Got Foreclosures, Anyone?
I don't understand what is really happening with the banks and with the real estate situation here in California. I had five properties and my sister had her own home and a rental property in Houston, Texas. All of them were in danger of being foreclosed or auctioned of at one time or another. We both shelled out some most-needed cash just to pay professionals to help us with our problem. My sister paid a negotiator $3,500.00 for each property. Well, her Houston rental property was foreclosed , despite the "professional" help. For her own home, the story gets weirder.
My sister went through the forebearance period. You know, you call the bank and tell them your intention of keeping the home and they say, OK, and in the same breath instruct you to send a certain "large" amount of money right away in the form of a bank draft or moneygram, to show your sincerity. At this stage, my sister was able to negotiate a smaller figure, but she still had to send that money ASAP. This forebearance amount was good only for three months or so. While her negotiator was gathering all the required documents for a loan modification, they increased my sister's monthly forebearance amount by $500.00. She paid this, of course. Finally, some more months passed, and she finally got her loan modification agreement. My sister was quite satisfied with the new monthly payment and the interest rate used on the rest of her home loan. All these happened with the help of the same professional that "lost" her Houston property. From these two examples, we can surmise that banks have their own different criteria when looking at those same financial papers submitted, and the loan modification specialists appear to be at the mercy of the banks' "whims and fancies".
After four months of paying the new mortage payment every first week of the month, and with the whole family able to sleep peacefully knowing that they still had a roof over their heads, her most recent check payment was returned to her by mail, from her lender. My sister was in shock and called the lender right away. She was informed that her loan modification application was turned down after all due to some anomaly about her signature. After more than an hour of explanations and argument, the lender asked my sister to submit all her paperwork the second time around. My sister did not know what to do and she continued to procrastinate until a paper was posted on her door, informing her that her home will be auctioned of the following month. Of course, my sister could not afford to pay another $3,500.00 for the loan mod specialist and coupled with stories of friends losing their homes because they prepared ltheir loan modification applications themselves, she gave up hope and decided to do a short sale instead.
The weird thing is, and it's been three months now since this happened, every week, my sister would receive both phone calls AND letters from that lender, informing her of weekend special events being held for her and others to help them save their homes. I mean, can you beat that! Here was my sister, paying regularly, and on time yet the lender stopped her from doing so AND THEN she gets a barrage of letters and phone calls for her to attend these "special real estate events" where she could discuss her situation with a live representative. I cannot blame my sister for ignoring the notices and calls.
So what is really happening here? It looks like with the bank or lender, the right hand doesn't know what the left hand is doing. And just try calling them up. There is no one person that will help with the case. Each time my sister called, she had to explain her situation all over again, to the one who got the call. Apparently, this is the new system. What all these customer representatives do is pull out your file and read from it, and then they think that they have been helpful. They have a foreclosure department and a short sale department and the two never mix. If the banks really care, they should have representatives who can go through your problem and explain your options; one imbued with enough knowledge about loan modification, short sale, forebearance, etc. showing a more comprehensive picture of the situation. Of course, they don't see the need for this because they have previously bombarded us with mail, informing us about them anyway. But nothing beats being able to talk to someone who knows about these things. I've called them myself with regards to my properties and the first thing they did was give me a telephone number of "Hope" or "FHA" where I can discuss my situation. I followed their advise and so I have been through these same agencies and all they did was take down notes. Is there really such a thing as "Obama's Home Affordable" Program? Where is tall that money the government gave to the banks?
As for my sister, her home was valued at $380,000.00, now it is only worth $170.000. 00. Yet, she was willing to keep on paying for her house which has lost more than half of its value. I guess, for most of us, who are in financial distress, there is no other option, short of bankruptcy ,which, I understand, can allow one to keep one's home. I believe that the government programs can really help us, like answers to our prayers, but.... where are they .... and who is in charge...
The experience my sister has gone through should never have happened. I would say that what we, homeowners are getting right now, is lip service, that's all.