Millions Of Homeowners Don't Qualify For Obama's Mortgage Assistance Program

New York Times:

MESA, Ariz. - She had seen the advertisements for the new government program offering relief. She had heard President Obama promise that help was on the way for homeowners like her, people who had lost jobs and could no longer make their mortgage payments.

Read the whole story: New York Times

Comments

[ohiomark]

This is just more proof that when you rely on government and politicians to solve all your problems, you will be disappointed.

[formerprosecutor]

If the government created them through deregulation then they need to step in. right mr T(

[NedFlanders19]

We are told to go for the American Dream, and many have tried for the carrot at the end of the stick. Yet, one side of the equation has not done their part and has created a financial mess that affects the world. They have been labeled too big to fail and we've had our taxes go to prop up banks and financial organizations. Why on earth would any of the banks change their M.O. when there were no penalties and the government basically said - we won't let you fail no matter what. There is no impetus to change, and they are now using our bailout money to continue to play with homeowners lives.

The USA has gone from a great country to the greatest Ponzi scheme going in less than 10 years. We're supposed to keep flowing money into the system through taxes and paying off debts that were deemed nearly patriotic to have. What are we the people getting in return? The rich get richer, the same people who helped create this mess are still running the financial show, and the middle class is squeezed between a rock, a rock, another rock and a hard place. And we've been whipped into shape enough that we have little outrage, and complacently go down the road towards indentured servitude. That's what happens when money is more valued than people.

[AnnfromCA]

It's interesting. She could hold on if the program worked.

[pinkindie]

"Promised Help Is Elusive for Some Homeowners"


As a person who qualifies under all of the government's guidlines for help, and yet has recieved no help from their mortgage "investors" whatsoever (thanks, BofA), I say, no sh*t, Sherlock.

[formerprosecutor]

from an article on the new program:

"When modifying first mortgages, servicers can receive $1,000 up front, and $1,000 per year for three years. If the mortgage being modified is eligible and not yet delinquent, they can also receive $500, for a maximum possible total of $4,500.
Then borrowers who make their new payments can get up to $1,000 per year for five years, up to a total of $5,000. This money is paid to the lender or investor who holds the first mortgage, and it reduces the borrower's principle.­"

[rc42]

disregard first post.got distracted didnt read second page.

[StellaRay]

I just can't believe the commenters here going on about people living within their means. Sure, there are people out there who went overboard on credit cards or bought a house they couldn't afford. But this article is about a woman who represents many of the middle class who are now hanging by a thread, despite responsible behavior and never missing a payment. Because like millions of others she lost her job. And there's very few in this country that don't face the possibility of loosing their jobs
tomorrow.

The idea that Americans overusing their credit cards has caused the biggest economic disaster since the depression is ludicrous. We might have even survived the subprime mortgage fiasco if the banks hadn't packaged up the bad loans into credit swap defaults and proceeded to bet on them as if they were at tables in Las Vegas.

And now Countrywide, one of those banks that most needed the bailout to survive, offers to lower her payment $79 a month if she hands over another $18,000, pays $5,000 in fees and accepts a larger interest rate. OUTRAGEOUS. The fact that they even made this offer says a lot about the arrogant entitlement of corporate America. A simple "Sorry ma'm, we can't help you but we won't try to cash in on you now would have been a huge improvement.

[hairyhuman]

Countrywide was just recently bought out by Bank of America. I know... my mortgage was one of theirs.
So yeah... this is just an example of where people thought by voting him in, they would be saved.

[kiki800]

yes, because mccain/palin would have done so much better.

She doesn't seem all that different from many people who live fairly modestly. It's not like she owns a $500K home, a BMW, and vacationed in the Bahamas every year. She was doing fine until she lost her job and being 63 doesn't help finding another.

She refinanced to pay off credit card debt at a much higher rate and put a new roof on her house. That's not extravagant, that's LIFE. Perhaps she didn't qualify for loan modification, but BofA is also repellent for the bait and switch using the program a way to get suckers in and then switch them to a different type of loan with higher costs.

What's needed is for Elizabeth Warren to oversee these programs and come down hard on these companies doing this...and it's not just the fly-by-night ones, either!

[Lorianne]

She sucked the (bubble) equity out of her home and then some, piled up credit card debt, etc.

You're right, she represents many in the middle class (and other classes as well) who did exactly the same things she did ... but that is why were are in this pickle.

[AlanBJ]

Take it from someone who once serviced defaulted loans and foreclosed on behalf many major banks and mortgage lenders as well as monitor their loans under bankruptcy: This woman was financially irresponsible and would be a hard sell for a loan modification under loss mitigation.

New York Times should have chosen a more worthier subject ---like a financially prudent person paying his/her mortgage on time, not foolishly borrowing against his/her home, but may have lost a job because of a devastating economy. I believe those are the ones for which the president's mortgage assistance program was aimed.

I hated to foreclose on people, but I was good, whipping the attorneys to keep the ball rolling form the first legal action up until the actual foreclosure sale. And working on everything from million dollar loans to unpaid principle balances as low as $10,000, from insurers such as Fannie Mae, Freddie Mac, VA, and FHA, I had no sympathy for people such as this woman, obviously living beyond their means.

So quit it with the sensationalized article because this woman, and others like her, does not need, and should not receive any help based on her own foolishness.

[notAMoron]

I haven't seen one story from the NYT or any other media outlet showing someone who has been responsible and is in trouble.

The way to buy a house is pretty simple: 15-30 year fixed rate loan with 20% down. If you are saving for a down payment and you feel like a dog chasing a corvette, their is a bubble.

[talkpeople]

I bet her mortgage company called her and sent out countless flyers practically begging this women to refinace. They draw people in and then whamo run around saying oh she was so foolish. I guess she was foolish she listened to her mortgage company. HSBC is my mortgage company and they won't do a thing. They didn't receive any bailout from USA so what do they care. But after reading daily how US banks still after all the Money has been given to them, they take our money laugh in our face and slam the door on anyone who asks for help.
This may be our only chance to insist on reform in our government and the banking industry. We must not let them continue on business as usual. We need to force change make our voices heard and not stop shouting til something is done. Vote out the criminals. Need a list who voted against reform go to senate.gov and pull up the records.

[silvercreeklady]

I agree ..She bought the condo for $97k and if not had been irrisponsible with credit cards she would have a small balance today if she had not borrowed the entire equity she had.

Even with the roof repair she would only have a balance of less than $150k

She lived off her severance and did not attempt to find another job???

Did she vote for Obama thinking like some that she would get a check in the mail?

[formerprosecutor]

wow, I know people her age with doctorates that can't find work.

the lastest grad class of my law school has a 20% employment rate

does it make a difference how much she owes on the hosue if she has no income??

how do you knwo she didn't look for another job??

cancel your gym membership; you get enough exercise from jumoping toconclusions and judgments

[RRoadrunner]

This is a tough one. I thought the plan was to rescue those who were duped by the mortgage companies and not those who leveraged their homes to support a life style. If I read the article correctly the “equity” was used to pay off credit card debt and to purchase a new car. This scenario would make a lot of people eligible. I feel bad for this woman and ask the question do we really want to go down this slippery slope?

[militarymomforobama]

I just think it is a matter of current situation. She has been able to keep up so far. Yes, she is on the brink--but so are millions of others.

[formerprosecutor]

I thought it was to keep people in their homes IF AT ALL POSSIBLE

[formerprosecutor]

http://news.cincinnati.com/article/20090429/BIZ/904290353/-1/today/Treasury+unveils+anti-foreclosure+move

This article states the "stipend " WE are offering the lenders for the modifications in the latest plan

[Jigglypuff]

What a shoddy article.
1. The banks have had their own loan mitigation programs before Making Home Affordable was announced. How many homeowners did they help then? With unemployment rising all over the country, what have the banks done to help their downtrodden customers?
The Making Home Affordable Plan was announced in March. The banks said they needed time to figure it out and get their processes in place. In April, some banks were to begin processing qualifying Fannie Mae loans and in May, Freddie Mac loans. Even in these parameters, I've heard that qualifying customers received/are receiving the run-around and unprofessional responses from the big banks who are unwilling to implement MHA.
2. This lone case study of Eileen's mortgage troubles is a poor example. Her original mortgage exceeds the 105% maximum allowed to qualify for the Making Home Affordable Plan. The article also fails to explain whether it is a Fannie or Freddie loan on her condominium and doesn't account for her adding $66K to her original mortgage debt . This doesn't mean that Eileen's bank should not work with her to avoid foreclosure through their own means instead of trying to sell her into a regular refinance with really excessive fees.
3. Ultimately, mortgage owners can't count on the banks to help, nor, the government which the bankers own. The article should have directed homeowners to call a non-profit like ACORN and legal aid in their state to empower them to find a solution.

[militarymomforobama]

You make some very good points. I don't see this woman's case as a good example of what the plan was designed for.

[Schaef]

Obama's program costs tons of money and doesn't help the people it was claimed to be targeting?

Inconceivable!

[Countdown09]

This program wasn't designed for people who over extended themselves by using the equity in their homes to buy cars and pay off credit card debt. If it were I suspect millions of people would qualify.

[rc42]

did i miss something?to use obamas plan dont you have to go through make home affordable website or 800#?did she think that because banks got money from the gov to start lending again they would just start handing out money ?maybe she should actually try getting help from the plan before saying that it does not work.i m not try to be cold, i feel for her but nobody forced her to use her home like an atm.

[behindEnemyLines]

actually no your wrong. The banks utilize the plan. A person does not work through the government to get the modification advocated by the administration.

[SingingGuy]

The women in the article did what a lot of reasonable people did (and were coaxed to do). As long as she had her job, she was able to make her payments. Joblessness is her problem. You would think that the Loan Modification Program would be designed to try and help those who had made their mortgage payments faithfully for years, but who were now finding themselves in a bad spot. She's trying to do something while she's still current on her mortgage payment, before she starts missing payments. That sounds like the right thing to do to me.

As far as all of you holier than though commenters who say she deserves to be foreclosed on, you should be careful. As this foreclosure crisis continues to deepen, you could be next. Oh, but I'm sure then it would be different!

[Countdown09]

Coaxed? She had a home with a reasonable payment, what she CHOSE to do was use her equity to buy things like a car and increase her payments. I would assume she believed liked many people who are now upside down in their homes, that the price of her home would continue to appreciate in value, she took a gamble and lost.

[sueinmn]

All you conservatives, why are you not watching the unveiling of your god's staute? Reagan baby! He is your god correct? Screw the people and give to businesses all they want and even more!

[babo74]

Are you reading something else? I believe the article is slamming Obamas mortgage "rescue" plan? "She had heard President Obama promise that help was on the way for homeowners like her" So the left's take is that Reagan is forcing people out of their homes? That's far fetched even for the looney-left.

[sueinmn]

No on TV they just unveieled your GOD! Im surprised so many concervatives are here blogging whe such a big event is happening. YES I know what this article is about.