11/30/2010 04:58 pm ET Updated May 25, 2011

Borrowers Who Try & Try Again Rarely Succeed

As a real estate attorney in a depressed market, I am peppered with questions about why things aren't improving when rates and prices seem so attractively low. When I arrive at the part of my answer about bloated housing inventory being on the verge of swelling further following the next wave of foreclosures, it's about a 50-50 chance my questioner will scoff and utter some variation on, "I don't understand why people who lost their homes didn't try to work things out."

Most recently, a man expressed how perplexed he was about "This rash of foreclosures messing up Long Island. Seems to me, you get the bank on the blower and they'll work it out, since they want their money back."

I wasn't as patient or as nice as I should have been, replying with a semi-curt "Hah!" His delusion that mortgage holders harbor one ounce of benevolence, or even flirt with common sense, was just too much for me. I've spent a great deal of my time in the last few years working with underwater and overwhelmed mortgage borrowers. Alone and together, we've tried to negotiate with so-called "loan modifiers" or "workout" staff members who can't or won't deviate from their scripts, rebuffing all attempts to maneuver through systems designed to disappoint.

Whether the copious forms are carefully filled out online or demanded documents faxed or sent overnight, the lenders claim the paperwork was never received. Alternatively, weeks after being told, "Yes, that's all we need," further records are suddenly required.

Time drags on even as diligent borrowers check back in online or on the telephone, and additional arrears accrue, along with interest and late charges. As one department allegedly considers workout requests, tardy mortgages are targeted by another for foreclosure, generating further costs, fees, and expenses. Borrowers who found their original mortgages impossible to pay (but were trying to work things out) are now faced with insurmountable additional charges!

I know there are mortgage borrowers who just walk away from bad bargains or devastating situations, and their lenders hastily foreclose without any alternatives proposed. However, I'm using my soapbox here to dispel the notion that all floundering mortgage borrowers are apathetic, thus bringing on their own losses. "If at first you don't succeed, try, try again" really doesn't apply when dealing with many mortgage holders. In my experience, lenders are transforming the adage into "Try all you like, but your chances of success are slim to none."