refer us to a firm that you think can actually do something. Our hope is that the firm you refer us to may be who we’ve hired. My email: mreinoso20@hotmail.com
Comment by Patrick Pulatie on 9 June 2010:
Marta,
You need to get in touch with an attorney who handles foreclosures on a regular basis. Loan mod firms can only do so much. Essentially, the mod company is along for the ride, and has no influence over the lender.
With Chase and the mod company saying not to make payments, you are only going deeper into arrears, which will make it more difficult. Chase knows this, and will do everything they can to dig that hole deeper than what you can climb out.
Comment by nel on 17 June 2010:
Mr PULATIE: Where do I find the WORDING OF THE PSA RE. my ESB loan?
Comment by Patrick Pulatie on 18 June 2010:
Nel,
Unless it was securitized, there was no PSA. And if it was securitized, you must know the name of the Trust to locate the PSA.
Comment by NEL on 19 June 2010:
CAROL AND GINA or any COUNTRYWIDE FANS: Who will be entitled to REMEDY from the REDRESS FUND of 100.8 MILLIONS COURT ORDERED 6/7/10 COUNTRYWIDE to deposit (within 10 days from above) in an escrow account to be distributted by the (plaintiff) FEDERAL TRADE COMMISSION ????(www.ftc.gov/countrywide). Upon notice of a job lay of within a few months, a past customer stopped making pmts on their C-WIDE(pockets) loan (last pmt made 5/6/2008). Also is this a CALIFORNIA only STATE covered on this setleament?
Comment by NEL on 19 June 2010:
LOAN MODIFICATIONS (TWO) took my $ without result the first one and the second one I cancelled in less than 24 HRS. I WANT MY $. What is your best suggestion/LAST RESort/THE MOST POWERFULL way about recovering my $ from this FORECLOSURE PREDATORS???I have involved the DIVISION OF MORTGAGE LENDING from my STATE with no result. One of these LOANMODIF!S told me “WHAT I ENJOY MUST ABOUT THIS JOB IS THE SALE PART OF IT”Do THese COmpanies have FORECLOSURE ENROLLMENT VICTIMS CONTESTS ??? and the other LOANMODIF!S told me that they will USE “YOUR STATE CONGRESS” etcetc.
Comment by Elizabeth on 26 June 2010:
Hi
Can you please give me the cite for the 5th Circuit decision that states if a lender engages in loan modification negotiations with no intent to actually do a modification, it is fraud.
Elizabeth
Comment by Ian on 27 June 2010:
To Marta Reinoso and others- Loan modifications are a criminal swindle, as is the HAMP program as set forth by the Obama White House. What you are doing is signing your legal rights away, re validating the debt, and opening yourself up to a virtually unstoppable barrage of additional illegal,amoral lies and actions by the servicer or whoever purports to have any right to modify or foreclose your loan. Just keep repeating, “it is all a lie, they are all lying”,to yourself all day long and it may sink in after a couple of weeks. The numbers of trial vs.permanent modifications put forth by both the white house and the “lenders” do not agree with each other for numerous reasons. Do not attempt a loan modification with your lender or servicer. They are all lying, in order to purge the markets of (your)securitized subprime loans. That is what they are doing. In addition, each and every loan is missing at least 2 assignments in the chain of title which renders the chain of assignment invalid. This cannot be corrected, either. Good luck and don’t believe anything you are told.
Comment by Elizabeth on 27 June 2010:
Hi
Do you have a cite for the 5th Circuit decision that states if a lender engages in loan modification negotiations with no intent to actually do a modification, it is fraud. (for real or just your opinion)?
Elizabeth
Comment by Patrick Pulatie on 27 June 2010:
In Richter, SA v Bank of America (5th Cir 1991) 939 F2d 1176. The 5th Circuit upheld a jury award of $1,550,000 against the lender based on negligent misrepresentation when the loam officer indicated to the borrower that the bank was willing to negotiate a restructured loam despite the fact that documents in the bank’s files demonstrated that it had already decided to disengage from the borrower.
Comment by Patrick Pulatie on 27 June 2010:
Nel,
You will probably need to engage an attorney. State agencies are as useless as the government.
Comment by Joe Bayani on 27 June 2010:
Hello Patrick,
Thank you for the reply. My loan started with Wamu and then was mover to Chase on the sale of Wamu. Do you think with Chase that I am in the HAMP program? Also, I have a copy of my audit that was done in an attachment in my e-mail. Could I send you a copy of the attachment for your review to verify your hunch.
Also, I would love to get the phone numbers of your recommended attorny.
Best Regards,
Joe
Comment by Patrick Pulatie on 27 June 2010:
Joe,
WAMU securitized most loans in the later years. So it was likely securitized. You can check on MERS for Homeowners to see who is likely the Trustee for your loan.
I am frequently finding that WAMU is showing Chase as the owner, even though the Note was securitized. This is also common with Aurora. As a result, it can offer defenses in BK courts, but the Trial Courts in different states tend to disregard such issues.
Go ahead and send your audit to me at patrick@loanfraudinvestigations.com. I will look at it, but expect that I will tend to be harsh about the results. Most companies have no idea what they are really doing with regard to audits. They are only out to make a fast buck at the expense of the homeowner.
Comment by Joe Bayani on 27 June 2010:
Patrick,
Thank you again for such great feedback and information. The audit is being forwarded to your attention. Also, in the e-mail can you send me information in regards to a great predatory lawyer.
Best Regards,
Joe
Comment by Elizabeth on 28 June 2010:
Patrick,
Thank you for your response I myself have Chase been in a fake trial modification for over a year each year their is a different reason for a delay the recent being I misrepresented my income in thr loan process so PMI canceled my insurance I went back to the bank Flagstone to find out what if anything was misrepresented I did not have to prove anything it was a no doc loan a program Chase was running for no doc loans well the Bank you did my loan states they have no idea What Chase is tlaking about because their was no misrepresentation of anything?
Chase is just in my opinion just stringing me a long for foreclosure here in Texas since we don’t have to go to Court.
Also at closing no one signed my note but me ? when they filed it with the county the added clauses stating “I am not a married person” when I am.
So many things wrong no lender was at my closing or signed any documents with me.
Elizabeth
Comment by Joe Bayani on 16 July 2010:
Patrick,
I just got bad news from my lender Chase after making 13 straight payments. They have told me that they have declined my modification due to my debt ratio being at 42%. I have just last month rented out my guest house. I told Chase about this new change and my negotiator said she would get back to me to let me know if they would consider that income to get my debt ratio down to the 31 to 35 %. Rental income should be considered income should it not. I will have to claim it on my taxes as such. I did the math on the 42% debt ratio and with the extra income on the guest house I should be right there at about 32%. What sould I do if they decline the Rental income even thou I can show proof by a rental agreement and deposited checks. Also, do you have a Great Attorney in San Diego County that will fight on my behalf? What would you advise. I value your opinion.
Best Regards,
Joe
Comment by Elizabeth on 17 July 2010:
They only consider it at 75% of the total amount you are trying to use I have chase too I am not playing those fools no more we going to court I need to know how I can get pool assignments and agreements Patrick can you recommend someone that do not want a arm and a leg
Comment by Linda Robinson on 18 July 2010:
In 2005, I refinanced my home and secured a 5.45% fixed interest rate convention loan with the mortgage brokerage firm PC Lending. In 2006, my daughter lost her job and was unable to maintain her car note. To assist her, I again contacted PC Lending (located at 25835 Narbonne Ave., Suite 205, Lomita, CA 90717) to refinance my mortgage to payoff her car. The initial representatives that handled my first refinance were not available. Pleased by my first transaction, I thought I could trust this company with my second transaction and informed the agent that I wanted to refinance my mortgage to payoff the car, did not want to pull out any additional funds beyond the payoff amount on the vehicle, and that I wanted the same terms: A fixed rate 30yr mortgage with a comparable interest rate. He assured me he could obtain this for me based on my excellent credit and payment history and income.
Based on my credit rating, income, etc., I qualified for a fixed rate, 30yr, conventional loan and was led to believe that that is what I was offered. I was told that I qualified for a 5.8% fixed rate home loan, offered and accepted these terms, and concluded my transaction in December 2006. I am a senior citizen and trusted that this company had my best interest at heart. Long story short, around the end of 2008, my daughter noticed that my principal balance had not decreased at all since I began making payments on this mortgage loan.
I had my daughter review the mortgage documentation and she discovered that I was offered a fixed rate, interest only loan and that all of the payments I had been making were for interest only and that under this type of loan excessive balloon payments would become due for any outstanding principle balance. The documents the broker showed me prior to closing indicate conventional, fixed rate loan on them. Yet my daughter went through the entire packet and showed me miscellaneous pages, buried among the loan documents, with fine print and barely noticeable disclosures that indicate interest only references. Even my Lender’s Closing Instructions state Conventional Loan and Fixed Rate on it. By the time I had realized what had happened to me, the mortgage crisis was well underway and I was unable to reach any of the agents I had dealt with at PC Lending. I continued making my interest only payments of $1,821/month while searching for ways to rectify the intentional fraud/deception I had been subjected to with this predatory loan, to no avail. Between 2008-2009 Washington Mutual, the original mortgage loan holder, went bankrupt and was taken over by Chase bank and getting answers from them during this transition period was virtually impossible.
Fast forward to June 2009. By this time I knew I was in trouble because I currently receive Social Security and pension payments. My pension will be exhausted as of February 2011. In June 2009, I made my first attempt to obtain assistance via a loan modification with Chase. I submitted and verified that Chase had received all of my documentation, via certified mail and I retained the receipt as proof. I followed up with them continually and in August 2009 they informed me that my case was closed and had no explanation or reason why. They advised me to resubmit the Home Affordable Mortgage Program (HAMP) packet and required documentation and advised me to go to their Glendale, CA office for convenience and to submit the second request.
On August 20, 2009, I went to Chase’s Glendale, CA office and submitted a complete HAMP packet. Their agents checked and verified that all documentation was included and faxed it to their regional HAMP processing center in Glendale, CO, at 10:40 am PST. They even provided me with the fax confirmation page which I still have in my possession. Again, I followed up numerous times, submitted everything they asked for, and to my dismay, they again closed out the file. It was now November 2009 and again, they had no explanation or reason for doing so and then turned around and asked me to resubmit it again (third time) to be considered for loan modification assistance.
At this point I became extremely frustrated and sought direction and help through a local HUD agency, Los Angeles Neighborhood Housing Services. I had just become delinquent on my mortgage payments, despite earnest attempts to avoid it. They explained the HAMP program, process, and recommended that I not give up and resubmit the third HAMP packet/assistance request. On December 4, 2009, via certified mail, I again submitted a complete HAMP packet. I called regularly to verify all documents were received and on file and check the status of the request. Every time, I was told that all of my documentation had been received and was on file and that they were backlogged with loan medication requests thus it would take longer for a representative to be assigned my file and to keep checking back. I did and this time I documented the date, name, and information I was told on each follow-up call. After, being in constant contact with Chase for months, yet again, they closed my file with no reason or explanation why.
On April 23, 2010, Frank, a Chase representative informed me that there were no records for the third request submission. I read off every date, every name, and every piece of information exchanged between me and Chase over the previous months and all he could do was apologize and ask me to resubmit the packet. I informed Frank that I was not pleased at all and that I would resubmit the HAMP packet for the fourth time but this time I was filing a complaint with the State of California Department of Financial Institutions and to note it on my account. I am fed up with this bank and based on their actions I believe they are intentionally trying to frustrate homeowners seeking relief. With the housing market already flooded with foreclosed properties, I fail to see and understand their logic and at this point, I no longer care to understand.
I will be 65 years old this year. My medical expenses are going to skyrocket in December 2010, I will exhaust me pension in January 2011, I am now delinquent on my mortgage payments after decades of perfect credit and payment histories, Chase refuses to assist me, my expenses have increased because my child and grandchild have had to move in with me, and from the looks of things we will all be out-on-the-streets if Chase has its way. I have worked hard all of my life. I have paid my dues and my taxes all of my life. I worked for and maintained an excellent credit rating most of my life. Now, in my old age, Chase is out ruin me and force me and my family into depths of homelessness.
I need help. I know there has to be some help out there for me and I cannot take on this financial institution alone. I have tried 3 times with no success and my expectations are low for this 4th attempt. Government, banks, and the media claim that greedy homeowners submitted fraudulent documentation and took out predatory loans that they knew they couldn’t afford. Well, I didn’t. I have always had conventional, traditional home loans…and I always made my monthly payments on time. I was misled by an unethical mortgage brokerage firm and bank and I can prove it. I have copies of all of my mortgage loan documents dating back to when I purchased this house in 1997 and older records for my home of 30 years before purchasing this one. I have proof of my credit worthiness/ratings over this period of time and my income as well. I have proof of the 4 HAMP packets I have submitted to chase and all relative documentation, correspondence, notes, etc. since initially seeking assistance in June 2009.
I need you to investigate this matter and help me keep my home. I need terms and payments I can afford. I need my tax dollars to work for me. I have never asked for or taken any handouts, and I will not start now. However, I could definitely use a hand right now. I don’t know who is responsible for investigation this type of mortgage fraud but I want to know because someone must be held accountable for what has happened to me (and many others I’m sure)! More importantly, I want to keep my home and California doesn’t need more foreclosed properties in the market. What can I, you, we, and the multitude of homeowners in this predicament do to salvage our homes and self-respect?
Comment by Linda Robinson on 18 July 2010:
The previous post was copy/pasted from a complaint I filed with the State of California Department of Financial Institutions in early June 2010. Shortly after filing it, Chase offered me a “Predatory Loan Modification” and it fits your article’s description to the tee. 2% for 5 years, 3% year 6, 4% year 7, and 5% for next 25 years. Here’s the issue, they want to add the delinquent arrears to the back of the loan, thus increasing the principal balance by almost $16,000 (and yes like most people I owe more on my home than it is worth). By year 7, the payment would be over $2,000/month and with my pension scheduled to exhaust early next year, my Social Security benefit will be $1,500/month not including taxes, homeowner insurance, food, utilities, and basic necessities. Chase is definitely in the business of offering loan modifications destined to fail. I was screwed over once, but I will not knowingly by screwed over a second time. I did not accept the loan modification and will likely be filing for bankruptcy in the near future.
Comment by Patrick Pulatie on 18 July 2010:
Elizabeth,
Getting PSA’s is either very easy, or it is a nightmare. There are no other scenarios. To get a PSA, you should try this.
1. If an Assignment of Beneficiary has been executed, then the Trust may be shown, and it is easy to look it up on Edgar.
2. If no Assignment shows the Trust, then you can try to call the servicer and ask them for the Trust name. Sometimes, this works.
3. If neither of the above works, then you have a real problem. There are only a handful of people in the country who can find the trust at this point. And, it takes hours of research. Even then, it is not guaranteed. I have hunted for days on some loans and been able to narrow down the trust to 10-20 different ones, and can go no further. Some loans, it is just impossible to find.
4. If the loan is Fannie Mae, then you will not be able to find out whether it was portfolio, placed into strips, Fannie Mae securitizations, or into private securitizations. The information just cannot be found under most circumstances. And Fannie Mae will not provide that information.
5. Sometimes, you cannot find the Trust, because the loan was not securitized. It is that simple.
After all this, you need to know how to use the information in the PSA. Most attorneys don’t know how to use it, so it is useless to them.
If you plan on using the PSA as a Pro Se litigant, forget it. Save the money for moving to a new home.
Comment by Patrick Pulatie on 18 July 2010:
Joe,
First off, you need to know that Chase has no intention of granting a loan modification, so they will calculate income as they see fit to decline the mod. After understanding that, you know your options.
Try Steve Haskins for the attorney in SD. 619-479-4351. He knows his stuff.
Comment by Patrick Pulatie on 18 July 2010:
Linda,
You need a competent attorney. That will be your only hope. Chase gave you the standard HAMP modification. But as you so aptly show, HAMP mods are recipes for failure.
What people don’t realize is that HAMP only applies to Fannie Mae and Freddie Mac loans. If the loan is privately securitized, then HAMP can be used, but often, many PSA’s allow for better modification terms than HAMP.
Your only hope will be to fight them in court. The government does not care, nor does the servicer. The investors, at this point, only want to get what they can and cash out the bonds. Nothing else.
Comment by Linda Robinson on 18 July 2010:
Do you have any attorney referrals for the Los Angeles County area that specialize in this type of situation? Also, thank you for your candid honesty…although the plight of this whole affair has been and is disheartening…I still manage to find the truth to be refreshing no matter how brutal it may be.
Comment by Patrick Pulatie on 18 July 2010:
Law Firm of Norberto Reyes. 213-382-6600
Tell him that I suggested that you call him.
Comment by Joe Bayani on 18 July 2010:
Hello Patrick,
Thank you for the attorney referral. I plan on calling them as soon as I hear back about the rental income situation. Have you done any work with the Steve Haskins firm. I would like to let him know that you referred him. What would it cost for you to go over my loan documents? Wouldn’t this help the Steve Haskins law firm on my situation to have as many options as possible to attack Chase?
Regards,
Joe
Comment by Patrick Pulatie on 19 July 2010:
Joe,
I never do an exam until after a person has spoken with an attorney and is ready to pull the trigger. That way, there is less of a chance of wasting a homeowners money. Usually, the attorney will order the exam himself. Just my way.
Haskins does good work. I have referred a couple of people to him in the past. They were satisfied with the results.
Comment by Elizabeth on 22 July 2010:
Patrick
I thought about what you said do you know a good lawyer in Houston Texas their is so many thing wrong with my documents I have a Fannie Mae loan and no assignments I went downe the county clerks office to search as a matter of fact the clerk did the search with and said its not unusal for no assignments to be found because they just don’t file them also I trust is with MERS.
I wait for the lawyer information before I do anything
Thanks so Patrick for your patience
Comment by Linda Robinson on 23 July 2010:
Mr. Pulatie, thank you for the referral to Mr. N. Reyes and I apologize for not responding sooner. I just wanted to verify that your referral was indeed for me because you did not list who the post was addressed to. Also, what exactly is his legal specialty? I checked his name on the CA State Bar site and I see something that I am not quite sure if I should be alarmed about or not. I do not want to prejudge him, can you tell me more about his credentials/expertise? Thanks, Linda.
Comment by Patrick Pulatie on 23 July 2010:
Elizabeth,
I apologize for coming on so strong with you, but I have found after three years of doing this that often people have to be talked to bluntly, and sometimes rudely, so that they see the point.
You are going to war against the lenders. And you are not just fighting the lenders, but you are also fighting the government which backs the banks, and you are fighting judges who simply have the viewpoint that you owe the money, so why aren’t you paying. As a result, you cannot afford to do it alone. There is just too much at stake otherwise. A good attorney knows the pitfalls and can try to work around them. A Pro Se litigant does not know these things, and only learns too late.
Securitization audits are quite complicated, at the least. Lenders are now trying to hide who the notes were sold to. They are having the Deed assigned to them and go into court claiming to own the Note. Only a few people know how to get around this, but it also takes a knowledgeable judge as well. The first thing that I would do would be to call the lender and see if they would reveal this information. After that, you can decide if one is needed. An attorney should always be the decider.
Unfortunately, I do not know attorneys in Texas who are getting good results. All you can do is to call around, and interview several, until you find one who understands what is going on, and can work with. Remember, you are marrying the attorney, so you must be able to work with him.
Comment by Patrick Pulatie on 23 July 2010:
Linda,
I checked out what was written about Reyes on the BAR website. It is not a big deal in the scheme of things. Co-mingling of Trust Funds, it happens. But it was in 96. The insufficient fund checks were likely the result of that.
Not returning phone calls. That is likely a client who expected to be contacted every day with status reports. When the case did not turn out as expected, a complaint was filed. I would not be concerned with it.
The reality that must be understood is that each attorney doing foreclosure is buried in business. They respond from emergency to emergency. They do what is critical at the moment and everything else gets put on hold in the meantime. The attorney just doesn’t have the time in the day to “hold hands” with the client every few minutes. If a client is not willing to accept that, then they should not have an attorney. Just a fact of life in this business.
(Heck, I run from emergency to emergency. Daily, I have to drop work that was planned so as to get something else out. My attorneys understand this. If they don’t, then I don’t work with them.
The key to Reyes is his staff. One attorney worked for a foreclosure title company at one time and understands the process. Another was an attorney for a lender. These people understand what is going on, and can fight better than other attorneys I know.
Comment by Linda Robinson on 24 July 2010:
Again, I thank you Patrick. Those were kinda’ my thoughts as I read the date and type of infraction but as a lay person I wasn’t sure what to make of it and wanted to check back with you first just to be sure. I will be contacting him first thing next week and will follow-up on your site periodically to keep you (and all the others frequenting your site) posted on events as they unfold.
Also, I have been conducting my own independent research, reading news articles and publications,and constantly searching the web for information, blogs, etc, trying to make sense of what has happened to me and has/is happening to so many others since this housing debacle began. After almost 2 years of seeking out direction and help, I find your website and feedback to be among the most well-written, well-communicated, and well-organized I have come across thus far. Even the people posting on this blog and sharing their experiences (the good, the bad, and the ugly) are among the most articulate, most determined,and most informed collection of folks I have come across to date. Thank you all.
Sink or swim, I’m glad I found you and I am somehow comforted in knowing that I am not alone in this fight.
Comment by Tina on 27 July 2010:
I am located near San Jose, ca. Super Jumbo, neg. am., pick-a-pay loan serviced by Aurora. After the first forbearance period they offered us a modification at almost double our original payment. If we could afford that I would not be asking for a modification (we denied the offer). Aurora says that our investor is not participating, yet they keep giving us a forbearance. We are now starting our second forbearance period for yet another 6 months. I don’t think that Aurora has any intention of modifying us. They have not filed a notice of default yet, so I would like to hire an attorney to see what my options are. I don’t want to wait until I am in foreclosure to start doing something. Could you refer me to someone in the Bay Area? Thank you.
Comment by Patrick Pulatie on 27 July 2010:
Call this attorney. His firm is in Oakland and does the best work in the Bay Area.
Law Office of Ronald Uy
1212 Broadway Avenue, Ste 820
Oakland CA 94612
510-835-3730
rvu_lawoffice@yahoo.com
Comment by Tina on 27 July 2010:
Thank you Patrick, I will give them a call. Stay tuned!!
Your website is wonderful!
Comment by Tina on 27 July 2010:
Thank you Patrick, I will give them a call. Stay tuned!!
BTW your website is wonderful!
Comment by nel on 30 July 2010:
Patrick: I have e-mailed my email adress to the ESB class action law suit attny and the ESB homeowner in charge person about 6 months
ago and I have never been contacted. What is new about this subject? Will you please refer my email adress to them? I realize you are busy and dont want to impose or perhaps they are no longer accepting ESB homeowners emails? TKS for your well researched guidance.
Comment by Elizabeth on 31 July 2010:
Hi Patrick
I know you said you don’t know any attorney’s in Texas but do you now any company that will do title, assignments and securitizations searches for a resonable fee?
Comment by Patrick Pulatie on 31 July 2010:
Nel,
Email to the homeowner leading the group mentioned above again.
Comment by Patrick Pulatie on 31 July 2010:
Elizabeth,
I don’t know of anyone in Texas who would do it. And, I don’t trust most people who claim to do them because there is just too much difficulty in finding the right information.
If there are No Assignments to the Trust, then it is extremely difficult to find the Trust. Countrywide, WMC, Indymac and others securitized loans in many different ways. Some they did on their own, and others they sold the loans to different lenders who securitized then.
That is why I only work with attorneys. If I can’t find the actual Trust, I can at least put together the argument showing it was securitized and then let discovery do the rest.
Comment by Marta Reinoso on 2 August 2010:
Hi Patrick,
I’m just now getting back to this blog and have read all that has happened since the last visit–things don’t look that good. Is there any hope for those of us who initially had WAMU as our servicer and now Chase? We have Chase as both our servicer and lender. Our third attempt to be modified is underway with attorney Aron Rofer with Avid Law Center. We would take the step loan mod it sounds like some are being offered and be happy with that as it saves our home. In your opinion, how do we get this to happen? I was thinking of filing a complaint with the department of financial institutions as a result of reading this site…is it worth the effort?
Comment by Marta Reinoso on 2 August 2010:
Hi Patrick,
Is Steve Haskins an attorney who deals with foreclosures? We live in San Diego and I saw that you’ve referred him to Joe. I called the office but nobody was available.
Comment by Marta Reinoso on 2 August 2010:
Question for Linda: Linda how did you file the complaint with the state of CA
Comment by Patrick Pulatie on 2 August 2010:
Marta,
I don’t deal with the lenders and I can’t give out advice. You need to speak with an attorney.
Haskins is good. In LA is a really good securitization attorney.
Norberto Reyes
213-382-6600
Comment by Don in San Diego, CA on 9 August 2010:
I am in the same boat as everyone else. CountryWide/BofA foreclosed on me while considering my loan modification for HAMP. They were dancing with me for four months, and I had a law group assisting me also. They snuck around the back door while they were performing a forensic audit and then foreclosed so quickly their negotiators didn’t even know as they were still trying to negotiate with me until I told them that I received a letter of foreclosure, then they were like, huh?, and then ended negotiations. I have a lawsuit that has been going along for almost a year now. The Judge has been ruling against the lender attorney’s demurrer, etc, motion to quash, blah blah. If anyone is interested in helping with my case, or joining in, it is in the Superior Court of California, Case No.: 37-2009-00102278-CU-BC-CTL.
Comment by Troy Kent on 26 August 2010:
Hello Marta, I noticed that you have used or are using the services of Aron Rofer in Aliso Viejo. You also asked for a recommendation of a San Diego lawyer. I was wondering: Were you asking for a SD attorney because you are not happy with Mr. Rofer or strictly for the sake of convenience since you live in San Diego? Also, if you wouldn’t mind, did you ever get through to Mr. Haskins’ office, and, if so, what do you think of them so far? I was recently referred to Mr. Rofer, but I have not scheduled an appointment yet. I live in Orange County, but I would be happy to travel the extra distance if Mr. Haskins is better. I just went through the acute aggravation of six months of trying to deal with Chase on my own and will not do that ever again. Thanks, Troy
Comment by bryan booren on 7 September 2010:
right on Pat, lets get the banksters and there buddys on the hill. I got chuck in seattle new to this action butt he can see the picture.we are all in school on this one,some longer than others.we have filed a suit,and need more of your support.thanks so far for audit , pulled the cat out of the bag.every american needs to see the real picture . THANKS AGAIN PAT.
Comment by Deborah Bean on 9 September 2010:
Dear Fellow Americans, My husband was injured at work almost two years ago and denied workers comp. He has worked for American Airlines 20 yrs. We have been in our home almost 10 years. Shortly after his injury I couldn’t continue financially supporting our household and my restaurant, which was only three years old. Citimortgage has strung us along for over a year and even requested money for escrow which we gladly paid. They refused for two different modifications, the last was a HAMP. They told us we were declined and sent us a letter of default. I noticed that the amount they say we are in default doesn’t include the reduced payments made. Apparently none of which was applied to escrow. Well we contacted them the other day to discuss a short sale and they said have considered us for another loan mod.. We feel like the horse with the proverbial carrot dangled in front of us. We are christians and believe in doing the right things. We have been honest with them, given them every thing they ask. But their intention was never to approve us. We did not buy to make money, or buy more house than we could afford, we have been here 10 years and was always on time, even up to the first loan modification. We could have made full payments most times there after. But it may have made finances uncomfortably tight. So a year later they want to continue this game! Psalms 118:8 says It is better to trust in the Lord than to put confidence in man. That is exactly what we are doing. If they want this house they can have it. We are not giving them another dime. America we have been duped. Our elite politicians, Barney Franks and Chris Dodd are responible for this mortgage mess. Now the Federal Reserve is putting the nails in the coffin. My children and grandchildren don’t stand a chance to have even half of what we have been afforded. We are losing more control of our lives thru fiscal gov’t mismanagement and individual freedoms being confiscated from us while we sleep! Pretty soon nobody will be able to own property. They will control what we eat, what we drive (if anything), where we live, how and who we worship. Wake up my friends!!! God grants us freedom, not any gov’t or man, they only guarantee oppression. Pray for America. LOVE, FAITH,HOPE,CHARITY AND PEACE.
Comment by Katerina on 16 September 2010:
Hi Patrick,
Thank you for your outstanding article. This is the first time I actually see someone analyzing the process from the right angle. Most folks want to believe there is help coming from the government or from their bank. Forgetting the old wisdom that banks only help those who don’t need help. I am in the same boat with most people on the blog. We just filed a complaint against Chase. We are accusing them of fraud in connection with loan modification. Nine months into the process after reading countless blogs it suddenly hit me, THERE IS NO LOAN MODIFICATION! This is all a scam, a game banks play waiting for the right moment to foreclose. How unbelievable, but true. The only way to get anywhere is to fight them in court. But how? Even attorneys go in the dark. I intuitively suggested predatory lending to my attorney. He did not support me on that. However if you think about the whole process it is completely fraudulent. We went through the process the first time for 8 months. Submitted and resubmitted countless documents. Finally were given a trial plan, which we completed. Just to get a denial letter three months later stating that our loan amount exceeds HAMP limits of $729,000. Like they did not know that before they put us on the trial plan! My loan amount is over $2,000,000. Give me a break Chase! When I called again to inquire about my options, Chase encouraged me to apply again. So I did, but concurrently filed a complaint. Presently waiting to see what happens. I like my attorney, however not sure if he knows what to expect. Not sure who knows. Banks deny us intelligent options when they take our modification applications, when they put us on trial plans. If I was told by Chase 12 months ago, that I am not eligible I would have made decision based on my real situation. Instead I was deceived by the bank. I was lured into this game just to find myself behind beyond return. This is fraud, deception and simply illegal on any level. I hope people can hear us, and get educated before they are too to fall victims of this legalized scam.
Are you familiar with any similar court cases? Any positive outcome recently? Really appreciate your input. Thank you. Katerina
Comment by Linda Robinson on 21 September 2010:
RE: Marta Reinoso
Hi Marta, I submitted my complaint online with the State of California Dept. of Financial Institutions (www.dfi.ca.gov). I also submitted my complaint to the Comptroller of the Currency Administrator of National Banks (www.helpwithmybank.gov). Put together your complaint letter and submit it to both agencies. FYI you can upload them electronically, fax it, mail it, etc.
Comment by Carmen B on 30 September 2010:
Hi Patrick
I was dealing with us bank and the invester of my loan was freddie mac I applied for a modification on 4/09 and they said I qualifyed for the Obama mod so they put me on a 3 month trial payments for 775.00 instead of 2000.00 so at the end of the 3 months I called them to see if they wanted me to continue with the payments and they told me that I had not qualifyed after all that they had already send me a letter which I did get it after and the reason they said was the value of my house well by then they wanted me to send them the money I got behind of those 3 months plus the new payment. I did not have the money to send them so I got a letter from hope that they would help me try to work with my lender for a modification so they tried and they said I was 300 short on my income to be able to qualify for a different loan so they said to try again when that changed so my daughter started to work for the summer and they started another mod at this time I got someone to help me. He started on the end of feb. 2010 and it took them6 months but mean while i got a letter saying my home was going to be action on 7/16/10 and before the date came up they were still working on the mod and the guy requested to extend the sale date 1 more month so they did so when the next sale date was 8/17/10 3 days before they requested a letter from my daughter saying she was contributing income to the home of 600.00 and at that time she had quit to go back to school and my mom gave me a letter saying she was going to give mew 600.00 a month for expenses but before this for a couple of weeks the mod man was requesting a extension again and the invester denyed it and they forcloused and they never told me if they even acepted the letter or what never got a deniel letter the only letter I got is someone came to my home and sewrved me with a letter from freddie mac attorney for cash for keys and saying freddie mac owns your home now. I did not wanted to signe for cash for keys or to lease my home. so I made a complain to bbb and us bank send me a letter now explaining to me why they did nt give me the Obama mod because the invester of my loan did not want to lower my balance of my loan 31% to be able to keep me on the payment that they had given me for the trial. Another words they were not willing to work with me they could of put me on a higher payment but they just said no and that is i. The reason I am very upset is that I bought my home 5 years ago and I put 150000.00 down and they are worried about their investment but who cares about mine right? I would like to know if there is a lawyer you can recomend here in Los Angeles California or San Fernando Valley area. Thank you so much
Comment by nelva fajardo on 2 October 2010:
THIS QUESTION IS FOR PATRICK AND/OR ANY OF THE WELL INFORMED PARTICIPANTS OF THIS GREAT GUIDE TO THE NEW GENERATION OF MISSINFORMED HOMEOWNERS. IN REGARDS TO TODAY ON LINE NEWS WHERE BOFA, CHASE, GMAC & ALLY FINANCIAL INCS HAVE HALTED THOUSANDS OF FORECLOSURE CASES AFTER IT BECAME PUBLIC THAT EMPLOYEES SIGNED DOCUMENTS IN FORECLOSURE CASES WITHOUT VERIFYNG THE INFORMATION IN THEM, ENTITIES THAT DID NOT HAVE THE RIGHT TO FORECLOSE, WETHER SOME OF THIS LENDERS COMPLY WITH A STATE (CA) CONSUMER PROTECTION LAW REQUIRING LENDERS TO CONTACT BORROWERS AT RISK OF FORECLOSURE TO DETERMINE WHETHER THEY QUALIFY FOR MORTGAGE ASSISTANCE, REQUIRING DOCUMEENTS TO VERIFY INFORMATION ON THE MORTGAGE, INCLUDING WHO OWNS IT. ALL THESE ALLEGED DISCREPANCYS ARE THE TYPE OF INFORMATION THAT AN UNINFORMED FORECLOSURE OR FORECLOSED HOMEOWNER SHOULD REVIEW IN THEIR PARTICULAR CASE.
THANKS, NEL
Comment by Linda on 14 October 2010:
Thank you Patrick for making sense of it all, especially the loan modification process that never gels.
To the readers, I have a doozy of one. I have a rental property in foreclosure and received the trustee sale notice yesterday. My tenant is opening my registered mail with confidential information in it clearly violating my privacy and mail fraud. Its clear he wrongfully obtained and used my personal data in some way that involves fraud, mail fraud or deception, for his economic gain. He then called and me and wanted to buy the property, of course much lower then it is worth, having used the information he read in my mail.
What action would you take? I don’t want to alienate the tenant. He is a good tenant with a lease. He also received the Intent to Sell property notice with no personal data on the letter.
18 U.S.C. § 1028(a)(7). This offense, in most circumstances, carries a maximum term of 15 years’ imprisonment, a fine, and criminal forfeiture of any personal property used or intended to be used to commit the offense.
Schemes to commit identity theft or fraud may also involve violations of other statutes such as identification fraud (18 U.S.C. § 1028), credit card fraud (18 U.S.C. § 1029), computer fraud (18 U.S.C. § 1030), mail fraud (18 U.S.C. § 1341), wire fraud (18 U.S.C. § 1343), or financial institution fraud (18 U.S.C. § 1344). Each of these federal offenses are felonies that carry substantial penalties in some cases, as high as 30 years’ imprisonment, fines, and criminal forfeiture.
Comment by Nora on 5 November 2010:
Hi Patrick,
I just found your blog and am happy to finally stumble onto good information. Like many people in this great country of ours have found myself in financial difficulties. I filed for a modification with WAMU in 2009, and I was told to default first for 90 days, then apply again which I did. So I am 3 months behind since March of 09, but have been paying since every month. I also received a trial mod. that went on for a few months then on Christmas day of 09, I was told that I did not qualify. So I filed again, and again and again since. I tried Hope and HUD, you name it now I am with NACA home save prog. but still fighting with the Chase. They have not filed a foreclosure on my property yet, and they refuse to tell me who actually owns the note on my home. I would like to take action before it’s too late. What’s your opinion and or take on Back’s Laws when it comes to assets protections against creditors especially those who purposefully deceived the borrowers? And what attorneys knowledgeable on all areas of predatory lending here in San Diego. I understand that you recommended one to another blogger, I would appreciate any assistance in this matter. And Patrick, thank you on behalf of myself and all those who have been helped by you and to those who desperately need help,
Sincerely,
Nora
Comment by Nora on 5 November 2010:
Hi again,
I meant Black’s Law on my previous comment. Can the UCC-1 financial statement and or a Common Law Lien help home owners to secure their investments?
Thanks again
Comment by Stephen Lillis on 19 November 2010:
Hi,
I have been searching the internet and dealing with Attorneys for 3 years now for an intelligent discussion of the modification and foreclosure process.
I knew in 2008 that Wells Fargo was stringing me along. I called them on it and they recorded a default the next day. It is painful to watch the Congress and everyone else miss the point. It is fraud.
I have a lawsuit against a Mortgage Broker. I question and a suggestion. The Notary backdated the signature page of the Deed of Trust to the date when I first signed some blank Loan Docs on a High Interest, High Fee loan and demanded I sign it. I thought I was completing the loan with the ‘Financial Institution. They then attached it to another Deed which now had a ‘Beneficiary’. In other words, another lender. So there are now two Deeds with the same date! And one signature. Is backdating considered Forgery?
Also, would you consider posting a list of the documents you request when you do an audit? Or sending me that information. I am suing the 3rd Lender who foreclosed and the Senior (Big Bank #1 for Modification fraud, as you rightly call it.
I have an Attorney now who has turned my case around and am going to show him your information this Saturday.
Thanks.
Comment by Marta Reinoso on 23 November 2010:
Thank you, Linda for the info. I’ll use it and really appreciate you getting back to me.
Troy, AVID will work hard for you. We are still trying for the mod unsuccessfully but the folks there give it everything they have and they do have a strong grasp on how to deal with these banks. Good luck and keep me posted.
Comment by Petra on 3 December 2010:
Hey Patrick. I am new to this site and came upon it by chance. I had been in loan modification hell with Chase since 9/09. Did it three times because of lost documents. Was dropped in 9/10. Last payment made. Went into a Chase branch because she said it can be done through her. Submitted all the paperwork, took until now 12/3, to find out I was denied because the investor did not want to participate in the program and Chase can’t make force them. I mad as hell, I want to fight just to expose what a shady, low down company this bank is. She also told me I do not qualify for a Chase Modification either, so it is a short sale, foreclosure or catch up with higher monthly payments..lol. Is all lost at this point? Can you recommend someone in the bay area?
Comment by john on 13 December 2010:
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about friedland law center.I created this topic to share the knowledge if anyone can give me a hand, cause some time before i
was in tension regarding my loan. but when i search on the net regarding legal advice of my loan. Then i got the link of this
site. When i talk to this community then they give me a very good advice. I suggest you to if you want any moderation in your loan part then visit friedland law center. I assure this center will
give you better advice.
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Comment by joan on 26 September 2011:
Patrick, thank you for the recommendation for the law office of Ronald Uy. After being completely jerked around by a Chase manager (having spent hours on the phone with them today), I called the firm this evening. Stephen Henrioulle spent a considerable amount of time on the phone with me, explaining all the possibilities regarding my mod-that-keeps-dying. I can’t say enough good things about them – it was first time I really got the straight deal. *Thank you*.
Comment by joan on 26 September 2011:
Patrick, I’d like to also thank you for your clarification of what the loan mod process is really about. In the next day or so, I’ll write up the summary of my series of phone calls to Chase, and the Kafka-esque conclusion, so I can add to the knowledge base.
I can now truly say, Chase has little to no intention of actually doing more than a few “for show” loan mods. They make a lot more money, more quickly, if the customers never go on a mod. None of my phone conversation would have made sense if I hadn’t read this blog first. Thank you.