Last week, we profiled one couple's fight to save their home from foreclosure, and asked you to share your experiences with the Obama Administration's "homeowners' bailout," Making Home Affordable. (If you'd like to contribute, please email us your story and sign up here to receive updates about our foreclosure project.)
An overwhelming number of you wrote in to tell us about your experience negotiating a government loan modification. Those of you who responded had one major complaint about the Making Home Affordable program: that the process of dealing with banks and loan servicers is inefficient, frustrating and difficult to navigate. Those who eventually did receive a Home Affordable Modification often had waited for months. Our respondents cited lost paperwork, miscommunications and delays as some of the difficulties they faced in the loan modification process.
Part of the problem is that banks are hard-pressed to keep up with the sheer volume of borrowers having mortgage troubles. When the Making Home Affordable program was announced in February, few banks had the systems in place to handle the overwhelming number of requests for modifications that came pouring in -- and they're still struggling with the backlog. According to a Treasury Department press release (PDF) from May, Chase fields 8,000 to 10,000 calls about the MHA program every day.
On top of that, homeowners have had to deal with the banks' learning curve. The program was announced as the "Homeowner Affordability and Stability Plan" on February 18, but it wasn't until two weeks later that the Obama administration published detailed guidelines for how the program was to be implemented. These guidelines were revised in April and again in May.
Megan McCord claims that when she first contacted her bank about a Making Home Affordable loan modification, they didn't have a system in place to work with the Obama program. Since then, she's run up against more hurdles:
I've been getting the runaround since March from my mortgage holder, formerly Countrywide, now apparently Bank of America. Their MHA phone number sends a caller into a circle, on a goose chase, until eventually you get a person on the phone who has no authority and no ability to assist you in your endeavors to modify your loan.
After two months of calling, and being told to call back later when B of A knew what to do with the MHA program (which several of the people I got on the phone said the bank did not know how to handle yet...the biggest bank in the country doesn't know how to handle the MHA program???), I stopped paying my mortgage altogether to see of that would get their attention. It did. I was threatened with foreclosure by mail and was finally advised by someone I got on the phone to fax a hardship letter and certain financial documents, as well as pay off the few months of mortgage for which I was in arrears or face foreclosure, and then they just might get the ball rolling on considering me for a loan modification which could take 90 more days. They harassed me by phone sometimes three times a day until I paid my balance off, promising to set the modification wheels in motion if I did.
Now that I've paid, they are once again silent and unreachable. I have a hard time believing any kind of serious attempt to modify my loan is in the works. I'm frustrated and scared. This was not how President Obama intended this program to be carried out. Why does no one do anything about making these lenders comply?
For Rosette Garcia from San Diego, CA, the most frustrating part of the loan modification process is the lack of efficiency and organization on the part of overburdened banks:
As far as I and my family are concerned, the so-called 'homeowners' bailout' isn't working very well. The problem seems to be that when people are dealing with these big banks (our mortgage is with JPMorgan Chase), the right hand doesn't know what the left is doing. There seems to be no way to get our papers into the hands of the actual decision-makers. We have submitted our paperwork for a loan modification about 4 times. Each time, someone else calls to ask why we are not paying our mortgage payment and to tell us that they haven't received all the paperwork we've been sending! It is soooo frustrating. A couple of times when we called to inquire about the status of our modification application, we reached customer representatives in India and Panama! Seems to me that President Obama needs to make sure banks have a more streamlined and efficient process for dealing with distressed homeowners like me.
Gloria from Michigan is frustrated not only because of delays, but because those delays keep getting longer:
Since I live in Michigan and our economic downturn has been among the worst in the country, my home is under water like those thousands of others. My mortgage was sold to a company far away from Michigan, to a mortgage company that puts me on hold and says "your call is important to us" for hours. When I finally reach a real human being I am told first that it will take 4 to 6 weeks and more recently, that it will take 6 to 8.
John Ryan from Hartford, CT has been trying to come up with a solution to foreclosure for six months:
The Obama bailout is definitely not working. I am on schedule to lose my
house on July 15. We are working with Lend America to refinance with FHA to
save it... just step after step after step of bureaucracy. We have submitted
ten times the information we gave to get the mortgage in the first place.
Who is being helped by the the Making Home Affordable program? If you or a neighbor has applied for or received a Home Affordable loan modification, we're eager to hear from you. Send us your stories at submissions+foreclosure@huffingtonpost.com. And sign up here to receive further updates about our foreclosure project.
Find out more about Dispatches from the Displaced, HuffPost's Eyes&Ears series of reader-submitted foreclosure stories.