Amendment calls for Homeowner Advocate Office to Handle Mortgage Servicing Complaints

 Nobody can steal your house.  Nobody can fold up your house, put it in a shirt pocket, and walk away with it. But remember, a house is just a house -and a home is where your heart is. And that's what being stolen -homes. Along with your heart and your little slice of the earth you call home, people's homes are being stolen left and right--by banks and mortgage servicing companies that push through foreclosures without regard for whether or not the homeowner is actually in default, whether or not their accounting or title to the property is flawed, and without regard for due process. 

It isn't just severely delinquent homeowners who are losing their homes.  As I've talked about before, fabricated or "misleading" documentation is being accepted as real and people are losing their homes.  Even when the papers are proven to be fake, it's too late. The families are already out of their homes and reparations can take months, even years.

Even when people believe they are doing the right thing, waiting patiently in line for an approval of their HAMP loan applications -many learn what they've been doing is buying time for the mortgage servicer to push their home through a foreclosure process. 

We have to hope things will change. Senator Al Franken, D-Minn., and Senator Olympia Snowe, R-Maine, recently filed an amendment that proposes creating a special office designed to assist homeowners who are dealing with loan modification runarounds and other mortgage servicing complaints.

A summary from Sen. Al Franken's press release says:

The proposal would create an Office of the Homeowner Advocate, funded from existing sources, whose focus would be on assisting homeowners who believe their mortgage servicer is breaking the rules. Currently, these families have nowhere to turn when wrongly denied from the program, or encounter difficulties in navigating the already stressful system of avoiding foreclosure.

The Office of the Homeowner Advocate would have three primary functions:

To assist homeowners, housing counselors, and housing lawyers in resolving problems with the HAMP program; to identify areas where homeowners are having problems in dealing with the HAMP program; and to identify possible administrative and legislative changes to HAMP.
 
In addition to gaining assistance in navigating the system, while a person is appealing a case through the Office of the Homeowner Advocate homes may not go to foreclosure sale until the process is finished or 60 days have passed.
 
The Office of the Homeowner Advocate would:

• Have an independent director, appointed by the Secretary of Treasury in consultation with the Secretary of Housing and Urban Development.  This director would have a background as an advocate for homeowners and have experience dealing with mortgage servicers.  The director cannot have worked for a servicer or for the Treasury Department within the past four years.

• Make the Director available to testify in front of the Senate Banking Committee and House Committee on Financial Services at least four times a year, or at any time at the request of the Chairs of either committee, and issue a formal report to Congress once a year.

• Have staff designated by the Director to have the authority, on a case-by-case basis, to implement servicer remedies, subject to the approval of the Assistant Secretary for Financial Stability. This will help to ensure that the staff of the Office of the Homeowner Advocate actually have the ability to make servicers follow the rules.

Nationally, Americans for Financial Reform, U.S. PIRG, National Association of Consumer Advocates, Americans for Fairness in Lending, Center for Responsible Lending, National Consumer Law Center, the Leadership Conference on Civil and Human Rights, Consumers Union, Consumer Federation of America, and National Council of La Raza all support the Franken-Snowe Amendment #3991.

I would bet many weary homeowners who have been getting nothing but the runaround do too!

Though many of us believe the unregulated mortgage servicing industry continues to be a large part of the problem.

Florida Attorney, Matt Weidner points out that a big part of the problem is the way foreclosures are processed;

Two important pieces of information that form a part of every foreclosure case are sworn statements of how much money is owing and the assignment of mortgages.  Both of these documents are simple to fabricate. 

Matt goes on to say:

Advocates and judges have only recently become aware of just how failed this whole system is.  Some judges are just covering their eyes, holding their noses and continuing to grant foreclosures despite the growing body of evidence that the law firms and the clients they represent are engaged in such widespread and systemic improper practices. 

And there's nothing we can do about.

Let's hope those that those who can do something will finally do it!

You can follow the votes here at US PIRG. For more info on mortgage servicing issues see earlier blogs here.