In a CNN article the other day it said only about 4% of troubled borrowers have received long-term help under the Obama administration's foreclosure prevention program, Treasury officials said Thursday.
A nearly equal number of trial modifications have been denied permanent assistance, the report showed. The reasons include not making monthly payments on time, not submitting all the necessary paperwork and not qualifying for reasons such as insufficient income.
A friend of mine, we will call him "Jack" has contacted the banks on several occasions to try to get some relief from his situation. Jack had retired from a fortune 500 company. The economy was roaring when he retired, stock market 14,000, business was booming, life was good. Two years later the stock market had hit 6669, Trillions of dollars of net worth evaporated.
My friends nest egg was gone, not down a little, not that it will eventually comeback.
It disappeared! vaporized! vanished!
But he still had equity in 2 homes, neither home completely paid for.(that is a discussion for another time) he tried to get the equity out of the homes through home equity lines of credit. He was turned down, a year ago and a 1 year later the same thing is true. The banks are not lending. Banks were given money to keep them from failing, but that is where it stopped.
Foreclosures are at an all time high. 14% of homeowners are behind on their payments over 10% are in foreclosure and Banks are being told to help the people, but there are some stipulations. Have perfect credit, don't be behind on anything you owe and show that you don't need the help, but you really do need the help.
My friend Jack had never been late on anything in over 40 years, now, all of the sudden he was strapped. He lived off his 401K for a year, now that is gone, He has tried to get a job, yet unemployment is rising and is over 10%, more like 18% if you count the ones who have given up looking for the past year.
The equity in the real estate investments has dried up to nothing, no one is purchasing homes, due to the tightness in Lending and the requirements.
Another friend told me of a situation he was in with a bank: He had a rental property he was behind on, he contacted the bank and let then know he had someone who would rent the property for 2 years, they had just sold their home and wanted to move in next week, The owner was asking the bank for some assurance that if he rented to the tenant for 2 years could we roll the payments he was behind on to the end of the loan, get the payment in line with today's market and keep this house from going into foreclosure. The bank told him to submit his loan modification paperwork it would be reviewed in the next 90-120 days, but their was no guarantee the application would be approved.
So Mr. Bank let me get this straight:
I have a tenant who will move in next week, pay the market price $3000 a month for the rental property for two years. The bank will need to roll $10,000 to the end of the loan, adjust payment by $400 to be at market and do this for 2 years and keep the property from being foreclosed on:
And the banks response is tell the tenants to wait 90-120 days until the process of approval takes place, of which their is no guarantee it will be approved, to see if we can make that work.
My friend ask the bank: So you are telling me you will not expedite the process so I can give these people an answer, you would rather take back the house. There response submit the paperwork, wait on the process and we will see?
There is no logic to their thinking and reasoning. The banks have their money from the government and they are holding on to it!
Screw the little guy!
OK, go ahead but, the little guy will remember the banks and the government when the revolution starts.
You keep squeezing for the taxes, push people to their breaking point, force them do buy government health care or go to jail.
Tax everything health care covers now and that you the government are saying you are no longer going to cover, but your going to Tax it if you need it, like pace makers, and breast pumps, cancer drugs.
--Voters disapprove 52 – 38 percent of the health care reform proposal under consideration in Congress, and they disapprove 56 – 38 percent of President Obama’s handling of health care, down from 53 – 41 percent in a November 19 survey.
TAX me for the War.
Raise the Estate Tax.
When there are no jobs and the government is raising taxes everywhere you turn. This has got to stop. This is senseless!
OK, but my friend said, the little guy will remember the banks and the government when the revolution starts.
If situations like this continue, my friend says there will be a Revolution.
As John Wayne said,
"A man's got to do what a man's got to do."
http://money.cnn.com/2009/12/10/news/economy/permanent_loan_modifications/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29
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