Homeowner Defense Project Staff Attorney Joseph Sant contributes to a Pro Publica article exploring a problem that is only too common for homeowners trying to participate in a federal program created to foster loan modifications and prevent foreclosures. Loan servicers claim that investors who own the mortgages won’t allow any modifications; however, Pro Publica's investigation reveals that in many cases, the servicers themselves are denying the modifications and then passing the buck.
From the article:
“The very phrase ‘investor restriction,’ I think, is deliberately confusing,” says Joseph Sant, an attorney with Staten Island Legal Services, which represents homeowners in foreclosure. “What we’re talking about are not business entities or people, but inert documents.”
Sant, the Staten Island attorney, says a servicer told one client that the contract with investors forbade extending the length of the mortgage, one key way monthly payments can be reduced through government’s program. But the government has addressed the objection, ruling that if a servicer can’t extend the length of a mortgage, it can still give a modification and just add a balloon payment to the end of the loan. Sant pushed back on the servicer’s attorney, who dropped that reason for denial and instead said the homeowner had failed the computer model that determines eligibility. Sant currently is reviewing the case to determine how to proceed.
Read the rest of the article at www.propublica.org.
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