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Sat Sep 22, 2012 at 01:31 PM PDT

Free Chicago from Gangs and Drugs!

by SteveSewall

This article about Chicago's gang/drug problem shows how a community's media - public, community, online and mainstream - can empower its citizens and government to define and solve all kinds of intractable problems.

A poll, a petition and other information is at the site.

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The great and good Yves Smith of Naked Capitalism writes brilliantly today about  President Obama's new "Shock and Awe" effort to force banks to make more HAMP loan modifications. Here I try to reframe the entire loan mod mess simply by pointing out that, on the basis of my own 24-month experience as a HAMP applicant, the President's battle may not be with the banks alone - unconscionable as they have been - but, quite possibly, and more essentially, with note holders Fannie Mae and Freddie Mac, which are wholly-owned entities of the federal government over which the President presides.

Obama may lack authority over commercial banks, but he and Congress do, I should think, have considerable authority over Fannie and Freddie.

I am certain that it was not GMAC, my bank, but Freddie Mac, my note holder, that rejected at least one of my five HAMP applications - after GMAC may have approved it.  Details below.

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IT IS FANNIE AND FREDDIE, AND NOT JUST THE BANKS, THAT ARE SUBVERTING PRESIDENT OBAMA'S LOAD MOD PROGRAMS

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In my case, my note holder, Freddie Mac, has definitely done so. This I learned from GMAC, my loan servicer. Multiple GMAC agents have told me that GMAC has once and probably twice approved a HAMP modification on my mortgage, sent it up to Freddie, and then learned of Freddie's denial.  

GMAC even informed me in writing of Freddie's denial. It did so in vague language marked with an X in its form letter of denial:

"We service your loan on behalf of an investor [Freddie Mac] or group of investors that has not given us authority to modify your loan under the program [HAMP] requested." (Brackets mine)

I wonder: have other HAMP/MFA applicants have seen language like this? If so, this story could be major news:

Government Sponsored Lenders (GSLs Fannie and Freddie) are subverting programs created by government agencies (Treasury Department and the White House). And the GSLs are doing so furtively by using the commercial banks as shields and whipping boys to conceal their subversion of the President's programs for at-risk homeowners.

I look forward hearing from other MFA/HAMP applicants. See below for more.

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MFA/HAMP APPLICANTS: What's Your Take on This Post?

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"Hardship is not imminent" is the language GMAC used to deny my fourth HAMP modification. (In denying my second, GMAC's language for denial had been "insufficient income" followed, in denying my third, by "sufficient income.")

After fully nine months of telling me I needed MORE income in order to qualify for a HAMP mod, GMAC seems now to be steering me in the direction of LESS or perhaps even NONE. I feel a "Must Be Delinquent" situation coming on. Recently a GMAC customer service agent told me that missed payments are a condition for qualifying for a HAMP loan mod ... but, she hastened to say, not a sufficient one!

The 8/05/2010 post below, from one of the wise grizzled veterans at the LoanSafe Forum (TY Riddlemethisbatman) is highly informative on this topic. The video this veteran refers to is well worth watching, as he says. To find his or her original post at LoanSafe, scroll to the bottom of the page looking for its date of 8/05/2010.

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How familiar are you with the "Must Be Delinquent" or "Hardship Not Imminent" Requirements made by lenders relative to a MHA/HAMP loan modification?

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We're inching along. Modest progress. No prairie fire interest as yet. But a decent slow burn, the kind that hides itself until heat and no rain cause it to flame up. Trick to the flame is more major media coverage of Lender Mendacity and more people to sign the Petition to the U.S. Government (see last link below).

I am now contacting housing reporters and government agencies (MHA Compliance, Freddie (my loan owner), FDIC, SIGTARP, Treasury, OCC, etc. Will post a list of those contacted in this diary.

Here's a useful link for more info on Lender Mendacity:

Link to the Loansafe.org thread on Lender Mendacity. Sharp suggestions here.

More links below, including to my letter to the President, resent August 17 (no response as yet from the White House).
                                         

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What's happening to the housing crisis in your area?

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I'm circulating my HAMP experience of lender mendacity because I've seen no account of it told by another HAMP applicant even though millions of homeowners are affected by it.

To demonstrate systemic lender mendacity, one must show how lenders have systemically replaced HAMP guidelines with their own denial-driven guidelines. This I do in my July 4 letter to the President, which describes GMAC's HAMP machinations and concludes as follows:

With these deceptions in place, GMAC agents can freely cite HAMP guidelines in order to justify its HAMP denials on grounds that either plainly violate HAMP guidelines or are nowhere to be found in them.

No response to my letter from the White House as yet, but I'm sending this letter on to appropriate public officials and housing reporters.

Here's a link to a PETITION TO THE U.S. GOVERNMENT FROM AMERICAN HOMEOWNERS that gas 1,700 signatures so far. Makes sense to me. My belly-in-the beast experience of HAMP is summed up below. Thanks for taking a look.

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What Should President Obama Do about His MFA/HAMP Loan Mod Programs?

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This letter has undergone scores of revisions. I'm trying to get the attention of public officials and real estate reporters. More important, I'd like to be in touch with at-risk homeowners like me who have applied for MFA (and HAMP) loan mods.  

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Is LENDER MENDACITY in Obama's MFA/HAMP programs a serious problem for President Obama?

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Harry's the whistleblower who for years documented Bernie Madoff's $50 billion investment scam to a deaf and dumb Securities and Exchange Commission. I'm not the equal of the great Markapoulos and there's no diary here, just a link to my revised letter to the President describing systemic LENDER MENDACITY at GMAC, which I've experienced over the past 14 months. Bankers and Realtors I know are telling me it squares with their experience.

AGREE OR DISAGREE? TAKE THE POLL!!

Better to shut the MFA/HAMP whole program down, I'm almost thinking, than to allow lenders like GMAC to continue to make a mockery and a nightmare of it for MFA/HAMP applicants. Applicants, what do you say?

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SYSTEMATIC LENDER MENDACITY IN OBAMA'S MFA/HAMP LOAN PROGRAMS?

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Have you entered the Kafkaesque world created by GMAC and other lenders to confound applicants to the HAMP arm of the President's "Making Home Affordable" program? Two excerpts from my July 4 letter:

GMAC’s HAMP application process, utterly severed from HAMP guidelines yet claiming strict adherence to them, is a shell game for which GMAC is accountable to no one. In my case, GMAC repeatedly invoked "HAMP guidelines" in rejecting "HAMP guidelines" supplied by its own agents! Each time, GMAC simply concocts new "HAMP guidelines" out of thin air, always to my disadvantage. GMAC denies this state of flux, but the fact is that nothing I've heard previously from GMAC agents ever applies NOW.

Looking back over the past 14 months, I see that GMAC has led me on a wild goose chase whose only desired outcome was to milk me for more full monthly mortgage payments until GMAC lowers the foreclosure boom. Indeed, two days ago GMAC asked me to send in still another HAMP application, suggesting that I may yet qualify for a modification.

I encourage HAMP applicants to write the President about HAMP. To see the full letter, click "There's more...".  

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This letter to President Obama about Lender Mendacity . . .

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Do monthly distributions from retirement funds qualify as gross monthly income (GMI) in applying for a HAMP/MFA modification? And does non-borrower income qualify as well?

Well now I'm getting personal. I've been working on my own load mod for the past 11 months. Over the past six months GMAC had told me again and again that annuity and IRA distributions DO count towards GMI when GMAC gets written proof of amount and frequency of distributions from fund providers.

But when I gave GMAC precisely this proof in December, two fairly senior guys there shot down my application, reversing GMAC'S earlier position and claiming now that HAMP guidelines DISALLOW such distributions. In a letter about my situation written at the request of the Illinois Department of Financial and Professional Regulation, GMAC even put its denial in writing: "IRA funds are not allowed, within program guidelines, to be used in income calculations." When I insisted on seeing the HAMP guideline they were referring to, GMAC would not direct me to it. So I had to dig deeper.

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HOW EFFECTIVE IS DAILY KOS AS A PROBLEM SOLVER?

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A reader says his lender (GMAC) gives him contradictory responses to the following:

Can distributions from retirement assets - IRAs, annuities, Keogh plans, pension funds - be counted towards Gross Monthly Income (GMI) in applying for a MHA/HAMP loan modification?

Readers says his lender is disallowing such distributions on the ground that MHA/HAMP guidelines don't allow them. He says also that GMAC can't give him chapter and verse from the March 4 2009 HAMP guidelines. He's told there have been several supplements to these guidelines - but says he can't find them.

Can any one help with this? And are there other questions about HAMP/MFA that savvy dKos readers might answer? Where are people going to get good information about HAMP/MFA?

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For HAMP/MFA applicants: Rate the quality of the information your loan servicer is providing

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Dere Diary (as Little Lulu used to say),

Just go an email - the first direct response I gotten so far:

Hi,

Just wondering if you have given up the fight writing about the farce that is the Obama Making Homes Affordable Program.....This Obama is the biggest fraud i have ever seen, all talk and NO results , making BIG promises and nothing ever happens....just watching him more and more disgusts me and i was once of the mindset that he could make the changes he said he would....anyway, the MHA is a joke if you havent already figured that out...if you have anything that could help the desperate peopleout there please post as time is running out quickly.....thanks !

Well, this was unsigned but it got me thinking. And here's my response to the writer and to readers of this diary:

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President Obama's $75 billion Making Home Affordable program is

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