No hope loan Mod’s

30 Apr

Today I am discussing a new law that you should be aware of…it has far reaching effects.

There are laws that are coming onto the books that affect our rights. They may seem to be good, but in reality they have bad effects.

And there are laws that seem to be good, but are really amounting to nothing.

Remember the Hope for Homeowners program? The Washington Post reported the other day that “lenders have balked at requirements that they cut some of the principal that borrowers owe. Only one homeowner has received a government-backed loan under the program so far.”

All that commotion. And only one homeowner has got a  loan from that program!

The Post reports that the new proposed law would pay servicers $2500 for each Hope for Homeowners loan they place.

We all know that we deal with loan servicers when we try to get a loan modified, lower the monthlies, and so forth.

Servicers handle foreclosure.

They handle incoming monthlies.

They are appointed by the actual investors who own the loans.

And now, the gubmint is proposing to let servicers mod loans without worrying about the contracts they have with the lenders.

The new proposals also involve seconds. The servicers who handle seconds will agree to drop the interest to 1%. And nothing the investors, the actual lenders, can do about it.

On the face of it, that’s a good thing you would think.But I do not think it is.

I think they will also work out a way to prohibit borrowers who have been screwed from suing the servicers and the lenders.

That is wrong. Huge crimes have been commited by lenders and servicers and it is wrong to make anyone immune from lawsuits that redress the problems.

Worse yet, the servicers are being paid to break contracts and simply stuff borrowers into loan mods no matter what.

What if the mods are no good? Homeowners will do practically anything to stay in their house. It may be in their worst interest. Meanwhile, the servicer gets thousands of dollars to pretend the loan mod will work out?

How long is this going to last? When will it too blow up? Does it remind you of the disgustingly high commish the lenders were collecting from subprime loans that never should have been made?

Now the gubmint is proposing paying enormous fees to get loan mods through that never should be made.

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