Senator Al Franken (D-Minnesota), who in my opinion should be wearing a cape to work every day, introduced an amendment to the Financial Reform Bill that would create an Office of Homeowner Advocate to assist homeowners who have been denied a loan modification through HAMP.
The Franken Homeowner Advocate Amendment, according to the press release, would be funded from existing sources and its focus would be to assist homeowners who believe their mortgage servicer is breaking the rules.
Prominent homeowner and consumer advocates from sites like Givemebackmycredit.com, MFI-Miami, 4closurefraud.com, and my ShametheBanks.org, to name a few, have shown support for this amendment because it would add an obvious and much needed appeals process to a program that has been abused by lenders and loan servicers since its introduction early last year.
There is, however, a possibility that because of a push to move the Financial Reform Bill along before lobbyists manage to gut the thing with their toxic amendments that crucial amendments, like this one, may not make it into the bill.
In addition, since Franken's amendment on credit rating agencies was up for debate last week, it's unlikely that this amendment will make it to the floor in time. It could however make the cut for the Manager's package - particularly since it already has bi-partisan support.
Bloggers and consumer advocates are hoping to see this one make it. Most notably, White House communications director Dan Pfeiffer, who praised the amendment in his White House Blog post listing it as one of ten amendments that would strengthen the bill. "Simple, straightforward improvements that would further strengthen an already strong bill and really help American families. We'll call them the "Good Guys". Let's hope they prevail over the "Lobbyist Loopholes" as the debate moves forward," Pfeiffer wrote.
Back in January I wrote a piece called Loan Modifications: A $4 Billion Con Game. I noted that nearly one million homeowners had entered trial modifications and that the majority of them were denied permanent modifications. According to Propublica the total number of modifications that have been granted permanent status stands at less than 230,000. That would imply that nearly 800,000 were denied. None of them were given the opportunity to appeal the decision.
The reasons given by loan servicers and banks for denying modifications - after approving homeowners for a trial period and taking their money for several months - come in varying degrees of lunacy.
In one glaring example, after three months of receiving trial payments, GMAC told one couple they were denied a permanent modification because they made their payments early.
ShametheBanks.org has received hundreds of stories from homeowners who have been denied for equally ridiculous reasons. Kathleen Burt, from Fort Lauderdale, Florida was told by a Chase representative, "we're not obligated to follow the federal guidelines.True the numbers work, but the bank doesn't have to take you on if we won't make enough money."
Catherine and Brian D., of Paso Robles, CA were denied twice. Once for having too much income and another time for not having enough - their income never changed.
Other reasons homeowners have cited for being denied include, Brenda Reed, who was accused of forging survivor benefits awards; Staci K. was told she had equity in the house despite being $90k underwater; Martha W. was told that her address could not be verified; Michael L. was denied because "the investors wouldn't make money" after having taken his trial payments for nine months; Rick L. was told he didn't have sufficient income to make the payments he's been making for eight months - the bank subsequently increased his monthly payments by $500; and that's just a sampling.
In an interview with Huffington Post, Franken said, "One of the problems is that the servicers or representatives who talk to people on the phone don't seem to [have the necessary expertise]. That's sort of the problem that this [amendment] is addressing."
Once a homeowner has been denied a modification, they have no available resources to question or appeal the decision. There are no viable official channels available to them. They are, for the most part, left to the mercy of the arbitrary, unfair, and deceptive practices that were initially responsible for this mess.
According to a press release from Franken's office, "Lawyers report stories of contacting regulators about problems with the HAMP program, only to be told, 'If the servicer says this is correct, it must be correct.'" Are these the same regulators and servicers that didn't foresee the collapse of the housing bubble and created "liars loans"?
For anyone who's been through this process and in most cases ultimately been denied a modification, this idea of regulating and auditing this program makes so much sense that it should have been part of the program to begin with.
This amendment has already received impressive bi-partisan support . Keeping it from a vote would clearly not be in the best interest of the American people.
The decision to bring this amendment up for a vote or at the very least add it to the Manager's Package lies with Senator Dodd, whose constituents have also told their stories on ShametheBanks.org. Some GOP senator, despite the stories from constituents, are still on the fence when it comes to helping homeowners.
Those of you, like me, who have been through this process, are still in this process, or are about to experience this process know the crucial role an office like this would play. I urge you to reach out to your GOP Senators and Senator Dodd and let them know that this amendment must be considered and that without it homeowners are at the mercy of arbitrary and ridiculous decisions on the part of the banks.
Quashing this amendment would be tantamount to actively participating in the foreclosure and eviction of millions of families from their homes.
Call your GOP Senators. Find out how they feel about the amendment ... then tell them how you feel. You can find their number here: http://senate.gov/general/contact_information/senators_cfm.cfm
Chris Dodd's office number is (202) 224-2823. Let him know that Franken Homeowner Advocate Amendment is important to the success of the modification program and needs to be part of the bill. Tell him to go to ShametheBanks.org and read the stories from his constituents in Connecticut.
Here's a summary of the amendment from Franken's office:
When homeowners think that their mortgage servicer is breaking HAMP's rules, has lost their paperwork, or has otherwise done something wrong, it's very hard to figure out where to turn. They can call their servicer--but that often is a dead end. They can call the official hotline for homeowners at risk of foreclosure--but that only gets them to housing counselors who are working on a government contract and have no real authority to fix the problem or withhold servicer incentives. Homeowners who use their own lawyers or housing counselors to help them navigate HAMP often fare no better--lawyers report stories of contacting regulators about problems with the HAMP program, only to be told, "If the servicer says this is correct, it must be correct."SUMMARY
This amendment would address this problem, creating an Office of the Homeowner Advocate (OHA) modeled after the successful Office of the Taxpayer Advocate at IRS. OHA would be funded from money that is available for the costs of administering the HAMP program, but is not otherwise committed. OHA would:
*Have three primary functions:
- To assist homeowners, housing counselors, and housing lawyers in resolving problems with the HAMP program
- To identify areas (both individual and systemic) where homeowners, housing counselors, and housing lawyers are having problems in dealing with the HAMP program
- To identify possible administrative and legislative changes to HAMP*Have an independent director, appointed by the Secretary of Treasury in consultation with the Secretary of Housing and Urban Development. This director would have a background as an advocate for homeowners and have experience dealing with mortgage servicers. The director cannot have worked for a servicer or for the Treasury Department within the past four years.
*The Director of OHA will be available to testify in front of the Senate Banking Committee and House Committee on Financial Services at least four times a year, or at any time at the request of the Chairs of either committee, and will issue a formal report to Congress once a year.
*Staff designated by the Director would have the authority, on a case-by-case basis, to withhold incentives from servicers or require repayment of previously paid incentives.
*While a person is appealing their case through OHA, homes may not go to foreclosure sale until the OHA process is finished or 60 days have passed, whichever is shorter.
Follow Richard Zombeck on Twitter: www.twitter.com/zombeck
Stuart Whatley: Financial Reform Won't Alter Capitalism's Icarus Trajectory
This era's troubling reality is that economics now dictates our cultural values. We no longer have a say in how resources, production, and mutual prosperity should be systematized to achieve the best society for all.
The latest comment I received from BOA is that I "call too much". Told them I would call for the next 365 days until someone helps me.
April 26th, faxed complete financial package.
April 30th, was told they didn't receive full package.
May 6th, refaxed full package.
Again, told they didn't receive it.
Refaxed a third time on May 10th.
Letter from them shortly after saying we needed to start the process over as: 1.) They couldn't reach us at our phone # (flat out lie, they never called - remember I've been trying to get this for over a year, I know I'd return a call if I got one) and 2.) We didn't supply the financial information they needed. (wrong again, we faxed it three times).
Now they tell me they have amended the program (once again). I will be receiving a mod. packet via Fed Ex. They tell me it was sent on 5/24. Today is June 10th. No package yet.
People say don't blame Obama for Bush's problems. Well...Obama is the only president that I know of who within 90 days of office named a program after himself. He's an arrogant SOB who doesn't give a damn about this country.
There is no Obama plan to help homeowners. It's all a hoax.
3/11/ I fax in required paperwork.
3/25 They receive all my faxed required forms but need 3 months P&L detail. I fax 17 pages of Jan-Mar in detail.
3/29 They can't find the Sched E & Financial Analysis papers I sent - I refax.
4/14 They can't find Sched E, Rental Agreement, Financial Hardship, and 17 pages of P&L details. I refax.
4/16 They can't read the faxed hardship or the rental agreement pages. I refax.
4/19 They have all the forms they need.
5/4 They never needed 17 pages of details (just the original page I sent) but page 2 is missing. I refax.
5/5 I need to send a more recent P&L statement. Too much time has gone by and the gov may not accept app.
5/21 Check status. Told to call 888-714-4622 x 7108064 in the future. (line always busy)
5/7 Everything looks good. 'call back from time to time' to check status.
5/28 Says P&L needs to show business & not personal I&E. I send Jan - May 28 P&L.
6/4 Need it to be dated Jan - May 31.
6/8 Need my P&L - business only. That's what I sent. They refer to the entry 'studio'. I'm an artist. That is business. "You need to point that out and send us a letter'. We are disconnected.
This plan is simple and actionable.
Bankruptcy Judges dismiss unsecured debt.
Allow the Bankruptcy Judges to discharge the amount of the mortgage debt over and above the current value of the real estate securing the mortgage debt ... as it can now be argued that it is no longer secured debt.
We already have the infrastructure to handle this ... we have Bankruptcy Law ... the Bankruptcy Courts ... the Bankruptcy Judges ... and the Bankruptcy Attorneys.
Every other discussion and/or plan has led nowhere.
Why not the Bankruptcy Cramdown Bill ?
Come on Obama !
And, what's really bad, it's going to get really, really bad as deflation takes hold and millions join the ranks of the upsidedowners and defaulters. The next nine months will break this nation because hundreds of thousands will be affected by the mortgage meltdown, the Gulf Gusher, and the inability of "Obama's Economic Team" to develop "out of the box" solutions benefiting "mainstreet." They only know how to grease the skids for their money masters.
http://www.elliottwave.com/freeupdates/archives/2010/05/20/-Triggermen--of-the-Financial-Crisis.aspx
Franken's amendment is not only essential, it is imperative that homeowners be afforded an opportunity to appeal a HAMP denial.
I wish my state senators took more interest in their constituents, like Senator Franken.
I will be watching how my Senators vote too. And not only on this issue.
If they are not voting in the best interest of the Americans, I will be voting them out of office.
In Mexico in the mid-'90s Wall Street engineered a currency coup that tripled the debt owed by small businesses and family farms and also allowed for them to be massively ratejacked on top of it. Mexicans consequently formed the "el Barzon" movement and pushed back Wall Street and deposed their ruling party of 60+ years. In this country YouTube phenom Ann Minch has already declared the debtors' revolt and begun going after them http://www.revoltstartsnow.com
If you've been pushed under, you can read every other page of my book for free: http://www.scribd.com/doc/25443175/Debt-Hope-Down-and-Dirty-Survival-Strategies-Evaluation-Version-Complete
As a man that works on debt and financial management in the UK and has done so for more years than l care to remember l have seen the changes taking place over the past few years and could see the writing on the wall as the structures were left to open to the type of abuse that is now being seen. The mere fact that we discuss the figure of 800,000 or more amendments not going through and that only 230,000 made it proves the love of money triumphs over honesty every time.
I was told a simple story a long time ago and it was that if a man had a loaf of bread and another a pack of butter and a third a lump of cheese everyone could have a sandwich, but when one of the men wanted more and valued his commodity or goods above everyone else greed set in and all that was being built fell apart.
We need regulators with teeth not afraid of the banks lawyers and we need to get tough and legislate as a country be it US or UK in favour of lending becoming a last resort and not a first port of call. This would be a bitter pill for many but it would teach us to accept less and to share more, look at times in history when people helped each other and only in adversity or times of tribulation does this occur.
It’s crystal clear. From the very beginning the homeowners have gamed the system. They started by tricking the property appraiser (lender’s agent) into submitting an outcome-based appraisal.
Then, millions of homeowners shrewdly conned the “lenders” into dismissing all agency and fiduciary responsibility in the underwriting process….going so far as to force the “lenders” into forging documents.
Then, the greedy homeowners forced the “lenders” to securitize the loan in such a fashion as to bifurcate the mortgage from the note.
On top of that, the homeowners secretly cooked up the concept of “Credit Default Swaps” and forced the “lenders” to insure the collateral at the full (outcome based) value 30X over.
Having successfully pulled the wool over everyone’s eyes – these irresponsible homeowners showered themselves with well deserved bonuses.
Realizing they were too big to fail, these irresponsible, reckless homeowners lined the pockets of legislators and received enormous sums of taxpayer bailouts.
The result of these cunning maneuvers by the fraudulent homeowner scheme has them sitting fat and happy in the cat birds seat. Yup, that’s how they did it. And they’re getting away with it.
Savings drained – check, 401ks all gone – check. Kicked out of their homes – check. “Lenders” made whole many times over via Credit Default Swaps – check. Homeowners foreclosed and “lender” buys property for pennies on the dollar – check.
It’s about time we hold these homeowners accountable.
4closureFraud
ForeclosureHamlet dot org
LivingLies dot wordpress dot com
HP sould blast your post to MSM for the AP to pick up and distribute all over Aamerica.
And to SENATOR CHUCK GRASSLEY (R-IA) and SENATOR TOM HARKIN (D-IA), I am closely following your voting records.
How you vote on this amendment determines whether or not you will earn my vote.
If you pass this test in my selection process, you will still be under consideration. If you fail, I will vote for anyone who opposes you in the election. I will also examine your voting record on all other amendments to this financial stability bill.
Iowans and all Americans are sick and tired of our misrepresentation in Washington. The time has come to "put up or shut up".
We are watching you like hawks.
Unemployment is at the lowest levels in decades.
The housing market is thriving.
There is no such thing as securitization (that is also known as slicing and dicing home loans and selling them on Wall Street).
The economy is booming.
Wish I would have thought of that: just get a job.
Here's the problem. The Government needs huge amounts of money to function. It issues bonds for sale. Large institutions like banks buy them. Where would a large bank get the money? Free, from the Fed.
See? The Governments needs to raise money to pay its bills. It issues bonds to sell. Large banks go to the Fed and get money virtually interest free. They buy Government bonds. The Government in return promises the bond purchaser a fair return on his investment, say 4%.
What does this have to do with Main Street? Well, if Main Street recovers too quickly the Fed will have to raise interest rates to keep inflation well under control. Now the banks don't get free money anymore. So they will be looking for higher interest rates on the bonds they buy from the government. The government would quickly descend into a financial crisis if they had to pay higher interest rates to its bond holders. Therefore, it is in the Governments interest to keep the economy depressed for the time being. Until they can reduce their deficit somewhat so they can handle the inevitable interest rate increases.