I just updated you on the August Status Report which showed how poorly the mortgage companies participating in the Making Home Affordable Modification Program continued to perform.

You may recall that last month there was a post on the initial Status Report on the program through July.  In that I indicated that the work being done by Bank of America, Wells Fargo and Ocwen Financial was disgraceful.  You may wonder how they did in August.  Let me tell you right now

Their Performances Continue to Be Disgraceful

Here are the numbers from the August Report:

*Figures for Wells Fargo include those for Wachovia Mortgage.  The number of estimated loans eligible for Trial Modification for Wells Fargo in the August Report was lower than in the July report.  July’s total was 394,500.  No explanation was given.

All three companies lag far behind the trial modifications which have been offered by J.P.Morgan Chase, CitiMortgage and GMAC.  The initial comments from executives at Bank of America and Wells Fargo were that they were pleased with the significant improvement they had made since the July report was released.  I have yet to see any comments by any executive at Ocwen Financial.

As I indicated in my general post on the August report for this program, trial modifications have only been offered on 12% of the loans eligible for modification.  While the Bank of America, Wells Fargo and Ocwen Financial may have improved in August, their efforts in this program are still really bad.  It does not appear that they are making a serious effort to help people facing foreclosure try to save their homes.

If these three companies continue to perform so poorly, you can be sure that they will start to say that the people whom they are trying to help are not cooperating and getting them the information they need to determine if they eligible for a trial modification.  They will also probably say that because of their circumstances many do not qualify for a trial modification.

Both congressman and senators in Washington are already upset that the Making Home Affordable Modification Program has not been successful.  When they see how poorly Bank of America, Wells Fargo and Ocwen Financial are handling modifications, they will call for other action to be taken.  One course of action that has been talked about in the past is to require mandatory loan modifications where the mortgage company and the person facing foreclosure have to work out a plan. 

You can be sure that if this occurs, the mortgage companies will scream that there is too much government intervention into their industry.  Yet are they giving our elected officials any choice not to require mandatory loan modifications?

So what do you think your chances are for a loan modification if you are facing foreclosure and if your mortgage company is Bank of America, Wells Fargo or Ocwen Financial?  I would say that they are slim and that you will have to wait a long time.  If you represent yourself, your chance of success drops further.  I suggest you get outside help – someone to represent you.  You need someone in your corner to take on your company and battle to get the best loan modification for you. 

I also suggest that you learn as much as possible about the ways that you can save your home as you can.  One resource available to you is my EBook.  You can find out more about it by clicking Stop Foreclosure.

Much Success,

Mark Elkins

In a post to this blog in mid August I reported on the initial status report on the Making Home Affordable Modification Program which the Obama Administration released on August 4.

You may recall that I was really upset when I reviewed the report.  The mortgage companies participating in the program not only flunked in their handling of loan modifications, they barely scored.  That report revealed that trial modifications had started on only 9% of the 2,705,302 loans that were eligible for these modifications.

Only a 3% Increase

The Obama Administration released the report for August on September 9th.  Let me tell you – there wasn’t much improvement.  It was estimated that the number of loans eligible for loan modifications increased from 2,705,302 to 2,965,980.  Trial modifications have only been offered on 12% of these.  There was only an increase of 3%.

Some people tended to discount the initial report.  They felt that the mortgage companies had to ramp up their departments to handle the volume of requests they received for loan modifications and by the end of July these departments were just starting to move on the applications.

The figures in the August report discount that.  These indicate that the mortgage companies are not doing a good job on loan modifications.  The horror stories that  we have been hearing and reading about where loan modifications are being given at the last minute and only through outside pressure are just the tip of the iceberg.  Most people facing foreclosure who have applied for loan modifications are not talking about the problems they are encountering.

Saxon Mortgage – The Best Performing Company

The August report indicates that Saxon Mortgage is the best performing mortgage company.  They have authorized trial modifications on 39% of the estimated 73,694 loans that are eligible.  39% is not good.  However, the next highest large company is GMAC.  They have offered trial modifications on 26% of the estimated loans they have that are eligible for modifications.

Don’t Be Misled By Saxon’s Statistics

I was all set to commend Saxon for the job they were doing, that is, until I did a Google search on them.

The first place I started was their website.  I was encouraged.  There they said “Our goal is to provide valued services with Care, Responsibility and Attention to detail to ensure a unique and positive experience with Saxon.  At Saxon, we pledge to deliver courteous and knowledgeable responses to all customer inquiries.”

Then I checked to see what their customers, the people facing foreclosure, had to say about them.  Most said that they were the worst company to deal with.  The problems ranged from poor service to poor record keeping to not recording payments promptly to losing documents sent to them.  I found very few instances where people had any positive comments about the company.  I said to myself – if this is the company with the best record to date in the Making Home Affordable Modification Program what are the others like.

Yet People Believe They Can Deal Directly With These Companies Themselves

Over and over again I see and hear stories of people facing foreclosure who feel that they can deal with their mortgage company, get the modification they need and save their home.  In my opinion these people are just setting themselves up to be slaughtered.  Anyone facing foreclosure should get a lawyer or an expert in stopping foreclosure to help them.

You also need all of the knowledge available to help you to deal with your situation.  In my book, The Stop Foreclosure Answer Book, there is much information on what you can expect and how to deal with it.  You can find out more about my book by clicking Stop Foreclosure.

Much Success,

Mark Elkins

Here is another horror story that I saw in the news recently.

A Florida man lost his home to foreclosure in mid July. The home went to his mortgage company, U S Bank. You won’t believe the reason that this happened. A local judge would not stop the foreclosure.

The man, Jerry Gomez, started having financial challenges when his painting business died in 2008. At the same time his monthly mortgage payment increased. He couldn’t make the new monthly payment and the foreclosure process started.

Jerry had been working with a housing counselor to try to save his home. When the Making Home Affordable Modification Program started in March of this year, they applied for a loan modification.

His request for a modification was approved. He sent his first payment under the modification to U S Bank, his mortgage company. They accepted and cashed it. He sent a copy of the check to the local judge requesting him to stop the sale of his home. The judge denied his request and let the sale proceed.

Representatives from U S Bank worked with Jerry and his housing counselor on the modification. It was totally acceptable to them. They wanted the process to stop. They did not want the sale to take place. Yet the judge didn’t honor their request.

Most probably this is not the end of the story. I would imagine that this will be corrected and Jerry Gomez will be allowed to keep his home.

It’s just another strange thing that can happen during this foreclosure crisis that the country is in.

If you are facing foreclosure and if you feel that you are being zapped by your mortgage company or the system in your attempts to save your home, you may want to get the news media involved. They have been very powerful in alerting the public to what is happening. Normally public outcry can get wrongs corrected. For more stop foreclosure information click here.

Much Success,

Mark Elkins

You may be in one of two spots right now.  Your mortgage company has started the foreclosure process against you. Or – Money is getting tight and you know that there is no way that you will be able to continue to make your monthly mortgage payments.  You decide to find out whether you qualify for a modification to your mortgage.

What is your first step?  Do you call your mortgage company?  Most people would naturally conclude that is a great starting point.  However, is it really.  I saw an article by a reporter for the Associated Press in August that you need to be aware of.

30 of the 38 Mortgage Companies in the Making Home Affordable Modification Program Already Sued or In The Process of Being Sued

Yes, you read that properly.  Legal action had or has been filed against 30 of the Mortgage Companies participating the Making Home Affordable Modification Program.  Many of these suits alleged these companies harassed borrowers, charged for unnecessary insurance polices or hit the borrowers with illegal fees.

These are not small companies either.  One is Countrywide which is now a part of Bank of America.  Another is Wachovia which is part of Wells Fargo.   Washington Mutual is also there.  They are now part of JPMorgan Chase.  Citigroup is also in the mix.  You may want to check to see if your mortgage company ihas been sued if it is not one that I have mentioned here.

In prior posts on my blog I have relayed horror stories of what people have gone through trying to get their mortgage modified.  In most instances when their stories were reported in the news and the public got involved, their mortgage companies offered them a loan modification.

So I ask you again

Do You Really Think You Can Trust Your Mortgage Company?

Is your mortgage company going to have your best interests at heart?  Are they going to review your situation carefully?  Are they going to offer you a loan modification which will truly help you save your home?  Are they going to offer you the best loan modification for you and your circumstances?

While you want to believe that your mortgage company is looking out for you and will do the best for you, this track record of legal action and horror stories does not support that.  You really need an advocate working for you, someone who will review the circumstances of your case thoroughly and help you get the correct solution.

That is the reason I recommend that rather than dealing with your mortgage company on your own and trying to get a modification of your loan, get either a lawyer or an expert to help you. They will do the best job to help you save your home and protect your family in the process.

You may want to check out my Ebook by clicking here.  In the book you will find much more information which will help you.

Much Success,

Mark Elkins

September 2, 2009

You may never have heard of them. I know I never did. However after hearing about them I know that I would like to do business with them.

Who am I talking about? First Federal Bank of California. They are a wholly owned subsidiary of FirstFed Financial Corp. They are federally chartered and have 39 offices in southern California.

What is so great about this bank? Their success in helping their customers, people who have home loans through them, stay in their homes and avert foreclosure.

I was amazed when I read their story.

Through May of this year they had modified the loans of over 2,000 of their customers. The total of these loans was over $1billion. They didn’t wait until the Making Home Affordable Program started. They didn’t wait until the government urged them to take action. They started early.

When the housing crisis started, they were very aggressive in their response. They reached out to every borrower whose mortgage was set to reset and where the payments would increase. They encouraged them to modify their loans if they knew that they were going to have difficulty making the new higher payments. The borrowers did not have to be behind on their monthly payments. Loans were modified before the borrowers could not make the payments. Their chairperson and Chief Executive Officer, Babette Heimbuch, said “As a community bank, we are committed to responding quickly to the needs of our customers. These mortgages are more than loan numbers; they represent people.”

What has their success rate been? It is significantly higher than the success rate for large national lenders. At the end of May, more than half of the borrowers who had their mortgages modified by the large national lenders were behind on their payments again. A little over 80% of the customers at the First Federal Bank of California whose loans were modified were still current on their monthly payments.

Only 29.1% of their customers have fallen behind on their payments after their loans were modified. Nationwide 63.3% of borrowers nationwide had fallen behind.

The First Federal Bank of California has improved their loan modification program as they have gone along. They have seen what works and what does not work. Only 15.6% of customers who had their loans modified during the third quarter of 2008 had fallen behind on their monthly payments. For the national lenders 59.5% of borrowers whose loans were modified during that quarter had fallen behind.

Why has this bank been so successful? I would say that the main reason is that they showed that they genuinely cared for the customers who came to them for loans. They saw the problem developing and knew that they had to reach out. They may not have known the best way to modify loans initially. However, they learned as they went along. They are still learning.

How do you think their customers have reacted to this? I am sure that it has had a tremendous positive impact not only on those whose loans were modified but every customer who have accounts at the bank. I believe that most have looked at the bank and said that they were really fortunate to havefound such a great institution.

As I thought about this more, I kept on thinking about Jimmy Stewart in the movie, “It’s a Wonderful Life.” Isn’t that the way banks are supposed to be? Isn’t that what the First Federal Bank of California? How long will it take the National Lenders to stop looking at how much money they can make and to start focusing on each of their customers especially those who are experiencing financial challenges?

Much Success,

Mark Elkins