Most of those with mortgage struggles engulfed in the foreclosure storm have become somewhat friendly with the initialized programs of recovery, beginning with HAMP, HOPE and FHA. Today, for our clients who visit our law firm with stacks and reams of failed modification attempts and long line histories of lender failings, we witness the results of the foreclosure rise since 2007.
Just a Few Statistics
AMP active trials are down by 33% this past month. The number of homeowners in limbo with their servicers and have not received any decision on their pending loan modification requests is soaring and new submissions have dropped by close to 90%. I have regularly seen and read that the average homeowner carries close to 80% of their income for debt servicing. After modification, it drops only by about 15%.
The Meaning is Quite Clear
Paying mortgages, credit card bills, utilities and basic family needs, for those affected by the economic chaos of the past several years, is simply staggering. Trial programs are routinely cancelled now after 3 months. More cancellations will be coming. The job and economic picture cannot sustain immediate repositioning for increased income. To easily sum it up, misery and worries are familiar patterns in our office.
Millions of Americans could have benefited by loan modifications but instead, over 600,000 have been canceled. Lenders and servicers were slow to participate, and slower to engage and populate their staff and equipment. And now, some "revel" in the failure of the loan modification process.
HOPE NOW (www.hopenow.com), an alliance between counselors, mortgage companies, investors, and other mortgage market participants to reach out to distressed homeowners, describes its non-HAMP success stories of principal and interest cuts, coupled with other boasts and efforts. But WHERE are these families? Because they certainly have not come in to our law firm! The transparency is clear and evident. The solution now rests within the courts of our state to protect our neighbors, families and friends from the devastating loss of their homes.
Some excellent information can be seen online at the "Know Your Options" website (www.knowyouroptions.com). It is bi-lingual and its services are free. Also, several major lending institutions have recently advertised the "Hope Loan Port", a system which provides services to the lenders, servicers and their borrowers involved in the loan modification process.
Take it to Court
Nonetheless, the failures of the Obama Administration in this process and the rising tide of foreclosure actions and lender repossessions of homes this year present those who have the singular desire to keep home their own with a dedicated purpose: to engage in our courts and answer the foreclosure summons. Bring your closing papers, paychecks, default letters and summonses into the very courthouses that were built with your tax dollars and insist upon good faith negotiations and lender responses. Identify those who have sued you seeking to sell your home at a foreclosure sale and insist upon proof of note purchases, mortgage assignments and commercial regularity in the legal arena.
And once we have entered upon this route of solutions, we must begin to look ahead and past those in our system whose leaning is to allow foreclosure sales to pass by without judicial scrutiny. For many in our courts, the thousands of homeowners who have entered are little more than overwhelming burdens to the judicial system that has never before witnessed foreclosure defense litigation. People fighting to keep their homes stand in line now, paying motion fees and submitting orders to show cause, arguing and pleading to stop foreclosure sales.
Our judiciary, court staff and clerks have shown remarkable patience, guidance and a willingness to listen; many themselves may even be suffering the same fate and most certainly have some degree of personal identification with those who appear before them. These tools have only been recently forged and invented, sometimes with success, and homes have been saved. Our clients consult on where to go; what to do if their homes have been sold at foreclosure sales and where our appellate courts stand if the homeowner now seeks to continue the battle to keep home their own.
Appeals-----the next step?
