BofA Misleads the Public with Its National Homeownership Retention Program
By Chip Parker, Jacksonville Consumer Attorney on Nov 25, 2009 in Foreclosure News, Mortgage Reform
As an attorney neck-deep in defending foreclosures throughout Florida, I am always cynical when it comes to mortgage industry claims that it is doing anything to fix the problem it created.
In a bit of unapologetic propaganda, Bank of America recently touted that it has “helped” 100,000 homeowners avoid foreclosure through its National Homeownership Retention Program (NHRP). BofA spokesperson, Jack Schakett brags, “The NHRP is one of the proprietary foreclosure prevention programs we use in addition to the federal government-sponsored Home Affordable Modification Program (HAMP).” Riiiight . . .
The problem, of course, with any propaganda is that it glosses over details that would refute the claim, and this piece of “news” is no different.
Specifically, the article, published by a default servicing trade publication, mentiifter acquiring Countrywide Financial Corporation.”
That’s right. BofA was REQUIRED to start the NHRP program because Countrywide committed mortgage fraud, and it was forced into an $8.68 BILLION settlement. “Reached an agreement” my eye. By the way, the program only applies to the loans acquired from Countrywide. You can view the settlement on the California Attorney General’s website.
The article proceeds to throw out these big numbers to convince the middle class that BofA is one of the good guys. According to BofA, “80,875 customers received mortgage relief, resulting in potential aggregate principal and interest savings of $1.6 billion.”
What does “mortgage relief” mean? I don’t know, but I can tell you what it doesn’t mean. It doesn’t mean real mortgage modifications that address the issue of negative equity.
Nationally, 28% of all home loans are at or near negative equity, where more is owed than the value of the home. Until there is a mandatory modification program that addresses this tremendous negative equity problem, there will be no meaningful and lasting mortgage modifications.
What is a homeowner to do? Take matters into your own hands. Gain leverage by fighting the foreclosure. Once the servicer and securitized trust realize foreclosure is highly improbable, they will engage in real negotiation which provides a permanent solution to the homeowner’s problem.
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