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Open Letter to President Obama: Systemic LENDER MENDACITY in his MFA/HAMP Programs

Discussion in 'Making Home Affordable' started by Civic Sam, Jul 16, 2010.

  1. Civic Sam

    Civic Sam LoanSafe Member

    Hello all,
    Here’s a link to a letter to the President that I wrote as an at-risk homeowner whose HAMP application is being processed by GMAC. It offers a pretty comprehensive account of GMAC’s rigged application process.<o></o>
    Here’s an excerpt:

    I'd like to hear from fellow HAMP applicants, whether or not your HAMP experience has been similar to mine. I want to know just how accurate or inaccurate my letter to the President is.
    I also maintain a HAMP diary at Daily Kos.
    Thanks for taking a look and good luck everyone,
    Steve Sewall (Civic Sam)<o></o>
  2. MyHAMP

    MyHAMP LoanSafe Member

    Sounds accurate to me. Although I'm not with GMAC, I can tell you that during our trial, we once were advised to NOT make a trial-payment since it "was already paid in advance". We still paid it ang guess what? It actually WASN'T paid in advance!:mad:
  3. goldie

    goldie LoanSafe Member

    You might think about complaining to MHA Compliance, Fannie/Freddie (if applicable), FDIC, SIGTARP, Treasury, OCC, if you haven't already. Yes, it is totally rigged. The servicers profit more from keeping your loan in a constant state of delinquency for as long as possible (capitalizing on arrearages). Even though this article is from 04/10 its great at explaining it all...

    HAMP is there Hope or is it Hopeless?
  4. Civic Sam

    Civic Sam LoanSafe Member

    THANKS. great article. good suggestions.
  5. davephx

    davephx LoanSafe Member

    Most all servicers are playing the game to keep on trials as long as possible and not doing mods other than for maybe 10%.

    Sadly there is no way to enforce HAMP since it is not a law. The regulators have tied to beg, scream and expose by the monthly reports to shame then into doing more modes. But there is no way to force them - only Congress can make laws and HAMP is not a law.
  6. Civic Sam

    Civic Sam LoanSafe Member

    Thanks! I have incorporated your thought into the latest version of my letter to the President. I have worked my ass off on this letter with the hope it will speaks for millions of MFA applicants. It now endoreses the Loansafe (?) Petition to the US Government.

    As time permits, I am circulating it to housing reporters and public officials.

    Thanks again! Steve
  7. davephx

    davephx LoanSafe Member

    The President knows all these issues as does Congress but nothing they can do about it with the Republican block in the Senate.

    It has been topic of often heated angry discussions by Democrats now in 3 Congressional hearings over the past two years. If you hear the CSPAN video at times very heated. Lots of upset Democrats with R's just saying the banks are doing such a great job with their own in house not the worthless HAMP programs. They claim we don't send in doc, don't qualify and need to be renters not be on trials for loans we can not afford.

    In the heated discussion the frustration is there is no way for Treasury to enforce HAMP ( required under TARP but most repaid TARP loans).

    Most lawsuits have been tossed since we have no standing with the HAMP participation agreements between the Treasury and servicers. A few are pending using a different approach based on deception etc and some seek class action treatment. But this will take years to resolve in the Courts and doesn't help stopping foreclosure sales now.

    Here is why after being bailed out they still want to screw us:

    The banks and servicers have made an estimated $4 billion by offering struggling homeowners the false hope of a modification, collecting the trial payments for three to eight months, and inevitably foreclosing with the addition of late fees, fines, back payments, and foreclosure costs passed on to the homeowner.

    We had hoped all the media attention both nationally and locally in media all over the U.S. In Phoenix we had huge series on Phoenix TV for months about how people are so badly treated by servicers_ but the profit motive of banks is stronger than the screwing homeowners by not following the HAMP directives. More and more media is picking up on this. But the Republicans counter it with their usual lies and deceptions of how well the banks do if just don't have to bother with HAMP.

    I am at a loss for a solution. Obama and Treasury seem to realize their is nothing more they can do to get compliance and spin it basted on how it is SUPPOSE to be if HAMP directives were followed and ignore that they are not - maybe because there is nothing they can do without a law which the R's will of course block in the Senate.

    And the R's do a great PR job blaming those that can do nothing about it for R's political gains with so many folks that believe their lies and deceptions.
  8. auroraproblem

    auroraproblem LoanSafe Member

    I would take the advice posted higher above about the agencies to file that complaint with.

    Despite the claims of R this and D that (which quite frankly are delusional at best, hoping that one or the other is to blame so that false hope can be placed on the other); you will need to realize that no politician is going to help you. The agencies listed above may be able to respond with help.

    This is a battle between you and GMAC and you are the best hope for this coming out positive for you (and of course resources from this board). I would post that letter to every agency I could, then to GMAC. Make sure to be polite when you call, but persistent.

    When you discuss or draw up your hardship letter (yes, it does not hurt to send in another one, blanket it to as many GMAC people that you can), make sure to explain the benefits for them that they modify your loan.

    Wish you good luck; don't give up that fight even when it looks like it is over, it may not be.
  9. davephx

    davephx LoanSafe Member

    The hardship letter is not the problem - very rare here over the last 2 years is denial based on lack of hardship the issue.

    The issue is the billions the servicers make by making trials last as long as possible and on foreclosure sales. That is where they earn the huge fees and profits. And for about 80% of 1st mortgages its the taxpayers that take the loss not any bank.
  10. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    The trials alone are being abused by the servicers. Each month of a trial puts the homeowner at more risk of foreclosure, instead of being a path toward a mod. The banks realized a long time ago that getting someone more and more behind equates to bigger and bigger profits. Those who go on trials of 10-12 months, and were already behind when they started, and are later offered some kind of forbearance are by that point so deep in the hole that either a foreclosure occurs, or all those payments are added to the loan, and the servicer collects bigger fees on a bigger loan balance, and the bigger loan balance makes a redefault more likely and makes for bigger payments once the teaser 2% rate ends. If they really wanted to help people, they would not make you wait to be flat broke and two months late before qualifying to be considered for a mod, not qualified for a mod- but qualified to be considered for a mod. All the housing counselling notices tell borrowers not to wait to ask for help, and then they come up with a plan that makes you wait way too long before you get help. That is bass ackwards
  11. Civic Sam

    Civic Sam LoanSafe Member

    These comments are all helpful. You guys know the game better than I do, and unfortunately you all confirm my worst suspicions.
  12. Civic Sam

    Civic Sam LoanSafe Member

    Forgot to say I will be back, soon I hope, with comments to specific posts. I'd like to take steps to get housing reporters to cover this story, which as my letter says seems to me to have been largely neglected in the nation's news media. Am I mistaken. Does anyone know of good "lender mendacity" pieces in housing publications or in the likes of Fortune, US News & Business report, Business week, Time, Newsweek, The Nation, Slate, Huff Post, Daily Kos, public radio or pubic TV or in newspapers, etc?
  13. Civic Sam

    Civic Sam LoanSafe Member

    I've never made it as far as the trail payment period! I've been making full monthly payments for 16 months and have told GMAC that I am working full time and supplementing my wage income with social security and distributions from my modest IRA. I had thought that trial modifications were a big positive step forward. Not so?
  14. Civic Sam

    Civic Sam LoanSafe Member

    davephx, could you post here a link to those monthly reports - Treasury Department, I presume? And links to any other sources that may be helpful. I want to collect a whole bunch of sources, maybe feed it into a Wordpress blog that housing reporters could draw on in getting their hands around this whole mess.
  15. Civic Sam

    Civic Sam LoanSafe Member

  16. riddlemethisbatman

    riddlemethisbatman LoanSafe Member

  17. davephx

    davephx LoanSafe Member

  18. davephx

    davephx LoanSafe Member

    Not to discourage you the more the public tries to expose it the better.

    The problem is everyone in housing and Congress know the problem. There just is no way to enforce HAMP without a law.

    Media including national has run stories especially towards end of 2009 with the swat teams sent to the banks and the White House bankers meeting etc.

    One major Phoenix TV station has run stories of interviews with homeowners showing all the lost paperwork of banks etc for what.. since back in 2009. Was a daily story now maybe a few times a week. It is telling the true story.

    Zillions of similar media stories around the country documenting the terrible experiences getting HAMP mods because of the banks not following directives, losing paperwork etc.

    A loansafe person submitted tons of stories from folks here willing to be part of a big MSNBC story which was supposedly to run a few months ago.. or early this year but as far as I know was never aired.

    Also Congress very well aware from 3 Congressional hearings over last 2 year with some VERY upset Democrats but R's just think its a waste and we should be renters not irresponsible homeowners.

    It all broils down to the banks making billions by extending and foreclosing not mods. It may be immoral but there is nothing Obama/Treasury/Admin can do about it without any law from Congress.
  19. auroraproblem

    auroraproblem LoanSafe Member


    I would try to focus on the positive rather than the negative. The advice I give about the letter is only a single part of an overall package.

    You will get plenty of opinions on this forum like any others. The most important thing is to stay focused and positive.

    Would highly recommend the letter format being correct. It is not a matter of being denied based on the letter. The letter was to be sent to those agencies listed above (not to just your servicer who is unlikely to read it).

    Remember that opportunity is what you make of it and there is one here. You need to be prepared that you may be denied, that is not the end. You will be delayed, nor is that the end.

    We have all been there. Those of us who were approved sat in line since before HAMP and a year or more. I was denied on two other programs before HAMP was out, applied for HAMP and waited 8 more months for that (5 trial payments and 3 months delays prior to trials).

    After you send the letters, continue to call. Each week I called, be polite, explain your hardship (they may ask each time). You will get some that care, some that don't and some in the middle. You will get little information each time you call. You can though, get a positive outcome in the end.

    Hope some of that helps, there is no other way to put it. I don't want you to go away thinking it will be easy, but do want you to know it is possible. No one gives money away for nothing and reducing interest is giving money away (no matter how you want to look at it). You will have to fight for it.

    Good luck and best wishes.
  20. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Get mad, do the research, and take action. If you are right, keep fighting and hunting and writing and then do it again. Maybe some one will finally notice you. The sqeaky wheeel gets greased, while everyone else gets lubed.

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