To: President Donald Trump, The United States House of Representatives, and The United States Senate
Modify Bank Rules in order to Reduce Foreclosures
It is very common knowledge among homeowners that banks will not take seriously any loan modification from homeowners who are current on their payments. Main Street knows very well that you have to “force” the bank to take you seriously by stop making any payment at all.
Often, but “unofficially”, banks themselves will advice the homeowner to “stop making payments” as they undergo loan modifications.
This practice is resulting in millions of foreclosures that can be avoided by a few, common sense rules:
1 – Prohibit bank and loan servicers from ever advicing their customers to “stop making payments” as they request a loan modification. Banks may and will say that is not their policy to give such advice, but millions of homeowners can testify to the contrary, so a law is needed to address this issue.
2 – Require banks and loan servicers to evaluate loan modification requests even if the home owner is current on payments. Require that banks make their evaluations only based on documentation submitted, not on the current status of the mortgage loan. If anything, homeowners who struggle to stay current (but know they can’t keep it up for long) should be rewarded for their struggle to meet their obligations, not punished as they are today.
3 – Allow homeowners in foreclosure to make partial payments towards their accumulating debt. Currently, once a homeowner enters foreclosure proceeding, they only have two choices: either pay the full amount currently owed (including the outrageous foreclosure fees, caused by the banks advice to enter foreclosure), or not make any payment at all. Because the loan modification takes years due to banks losing documents, not having enough personnel and organization to process requests in a timely fashion, etc. – banks keep making the homeowners pay for their own delays through more foreclosure fees, interest on unpaid amounts (which already includes interest on its own), and the result is often that the homeowners end up owing the banks much, much more than they would had they been allowed to make partial payments throughout the proceedings or – better yet – not to have to enter foreclosure in the first place just to be considered.
If the US government wants to quickly reduce the amount of foreclosures and economic hardship, to implement the above rules and to face this problem is the quickest path to slash the foreclosure epidemic and help millions of homeowners.
Often, but “unofficially”, banks themselves will advice the homeowner to “stop making payments” as they undergo loan modifications.
This practice is resulting in millions of foreclosures that can be avoided by a few, common sense rules:
1 – Prohibit bank and loan servicers from ever advicing their customers to “stop making payments” as they request a loan modification. Banks may and will say that is not their policy to give such advice, but millions of homeowners can testify to the contrary, so a law is needed to address this issue.
2 – Require banks and loan servicers to evaluate loan modification requests even if the home owner is current on payments. Require that banks make their evaluations only based on documentation submitted, not on the current status of the mortgage loan. If anything, homeowners who struggle to stay current (but know they can’t keep it up for long) should be rewarded for their struggle to meet their obligations, not punished as they are today.
3 – Allow homeowners in foreclosure to make partial payments towards their accumulating debt. Currently, once a homeowner enters foreclosure proceeding, they only have two choices: either pay the full amount currently owed (including the outrageous foreclosure fees, caused by the banks advice to enter foreclosure), or not make any payment at all. Because the loan modification takes years due to banks losing documents, not having enough personnel and organization to process requests in a timely fashion, etc. – banks keep making the homeowners pay for their own delays through more foreclosure fees, interest on unpaid amounts (which already includes interest on its own), and the result is often that the homeowners end up owing the banks much, much more than they would had they been allowed to make partial payments throughout the proceedings or – better yet – not to have to enter foreclosure in the first place just to be considered.
If the US government wants to quickly reduce the amount of foreclosures and economic hardship, to implement the above rules and to face this problem is the quickest path to slash the foreclosure epidemic and help millions of homeowners.
Why is this important?
This petition is intended to help millions of homeowners who are asking for a loan modification.
It is common knowledge that banks will not even look at a loan modification request of homeowners who are current on their payments.
This is forcing many homeowners - often adviced "unofficially" by the banks themselves - to stop making payments, and therefore enter foreclosure proceedings, or the the banks will not consider their loan modification requests.
During the foreclosure/loan modification evaluations, which all too often last years, foreclosure fees pile up, interests on the unpaid amount accumulate, a continuous hardship is imposed upon families by the ever impending (moved month to month) auction date and the repeated requests by banks for more and more - and in half the cases, duplicate - documents.
We need to change the way banks look at the loan modification requests and increase the homeowners range of choices to reduce their own liability.
You should sign and share this petition if you or someone you know has or is navigating through a loan modification. Then you'll identify with its requests!
It is common knowledge that banks will not even look at a loan modification request of homeowners who are current on their payments.
This is forcing many homeowners - often adviced "unofficially" by the banks themselves - to stop making payments, and therefore enter foreclosure proceedings, or the the banks will not consider their loan modification requests.
During the foreclosure/loan modification evaluations, which all too often last years, foreclosure fees pile up, interests on the unpaid amount accumulate, a continuous hardship is imposed upon families by the ever impending (moved month to month) auction date and the repeated requests by banks for more and more - and in half the cases, duplicate - documents.
We need to change the way banks look at the loan modification requests and increase the homeowners range of choices to reduce their own liability.
You should sign and share this petition if you or someone you know has or is navigating through a loan modification. Then you'll identify with its requests!