The US Treasury Department has produced a number of loan modification laws or mandatory guidelines requiring lenders to review homeowners’ loan modification requests and perform loan modifications where possible. Under the current loan modification laws, in exchange for fixing loan payments at 31 percent of the homeowner’s monthly gross income, the lender receives generous incentive payments (aka: your tax dollars).
Loan Modification Laws Not Followed…Not Even Close
Lenders representing 85 percent of the housing market have agreed to participate (and accepted incentive payments from Treasury). Homeowners must first go through a trial loan modification period before their final mortgage payments can be permanently reduced. But lenders have been extremely slow to follow loan modification laws and convert hundreds of thousands of trial loan mods into permanent loan modifications. According to Treasury, as of November 2009, only about 31,000 trial loan modifications had been made permanent. This seems to be in direct violation of loan modification laws.
Treasury Reaction to Lenders Ignoring Loan Modification Laws
Since that time, Treasury has publicly criticized the lenders’ performance and to put out new loan modification laws and guidelines in recent months to speed up the process. Treasury is now saying (September 2010) that the number of permanent loan modifications has “increased substantially” and lenders are following loan modification laws more effectively, but (of course) no data is available to back up those claims. The current state of loan modification laws is embarrassing and disgusting for homeowners. Homeowners own tax dollars were used to incentive lenders with the promise that loan modification help would be coming. Lenders took the money, but did not hold up their end of the bargain and have largely failed to follow loan modification laws.
California and Federal Loan Modification Litigation Attorneys
Homeowners who are qualified but have been denied a permanent loan modification under current loan modification laws do not have to simply roll over. McFarlin LLP loan modification litigation attorneys help homeowners who feel their loan modification rights have been violated. We can assist you in Los Angeles, San Diego, San Francisco, Fresno, Santa Ana and throughout California. Our attorneys are available to provide you with honest reliable advice at our office or over the phone. Call us today at (888) 728-0044.