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June-July 2009
May 2009
April 2009
   January - March 2009
   July - December 2008
June-July 2009
May 2009
April 2009
   January - March 2009
   July - December 2008
January - March 2009

March 6, 2009 — Mortgage ‘Cram-Down’ Bankruptcy Bill May Aid 1 Million in U.S.
At least 1 million Americans would be able to use bankruptcy to reduce mortgage payments.  H.R. 11066 (Helping Families Save Their Homes in Bankruptcy Act 2009) — the “cram-down bill” — would allow federal judges to lengthen terms, cut interest rates and reduce mortgage balances of bankrupt homeowners.

The bill also permanently increases the Federal Deposit Insurance Corp.’s coverage of bank deposits to $250,000, provides mortgage servicing companies legal protection to modify troubled loans, and reshapes the $300 billion HOPE for Homeowners.  Designed to refinance 400,000 borrowers facing foreclosure, this program has completed about 25 loans since it began in October 2008.  The changes to the program would allow the Federal Housing Administration to help 25,000 borrowers over the next 10 years.

Faces of Foreclosure—Argy Tripodiss
The Tripodis family story illustrates why giving bankruptcy judges the power to modify mortgages on primary residences can’t come too soon. After a bankruptcy failed to keep the interest rate on their mortgage from going up, they had to refinance into another adjustable rate loan with increasing payments.

Opponents of bankruptcy reform are whiners

March 6, 2009 — Fannie Mae Extends Eviction Suspension Through March 31
Fannie Mae extends the suspension of all eviction proceedings through March 31, 2009 as it implements the Home Affordable Refinance and Home Affordable Modification initiatives as part of the Obama Administration's Making Home Affordable program.  A foreclosure sale may not occur on any Fannie Mae loan until the loan servicer verifies that the borrower is ineligible for a Home Affordable Modification and all other foreclosure prevention alternatives have been exhausted. contains materials for loan servicers, attorneys and others in the mortgage industry. For example, its requirements for Eviction Halt Extension, Announcement 09/05 are here.

March 5, 2009 — Freddie Mac Officially Launches REO Rental Initiative For Tenants, Owner-Occupants After Foreclosure; Freddie Mac Continues Suspension of Evictions Through April 1, 2009
Freddie Mac has launched its new REO Rental Initiative giving qualified tenants and former owners the option to lease their recently foreclosed properties on a month-to-month basis. The REO Rental Initiative will be managed by HomeSteps®, Freddie Mac's national real estate unit, and implemented through several national property management firms. It will continue to suspend all eviction actions until April 1, 2009 to ensure there is ample time for current occupants to learn about the options available to them under the new initiative.

March 5, 2009 — Freddie Mac Stops Foreclosure Sales On Loans Eligible For New Obama Home Affordable Modification Program
Freddie Mac is suspending foreclosure sales on mortgages eligible for the Home Affordable Modification Program as part of the Obama Administration’s Making Home Affordable plan. Freddie Mac’s previously announced suspension of foreclosure sales on occupied properties will expire on March 6, 2009.

March 5, 2009 — Obama’s Mortgage Plan
1.  A refinancing program for people current on their mortgage, but with less than 20% equity or upside down.  These homeowners can have their interest rates brought down to the market rate at the time of the refinancing.  The program is open only to homeowners with loans owned or guaranteed by Fannie Mae and Freddie Mac.  Borrowers who owe up to 5% more than their home is worth can qualify.  The homeowners must be current on their loan.

2.  A loan modification program for people delinquent (or current and struggling to make their payments).  This aims that to bring monthly payments to 31% of income.  Lenders may also lower the principal owed by the borrower or stop charging interest on a portion of the loan, known as principal forbearance.  The loan must have originated on or before Jan. 1, 2009.  The property must be owner-occupied, and the principal balance cannot exceed $729,750.  The program also requires the borrower to document income and sign an affidavit of financial hardship.  The modification can occur between now and December 2012.

The biggest mortgage-servicing companies, overseeing two-thirds of all home loans in the country — Citigroup, JPMorgan Chase, Bank of America and Wells Fargo — are expected to participate in the plan.
Any bank that receives additional U.S. government money under the Treasury Department's $700 billion financial rescue program will be required to take part.  Many lenders are expected to participate voluntarily, because the government would be absorbing much of the cost of resolving their bad loans.

Obama Housing Plan: What You Need to Know

Whether Unlucky or Unwise, Some Borrowers Are Left Out  The Obama Plan doesn’t help borrowers who have seen their income decline drastically or who owe more than their home's value on loans over $729,750.  In about 10 million places such as Las Vegas, Phoenix, and California values have plunged as much as 40%; the plan still leaves many in homes they cannot afford.

March 3, 2009 — Citi Expands Homeowner Assistance Program to Help Recently Unemployed Borrowers Stay in Their Homes
Homeowner Unemployment Assist is a new initiative that will help recently unemployed, delinquent CitiMortgage customers stay in their homes by paying a reduced monthly mortgage payment for three months. It’s a new component of Citi Homeowner Assistance, the company's multi-faceted program to help people avoid foreclosure and stay in their homes.

February 27, 2009 — AB 1160 (Fong) – Mortgage Contracts: translation
Provides that if a mortgage loan is negotiated in language other than English, then a translated summary of the key terms of the loan must be provided to the borrower in the language that the loan was negotiated in prior to execution of the mortgage loan contract.

Current law only applies to loans originated by brokers; it does not cover banks, credit unions or residential mortgage lenders.

February 26, 2009 — “Produce the Note” Buys Homeowners Time
Consumer Warning Network discusses this strategy and provides templates for a legal document request, a letter to your lender and a motion to compel to help consumers through the process. Find more articles here.

How to use “Produce the Note” in Non-judicial Foreclosure States (California)

Where’s The Note, Who’s The Holder: Enforcement of Promissory Note Secured By Real Estate
(See Resources)

February 20, 2009 — California Foreclosure Prevention Act
Effective 5/22/09, SB2X-7 and AB2X-7 requires lenders to wait an additional 90 days from the filing date of a notice of default before the trustee can give notice of sale in a non-judicial foreclosure in effect creating a six-month waiting period.  This extended waiting period is intended to encourage lenders to work with their borrowers and enter into loan modifications.

The moratorium applies only if several requirements are met including: the owner occupied first loan was recorded against residential real property between 1/1/03 and 1/1/08; the loan is serviced by a loan servicer that has not implemented a "comprehensive loan modification program"; imposing such moratorium will not "require a servicer to violate contractual agreements for investor-owned loans."

For a legal analysis of the Act, go here.

February 4, 2009 — Facing foreclosure? Don't leave. Squat
In Michigan, Wayne County Sheriff Warren Evans announced that he won’t enforce sales of foreclosed homes.  And in Ohio, Rep. Marcy Kaptur is encouraging homeowners facing foreclosures to stay in their homes.

February 2, 2009 — Ethics Alert: Legal Services to Distressed Homeowners and Foreclosure Consultants on Loan Modifications California Committee on Professional Responsibility and Conduct
This Ethics Alert outlines ethics rules that may apply when a foreclosure consultant or another non-lawyer requests assistance from a lawyer and/or refers potential distressed homeowner clients to the lawyer. It also cites to California law prohibiting foreclosure consultants from collecting a fee before any services have been rendered.

Jan. 22, 2009 — Rep. Maxine Waters Dials and Redials Attempting to Get Help for Constituents On Hold: Even Congresswoman Gets the Runaround on Bank Help Lines
Sound familiar?  ABC News Nightline cameras were rolling as Congresswoman Maxine Waters (D-Ca.) was repeatedly put on hold for long stretches, disconnected, transferred to extensions that did not work and ultimately switched to a recording which directed her to the bank's website.  ABC News investigation found that the process of reaching out for help can be disorganized and frustrating, hardly consumer friendly, even when a prominent member of Congress is on the line.

January 22, 2009 — Foreclosure Fightback
Community-based movements are working to halt the flood of foreclosures throughout the country including California whose foreclosure rate is more than twice the national average.  San Diego, Stockton, Vallejo, Antioch, in churches, union halls and community centers, angry homeowners have been organizing to freeze foreclosures and impose a systematic modification of home loans.  This article by Ben Ehrenreich (son of Barbara) focuses on Faith Bautista who runs the Mabuhay Alliance in San Diego.

January 18, 2009 — US Supreme Court to hear Cuomo v. The Clearing House Ass’n, L.L.C.
The Supreme Court granted cert. to decide whether states have the power to enforce their own anti-discrimination lending laws against national banks.  The federal Office of the Comptroller of the Currency sued to stop New York Attorney General Andrew Cuomo’s investigation of several national banks — including J.P. Morgan Chase, Wells Fargo and Citigroup – on the grounds that only federal regulators have the power to investigate national banks.

Find all papers, opinions and briefs with arguments about the discriminatory angle on predatory lending and the mortgage melt down at the SCOTUS Wiki.

January 12, 2009 — Barney’s Great Adventure — The most outspoken man in the House gets some real power.
Read Jeffrey Toobin’s profile of Congressman Barney Frank and his work on the banking and housing crisis,