I began trying to refinance my home in Half Moon Bay on the day Obama announced the supposed homeowner retention program. At first I wanted to do it because I was having trouble making payments during the fall and winter financial crisis. I'm still trying to do it because I'm about $150,000 under water, which wipes out my second lender completely and makes it impossible to refinance the house when the ARM adjusts. I have no equity, but I like living in the house. Eventually, the ARM will adjust and I will be kicked out or the payments will get higher.
Because I own my own business, Aurora Loan Services asked me for three years of tax returns, three months of bank statements, a year-to-date P&L, a hardship letter, and a personal financial statement. I sent them all, at a cost of about $100 by the time I printed everything at Kinko's and FedExed it to them. And then I had to turn around and do the same thing for Citibank which holds my home equity line, because the "mortgage" I was given is actually a melange of a mortgage and a HELOC (common in California avoid the very high rates for jumbo loans).
After about 60 days Aurora told me 1) I was not eligible for Obama's program because I didn't have an FHA loan, and 2) they couldn't do anything for me.
After I heard the government had put more pressure on the lenders to restructure mortgages, I reapplied. Once again, I had to send all those documents, and once again I was told they couldn't help me. Their "investors" had said no.
In April, I learned that if I could break even on paper I could refinance, so I sent everything again. This time Aurora asked for my 2008 return, and I sent it. They told me they were now very busy trying to restructure loans, and to wait 90 days.
I heard nothing, so I called: they said they were missing my tax returns, proof of the contracts responsible for my income for the rest of the year, and three months of current bank statements. I sent those in July. I called in August, and they asked me whether I remembered that I had to wait 90 days.
Last week I emailed them. And guess what? They told me they needed copies of my 2008 tax return, a year-to-date P&L, those contracts again, and proof of which bank deposits came from those contracts. You have no idea how hard it is to keep generating and updating these documents, even for me a person whose information is mostly in the cloud as mine is (not the contracts, which are sent to me by municipalities for signing as hard copies that I have to mail back).
It has been 9 months since I began trying for relief. So it's only fitting that this afternoon I went to see Michael Moore's Capitalism: A Love Story.
I urge you to see this film.
I am the first to agree that Michael Moore exaggerates. But in this movie, not so much. It is 100% true that Congress is owned by the financial institutions lock, stock and barrel. I don't care which party you belong to -- I'm an independent -- you should be outraged by this movie if you are young, or have children, or work, or build businesses. Because America has been, and continues to be, ruined for the rest of us by about a hundred people on "Wall Street" who have all the money and therefore run the government and your life. It's everything from credit card fees to subprime mortgages, to Ponzi schemes, to health insurance reform.
In Phoenix, the real estate market has bottomed and the "investors" are coming in and beating first-time home buyers to foreclosed houses with all cash deals. The banks don't care who they sell to; the people who want to take advantage of the tax credit can't get in on the deals.
Because Moore shows a lot of archival footage in the movie, I got to think about how much American life has deteriorated for the middle class during the past 25 years. When I started my business in 1980, I made a great deal more money doing essentially the same thing, and I had a pretty good life. Twenty-five years later, my standard of living has totally deteriorated. I personify the vanishing middle class, and so do most of you. I wouldn't ignore it if I were you. As my friend Fred says to me every Saturday night, "It's a good thing we're not going to be here to see what's coming."
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