Secretary of the Treasury, Jacob Lew, weighed in on the foreclosure crisis at a conference in late June celebrating the fifth anniversary of the Making Homes Affordable Program (HAMP) and waxed poetic about the program's alleged success. The problem for Lew, however, was explaining why only a quarter or so of the 46 billion originally promised as TARP relief to homeowner's has actually been paid out in the six years since the money was allocated. Treasury's head honcho tried to spin his way out of the quicksand by claiming that "HAMP and our other programs cannot be judged only on what they have done directly for homeowners. Treasury's housing assistance programs have become a model for the broader housing sector."
It was a "run-that-by-me-again" moment, a bit of clever obfuscation designed to divert attention from the administration's lack of concern regarding those directly impacted by the on-going foreclosure crisis. While HAMP was supposed to throw a life preserver to those drowning in default the program has turned out to be a life preserver in name only, more like its candy counterpart: looking good and tasting sweet but not providing any long term satisfaction.
At the conference Lew cast some bread upon the water -- announcing an extension of HAMP and related programs through 2016 -- and these crumbs were eagerly consumed by so-called housing advocates who, according to the New York Times, "applauded the extension, mainly because there is nothing yet to replace it" which speaks volumes about the sorry and short-sighted state of affairs considering that there's lots of meaningful stuff -- try mortgage principal reductions and foreclosure moratoriums -- that could provide real cement to shore up foreclosure defenses for at risk homeowners.
The largely nameless victims in this crisis brings to mind Jules Dassin's fabled 1948 film noir classic, Naked City, that explored the lives of New York's underclass. At the movies finale a disembodied narrator's voice proclaims, "There are 8 million stories in the Naked City, this has been one of them."
The movie inspired an idea. I'd like to host a party over at my place and invite a few foreclosure victims. Perhaps Secretary Lew might attend. He lives just a stone's throw from my digs in Westchester (he calls the Riverdale section of the Bronx home). Tim Geithner would be welcome as well. He hails from the nearby Westchester village of Mamaroneck. A meet and greet would give them a chance to chat with real flesh and blood individuals who've weathered the outrageous slings and arrows of an industry bent on driving them from their homes.
Here's are some names:
Bob and Stacy Schmidt, a Tennessee couple and victims of a 2007 Litton Loan Servicing/Deutsche Bank foreclosure. Their brutal eviction was documented for a Pacific Street Films documentary, Foreclosure's Harvest of Shame, (still in production). Not only did the Schmidt's lose their house but Bob's health took a nose dive. Despite being hospitalized numerous times he's made it abundantly clear that he's not throwing in the towel.
Steven Verdekel, a homeowner in Hawaii has been on the HAMP hamster wheel for quite some time care of Ocwen Financial, the non-bank servicer that's been in the regulatory cross hairs for the past few years (I investigated the company in articles for In These Times). Verdekel has submitting endless reams of requested documentation seeking to turn a temporary modification into a permanent one and has yet to receive an answer. His house and his life remain in limbo.
This next set of invitees have shouted to the high judicial heavens asking that their allegations of servicing fraud be taken seriously and despite the 2010 hoopla surrounding revelations of "robo-signing" still find law enforcement doors slammed shut in their faces.
Playing fast and loose with mortgage notes is what Pennsylvania resident JoAnne Kennedy claims Wells Fargo engaged in while prepping for a 2011 foreclosure. She's alleged that Wells fabricated a bogus note bearing her deceased husband's signature (her husband died in 1998) which they submitted to Fannie Mae in 2005. And for those who can't bring themselves to believe that a major bank would do such a thing: let me direct their attention to recent revelations of a secret foreclosure playbook that Wells used to help grease the eviction machinery.
In similar fashion Michigan resident KathyJo Enders Torrenga has tried to make sense out of the disparate links that don't seem to fit together in her mortgage's chain of title. Hunkered down in her house, fighting eviction, she finds it especially galling that the documentation to support the foreclosure was prepared by Trott & Trott, a foreclosure law firm whose deep pocketed CEO, David Trott -- also known as Michigan's "Foreclosure King," recently won the Republican nod for the upcoming 11th District Congressional race.
Montana resident, Mary McCulley, may find it difficult to attend. Currently she's a guest of the Federal government, serving time in the slammer for allegedly "impersonating" a government agent while investigating why her bank -- U.S. Bank -- decided to change a 300,000 30-year loan to a 200,000 loan due in eighteen months. A Montana Jury in February, 2014, found her accusations credible to the tune of six million dollars (a verdict reached several months before her incarceration). The case, first mentioned in a Salon.com article is a jaw dropper, and enough to make you wonder why Hollywood hasn't yet come knocking on her jail cell door.
These folks represent a constituency that's been victimized by an industry that just keeps steamrolling along looking for new ways to turn misery into money and they'll be getting together for their own soiree in mid-September in Dallas. Yes, the foreclosure empire will be striking back with some of the biggest names in mortgage banking and servicing in attendance, all trading notes on how best to thwart any strategic offensive by the defaulting homeless rabble. Break-out "labs" will discuss such tantalizing questions as:
Frivolous foreclosure defense litigation is a cottage industry. Can anything be done to stop it? Yes, it can! Let's talk about what.
And for those industry types who've found themselves wavering in the face of increased regulation and unconvinced that foreclosure's future is still theirs to exploit, please keep the faith. There will be an inspirational Q &A with Dubya and family -- the man who helped create the crisis - that will, no doubt, serve to restore confidence.
Joel Sucher is a filmmaker/writer with Pacific Street Films.