Monday, February 11, 2008

Countrywide Partners With ACORN

thumbs-up.jpgCountrywide announced on Feb 11 that it's partnering with consumer advocate group ACORN to broaden the types of assistance they offer to homeowners having trouble paying their mortgage and/or facing foreclosure. Countrywide's new program(s) will help homeowners who are already in default, those who have ARMs (Adjustable Rate Mortgages) and even those who don't.

I can't say "I'm Happy" enough! I've been trying to help a client who's in default on her loans. I filled out and sent in the required forms so the lender would talk to me as well as the homeowner.

Background: The homeowner has an ARM. She was current on her payments until the ARM adjusted to a higher interest rate (thus a much higher payment). At the same time the ARM adjusted, the bottom fell out of the Phoenix market. Now her house isn't worth what she owes on it, and she can't afford the monthly payments. She's 3 months behind about to go 4.

I call the lender. They say she's ineligible for a loan modification and they won't/can't refinance her because she's upside down in the loan. They offer a repayment program. Their idea of a good repayment plan? She pays a full mortgage payment plus 1/3 of another mortgage payment, each month. This way she'll be all caught up in just 4 months. Shiny!

This is about as stupid as your bank charging you a $35 fee when you bounce a check. If you didn't have the money in the bank in the first place, what makes them think you'll miraculously have that money plus $35 the very next day?!

Same thing with the lender. If the homeowner didn't have $2100 last month, what makes CitiMortgage think she'll have $2100 plus $700 this month?! Crazy. Their only alternative was to transfer me to the Collections Department. They proceeded to threaten me. ME? I'm just the agent. I don't have $2100 a month either. If I did I'd be sending it to my mortgage company to pay my own mortgage off early.

Countrywide - congratulations on beginning a sane exit strategy for our mortgage crisis! Now if you could just come up with a good exit strategy for our other problem over in the Middle East.....