How Do You Modify A 2-Party Contract With Only 1 Party Present? HAMP!

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COMBO ANALYSIS TITLE AND SECURITIZATION

House GOP Pushes HAMP Repeal

EDITOR’S COMMENT: THE REAL REASON IS THAT HAMP IS EXPOSING FATAL FLAWS IN THE CHAIN OF TITLE, AND FATAL FLAWS IN MILLIONS OF “FORECLOSURES” THAT SUPPOSEDLY ARE CLOSED OUT. The question keeps popping up now after being accepted without thought for years: can a servicer modify a mortgage? If a servicer reports to the court that the investors turned it down, can the borrower inquire as to the veracity of that statement? And if the borrower starts asking investors questions what ELSE is going to come out that Wall Street doesn’t want anyone to see?

Foreclosure

First Posted: 01/28/11 02:18 PM Updated: 01/31/11 12:06 PM

WASHINGTON — Three leading House Republicans have introduced legislation to repeal the Home Affordable Modification Program, the Obama administration’s signature foreclosure-relief effort, calling it a “colossal failure” and seconding an inspector general report that found the program ultimately left many participating homeowners worse off.

By most objective measures, the diagnosis of failure is a fair one. HAMP has bounced more people than it’s helped and has no hope of reaching its original goal, as stated by President Obama in February 2009, of reducing mortgage payments for 3 to 4 million homeowners — a goal the administration has since disavowed.

The main requirement for HAMP eligibility is that a borrower’s monthly payments amount to more than 31 percent of monthly income. Eligible borrowers who make three months of trial payments are supposed to be granted five years worth of “permanent” reduced payments. But these temporary-reduction periods often drag on far longer than three months, as banks lose paperwork and offer shifting excuses.

Borrowers who are ultimately rejected from the program are then required to make up the difference between the lower rates they received during the trial period and their full mortgage payments. If they can’t come up with the money, they lose their house to foreclosure even if they never missed a payment before they applied for HAMP.

The bill to unwind the program is being put forward by Rep. Jim Jordan (R-Ohio) — the head of the Republican Study Committee, a powerful bloc of conservative Republicans — as well as House Oversight Committee Chairman Darrell Issa (R-Calif.) and Rep. Patrick McHenry (R-N.C.), a former member of House leadership. Jordan is chair of the newly renamed Regulatory Affairs, Stimulus Oversight and Government Spending subcommittee on the oversight panel.

“HAMP is a colossal failure,” Jordan said in a statement. “In many cases, it has hurt the very people it promised to help. It’s one more example of why government interference in the private sector doesn’t work and that’s why it should be repealed.”

Progressive critics of HAMP, however, argue that the program failed because there was insufficient government interference — that the program relied too heavily on bank cooperation and lacked necessary enforcement powers (the Treasury Department has not sanctioned a single mortgage servicer for violating HAMP guidelines). But in the face of HAMP’s failure, that’s a tough argument to make.

“[W]hat is infuriating is that their logic is practically unassailable at this point,” writes David Dayen of FireDogLake, a longtime critic of the program. “And this is why HAMP was so damaging. The government ruined its own brand with a program that hurt the people it was meant to help. This is why I’ve said for almost a year that HAMP gravely hurt liberalism. I cannot argue with Issa and Jordan and McHenry when they say that HAMP has to go.”

The House bill would snag the unspent HAMP money and return it to the Treasury to pay down the national debt. Despite the program’s lack of results, advocates fighting the foreclosure crisis are loathe to lose the few remaining dollars still available to combat the problem, especially given the new political dynamic in the House, which is unlikely to produce any money to fund other foreclosure-relief efforts.

“There’s no doubt HAMP is a flawed program, but to simply throw it away would make a bad situation worse,” said Chris Vaeth, legislative director for the low-income homeowner advocate Greenlining Institute. “What we need to do is fix it — push lenders and loan servicers to reduce the principal on underwater loans and give struggling homeowners real relief. Otherwise, we’re looking at millions more foreclosures, more devastated neighborhoods and a continuing drag on the economy.”

The Republicans’ bill seconds the conclusion of the Inspector General for the Troubled Asset Relief Program — that in some cases, HAMP actually causes the foreclosures it’s designed to prevent by luring current or slightly-delinquent borrowers to make reduced trial payments that leave them severely delinquent. The legislation states that “many homeowners whose modifications were canceled suffered because they made futile payments — some were even forced into foreclosure as a result.”

Bea Garwood of Pinckney, Mich. told HuffPost in August that that’s what happened to her. “They told us we were a great candidate, so we went for it,” she said. “And as a result we’re losing our home.”

Dave Graham of Big Bear City, Calif. told HuffPost this month that he wouldn’t have fallen so far behind if it weren’t for HAMP. “I would have found some way to [make my payments] if I had to,” he said. “It may even been that we’d have fallen behind a month or two. I certainly wouldn’t have been in this sort of shape.”

Troy Taliancich of New Orleans said he could have caught up if Bank of America hadn’t told him to make reduced payments, while Linda Cooks of Aurora, Col. said in November she wished she’d saved the $893.86 she paid each month during the futile trial period. “That’s money I could have put to getting another place,” she said. “I thought I had a chance.”

The Treasury Department said in a statement that the GOP bill would bad for homeowners.

“If enacted, this legislation would close the door to struggling homeowners seeking relief in the face of the worst housing crisis in generations,” said a Treasury spokeswoman in an email to HuffPost. “The Administration remains committed to reaching eligible homeowners to give them every opportunity to avoid foreclosure and will continue working to make our programs as effective as possible.”

22 Responses

  1. Know your enemy, become your enemy, learn everything you can about your enemy in order to defeat your enemy.
    Here are the actually websites and information used in training a HAMP housing counselor.
    It’s a lot of material to look thru, but well worth the time.
    Remember, what you don’t know can hurt you. What you do know can help you win.
    Go get’em! Knock their socks off!

    Chapter I: MHA MHA Handbook v3.0 36

    3 Escalation of Borrower Inquiries
    The guidance in this Section 3 is effective February 1, 2011.
    3.1 Treasury’s Borrower Support Centers
    The HOPE™ Hotline, a 24-hour telephone help-line operated by the non-profit, Homeownership
    Preservation Foundation, provides homeowners with free foreclosure prevention information and
    housing counseling referrals. Under contract with the Program Administrator, the HOPE™ Hotline
    assists borrowers with a preliminary assessment of their eligibility for MHA Programs and also
    connects borrowers with detailed program or denial questions to MHA Help, a team of housing
    counselors dedicated exclusively to working with borrowers and servicers to resolve MHA
    escalated cases. Treasury established a similar resolution resource, the HAMP Solution Center
    (HSC), to manage escalated cases received from housing counselors, government offices, and
    other third parties acting on behalf of a borrower.

    Specially trained personnel at MHA Help and HSC handle Escalated Cases (as defined in
    Section 3.2), evaluating the circumstances and status of a borrower’s request for assistance
    under an MHA Program and working with the servicer to identify and resolve the case in a
    manner consistent with MHA program guidelines. To facilitate review and response to cases
    escalated to servicers by HSC and MHA Help, servicers must report to HSC or MHA Help the
    status of referred Escalated Cases and, upon request, provide all necessary information required
    to assess the borrower’s Escalated Case, including, but not limited to:

     Debt and income inputs, assumptions, and calculations used to evaluate the borrower;
     Name of the investor/guarantor and Pool ID if the reason for denial is “Investor/Guarantor
    Not Participating,” unless restricted by confidentiality;
     Correspondence by either the borrower or the servicer relative to the applicable MHA
    Program evaluation;
     Timeline of events constructed by the servicer relative to the applicable MHA Program
    evaluation; and Other relevant data relied upon by the servicer in conducting the evaluation.
    Servicers must permit calls with MHA Help or HSC to be recorded for quality control and training
    purposes.

    sites with more info:
    https://www.hmpadmin.com/portal/resources/counseling.jsp
    https://www.hmpadmin.com/portal/learningcenter/index.jsp
    https://www.hmpadmin.com/portal/learningcenter/checklists.jsp

    For those interested in becoming a housing counselor:
    http://www.nhnla.org/index.cfm?fuseaction=Calendar.eventDetail&eventId=77&nodeID=1

  2. Millie: Please show your lawyer this information.
    IF you only missed 2 payments then you qualify for the repayment program.
    THEY CAN’T TURN YOU DOWN IF REPAYMENT CAN BE DONE QUICKLY AND IS THE BEST WAY TO GO.
    (I can help you avoid eviction in CA, you have many more options than you realize. Have you been to court yet on the eviction? A quick, legal delay is to simply ask for a new judge, no reason has to be given.)
    Your case is a prime example of the scam being run on clients, force you into a mod then deny the mod.

    The guidelines call for REPAYMENT PLANS TO BE OFFERED FIRST. To work out someway for the homeowner to catch up missed payments, get current and stay current on payments.
    The servicers get paid $400 for that.
    If a repayment plan can’t be worked out then a MODIFICATION PLAN should be tried next, with trial payment plan that ends with the homeowner getting a complete MODIFICATION FROM THE LENDER.

    http://www.hud.gov/offices/hsg/sfh/hcc/hcc_home.cfm

    This is in the Handbook for counselors:
    Report them to HUD and HAMP.

    Email :
    escalations@hmpadmin.com to ask questions, report servicers that are not responsive, cooperative or who made errors, etc, or
    visit the website: http://www.hmpadmin.com
    OR check out the guidelines for yourself at:
    https://eclass.hud-nsctraining.com/

    The servicers get $800 for setting up the trial modification plan, then they get paid $1900 more for getting the homeowner to the end of the trial modification.
    Servicers can’t foreclose, they don’t own the property and have no standing in court.

    How many people have you heard of the got a repayment plan or were offered a repayment plan?
    None, same here, none.
    Why are people pushed into the TRIAL MODIFICATIONS?
    IT PAYS MORE AND THERE IS NO REQUIREMENT FOR A MODIFICATION TO BE APPROVED OR COMPLETED TO GET PAID.
    Which plan do you see being pushed?
    MODIFICATIONS, HAMP KEEPS SHOOTING ITSELF IN THE FOOT!
    I signed up for the training as a housing counselor with HUD, that is where I found all the information on HAMP!
    Who is gonna turn down nearly $2000 in bonuses and not be held responsible for the outcome? No requirements to complete the project, get paid for doing a half-assed job, who would turn that down?

  3. Neil- in reading my prior post, I neglected to mention that you may have 4000 people per month paying 19.95 per month which is of course just a tad shy of 80k per month or 960,000 per year. This will of course be a shotgun approach, but informative to all subscribers. Thanks, Ian

  4. Neil Garfield- while we are all grateful (at least I think we are all grateful) for the unreimbursed time which you spend on LL, I have an idea, whereby you could begin a small monthly payment sidebar (for lack of a better term) where someone on your staff could post more instructive answers to a lot of the queries on LL which go unanswered, like ships passing in the night. For instance, I see that a combo title/securitization search is 195/month for 6 months, could you perhaps have an open forum type service for $19.95/month,perhaps you could have several staff answer questions, post informative links, possibly on a 2nd site? Just thinking out loud. Also, a series of blank letters to AGs nationwide, addressing various topics, where readers could print out the letter, write in their AG address, stamp and send. I think this is a good idea, minimizing the amt. of time needed to send these letters out. Emails are one thing, printed snail mail letters are entirely different. I appreciate your thoughts on these items, sincerely, Ian Sopko. You have my email.

  5. We are losing our home that we owned “free and clear” (paid cash for it in 2005), and 2 years took out a relatively small HELOC loan (for home repairs), which we later tried to modify via HAMP “just because” we had heard about this great Government Program that was supposed to help people lower their payments!. We had never missed a payment before nor were anywhere near default…but HAMP got us anyhow…thanks to our Loan Servicer, SLS! We were instructed by SLS to “miss a few payments” during the loan mod application approval process…so we are losing our entire home, all of our equity…over 2 lousy payments that we tried to repay, but they refused, jumped the gun and filed the NOD 2 weeks early! Shysters!

    We went on a local tv station and told how the Federal HAMP program backfired on us. They’ll be doing an update soon on how we are being evicted in a few weeks because the CA courts have denied us due process of law, and have barred us from protesting the fraudulent foreclosure! We’re fighting and in the Appellate stage now!

  6. Deb wynn,
    Yes — Nes pas — and could use a little help from courts –and Congress — and HAMP — who should know contract law.

  7. My motto:
    KNOW YOUR ENEMY!

  8. I can sign up as soon as I take the exam and get certified.
    I also found out that Greenpath, the largest bunch of counselors, has taken in more than a million dollars between their 2 offices! And they are some of the worst. Part of the reason I figured I could do better for myself.
    GMAC is hiring any warm body that can handle irate people and understand the work.
    Will keep you updated, I haven’t much else to do while it’s storming anyway.
    I can say the if they had done the program like it was supposed to be done from the beginning, there would be fewer lawsuits, less confusion, far far fewer foreclosures and most of the homeowners would be caught up and out of danger.
    If only…

  9. Last comment per Soliman

  10. Anon so listen therefor they have to admit that the contract is null and void in the first instance
    Nes pas ?

  11. Deb wynn,

    Yeah — You don’t — and you can’t — that is also why it must be a new contract.

    Mary — can you go in now and challenge the (non) contract?? —- I am not an attorney — this is contract law — any attorneys have answer???.

  12. How do you modify a Loan thst never was never perfected

  13. Anon: I know you did tell me that a week ago.

    I just want to say to everyone, I am very proud of all of you that contribute and help each other .

    You are all very supportive and I thank each and every one of you for all you do for yourselves and each other.

    God Bless you all.

  14. Cheryl- good inside info you got by signing up for training as a HUD couselor. Now….any way you can sign up for a training counselor for a servicer? And then get back to us, of course…..

  15. Mary,
    A modification is a modification of the original contract. But, if terms of original contract are changed — it must be a new contract. Servicer must identify the creditor for the NEW contract. They are not the new creditor — and any contract signed is then invalid.

  16. Nobody has checked the actual guidelines for HAMP!
    I did, and found some amazing things about HAMP.
    The true problem with HAMP is that the servicers are making a fortune off the program by NOT HELPING PEOPLE.
    The guidelines call for REPAYMENT PLANS TO BE OFFERED FIRST. To work out someway for the homeowner to catch up missed payments, get current and stay current on payments.
    The servicers get paid $400 for that.
    If a repayment plan can’t be worked out then a MODIFICATION PLAN should be tried next, with trial payment plan that ends with the homeowner getting a complete MODIFICATION FROM THE LENDER.
    The servicers get $800 for setting up the trial modification plan, then they get paid $1900 more for getting the homeowner to the end of the trial modification.
    How many people have you heard of the got a repayment plan or were offered a repayment plan?
    None, same here, none.
    Why are people pushed into the TRIAL MODIFICATIONS?
    IT PAYS MORE AND THERE IS NO REQUIREMENT FOR A MODIFICATION TO BE APPROVED OR COMPLETED TO GET PAID.
    Which plan do you see being pushed?
    MODIFICATIONS, HAMP KEEPS SHOOTING ITSELF IN THE FOOT!
    I signed up for the training as a housing counselor with HUD, that is where I found all the information on HAMP!
    Who is gonna turn down nearly $2000 in bonuses and not be held responsible for the outcome? No requirements to complete the project, get paid for doing a half-assed job, who would turn that down?
    Guess who helped to write the guidelines for HAMP?
    THE BANKERS, THAT’S WHO!

  17. ………sign both copies and we might send one back to you……..

    yeah, like that’s legal.

    and the space for notarization of YOUR signature is on the last page, all by itself, apart from the signature said notarization is said to notarize.

    yeah, that’s…..
    nevermind……

  18. At this point, since “creating a new loan” is contrary to REMIC tax law, we are affirming an extinguished debt, one that has been written off, and the amount of the debt being increased exponentially, without any ability on the behalf of the borrower to survive.

  19. Anon:

    What if servicer, states it is holder in modification and that note and mortgage still in effect?

    Does that mean the servicer modified the loan for the original lender on note and mortgage, with their permission?

    No one signed my mod other than a person for the servicer corp.

  20. Neil is right – “How Do You Modify A 2-Party Contract With Only 1 Party Present? HAMP!”

    When TARP was initiated — the bail-out for banks was supposed to include help for homeowners via HAMP. Why was program made voluntary? Because it is not the banks that would be modifying but, rather, distressed debt buyers who refuse to identify themselves. One party present for 2-party mod contract — you. Any modification signed by servicer without identification of current creditor is invalid.

  21. EDITOR’S COMMENT: THE REAL REASON IS THAT HAMP IS EXPOSING FATAL FLAWS IN THE CHAIN OF TITLE, AND FATAL FLAWS IN MILLIONS OF “FORECLOSURES” THAT SUPPOSEDLY ARE CLOSED OUT.
    **************************************************
    Doesn’t matter ,, the truth is out .. It’s nationwide QT time.

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