The loan modification program appears to be a scam. The stories of lost documents, delays, excuses, and turn downs multiply. Pro Publica reports politely that " it appears that in many cases, servicer errors, such as losing paperwork and improperly calculating income, have caused denials."
Many homeowners believe their denials were the result of servicer mistakes. Belinda Stanley of Kentucky says her mortgage servicer gave her four different reasons for being denied, including that her husband made too much money. "What husband?" she says. "I've never been married."
The Government Accountability Office recently found that 15 of the largest 20 servicers made mistakes using the computer model that determines if a homeowner qualifies for the program; they miscalculated income and did not properly determine if investors would make more money from a foreclosure or modification.
The sheer volume of documents involved in modifications also appears to cause mistaken denials. Banks report to the Treasury Department that "missing documentation" has been a major cause of denials, but homeowners say it's the servicers that regularly lose documents.
Naw! Chase? Wells Fargo? Those guys try to cheat customers? Never. The comments at Pro Publica tell the story. It just goes on and on.
My wife and I are in our second go-round with Chase. They denied our first modification request because they said my unemployment was not a permanent situation. Well, 13 months out of work doesn’t seem temporary to me! The process has been mind numbing - you send in the forms, you wait, you call, they say please send updated forms, you send them, you wait, they say send updated forms, and on, and on, and on…It is criminal, period.
