{"id":517415,"date":"2010-04-06T03:00:00","date_gmt":"2010-04-06T07:00:00","guid":{"rendered":"http:\/\/www.sacbee.com\/2010\/04\/06\/2657457\/homeowners-need-backup-when-loan.html#mi_rss=Opinion"},"modified":"2010-04-06T03:00:00","modified_gmt":"2010-04-06T07:00:00","slug":"my-view-homeowners-need-backup-when-loan-servicers-goof","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/517415","title":{"rendered":"My View: Homeowners need backup when loan servicers goof"},"content":{"rendered":"

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In 2007, well before the economy tanked, before home values started to plummet and before his adjustable-rate mortgage was set to increase, Zachary Norris of Oakland began seeking a loan modification. <\/p>\n

After repeated phone calls and faxes and struggling to make sporadic payments, the Norris family received a notice of default, even though officials at Litton Loan Servicing had yet to either make a loan modification offer or tell Zachary Norris why they hadn’t. <\/p>\n

Sadly, the Norris family’s story is not unique. While specific data is hard to come by, lawyers and housing counselors from across the state tell the same stories of homeowners who lost the roof over their heads while they were trying to honor the debt that paid for it. <\/p>\n

Recently, the federal government announced changes to the “Home Affordable Modification Program,” otherwise known as HAMP, aimed at preventing loan servicing companies from initiating foreclosure on a homeowner when a loan modification is in progress or under negotiation.<\/p>\n

The Norris family story suggests those changes do not go far enough. Servicers make mistakes. Borrowers fall through administrative cracks that shouldn’t exist. Homeowners who lose their homes due to errors by loan servicers have no remedy. <\/p>\n

Fortunately, California state Sens. Mark Leno and Darrell Steinberg have a modest and common-sense proposal to address this problem. Their legislation, Senate Bill 1275, would include some provisions similar to the new HAMP changes, like prohibiting the start of the foreclosure process when a homeowner is pursuing a loan modification. But it would also go further. It would provide borrowers with a backstop if they face foreclosure because of mistakes by a loan servicer.<\/p>\n

This is a critical void that HAMP alone cannot address. It’s unfair that when homeowners play by the rules, but servicers don’t, the only party that pays the price is the homeowner. <\/p>\n

It’s also not fair that the same rules don’t apply to all servicers. Even as the Obama administration has made significant changes to HAMP that both complement SB 1275 and underscore the need for policies that prevent as many avoidable foreclosures as possible, SB 1275 will go even further by making sure that all servicers doing business in California, whether they are participants in the voluntary HAMP program or not, must abide by the same foreclosure-initiation provisions.<\/p>\n

Consistency is critical, and no California homeowner should be foreclosed upon because their servicer doesn’t participate in the federal loan modification program. All of the program fixes in the world won’t help those homeowners whose servicers aren’t HAMP participants. <\/p>\n

The need for improvements to HAMP, as well as to California law, has been abundantly clear for months.<\/p>\n

We are now two years into our foreclosure crisis and mortgage servicers simply have not delivered a sufficient volume of loan modifications: Federal data released last month showed that only 35,000 California homeowners had received permanent modifications through the end of February 2010, compared to the more than 200,000 completed foreclosures that occurred in 2009. If a homeowner gets turned down for a modification, or worse, loses a home to foreclosure, it shouldn’t be because a loan company is understaffed or can’t keep up with its faxes. Leno, Steinberg, the Obama administration and growing numbers of policymakers now recognize this. <\/p>\n

It’s true that there are many California homeowners who probably won’t be helped by any legislation, fixes to HAMP or tweaks to the foreclosure process. We cannot prevent every single foreclosure. But we must work to prevent the ones that we can, and certainly no one should lose their home while they are in the middle of trying to save it.<\/p>\n","protected":false},"excerpt":{"rendered":"

In 2007, well before the economy tanked, before home values started to plummet and before his adjustable-rate mortgage was set to increase, Zachary Norris of Oakland began seeking a loan modification. After repeated phone calls and faxes and struggling to make sporadic payments, the Norris family received a notice of default, even though officials at […]<\/p>\n","protected":false},"author":4325,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-517415","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/517415","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4325"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=517415"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/517415\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=517415"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=517415"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=517415"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}