Federal mortgage modification program little help to Miami homeowners facing foreclosure

As South Florida homeowners continue to struggle, the Obama Administration’s foreclosure prevention program has been hobbled by lax oversight and a propensity to cooperate with banks rather than stand up for property owners, MSNBC reported.

Our Miami foreclosure defense lawyers understand the legal landscape and can assist homeowners in fighting to prevent foreclosure in Miami and throughout South Florida. As we have reported on our Miami Foreclosure Lawyer Blog, recent legal developments give homeowners a real shot at stopping foreclosure, nullifying a deficiency judgment or even successfully arguing for a monetary settlement or the return of their property.
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The federal program has resulted in no penalties against banks or mortgage servicers, despite criminal investigation into the conduct of banks in all 50 states. Despite spending a year issuing warnings about such penalties, the Treasury Department recently said it lacks the power to do so. Meanwhile, it has actually loosened program restrictions in the wake of heavy lobbying from the banking industry.

The program was launched in early 2009, saying it would help 3 to 4 million homeowners. Fewer than 800,000 have received lasting mortgage modifications amid widespread complaints that banks have wrongly rejected homeowners, lost paperwork and ignored program rules. In many cases, homeowners were quickly allowed into the program on a “trial basis” but banks failed to make decisions, missed deadlines or inappropriately rejected applicants.

In some cases, payment reductions during trial modifications were then counted as delinquent and foreclosure proceedings were initiated.

Under contracts drawn up by the government, banks were to receive $1,000 for a completed modification and up to $4,000 if the loans continue to perform. Now the government is claiming those same contracts only permit the government to withhold or “claw back” a payment under very narrow circumstances; specifically when a lender incorrectly grants a modification.

To highlight the absurdity: Banks have not done nearly enough to modify home loans and the government’s own contract only permits sanctions for banks that incorrectly grant modifications.

In other words, banks continue to make a mockery of the entire system. You deal with them at your own peril. Consulting an attorney is the best course of action when it comes to fighting for your rights and holding your bank accountable.

Negotiate from Strength.

If you need help with foreclosure issues in Miami or the surrounding areas, including short sales, deficiency judgments, strategic defaults or other help for Miami homeowners, contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991.

Home-loan program hobbled by lax oversight – Business – Real estate – Mortgage Mess – msnbc com.pdf