financialcounselor

NATIONAL MORTGAGE SETTLEMENT

Billions to go Toward Reducing Principal Balances on Mortgages

  The federal government recently released details of the $25 billion settlement it has reached with the nation’s five biggest mortgage servicing companies concerning improprieties with their business activities. The money is earmarked for three main purposes:

–Reducing the principal balances of mortgage loans to bring them in line with current home  values

–Refinancing mortgages

and compensating people who lost a home to foreclosure

According to a factsheet released by the U.S. Department of Housing and Urban Development, homeowners eligible to have their mortgage balances reduced will be notified within the next nine months by the government administrator who will monitor the settlement.
The  five mortgage companies who are part of the settlement are Bank of America, Wells Fargo, Chase, GMAC/Ally Financial, and Citibank.
While HUD estimates that 2 million homeowners could see their mortgage balances reduced, it will be up to the five banks to determine which homeowners will be included in the program.
In addition, payments of between $1500 and $2000 will be paid to people who lost a home to foreclosure between 2008 and 2011, so long as certain criteria are met. The factsheet does not explain the criteria necessary for those people to qualify.
As with the government’s current housing program, Making Home Affordable, it will remain the choice of the mortgage companies as to which mortgages they choose to reduce the balances of.


  1. Although we were notified by the Dept of Housing and Urban Renewal of settlement and that we should qualify if we met one or more of the criteria. We had 4 choices i believe and i marked every box. We were never offered a mod. We were strung along and even though we hired a attorney firm from another state who found me. And, who continues with “no complaints” and pledged me if we can’t save your home we’ll return your money. Well a year later and we are waiting for our $ 2600.00.
    In fact, one of the criteria was did the bank goof up on the mod? Umm… first the attorney did. She didn’t submit my first app on time. She was going on vacation. Christmas. 30 days passed … waiting .. she says i still havent’ heard . Still in review. Another 2 weeks. And rejection. With no reason. Finally , my husband after getting another notification that we are back in foreclosure calls the bank. Talks to a high up who wanted to know how we got her extension. Hello you sent us the letter?
    So the ball is rolling and we have to submit new docs that took me a month to get in the first place and its never enough.
    Winding down we are approaching the end of October back and forth with need new, well time has gone by and we need all new again. And they didn’t ever like my copies of bank statements that the bank gave me. ” They don’t look real” What ! over and over fasttly appoaching the sale date.
    Thats right they did not postpone it this time. I am frantically calling this worker of Bank of Amer. Who out of the blue emails me saying hello, and all i need are these docs listed and we will have the mod going. Right….. then the attorney shimes in with i have this huge list of docs that bank wants and by this date. What !!!! i quickly email this worker of the bank and his reply was “oh no these are what is requested” Now chimes in this message on my voice mail, please call ****** we have a couple things before we can move forward. Yes, you have docs missing…. OMG …. i’m scrambling because the docs i sent to the worker guy. He didn’t submit on time….. and yep they do want all those items. And the worker ? He was transferred to another division dept. Huh?
    And the mysterious other new guy? who told me ” we don’t want your house ” we want you to stay in it” and also wanted to know who our bank of america liason was that was assigned to us. What liason. The one we never got cause opps ball dropped by someone . He didn’t return my calls , my faxes were hell to send. I got what i could into them.

    Fnally the morning of the sale. November 2, 2011 at 10 am he returns my call. ” sorry the investors said no” the sale was at 11 am and no one bid on it so it went on to Fannie Mae.

    Two days later a knock at the door from real estate people with paper work. Get out by this date and we’ll pay you 1800.00. We had 10 days. The day before Thanksgiving we moved in torential rains we had for 3 days. Our belongings many many ruined.
    We almost divorced. I yelled ‘ i hate you ” blaming his unemployment. My stress level snapped. I had been pushed over the edge. I went numb and didn’t want to be here anymore. Everything we had worked so hard for the last 20yrs was gone. Homeless. Family acted like and still does to this day, like we are leppers. Wow.
    Fortunately, we were not homeless and have a rental of a really nice property and if i do say, better than our house, in ways. But not, we have not unpacked completely. Its not home. And the house sold 6 months later for 10,000 over the asking price which was our owed amount of 148,000 so it sold for 158,000. Hmmmmm
    And as for the 800-2000 that we may receive for the settlement for lost to foreclosure people. Its nice, but i want my home back! You put me in a home again Bank of Amer. and the pain and sufffering you caused you can’t put a $$ amount on. You changed us forever.

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  4. And those of us that are in the unfortunate situation of dealing with a bank that absolutely refuses to modify ANYTHING, despite having a “government insured FHA loan”.

    My husband and I have been FIGHTING tooth and nail since 2009, have done EVERYTHING asked of us – even filed bankruptcy because the bank said that they would not modify our mortgage because we had too much unsecured debt. Then they denied us because we filed bankruptcy. Even after we have rebuilt our credit, no matter what, we are told that although we meet EVERY criteria, we are denied. We have depleted every penny from any savings for our retirement, our children’s college funds, even been given money from our parents, but no matter what, we are looking at losing our HOME. I say HOME, rather than house, because with all we have put into this, all we have fought so hard for, this is our home…not just a house. “Said Bank” has flat out told us that “it doesn’t matter that they would make more money by helping us and approving the modification. They would rather foreclose or short sale the house, and lose money, because if they approve the modification, then my husband and I would “win” and they will not let that happen.” [I wish I was making that up, believe me, but that is EXACTLY what we were told.] And believe me, they are holding tight to that. We found two different banks that would forgive the lateness, just to help us by lowering the interest rate and rewriting the loan for another 30 years. But “Said Bank” refused to be paid off by the other bank/credit union. REFUSED! Thus, again, doing everything in their power to try to take our home away from us.

    How is that even POSSIBLE?!? This is criminal. Period. This bank took a bad situation from my sickness, and my husband’s loss of overtime, and turned it into a 5 year long nightmare that we cannot get out of.

    So what are those of us in THIS kind of situation to do? The bank won’t work with us, and our so-called Government-Insured loan is useless because said government won’t make all banks that wrote FHA loans adhere to the policies and programs put in place FOR OUR EXACT SITUATION.

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