Stop PHH Mortgage

Lets join together to save consumers from PHH Mortgage's bad business practices

Archive for the ‘New York Times’ Category

Firms Will Be Embarrassed

Posted by CM on November 29, 2009

Yes, you read the heading correctly.  It seems that Obama and Geithner can’t seem to get our beloved mortgage servicers to effectively modify delinquent home loans.  That is one heck of a surprise!  We all know from experience that mortgage servicers will stop at nothing to get a foreclosure processed. 

On Monday, Obama will initiate a new campaign aimed at embarrassing mortgage firms (I hope mortgage servicers are included) into creating permanent modifications that reduce monthly payments.  Unfortunately, reducing principal balances was not mentioned in the article

Those servicers who have not made enough permanent modifications will be called out and embarrassed.  Recall that Geithner’s entire idea with his monthly mortgage servicer performance reports was to embarrass those firms that haven’t made many modifications.  That hasn’t worked very well and now it seems Geithner and his team is trying another embarrassment model for the servicers.  I don’t know about you, but when all the administration can think of is different ways to embarrass mortgage servicers, I don’t hold out much hope for this new campaign. 

A guess a bit of a change to HAMP is that the puny incentives ($1000 per modification) will not be paid until the modification is permanent and monthly payments are reduced.  To date, only 2,000 out of 500,000 or 0.4% of loans have been permanent modifications1.  If that is the only plan for pushing servicers in the right direction, I fear that that will only push servicers right out of HAMP all together.    

The word inside the Treasury Dept. is that HAMP is not really working but no one seems poised to create a new plan.  I have 2 ideas, 1. Reduce Principal Amounts and 2. One Year Freeze on all Foreclosures. 

Luckily the Senate is getting restless and they are pretending like they will create a National Foreclosure Prevention Program (like Philadelphia’s) where every delinquent home owner gets to have a court-supervised mediation1. Or they want bankruptcy judges to amend mortgages1.

It all boils down to the fact that servicers have zero incentive to modify loans and have more incentives to do a trial modification while still collecting delinquent fees. 

“I don’t think [mortgage servicers] ever intended on doing permanent loan modifications1.” Margery Golant 

Source:
1. U.S. Will Push Mortgage Firms to Reduce More Loan Payments. Peter S. Goodman. NY Times. 11/29/09.
URL: http://www.nytimes.com/2009/11/29/business/economy/29modify.html

 

For more about the run around between mortgage servicers and their customer’s regarding modifications see Goodman’s related article:
Winning Lower Payments Takes Patience and Luck.  11/29/09
URL:  http://www.nytimes.com/2009/11/29/business/economy/29modifyside.html

Advertisements

Posted in Foreclosure, Green Tree Servicing, Mortgage Servicers, New York Times, PHH Mortgage, Treasury, white house | Tagged: , , , , , , , , | 1 Comment »

Vulture Funds

Posted by CM on November 25, 2009

I came across this article in the NY Times on Sunday about the fate of Vulture Funds (Troubled Investments).  Here is what is going on now in Wall Street….

  1. Investors are buying discounted home loans from distressed banks.
  2. Mortgages are then refinanced through the government.
  3. Profits are made by reselling government insured loans.
  4. The newly refinanced loans are bundled into securities and sold to investors (like usual).

For those of you who like diagrams….

 graphic vulture funds2

So, evidently all of the risk for these newly refinanced loans falls on the government and then ultimately the taxpayers.  Keep in mind that “Americans are falling behind on mortgage payments in record numbers1.” 

Homeowners are involved here.  They receive a letter stating their principals have been reduced and then have to refinance to get the reduction.  The investors receive a profit when the refinances amount to more than their original $40 Million investment.   Many of the interviewees in the article expressed their concerns about this new strategy and weren’t quite clear where all of this was headed. 

From my understanding;

  • These Vulture Funds are coming from distressed banks, not necessarily from distressed loans.  Yes, the argument is that distressed banks are a victim of distressed loans, but not every single loan is in distress.
  • Principal reductions don’t seem to be targeted toward people with distressed loans or those asking for modifications.  The article didn’t make this issue clear.  It just seems that whatever loans were in the pool are the ones being refinanced.  I don’t believe investors are going around looking for homeowners to help by reducing principals.  Wall Street just doesn’t work that way.
  • This article is a clear indication that the game hasn’t changed at all.  Regulations with teeth haven’t been enacted and the rules of the game haven’t changed either.
  • All we seem to have here is either a different way to play the mortgage game or a new side game to the game that has always been played.

Come on Obama and Geithner, “Yes We Can” do something about this.

Sources:
1.  Wall Street Finds Profits by Reducing Mortgages. Louise Story. New York Times. 11/21/09.
URL: http://www.nytimes.com/2009/11/22/business/22loans.html

Posted in Foreclosure, Green Tree Servicing, Mortgage Servicers, New York Times, PHH Mortgage | Tagged: , , , , , | Leave a Comment »

Between Homeowners and Banks

Posted by CM on November 18, 2009

The NY Times has an article online today about Philadelphia’s “conciliation conferences.”(1)  Basically when you are about to be foreclosed on, you and your bank meet at the courthouse and work out a solution.  The article did not say whether principal amounts are reduced or how many homeowners redefault.  The article did say that monthly payments are reduced in most cases.  Well, as we know, reducing monthly payments means nothing if your principal is increased and if there is some hidden trigger that will balloon your payments all over again.  This is just more of the same bank/mortgage servicer game playing.  Until I hear that principals have been reduced, I’m not buying what their selling. 

On a related note, The Justice Department has created a “Financial Fraud Task Force.”(2)  The Treasury Dept is involved and they are going to investigate mortgage fraud among other things.  How do we sign up? 

Sources:
1. Philadelphia Gives Homeowners a Way to Stay Put. Peter Goodman. NY Times. 11/18/09.
URL: http://www.nytimes.com/2009/11/18/business/18philly.html

2. Administration Widening Pursuit of Financial Fraud. AP. 11/18/09
URL: http://hosted.ap.org/dynamic/stories/U/US_FINANCIAL_FRAUD?SITE=NCAGW&SECTION=HOME&TEMPLATE=DEFAULT

Posted in Foreclosure, Mortgage Servicers, New York Times, PHH Mortgage, Treasury | Tagged: , , , , , , | Leave a Comment »

Modifications and Foreclosures in the News Again

Posted by CM on November 12, 2009

Ok, we have lots of news on the modification/foreclosure realm today. 

First, I came across this article yesterday about mortgage modification programs.  Alan Zibel for the AP wrote that Obama’s HAMP plan has started reaching “1 in 5 homeowners.”(1)  But, as we know, most servicers keep up with the foreclosure process while doing a modification.  Also, judging by your comments, modifications seem to result in foreclosures later.  I thought another section of this article was more important to our issues.  Zibel touched on a class action lawsuit in Minnesota filed by homeowners that said HAMP “failed to give proper notice when they were rejected [for modifications] or the right to appeal [the rejections].”(1)  The Judge rejected the suit and said, “the federal government has never made loan modifications an entitlement.”(1) 

What Judge Montgomery said basically sums up exactly what we are up against in the legal court and the court of public opinion.  When I first starting complaining about PHH Mortgage, I was told, “you agreed to pay for your house didn’t you?”  I said yes, but, shouldn’t I have some sort of consumer protections if something happens and I cannot pay for my house anymore?  The premise for my petition letters came from the above conversation.  As you see, we are facing a steep battle from people who think if we signed the loan papers, we should pay and that is it. 

Second, Foreclosures dip in October.  I didn’t even have to read the article to know exactly what they are talking about, because of HAMP, modifications are being started and foreclosures are being stalled.  That is all, foreclosures will rise again, I promise.  Anyway…Foreclosures dipped, but filings were “up 19% [from last year]” and “1 in every 385 homes received a [default] notice this month.”(2)  Wow, that is great news!  Those numbers sure do make me feel better, don’t they make you feel better?  Those numbers are crazy.  1 out of 385 is not a good statistic whatsoever.  Give me a break. 

The top ten foreclosure states in order from top to bottom are…..Nevada, California, Florida, Arizona, Idaho, Illinois, Michigan, Georgia, and Utah.(2)

Third, here is the MHA (Making Home Affordable) Mortgage Servicer Report through October 2009.  Enjoy.  What can I tell you about it?  It has 5 pages instead of 2.  There are more graphs showing downward trends with home prices and upward trends of housing inventory.  Fancy Fancy!  Other than that, PHH Mortgage is still not listed on there although it does say that servicers servicing Fannie loans are eligible to participate.  Here’s to crossing our fingers that PHH will one day participate. 

Last but not least, the best editorial I have read in a while came from the NY Times today.  More Foreclosures to Come.  Need I say more?  The editorial called for real modifications with principal loan reductions.  We have heard this before, yes, from the National Consumer Law Center.  The editorial goes on to say that, “another 2.4 million homes will be lost [to foreclosure] in 2010 and home prices will be reduced by 10%.”(3)  Recall above that I said most modifications will end in foreclosure, well the editorial said that, “most troubled borrowers will ultimately not qualify for help, and bad loans will be in foreclosure.”(3) 

The editorial continues, HAMP “has been flawed from the start and has no teeth to compel lenders to participate.”(3) 

Finally, “American Homeowners need an antiforeclosure plan that works.”(3) 

Sources:
1. Housing Plan Reaches 1 in 5 Borrowers. Alan Zibel. Associated Press. 11/10/09.
URL: http://hosted.ap.org/dynamic/stories/U/US_FORECLOSURE_AID?SITE=FLROC&SECTION=HOME&TEMPLATE=DEFAULT

2. Foreclosures Dip in October. J.W. Elphinstone. Associated Press. 11/11/09.
URL: http://hosted.ap.org/dynamic/stories/U/US_FORECLOSURE_RATES?SITE=MATAU&SECTION=HOME&TEMPLATE=DEFAULT

3. More Foreclosures to Come. NY Times Editorial. 11/12/09.
URL: http://www.nytimes.com/2009/11/12/opinion/12thu2.html

Posted in Congressional regulation, Court Filings, Foreclosure, Green Tree Servicing, Mortgage Servicers, New York Times, PHH Mortgage, Treasury | Tagged: , , , , , , , | 2 Comments »

States May Go After Banks?

Posted by CM on November 3, 2009

Yes, you read that correctly.  It appears that the Supreme Court paved the way for states to prosecute banks for lending fraud, known as the “Clearinghouse Ruling.”  Yes, the Supreme Court did make this ruling in June and it has taken until now for states to “ponder” these cases.  But, at least the attorney generals are thinking about going after the banks.  Apparently that is all we need in America these days, the ability to think about doing something and then to give a speech about it.  However, doing something would just take ethical and moral responsibility, something that our politicians lack.     

See the NY Times article here

Posted in Congressional regulation, Foreclosure, Green Tree Servicing, Mortgage Servicers, New York Times | Tagged: , , | Leave a Comment »

PHH in NY Times Article!

Posted by CM on October 25, 2009

Finally!  Just about an entire article was dedicated to PHH in Sunday’s NY Times!  Click Here to read it

A Federal Bankruptcy Judge in New York State determined that PHH did not have the correct documentation to legally foreclose on a house.  This is another “produce the note” type of situation that we have heard about.  The article also mentions securitizations which I have just read about in the the National Consumer Law Center’s newest report on foreclosures.  Stay tuned to this blog for more about securitizations.  Or read the report here

I am printing this NY Times article for reference later.  We need to make sure our attorneys know about this information.  We can’t assume that they know everything about mortgage servicers.

Posted in Foreclosure, Green Tree Servicing, Mortgage Service Providers, Mortgage Servicers, New York Times, PHH Mortgage | Tagged: , , , , | 1 Comment »

Meet with Wells Fargo Reps

Posted by CM on September 4, 2009

Starting Tuesday, September 8th, 2009; Wells Fargo Representatives will be on hand at the Phoenix Convention Center for 3 days to meet with customers regarding their loan modification applications.  Customers will be able to determine if their modification applications have been approved or denied.

Mrs. Giguere of Phoenix, AZ, lost her employment and requested a loan modification from Wells Fargo.  She sent in her paperwork several times with no response.  In bankruptcy court she was able to ask a high-ranking bank executive of Wells Fargo why she never received a response to her loan modification request and subsequent paperwork. 

Judge Randolph J. Haines of the United States Bankruptcy Court asked this of the Wells Fargo executive: “When did you tell the debtors that their loan was no longer being considered for modification?”

The Wells Fargo rep replied, “We haven’t. They’ve never been told.”

Ha! I would love to hear PHH Mortgage admit that and more! 

Read the full story here

Source:
Judges’ Frustration Grows with Mortgage Servicers. John Collins Rudolf. The New York Times. 9/4/09. 
URL: http://www.nytimes.com/2009/09/04/business/economy/04wells.html

Posted in Foreclosure, Mortgage Service Providers, Mortgage Servicers, New York Times, PHH Mortgage | Tagged: , , , , , , | Leave a Comment »

Update

Posted by CM on September 2, 2009

In a past post, I indicated that Sheila Bair, the FDIC Chair, is against the Consumer Financial Protection Agency(1).  In today’s New York Times, Ms. Bair writes in her Op-Ed that she “supports a consumer financial protection agency(2).” 

Sources:
1. “FDIC Chief says parts of regulatory plan won’t fly.” By Daniel Wagner, AP Business Writer.  8/14/09. URL: http://hosted.ap.org/dynamic/stories/U/US_FINANCIAL_OVERHAUL?SITE=SCAND&SECTION=HOME&TEMPLATE=DEFAULT

2. The Case Against a Super-Regulator. By Sheila Bair. The New York Times. 9/1/09.
     URL: http://www.nytimes.com/2009/09/01/opinion/01bair.html

Posted in Congressional regulation, Foreclosure, Mortgage Service Providers, Mortgage Servicers, New York Times, PHH Mortgage | Tagged: , , , , , | Leave a Comment »

Produce The Note

Posted by CM on August 31, 2009

Meet Judge Arthur M. Schack of the New York State Supreme Court for Brooklyn and Staten Island.  Judge Schack is actually holding banks accountable for foreclosures.  He is meticulously going through foreclosure papers filed by banks and mortgage servicers looking for errors.  He found a representative of Deutsche Bank who had signed papers “claiming to be the vice president of two different banks1.”  He has thrown out “46 of the 102 foreclosure motions before him in the past two years1.”  Judge Schack said, “I won’t accept their comedy of errors1.” 

Judge Schack looks for errors and makes sure that the bank who is foreclosing actually owns the house.  Many times he has seen that the bank doesn’t even own the house.  When these loans were packaged and repackaged again, much of the paperwork was misplaced and signatures went missing.  If the banks can’t prove ownership of the home then they can’t foreclose on the loan. 

Judge Schack’s approach to foreclosure has become a revolutionary idea to some judges.  Not because this is a new idea but because he is actually holding corporations accountable for their actions.  I wish Judge Schack was handling my foreclosure! 

Judge Schack’s idea of demanding proof of ownership reminds me of the “Produce the Note” strategy promoted by Congresswoman Marcy Kaptur2 earlier this year.  If my memory serves me correctly, Kaptur urged her constituents to stay in their foreclosed homes until the banks produced the note and proved ownership.  There is also a website with more information about producing the note3

Clearly Judges and homeowners are starting to understand the games played by the mortgage industry.  A way to beat the banks at their own game is to have them prove ownership first!

Sources:
1.   A ‘Little Judge’ Who Rejects Foreclosures Brooklyn Style. Michael Powell. New York Times. 8/30/09.
      URL: http://www.nytimes.com/2009/08/31/nyregion/31judge.html

2.  Congresswoman Marcy Kaptur’s website
      URL: http://www.kaptur.house.gov/

3.  The Consumer Warning Network. Produce The Note Page. Found 8/31/09
     URL: http://www.consumerwarningnetwork.com/2008/06/19/produce-the-note-how-to/

Posted in Congressional regulation, Court Filings, Foreclosure, Green Tree Servicing, Mortgage Service Providers, Mortgage Servicers, New York Times, PHH Mortgage | Tagged: , , , , , , , | Leave a Comment »

Tax Liens Sold to Investors

Posted by CM on August 28, 2009

Did you know that cities and counties are selling tax liens from unpaid property taxes to investors?  Cities are making money from selling liens.  Investors are making money from liens by charging double-digit interest rates and adding thousands of dollars of fees1.  Plus, investors now hold precedent over the foreclosure proceedings.  They can decide to foreclose on the house without the consent of the mortgage servicer and/or bank. 

This is an alarming piece of news.  This means that if you were down on your luck and had to choose between paying the mortgage or property taxes, most would choose paying the mortgage.  From our knowledge up to this point, foreclosures happened because of unpaid mortgages, not unpaid property taxes.  Not to mention that cities charge low interest rates and low fees to unpaid property taxes thereby giving you an opportunity to pay the taxes back when you can.  Now with investors involved, being able to pay back taxes seems more difficult.

In today’s New York Times Editorial, they noted that subprime loans did not even include property taxes and insurance in the monthly payments2.   Sometimes the exclusions were known by the homeowners and sometimes they were not.  Clearly this brings to light another bigger problem, the fact that you can still get a lien or go into foreclosure when you had no idea that your taxes were not being paid by your monthly mortgage payments.  This is a troubling situation and is another reason why we need a Mortgage Bill of Rights, The Consumer Financial Protection Agency (HR 3126-see right side of this site to track the progress of this bill), and also why the New York Times used this editorial to advocate for “an independent consumer safety regulator for mortgages and other loans—and that the Federal Reserve Board [who wants to regulate mortgages and loans] is not the right choice for the job2.”

 

Sources:
1. Tax Bills Put Pressure on Struggling Homeowners.  Jack Healy. New York Times. 8/17/09. 
    URL:  http://www.nytimes.com/2009/08/18/business/18taxes.html

2.  Another Way to Lose the House. New York Times Editorial. 8/28/09.
     URL: http://www.nytimes.com/2009/08/28/opinion/28fri1.html

Posted in Congressional regulation, Foreclosure, Green Tree Servicing, Mortgage Service Providers, Mortgage Servicers, New York Times, PHH Mortgage, Treasury | Tagged: , , , , , , , , , | Leave a Comment »