Consumer Warning HAMP

The Home Affordable Modification Program, is a Federal Program set up by the United States, to assist eligible Home owners in danger of losing their homes.  The people who are to be aided  by this program receive loan modifications to lower payments, and avoiding foreclosure.  This is in the midst of the subprime mortgage crisis.  Remember the Bailout money given to the banks. Banks took $50 billion of our taxpayer money to help homeowners reduce payments.   You have all heard the advertisements “Keep your home for less.”   “Save hundreds of dollars”

It has come to my attention that this program also works in favor of the banks.  The trap takes the form of what they call  “Trial Period”.   The way I understand it,  (I’m no Lawyer, Banker, or Real Estate salesman),  a person must apply for the modification, submit all requested documentation, and meet certain criteria before being accepted for the “trial period”.  Once accepted into the trial period,  which protects your home from foreclosure, a person must make the payments at the lower rate for 3 months.  If they meet this requirement they should be accepted for the full modification.

I have heard stories about people who do all the things required, only to be told they have been rejected.  As the story goes they are told to pay $X,000,00 or be foreclosed on.  Desperate to keep their home the couple dips into their Saving,  IRA, 401K, or whatever to pay the $X,000.00.  Send the payment in, only to have it returned.  The bank wants $100.00 payment until December.   At any rate the people in question were then told to keep their house they would have to pay  $XX,000.00

Does this sound like some kind of racket?  It does to me.  The people had not missed a payment before or during the trial period.  Now they face a real possibility of losing their  home.  The bank wins again.

That Is How I See It.

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