There is a petition circulating and picking up steam in the online world designed to get the attention of lawmakers on Capitol Hill. It is simply titled, The Petition to the US Government from American Homeowners.With hundreds of thousands of homeowners facing foreclosure and running into bureaucratic delays at the hands of less than sympathetic bank employees, constantly lost documents, trial modifications never mailed out, trial periods past but never made permanent and foreclosure sales in the midst of supposed loan modification review the cries for fairness & accountability are reaching a crescendo.
The HAMP system as it stands rewards banks for making a trial modification by advancing them nearly 1/3 of the monies available for the 
entire modification at the time homeowners enter the trial. Given the truth that entering the trial modification is such a small step in the process, along with the banks less than stellar performance on making these modifications permanent it appears that the compensation may be premature and out of line.
When a borrower enters the trial modification the servicer receives $1,000. Bank of America who has placed over 200,000 borrowers into trial modifications received has received over $200 million dollars for simply placing homeowners into "trial modifications" with no guarantee of ever getting a permanent modification. At one point the bank had rushed 180,000 trial modifications into the mail without having complete income documentation, leaving in doubt the ability to complete these modifications.
As of the latest Treasury report, Indymac / OneWest has entered 19,623 homeowners into the trial modification phase and accomplished an astounding ZERO completed modifications; yet this dismal effort has netted the investment group over 19 million in taxpayer dollars. Many borrowers, and consumer advocates complain that Indymac is making no effort to make these modifications permanent and in fact has invented new ways to deny modifications.
Many servicers mass mailed trial modifications to at risk borrowers to get their share of the free money offered for simply getting a borrower into the trial plan. They then seemingly pull out all the stops to halt the process and deny making the modifications permanent.
Indymac borrowers all across the country are searching for attorneys to bring class actions for the trial modifications that were sent out and denied before the 2nd payment was received by the bank. Even in these cases the servicer was paid $1,000 for entering the homeowner into the trial period and then promptly dumping them out of the plan.
I have spoken to homeowners who say the lender constantly get the financial income and expense numbers wrong and will not listen to reason or go over the numbers they use to deny the modification. Mitha, an embattled homeowner from Brooklyn, NY complains "the customer service reps blame the "negotiator" and will "never" put that person on the phone" she went on to say; "calls to Indymac employees result in well scripted answers that always end in favor of the bank".
The current system appears to be a mess and the trial period has created a new layer of bureaucracy in an already bogged down system. The financial benefit gained by servicers for simply putting a homeowner into the trial is great. The monies left to make the modification permanent pales in comparison.
Banks who made the original loans with little or no documentation and closed them sometimes in less than a week from application now routinely take 5,6 or 7 months to approve a loan modification. The irony doesn't go unnoticed.
To further complicate the situation lenders are outsourcing some of the work to 3rd party providers who are even worse at processing the paperwork, and have little access to a borrowers account. Bank of America uses the HOPE team a 3rd party that goes out of its way to make homeowners believe it is part of the bank. Until recently SunTrust used LoanCare this outsourcing caused so many delays and problems Suntrust recently pulled back all of its files from LoanCare. Some lenders are using Zenta, which has a myriad of addresses and if you send paperwork to the wrong address it is returned by Zenta employees as undeliverable.
The Petition to the US Government from American Homeowners seeks to address the many concerns of homeowners facing foreclosure.
Click Here to See The Petition
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