Foreclosures and Debt » Foreclosure Horrors

Blame Low Income Home Buyers

Jacky — Sun, 19 Oct 2008 23:51:34 +0000

After several weeks of billion dollar lifelines being thrown to Big Business and Wall Street, there appears to be a growing consensus that the mortgage crisis was caused by low-income home buyers.Â Many people believe that because low to moderate income home-buyers received SUBPRIME mortgage loans to buy their homes from banks and brokers who turned around and sold investments backed by those SUBPRIME loans on Wall Street, that these home-buyers are responsible for the financial crisis we are currently experiencing in the United States and around the globe. Many are pointing directly at the Community Reinvestment Act (CRA), which was created to prevent redlining and discrimination in certain geographic neighborhoods by banks and lenders.

Just to name a few of the people blaming low income homeowners for “wanting the American Dream” are as follows from the Washington Post’s Clarence Page;

Neil Cavuto of Fox News opined last month that if banks hadn’t been forced to make loans to “minorities and risky folks,” the Wall Street disaster would not have happened.

Ann Coulter blamed “affirmative action lending policies” that loaded banks up with mortgages that eventually defaulted and brought the financial system to its knees.

George Will on ABC’s “This Week” blamed “regulation, in effect, with legislation, which would criminalize as racism and discrimination if you didn’t lend to unproductive borrowers,” because “the market would not have put people into homes they could not afford.”

And there’s Rep. Michele Bachmann, a conservative Minnesota Republican, who caused a stir in Congress by quoting an Investor’s Business Daily article that accused the CRA and President Bill Clinton of forcing banks to give out loans “on the basis of race and often little else.”

It is appalling that the economic prosperity of Wall Street was designed on the backs and salaries of working people and when their house of cards crash, the working class homeowner gets the blame, while Wall Street gets the billions of tax-payer monies as a bailout. In effect, this process of predatory subprime lending started in the late 1990′s. There were many homeowners who were targeted and forced into foreclosure from their primary lenders for being slightly one month late and other inconspicuous fees appearing in their mortgage payments from the so-called “servicer” of the loan.Â Primary lenders would package their mortgages and sell them to Fannie Mae and Freddie Mac at face value, and would then set themselves up a “servicer” who collects the mortgage payments from the homeowner. This entitled banks and lenders to get paid many times for one home mortgage. Let the greed begin!

This is just the tip of the iceberg of the greed-driven world of debt and foreclosures. There is more to this story behind the financial crisis and we will bring more of it to you soon!

Foreclosure only Option

Jacky — Thu, 23 Aug 2007 23:00:13 +0000

At the rate of foreclosure filings by home mortgage lenders, many borrowers find themselves stuck in idle and do not know what to do next.

Recently, in March 2007, a couple was facing foreclosure and began worrying their heads off about losing their home. The husband was in between changing jobs and they had fallen behind on their mortgage payments by a month.

Their first action to try and catch up on the home loan, was to contact friends and family to borrow money. Needless to say, many of them were in a cash crunch themselves, so they ran into a brick wall.

The next action was to call the lender and try to negotiate a payment for the current month and ask, if the month missed could be paid later on during the term of the loan so they could prevent foreclosure. The lender’s representative insulted them and told them “if they could not pay the missed payment, then they did not deserve to have a home! “

By this time all hope to save their home was fading fast! They tried calling lenders that advertised they would do “refinancing of loans in foreclosure”, only to be told that they did not qualify.

They received the loan default notice and knew that time has run out and their only option was to sell their home of their dreams to try and salvage what was left of their good credit! They sold the home and only received enough money to get a room without a view!

Lender Refused Payment

Jacky — Tue, 07 Aug 2007 21:59:23 +0000

In the late 1990′s in Los Angeles, Ca., and surrounding areas, homeowners experienced a wave “property snatching” under the color of foreclosure.

In one case, a homeowner had their mortgage payment servicer, the company that collects the money, change over four times. Every couple of months they were directed to make payments to a different lender. While trying to keep up with the lenders reselling the loan to different companies, the homeowner was late mailing one payment to their new lender. The homeowner, tried to speak to someone in charge of the account at the lenders’ office, but was rudely snubbed. The clerk, who claimed to be a supervisor, stated that “even if the payment was made, it would not be accepted”! The homeowner became confused and did not know what to do, if the lender refused to accept the payment on their mortgage to their home!

After several attempts to try and make payments on their mortgage, the homeowner was told that their property would be foreclosed upon, and that there was nothing else they could do.

Needless to say, the last lender commenced foreclosure proceedings against the borrower without an avenue of resolution despite many attempts by the homeowner to try and make good on the loan! There will be more on the story…