Sep 2, 2009
For individuals like Mark and Angela Kollar, the Obama administration’s Making Home Affordable program is their only hope. The debt help program is designed to be a win-win situation that will let homeowners keep their homes while letting the nation avoid another foreclosure at the same time. The problem is, the banks that are supposed to implement this measure aren’t cooperating. The Kollar couple has done everything possible to keep their house; they changed their jobs, used their savings, and drained their 401 (k). Still, all their efforts aren’t enough. They need help.
Similar to what countless Americans went through though, the Kollars also got the runaround when they tried to get assistance from banks. Consumer advocates, housing counselors, and struggling homeowners all tell the same story. Most of the banks will decline eligible applicants, pressure them into getting loans they can hardly afford, or tell them to waive their legal rights even if the Making Home Affordable program explicitly prohibits it. As if declining homeowners applications isn’t bad enough, a lot of bank employees also drop their calls or lose their paperwork as the foreclosure clock ticks on.
Statistics from the Treasury Department reveal the same thing. Out of the qualified four million qualified homeowners, only 230,000 benefited from the program. Treasury Secretary Tim Geithner has already informed the bank about the problem. In their defence, the banks say that they are still training their staff to handle these applications because it took 90 days to get the new program’s rules ironed out. However, desperate homeowners have no time for excuses.
The Kollers, whose repayment should have been reduced to 31 percent of their some $3000/month income were asked to repay $2,892/month. While this is certainly far from ideal, the Kollers are actually quite fortunate in a certain sense because the bank did not sell their house under their noses. Other homeowners had their house foreclosed even when their load application was being considered. The Treasury Department is now working with the banks to make the program strong. For individuals who have had their house foreclosed, the only option is to go to the courts.
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