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HAMP Problems Abound – Struggling Miami Homeowners need an Attorney to Deal with Mortgage Foreclosure, Loan Modifications

As we continue to fight to provide help for Miami homeowners, we are seeing more and more problems for homeowners who have sought mortgage loan modifications. The Florida-Times Union recently reported on the case of Edward Rukab, who sought help from Bank of America through HAMP, the Home Affordable Modification Program sponsored by the federal government.

As our Miami foreclosure defense attorneys reported recently on our Miami Foreclosure Lawyer Blog, fewer than 500,000 homeowners have received permanent modification through the program — millions have applied. What has happened with increasing regularity is banks have offered temporary modification, only to reject an application and initiate foreclosure actions on those who cannot pay the resulting mortgage arrears.

Bank of America is just one of the banks that have faced persistent complaints about changing rules, losing paperwork and dragging out the application process for months. Rukab reported his credit rating took a dive as we waited more than a year for an answer. He ultimately signed off on a permanent modification agreement program, only to get a letter from the bank the following month saying he had withdrawn from the program. The Time-Union reports that Bank of America accused the couple of failing to return the paperwork.

This despite the fact that a Bank of America notary witnessed the signing and took the paperwork with him.

The newspaper reports that the bank changed Rukab’s status after calls from the media. It sent him new paperwork to sign. Meanwhile, the emotional experience has taken a heavy toll. While he initially applied to the government program thinking it might help reduce the stress of dealing with an underwater mortgage (largely the result of the banks making billions by handing out bad loans to anyone who asked for one during the boom), he is now left shaking every time he gets off the phone with Bank of America.

His credit score has dropped from 790 to 626. This despite the fact that he says he has never missed a mortgage payment. The couple bought their townhouse for $143,500 in 2005 and still owe $121,000. The Duval County Property Appraiser lists the home at $99,000. HAMP is designed to reduce mortgage payments to 31 percent of a homeowner’s income — the loan balance may also be reduced by $5,000 if they make on-time payments for five years.

Upon applying in September 2009, he expected to enter a four-month trial period, in which his payments would be reduced from about $1,040 to $642 a month. What followed was a 17-month nightmare. Nine months later he got a letter saying he was approved for a three-month trial period at $775 a month. In November they said he’d been approved for permanent modification in the amount of $884. After a year of hassle, he had to accept the modification, which amounted to a savings of only about $100 a month, or face a bill for $6,000 in arrears.

Two months later he got the letter saying he was no longer in the program.

If you are facing foreclosure or problems with a mortgage in Miami, hire a lawyer. Negotiate from Strength.

If you need help with foreclosure issues in Miami or the surrounding areas, including short sales, deficiency judgments, strategic defaults or other help for Miami homeowners, contact Jacobs Legal for a confidential appointment to discuss your rights. Call (305) 358-7991.

Frustrated First Coast homeowner says_ Modify this!.pdf

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