Our Ontario foreclosure defense lawyers have worked in this field since before the Home Affordable Modification Program existed, and we know all too well that it doesn't have many fans. So we were disappointed but not surprised to read that a new federal survey finds most borrowers have had negative experiences with HAMP, as reported by housing counselors who work directly with borrowers. A May 26 article from HousingWire said only about 9 percent of respondents told the Government Accountability Office that their borrowers had had a positive experience with HAMP. The counselors had numerous criticisms of the way loan servicers handle loan modifications, including their organizational skills, lag time before responses and more.
The survey was taken in October of 2010, with about 500 responses from housing counselors. One complaint from about half of those responding was that loan servicers had no single point of contact working with them, making interactions slow and inconsistent. That problem may soon be addressed by a rule the Treasury Department made in May, but counselors had more. More than 86 percent said it took four months or longer for servicers to decide whether to grant a HAMP modification, in direct violation of HAMP guidelines; nearly half said it took more than seven months. Three-quarters said servicers lost paperwork. More than half said servicers' math inflated borrowers' incomes, making them seem ineligible when they were not. To solve those and other problems, 60 percent suggested that the Treasury Department sanction servicers that aren't measuring up.
As Corona foreclosure defense attorneys, we couldn't agree more. As this article notes, the GAO itself criticized Treasury a year ago for failing to sanction servicers that break the rules. Apparently, the department has not taken any more steps toward sanctions, although it has offered new rules and new tools in the last year. This lack of accountability directly fails homeowners by giving loan servicers the opportunity to deceive them, dual-track foreclosures and draw out the process for profit. It also indirectly fails homeowners by making HAMP itself look ineffective, which has led to political attempts to end it. We still believe HAMP can be useful if it's backed up with some kind of enforcement mechanism, but we do not recommend that borrowers wait for Treasury to create it.
Howard Law PC helps borrowers enforce HAMP rules through the courts whenever necessary to protect their homes and home equity. While HAMP does not specifically authorize enforcement lawsuits, it does provide clear guidelines for when borrowers are eligible for trial loan modifications, or to make trial modifications permanent. When servicers arbitrarily deny people who meet the criteria, our Fullerton foreclosure defense lawyers fight back with lawsuits. Suing generally gets the lender's attention right away, something that may be a relief to frustrated borrowers. It can also stop any foreclosure sale right away by court order, giving you time to make your case in court. And when you do make your case, it will be in front of an experienced judge -- not to a loan servicer that stands to make money from foreclosure fees.
If you're in default or you know you will be soon and your loan servicer is giving you the runaround, don't hesitate to call Howard Law to see what we can do. For a free, confidential case evaluation, send us a message online or call 1-800-872-5925.