by Craig
You are going to read this and say "you've got to be kidding"
Well I'm not, so here goes. . . A home owner was wanting to do the right thing and continue to pay his mortgage even when there was not enough money coming in to pay all the bills! So he calls the lender holding his loan and says "can we talk about loan modification where we can reduce the rate or payments so as to avoid credit problems and also avoid foreclosure?" The lender said that the loan modification dept would be able to help so he gets transfered to that dept. They tell him that they can NOT help him because he is NOT behind on his payments. "Yes, correct" he explains and he would like to keep it that way and continue paying them on time if they could just modify the payments or rate.
NO - the loan modification dept will only work with you if you are behind in your payments. So the home owner -- after several calls -- decided that there was no help to be given in that dept unless he stopped making his payments ...which eventually happened. Two months past and he called them back. He was "counseled" about his late payments history and was then told that the loan modification dept may be able to help him. So back with the loan modification dept. They said that they would consider him for modification if he would fill out a package of info including pay stubs, bank statements, income, and debts, credit report and (here's the insane part) he would also have to get his payments CURRENT before they could modify his loan. "you've got to be kidding"
Yes, you have to be past due in order to qualify for the loan modification (otherwise every American household would get a modification to a lower rate - that would not be fair) then you have to be current before they will actually modify the loan. Because if they are going to be so kind in helping you out the least you can do is get current on your loan payments. Makes perfect sense.
Is it possible that the POLICIES themselves are contributing to the downward spiral of the housing industry. Could it be that forcing people into NOT paying in order to help them - - actually creates more foreclosures?
CitiMortgage seems to be trying to lead the pack with the possible moratorium on foreclosures along with Fannie and Freddie. However it sounds like the only people they are NOT going to foreclosure on are those who are currently NOT late but may be struggling. So much for the rest of the country who has already gone down this path. Here is a portion of a story that you can find on ABC news website at this link.
http://www.abcnews.go.com/Business/Economy/Story?id=6225660
Citi also announced that it will extend its moratorium on foreclosures on mortgages it owns. To qualify, a homeowner has to stay in the home, it has to be the principal residence, the homeowner must work in good faith with Citi and have enough income to pay a more affordable mortgage payment. Citi says it has already saved 370,000 customers from foreclosure in the past two years through this program. They believe extending the foreclosure moratorium will help an additional 50,000 families avoid foreclosure.
Citi owns nearly $200 billion in mortgages and the 500,000 homeowners it plans to contact represent about $50-55 billion.
You can google this article and do your own research and come to your own conclusions if it is good or bad etc... but let's all agree that banks who tell you to get behind in your payments so they can help you - then tell you to get current so they can help you is ...are need of a straight jackets.
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