While Hundreds of Thousands have been Denied a Loan Modification, this Couple was Practically Begged to take One
On any given day, a person can find stories in the news about homeowners who beg and plead with their mortgage company for inclusion in the government’s Making Home Affordable loan modification program. Loan modifications have become so sought after that a whole criminal industry has sprung up, where con artists promise homeowners to get their mortgages modified for an upfront fee. (The Federal Trade Commission recently made it a crime to do this.)
But a woman who recently called our agency told me that she spent the entire summer fielding calls from her mortgage company, Bank of America, repeatedly offering to modify her loan through the MHA program.
“They would call all the time and offer the modification to us,” said the client, Sandy. “I talked to supervisors and told them to quit calling. And it still didn’t stop. It was torture. It was three times a week at least. They’d call me and my husband. It went on for 6 months.”
What happened was Sandy had lost her job in December 2009, and by spring they were two months behind on their house payment. Sandy had called the mortgage company to let them know they would be having problems. When they did, Bank of America had them apply for a MHA loan modification (as they do with most borrowers who call with problems). After two months, which is very short for most applications, they were notified the modification was approved.
But Sandy turned it down because it would have only reduced the payment by $30 per month, no where close to let them afford the house. Luckily Sandy found another job, and they borrowed money from their family to bring the mortgage current. But Bank of America wouldn’t take no for an answer, and spent the next six months hounding these people.
Adding another layer of weirdness to story, Sandy told me that in June, Bank of America didn’t credit their account for that month’s payment even though the money for the house payment indeed left her account.
“When I called to ask why they didn’t credit the payment, they told me it was because they wanted to give us the loan modification. So they basically kept the money from the payment in limbo.”
According to most statistics available, of those who apply for a loan modification, more than half are denied.