Banks defrauding us- Banks think loan mods and customers are a JOKE
[h=1]The Mortgage Fix That Can Save the Economy[/h]<script type="text/javascript">contributorName = "Ann Brenoff";var primarycategory = "News";</script>
| By
Ann Brenoff 
| Posted Aug 25th 2011 12:30PM <fb:like class=" fb_edge_widget_with_comment fb_iframe_widget" href="http://realestate.aol.com/blog/2011/08/25/the-mortgage-fix-that-can-save-the-economy/" ref="article" width="300" action="like" show_faces="false" layout="standard"></fb:like>
<iframe style="POSITION: static; BORDER-BOTTOM-STYLE: none; BORDER-RIGHT-STYLE: none; MARGIN: 0px; WIDTH: 38px; BORDER-TOP-STYLE: none; HEIGHT: 24px; VISIBILITY: visible; BORDER-LEFT-STYLE: none; TOP: 0px; LEFT: 0px" id="I1_1314894030281" title="+1" tabindex="-1" vspace="0" marginheight="0" src="https://plusone.google.com/u/0/_/+1/fastbutton?url=http%3A%2F%2Frealestate.aol.com%2Fblog%2F2011%2F08%2F25%2Fthe-mortgage-fix-that-can-save-the-economy%2F&size=standard&count=false&annotation=&hl=en-US&jsh=r%3Bgc%2F23579912-2b1b2e17#id=I1_1314894030281&parent=http%3A%2F%2Frealestate.aol.com&rpctoken=771042082&_methods=onPlusOne%2C_ready%2C_close%2C_open%2C_resizeMe" allowtransparency="" name="I1_1314894030281" marginwidth="0" hspace="0" scrolling="no" width="100%" frameborder="0"></iframe>
The loan modification programs have been a joke.
You have a house that has tanked in value and the best the banks can come up with is a plan where they sort of delay what you owe long enough for you to get back on your financial feet -- if that -- based on the flawed logic that the housing market is certain to improve in just a matter of months.
The real answer for what ails us is a Third Rail solution that banks don't want to touch: Erase some of the amount we borrowed, a process known as a principal reduction. To do so would share the burden of the housing crash with the lenders who helped create it. It would also allow us to get on with our lives, and, according to The New Bottom Line,
save the economy in the process. Got your attention now, didn't we? <style type="text/css">#mini_module { width: 265px; height:220px; border: none; float:left; margin:10px; font-size:12px;} #mini_module img {border:none; width: 265px; height:131px; border: none; margin:0px; } #mini_module .mini_title { margin: 0px; padding:0px; width:265px; height:131px;} #mini_module .mini_main { margin: 0px; padding:0px; width:265px; height:85px; background: transparent url(http://www.aolcdn.com/travel/bg-short)} #mini_module .mini_item {padding:12px 0px; margin: 0px 20px; border-bottom:1px dotted #CCCCCC;} #mini_module a { color: #49A3CA; text-decoration:none; } #mini_module a:hover { color: #F98419; text-decoration:underline;}</style>
Banks would rather poke out their proverbial eyes with sharp sticks than offer principal reductions. Only 2.8 percent of all loan modifications in the first quarter of 2011 involved any actual sort of
principal reduction, according to the ratings agency DBRS. And that number is actually up a full percentage point from the same time last year.
But some analysts believe that the industry-wide reluctance to perform principal reductions on a wide scale is actually what is holding back the housing recovery.
If lenders would reduce all underwater mortgages to their current market value, the nation's banks could pump $71 billion per year into the economy, create more than 1 million jobs annually and save families up to $6,500 per year on mortgage payments, according to
The New Bottom Line, a collaborative of 1,000 faith-based and community organizations who want Wall Street held accountable for the mess it created.
Grassroots organizations associated with The New Bottom Line have called on state attorneys general to investigate banks for
foreclosure fraud and to work for a settlement that includes large-scale principal reduction for borrowers.
According to the report, "The Win/Win Solution: How Fixing the Housing Crisis Will Create One Million Jobs," homeowners are struggling to pay their "boom-era mortgages with their recession-era salaries" and the economy is suffering for it. The report adds: "Writing down the principals and interest rates on all underwater mortgages to market value would serve as the second stimulus that America so desperately needs, only without added costs to taxpayers." Amen to that part.
The plan says that the money that homeowners would save on their mortgage payments each month would be spent instead on groceries, clothing, and household necessities.
As consumer demand increased, businesses would start hiring again.
The plan projects an annual stimulus of $20.5 billion in California alone, leading to 300,000 new jobs a year created there. A $12 billion stimulus to the economy of Florida would result in almost 180,000 new jobs.
The report says that in 2010, the nation's top six banks paid out more than twice the cost of the plan ($71 billion per year) in bonuses and compensation alone ($146 billion in 2010).
And that currently, the country's banks have cash reserves of $1.64 trillion -- a historic high.
comments below.
http://www.loansafe.org/forum/
by BJW - August 29th 2011 @ 12:13PM
The US government bailed out the banks over a year ago. It is now time for the banks to thank the American people by helping out with a reduction of some sort. Make it a drop in mortgage interest rates, or a drop in the principal. We helped them out of a jam, now it is their turn to help us out of a jam.
by Reza - August 29th 2011 @ 12:04PM
It makes a lot of sense. It is unbelievable that the banks prefer to go through foreclosure, auction a property and let the property go most of the times one third of the original loan but, not willing to reduce the principle which most of the time up to half or less amount of the loan. Needless to mention that the reduction would definitely, stimulate the economy and will help the desperate families to save their home and have a better quality life.
How stupid and arrogance of the Banks/Lenders. After all they have got their loss covered by various insurance and the Government help.
by GB55 - August 29th 2011 @ 12:59PM
I don't even care about principal reduction. I just want them to reduce the rate of interest on my existing !st and 2nd which is 6.75 and 8.25%. I have been begging them for the last 2 years to combine the loans and give us a lower interest rate. If you pay "no way". They will only talk to me if I stop making payments. If the banks can send a letter to may 21 yr old daughter raising her debt limit on a credit card without any paperwork, they can re-write our existing loans with no paper, no fees, no appraisals. Just change the rate of all loans (whether in foreclosure or not) over 5 years old to 4.5% and see what a boom that would be!
by Noreenre - August 29th 2011 @ 3:32PM
This would be a dream come true. We never missed a payment but everything else has suffered, repairs to the house, back payments on tuition, less healthy food because of the cost, etc. etc. etc.
by Brett - August 29th 2011 @ 4:45PM
Principle Reduction has been proven to be one of the Best ways to get our country back on the right path to prosperity. Home owners all over the country have been screwed over by the big banks and financial institutions over the last 15 years with unscrupulous business practices designed to steal money from the consumer and take that same money to pay unheard of saleries and bonuses to their ceo's and upper management. I strongly believe that the only way that the big banks will ever consider wide spread principle reduction on home loans under water, will be for the federal government to get involved to force them to do this. After all, the big banks and other lending institutions are the ones that created this whole mess in the first place!
by Elvie - August 29th 2011 @ 6:51PM
If mortgage lender or banks can do reductions of underwater properties they should do that with everybody, I'd been paying my mortgage all this years not refinancing to get cash back.
by Pamella Corvelli - August 29th 2011 @ 5:16PM
This makes a lot of sense to me. In 1986, our economy was in as bad a shape as it is now. An airline I was working with went bankrupt, leaving thousands of people unemployed over night. The credit union who had financed most of our homes did the debt reduction. Saved everyone's home. The banks do not want our homes and as mentioned above they have plenty in foreclosures and bankruptsies. They do have insurance covering their greedy behinds. Unless you have a huge downpayment, banks won't even give you a mortgage loan. This has happened to me twice in the past 2 years. Once I went to Wells Fargo who held the property, and they lied to me saying they wanted to hold onto all their underwater mortgages. The next thing I knew some fast flipper from CA comes up with full payment in cash and WF changed their mind. The property has fallen into total disrepair, and twice hoemeless have broken into it. Don't think for one moment forclosed properties on your block won't affect your property values!
by mike - August 29th 2011 @ 6:39PM
I tried every reasonable way to save my family home. Standard Federal would not even talk to me about it. They eventually put me and the kids on the street. The sad part is that they then sold my home for less than I was trying to negotiate with them for on a reduction!! I could have saved my home and they could have made more money but instead we both lost.
It's time for big banks to step up and help people...Big banks have been raping us for years so now that they have been bailed out they need to bail us out. The government should have seen to that prior to bailing them out. If the government was really thinking of the people that would have been a no brainer and we all would have been out of this mess.
by njones0623 - August 29th 2011 @ 7:07PM
BANK OF AMERICA, IF you can do this for me, I will be eternally grateful and able to keep my underwater house....My house is assessed at 81000 and I owe 166,000....It's only fair, we both make a bad investment. When we bought the house, they said we got a great deal, and then the economy tanked and my neighbors feel sorry for us!!! You got bailed out...help us...
by unknown - August 30th 2011 @ 12:46PM
Perhaps EVERYONE should STOP paying their mortgages for a year, not just a few, EVERYONE FOR ONE YEAR. Maybe the banks would listen then. Greedy bastards.
<script language="JavaScript" type="text/javascript">var sns_checked = false;var current_tab = "email";function tabTo(tab){ document.getElementById('formerrors').innerHTML = ''; document.getElementById('cmtuinfo_email').style.display='none'; document.getElementById('cmtuinfo_blogsmith').style.display='none'; document.getElementById('cmtuinfo_sns').style.display='none'; document.getElementById('cmtuinfo_'+tab).style.display='block'; document.getElementById('cmtutab_email').className=''; document.getElementById('cmtutab_blogsmith').className=''; document.getElementById('cmtutab_sns').className=''; document.getElementById('cmtutab_'+tab).className='currenttab'; if (!sns_checked && tab == 'sns') { image1 = new Image(); image1.src = "http://www.blogsmithmedia.com/framework.weblogsinc.com/media/loading.gif"; sns.init('ch1ga1KvP7TotwTC'); sns_checked = true; } current_tab = tab;}function inputValidation(){ document.getElementById('formerrors').innerHTML = ''; var validInfo = 0; var validName = 0; var validEmail = 0; var validComments = 0; var validSNS = 0; var links = 0; var errors = ''; switch(current_tab) { case "email": var filter = /^([a-zA-Z0-9_\.\-\+])+\@(([a-zA-Z0-9\-])+\.)+([a-zA-Z0-9]{2,4})+$/; var email = document.getElementById('AuthorEmail').value; if(document.getElementById('AuthorName').value == '') { errors += "Please provide a name.
"; } if (email == '' || !filter.test(email)) { errors += "Please provide a valid email address.
"; } if (!errors) { validInfo = 1; } break; case "blogsmith": if(document.getElementById('C_AuthorEmail').value == '') { errors += "Please enter your email address.
"; } if(document.getElementById('C_AuthorPass').value == '') { errors += "Please enter your password.
"; } if (!errors) { validInfo = 1; } break; case "sns": if (document.getElementById('sns_screenname') && document.getElementById('sns_password')) { if (document.getElementById('sns_screenname').value && document.getElementById('sns_password').value) { sns.calls.login(); return false; } } if (document.getElementById('sns_securid')) { if (document.getElementById('sns_securid').value) { sns.calls.login();//setTimeout("sns.calls.login();",1000); return false; } } var token = (document.getElementById('token')) ? document.getElementById('token').value : ''; if(token == '') { errors = "Sorry, we don't have that login on file. Please try again, you may have made a typo.
"; } else { validInfo = 1; } break; } var txt = document.getElementById('Comments').value; if(txt != '') { validComments = 1; } for (var ind=0;ind<txt.length;ind++) { if (txt.substring(ind,ind+7)=="http://") { links = links + 1; } else if (txt.substring(ind,ind+6)=="ftp://") { links = links + 1; } else if (txt.substring(ind,ind+8)=="https://") { links = links + 1; } } if(validInfo == 1 && validComments == 1 && links < 4) { return true; } else { var errorMessage = "[h=4]Sorry there were errors:[/h]"; errorMessage += errors; if(validComments == 0) { errorMessage += "Please enter a comment.
"; } if(links > 3) { errorMessage += "Sorry, we can only store 3 urls.
"; } document.getElementById('formerrors').innerHTML = errorMessage; return false; }}</script> <script type="text/javascript">adSetType('F');if ('' != '') {htmlAdWH('','RR','RR');}else{htmlAdWH('93312447','300','250');}adSetType('');</script><iframe id="atwAdFrame1" title="Ad" marginheight="0" src="/_uac/adpage.html" allowtransparency="" marginwidth="0" mn="93312447" w="300" h="250" divname="adsDiv1" textad="undefined" scrolling="no" width="300" frameborder="0" height="250"></iframe>
[h=2]Video[/h]
[h=3]Tag Along with a Home Inspector[/h]
[h=2]Most Popular Stories[/h]
Teenager Builds 130-Square-Foot House for College
Read More »
The Mortgage Fix That Can Save the Economy
Read More »
The 10 Best and Worst Real Estate Practices
Read More »
The 10 States Where No One Wants to Buy a New Home
Read More »
></O
