"Do you want fries with that?"

The last few weeks have been difficult.  Homeowners have found their way to my door with personal stories of loss, fear for their children and a deep sense of shame and embarrassment. There is anger, frustration and no one they can ask for help.  Law enforcement individuals might be sympathetic to a homeowners distress but must enforce a broken legal process.  Attorneys can be expensive and represent their own financial self-interest rather than a favorable outcome for their clients.  Certainly there are honest legal representatives, but how does the ordinary person know who is honest and who is not?

Wall Street and the banking industry created this housing crisis that in turn lead to the economic collapse we are now suffer.  Homeowners were conned into believing that it was OK to take out an exotic mortgage (subprime loan) as in two years when the interest rate adjust to where you can no longer afford to pay it, your home would have doubled in its value, at which point you can either sell the property for a huge profit or refinance to a lower fixed rate.

Well guess what? That never happened. The housing bubble popped, property values plummeted and unemployment rose to over 8%. Between 2004 and 2008, the height of the mortgage feeding frenzy, blacks were 2.8 times and Latinos were 2.2 times more likely than whites to receive subprime loans. White families too have been affected by the rampant and ongoing theft. Now, homeowners are left with an “investment” that is worth way less than they paid for it and a mortgage payment they cannot afford.

The banks and Wall Street executives carefully thought out who their first victims would be – low income and minority groups. In 2011, 20% of foreclosures and at risk for foreclosure were in minority neighborhoods while 25% were in low income communities. During the mortgage frenzy, securitization of mortgage loans were sloppy and carelessly done. This has led to fraud upon the courts, clouded titles, the now infamous “robo-signing,” endorsement in blank, no endorsements, loss notes, loss note affidavits, errors in note delivery practices, MERS (Mortgage Electronic Registration System created in 1990) and strange assignments of mortgages. It is hard to defend oneself when one does not quite understand the legal and banking systems and when English is not ones first language.

So, where do we go from here? Ah yes… the 25 billion dollar mortgage settlement. I hate to burst your bubble, but there is no settlement for homeowners. The banks got away without paying any money as “...they get credits against the settlement amount for ceasing all kinds of illegal activities that they agree to stop as part of the settlement.” (George W. Mantor, The Real Estate Professor.)

“Illegal activities” you say, why are the CEOs, CFOs, CEEOs, not in jail? I’m guessing that they are bankrolling both election campaigns and many will work for and represent those very CEOs, CFOs, etc., so they can’t jail their buddies (see revolving door).

As to the homeowners who are struggling, some are now homeless and/or scattered among family and friends willing take them in. The American Dream, education of our children and upward mobility has all been a trail of tears. I’m sure you’ve heard of the suicides as a result of a home being foreclosed (see the article “Death by Foreclosure”). In Florida, 10% or higher of our children have lived or live in owner-occupied homes that is in foreclosure or at risk for foreclosure. The stress of foreclosure has lasting effects on our children. As parents struggle with shattered nerves and fewer resources they sometimes engage in harsh and negative behaviors. In high foreclosure neighborhoods (blighted communities) children suffer as vacant homes (REO a/k/a bank owned properties) create havens for illegal activity, lower property values and a lower tax base. The results are lower social and educational achievements. 

Well, the 1% has got to have someone to ask them “do you want fries with that?”

Loan Modifications and How I Can Help.

In the wake of the Espinosa family's amazing victory (Citibank vs. Espinosa, see: http://www.occupyhomesmn.org/11th-hour-victorycitibank-cancels-foreclosure-auction-of-minneapolis-moms-home-commits-to-loan-modification-with-reduced-payments/) I am reminded of the loan modification workshop I attended in North Miami Beach in late April.  The main speaker was Raven Liberty, Esq., from Raven Liberty, P.A. and her focus that evening were the various changes to the HAMP program.  Ms. Liberty spoke at length about the many changes but emphasized the importance of having the "numbers" correct.  Each of the loan programs require an accurate and updated financial statement along with requested documentation.

In my experience, the loan package provided by the banks are not adequate to the task and so they keep asking repeatedly, for more and more information.  We know that the banks are not to be trusted so it begs the question, is it a mistake, did the loan officer forget to include the list of required documents?  I cannot answer those questions, but what I can do is assist any homeowner with getting his/her financial statement in a format that is bank acceptable and organizing the necessary documentation (including those not requested in the original loan package) for easy access by any loan officer.  The web-based, software program that I employ, apart from producing bank ready financial statements, has the ability to e-mail documentation to any loan officer and the homeowner with the push of a button, thus saving time & money.

I cannot guarantee, nobody can (the governing documents of the trust may not allow loan modifications) that this manner of presentation will get the homeowner the much needed loan modification but it will get the loan application the attention that is necessary to make that determination.

The process is tedious and attention to detail is absolutely necessary.  We know the banks are counting on homeowners to be stressed, frustrated and not equipped to deal with all the paperwork that goes into getting the loan package bank ready.  Let's not give them this perceived advantage.  If you or any one you know needs help, contact me and I will do everything I can to get the loan package bank ready.