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Are The Banks Getting Paid Off or Kickbacks to Not Modify Loans? – Vicki

“Dear Steve,

My house was sold for $80,000.00 under what I originally paid for it. B of A was giving me the run around. I am off work due to work injury, I started to “try” to talk to B of A before I fell behind on my payment. I filled out paperwork 3 or 4 times. One person would say they got it and was with a negotiator and the next would say they never got the paperwork and tell me to send it again. I sent it certified still no go I paid a attorney $4,000.00 to help me negotiate with B of A for a loan mod because B of A wouldn’t deal with me.

The result was $2,000.00 a month for 3 months then a $35,000.00 balloon payment, then $4000.00 a month. That was their idea of a loan mod! I put the house up for short sale, got an offer and B of A wouldn’t even look at it until I paid the first payment of the loan mod.
The bank wouldn’t work with me to renegotiate my loan , BUT no problem selling my house to someone else for $80,000. under what I originally paid. I was able to make a lower payment but they wouldn’t deal.

They could have made more dealing with me.

Luckily I had a rental house I could move into, so I did. I tried for over 2 years to get a loan modification, paid a company to help me negotiate with B of A. I only wanted to re-work my loan to include my 10 3/4% second at a lower rate. I did get a “forbearance ” for 6 months . Before signing I asked if the difference in the payment would be put on the end of the loan. Because I didn’t want to end up owing a balloon payment . I was assured that that wouldn’t happen. After paying the lower payment for five months I was told by B of A to expect permanent mod papers in the mail with in 30 days. But what I got instead was a notice to excelerate and a statment that I was 5 payments behind and they were foreclosing. When I called they said that I made too much money. Give me a break…too much money on work man’s comp!

What have they been smoking?

After 2 years of *^#@ I finally gave up. I got a small inheritance so was able to pay them.
I paid B of A what “THEY” said I owed. Now they say I still owe them ? I have asked for records of payments. They only sent information back to where they took over from Countrywide. I called again and some one else said that they have it from the first of the loan. B of A has payments I paid floating around showing “Un-applied”. Yet when I call and ask about it after what seems hours on hold and talking to a computer, I get another computer that tells me that my call was lost and to call back !

B of A has also held posting to my account several times for almost a month. When I ask if I am getting charged interest while they hold my checks they act dumb !! I send my payments overnight, return receipt prior to the first of the month. So I know exactly when they get them and when they are cashed and posted.

I paid last night what they asked just to get them off my back until I can find all my bank statements and certified checks to prove them wrong.

I am still off work have had one surgery and am waiting for another .I just can’t physically or mentally deal with B of A right now.

I always see these adds that people aren’t taking advantage of “Obamas” plan. But from what I hear from the comments on this site and people that have dealt with trying to negotiate loans both professionally and home owners. Only about 3% are getting them and the banks would rather foreclose or short sale a home rather than work with the homeowner. That has also been my experience !

Helping the homeowner seems to be just a smoke screen or part of their magic show to make us think they are trying to help!

Are the banks getting “PAID OFF” , “KICK BACKS” or some other incentive that makes it just “easier” and more” profitable” for them to foreclose or short sale a property ?

Who watches the banks to see if they are actually trying to help the homeowner.
Why aren’t the banks penalized for lack of doing their job right and in a timely manner.
What can we do about fighting the deep pockets and bail outs of the banks!
When are they actually going to start helping the homeowner?

Vicki”

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The Answer

Dear Vicki,

Everything you describe is unfortunate but far too common. In fact I’ve probably seen more people give up in frustration with Bank of America and hand their houses back than actually treated in a manner most would call “fair.”

Recently I posted an article, Bank of America Mortgage Modification Through HAMP, Blows! which reveled only 27% of Bank of America modifications actually converted into permanent modifications. In fact, in almost every consumer satisfaction metric, Bank of America scored at or near the bottom of the heap. Basically, they suck when it comes to modifications.

The underlying issue here is the government has no power or authority to force any bank to do a modification. The government funds for loan modifications granted were an incentive to encourage banks to modify the loans but if they don’t want to, they don’t have to.

In the case of Bank of America I don’t see it as some grand plan, but just massive inefficiency and ineptness. No comfort to you.

The government agency that watches the banks is the Office of the Comptroller of the Currency. If you want to file a complaint about Bank of America and the way you’ve been treated, click here.

Not only were you treated poorly by the bank but there was never much expectation that paying someone for help would result in a permanent modification. In some parts of the country it is actually illegal to accept payment for modification work before the modification is granted.

The bottom line on this issue is the banks have no interest in bending over backwards to help the homeowner. The banks are simply most interested in helping themselves and trying to maximize profit. For some reason the current policies and procedures in place somehow benefit them, but they are not receiving government funds for this bad behavior.

There are a number of underlying issues that might complicate the assistance process, such as who actually owns the underlying loan, can the investors be located to agree to a modification, can B of A wade through the volume of requests, etc.

My advice at this point would be to file an OCC complaint, call the office of your Congressional representatives, and send a certified letter to the president of the Bank of America and hope it filters down to someone that will take action.

Brian Moynihan
President, CEO
Bank of America
100 North Tryon Street
Charlotte, NC 28255

You may also want to try brian.t.moynihan@bankofamerica.com

A call to Matthew Task, Executive Relations, Office of the CEO at 813-805-4873 might assist as well.

Also check with your state Attorney General office and see if it was legal to charge you for mortgage modification services in your state. Some states do have foreclosure mediation programs.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

Are The Banks Getting Paid Off or Kickbacks to Not Modify Loans?   Vicki
Get Out of Debt Guy – Twitter, G+, Facebook

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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Bconsbruck

    I wish you good luck.  We tried to get a modification and it was just too difficult to jump through their hoops, so we gave up.  It seems when you are already down through no fault of your own, they make it as difficult as possible so you’ll just give up and go away.

  • Alwaysspring4

    Thank you for your response and information. I will contact some of these people. Vicki

  • Alwaysspring4

    Thank you for your response and information. I will contact some of these people. Vicki

  • Alwaysspring4

    Sounds like the banks are just padding their own pockets since it appears very little of the money is going to help home owners.
    It’s bad when you can’t refinance a home due to the decline even at the same loan amount. It would be nice to take advantage of the lower interest rates with out destroying credit. Now that would be a great way to jump start the econemy. Oh..Sorry the banks wouldn’t like that.
    To modify they basically force a person to default due to the fact you have to be at least 2 months behind.
    I tried to talk to B of A prior , they wouldn’t respond. When I got behind after going through all my savings, they said ” YOU should have contacted us before you defaulted”…Go figure

  • Steve Rhode

    Vicki,

    Just posted this and it made me think of you.

    Good new information about the modification program.

    Steve

  • http://GetOutOfDebt.org Steve Rhode

    Vicki,

    Just posted this and it made me think of you.

    Good new information about the modification program.

    Steve

    • Alwaysspring4

      Sounds like the banks are just padding their own pockets since it appears very little of the money is going to help home owners.
      It’s bad when you can’t refinance a home due to the decline even at the same loan amount. It would be nice to take advantage of the lower interest rates with out destroying credit. Now that would be a great way to jump start the econemy. Oh..Sorry the banks wouldn’t like that.
      To modify they basically force a person to default due to the fact you have to be at least 2 months behind.
      I tried to talk to B of A prior , they wouldn’t respond. When I got behind after going through all my savings, they said ” YOU should have contacted us before you defaulted”…Go figure

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