Aug302012
Mostly through short sales, banks met 40% of settlement requirement by 2012
The settlement with the major banks dramatically altered their incentives. As part of the settlement, banks can count short sale losses toward their settlement amount. Foreclosures don’t count. So how did banks respond? They dramatically reduced their REO processing and focused on approving short sales. This had two impacts on MLS inventory. 
First, the lingering short sales that polluted the MLS for months were cleared out. And second, far fewer REO were processed to replace the REO the banks were selling. By clearing out the backlog and not replacing with fresh supply, the number of properties available for sale on the MLS dried up. As a side benefit, prices went up increasing the bank’s capital recovery on the properties they did sell.
This change in incentives is one of the many policy changes and manipulations impacting the housing market. It’s very difficult to predict when such changes will occur and what their impact will be. Anyone who guesses right about the direction of home prices in this environment is either extraordinarily insightful, or rather lucky.
BTW, the headline of this article is misleading nonsense.
Mortgage settlement with banks starts to ease foreclosure crisis
Nearly 140,000 homeowners have received a total of $10.6 billion in mortgage debt relief from March through June, a federal report on the banks’ progress says.
By Jim Puzzanghera, Los Angeles Times — August 30, 2012
WASHINGTON — The nation’s five largest banks are off to a good start on their promise to help ease the foreclosure crisis, providing nearly 140,000 struggling homeowners with a total of $10.6 billion in mortgage debt relief, according to a government report.
But the banks have much more work to do to fulfill their requirements under a $25-billion agreement reached in February to settle federal and state foreclosure abuse investigations, key officials said.
$10M out of $25M is 40%. That is tremendous progress for only six months. Of course, that progress was almost entirely in the form of short sales, which are losses the banks would have absorbed anyway, but it makes for good public relations for both the banks and the government.
And to keep the pressure on, the government released the preliminary report Wednesday — the first look at how Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co., Citigroup Inc. and Ally Financial Inc. were carrying out their commitments.
“We will continue holding the banks’ feet to the fire in the months ahead, and we will be watching like hawks to make sure they live up to the requirements under this settlement,” Housing and Urban Development Secretary Shaun Donovan said.
Self-serving bullshit. The government regulators are trying to come off as tough guard dogs when in fact all they’re doing is watching the banks approve short sales — something the banks would have done anyway.
The report from the Office of Mortgage Settlement Oversight showed that Bank of America … did not complete a single modification of a first mortgage from the settlement’s start date of March 1 through June 30.
The other four banks had completed a total of 7,093 modifications of first mortgages worth $749 million during that same period. JPMorgan Chase completed the most, 2,920, with the highest value, $367 million.
Bank of America quickly responded to the report with updated numbers, saying that from July 1 to Aug. 21 it had completed 3,823 first-mortgage modifications, worth $596 million. Bank spokesman Dan Frahm said the modifications were difficult to complete by June 30 because each homeowner must first go through a three-month trial period.
That’s a plausible explanation. The banks want to keep can-kicking, so they are happy to complete loan modifications to get a few more payments out of hopeless debtors.
It’s amazing how many loan modifications fail in the first three months. According to the most recent HAMP report, 14% of loan modifications don’t even survive the three-month process to become permanent. Loan modifications are can kicking, not a viable long-term solution.
Overall, 137,846 borrowers nationwide received some type of monetary relief from the banks during the four-month period for an average of about $76,615 each. Californians received about $4.6 billion in relief, by far the most of any state.
The banks stopped taking back properties as REO to comply with the settlement. They are making good progress.
“We are happy with California’s share of the pie, but the pie needs to get bigger,” said Shum Preston, spokesman for California Atty. Gen. Kamala D. Harris, who was a key player in the settlement. “There’s a lot of hurt out there.”
Kamala Harris is an opportunist hoping to gain notoriety for herself. She had egg on her face when Jerry Brown decided to spend the relief money on other purposes. There may be a lot of mortgage hurt in California, but the settlement is doing nothing to alleviate that pain.
…The banks get credits for various types of homeowner relief. Each dollar forgiven in a short sale, for example, results in a credit of 45 cents if the bank owns the loan and 20 cents if it is held by investors.
There are two outrages in that sentence. First, it’s ridiculous that banks get relief credit for approving short sales. That was a massive loophole designed for the banks. When a delinquent borrower wants to leave a property, they can complete a short sale, or they can strategically default. If the borrower does not want to complete a short sale, they can default and live for free until the bank finally forecloses. Once the borrower decides to stop paying, the banks don’t have much leverage. Banks should not be given relief credit for completely a short sale instead of a foreclosure.
Second, why are banks getting credit for short sales in which they don’t lose money? When the act as servicers for an asset-backed security pool, they aren’t the ones losing money, yet they are getting relief credit. Outrageous.
The settlement was a complete and total victory for the banks.
The report did not say how much the $10.6 billion provided as of June 30 would reduce the $20-billion obligation. The largest amount of relief came in debt forgiveness as part of short sales, in which the bank allows a homeowner to sell a home for less than what is owed on the mortgage. The banks forgave about $8.7 billion in first- or second-mortgage debt as part of short sales.
Big surprise. The banks are maximizing their credits under the loophole.
In addition to the $749 million in principal reductions on first mortgages, the banks provided $231 million in principal reductions or outright forgiveness for second mortgages.
The banks also are adopting 304 servicing standards required by the settlement, with four of the banks saying that they implemented more than half the standard as of July 5. The report did not identify those banks.
Overall, Bank of America had provided the most relief to homeowners for the report period — $4.9 billion, nearly all in the form of short sales.
Now we know who’s clearing their books. Most of it was likely the crap they bought from Countrywide.
Kevin Stein, associate director of the California Reinvestment Coalition, a housing advocacy group, said he was concerned that most of the relief from the banks was in the form of short sales instead of principal reductions, which allows people to keep their homes.
That’s the best part of the settlement. At least the settlement didn’t create incentives to maximize moral hazard.
“It’s still early, and we want to be hopeful that will turn itself around,” Stein said.
Donovan said short sales were easier to complete in the first few months of the settlement than principal reductions. But he said short sales are capped and are not as attractive to banks because they result in less credit toward fulfilling the settlement terms.
Bullshit. Short sales cost the banks nothing. This is money they would have lost anyway — hell, this is money they would have recognized as losses years ago if not for amend-extend-pretend. They could have given banks 5 cents on a dollar and they still would have met the entire requirement with short sales. They will meet their settlement requirements long before they run out of short sales to lose money on.
Katie Porter, a UC Irvine law professor who is monitoring the settlement compliance for the state attorney general, said the report showed that the banks had moved quickly to start providing relief, though their performance was uneven.
“We need to see more, but the trend is in the right direction,” she said.
The bank settlement was a sham. I suppose it’s good that banks are now encouraged to recognize some losses, but this shift to short sales and away from REO processing has created acute shortages of MLS supply across the southwest. Delinquent mortgage squatters are not stepping up to fill the void left by the diminished REO processing. Why should they? They benefit more by squatting until foreclosure.
So what happens when the banks finally meet their requirements for the settlement? At the rate they are going, they will be done by next spring. At that point, I would expect them to turn their attention to the committed squatters and finally force them out.
When the banks reach $25 billion in short sales, as per the settlement agreement, will short sales through banks become more difficult?
Good question. That probably depends on what incentives the government makes for them to complete short sales. If the government starts directly subsidizing short sales with pass-through payments, then the incentive to sell short will continue. At some point, the banks are still going to have to foreclose on the squatters who simply won’t participate because they want continued free housing.
“At some point, the banks are still going to have to foreclose on the squatters who simply won’t participate because they want continued free housing.”
Why? Why will the banks have to foreclose? Are they legally bound to foreclose?
If the bank forecloses, it must, by law, account for the loss. Presently, as long as the bank does not foreclose, the bank accounts for all unreceived payments as income and marks the loan at par.
I do not think that people really comprehend that the banks have no motivation to foreclose and every motivation not to. If the banks foreclosed, accounting principles as they are, were immediately show the banks as insolvent. So why in the world would the banks do that?
It seems as though people think that banks will foreclose because that is the thing to do, or the right thing to do, or the normal thing to do. What would you do if you were in the banks position? Foreclose and show massive losses and insolvency? Or extend and pretend while the taxpayers subsidize your losses?
When a bank takes a deposit, it must account for that deposit as a liability. When the bank makes a loan, it must account for that loan as an asset.
Yes, this is bass ackwards from all other GAAP, but that is bank accounting. Loans are counted as assets. At present mark to fantasy rules, the banks are marking bad loans as if they will be paid for.
So, why in the world would they foreclose and show a loss rather than keep an “income producing, full value asset”?
They will eventually foreclose to regain their non-performing loan capital. They will do this slowly in order not to be insolvent, but the alternative is to give away millions of houses.
They don’t feel any urgency as long as they can borrow unlimited money from the fed for nothing, but eventually, some of the major banks will earn their way back to solvency, and then the federal reserve will allow interest rates to rise. This will finally wipe out the laggards who couldn’t earn their way out of trouble in time.
I think we will see an increase in foreclosure activity as soon as the banks feel they are financially strong enough. There will be a tremendous advantage to the banks that get healthy first. It may make the difference between survival and oblivion.
The Fed will never let interest rates rise. The Federal government needs to borrow $1 trillion a year. $43,000 a second, around the clock.
What would the interest be, if rates rose even to 4 or 5%? It would destroy the budget, and anyone in power when it happened would be hanged from lampposts.
I know you focus on The Bernank’s pious statements that ZIRP is all about getting jobs back for the proles, keeping the housing afloat, et cetrera. But really, consider the distincit possibility that this is just complete bullshit, a cute cover story that allows the public to see Federal monetary policy as (at worst) well-intentioned bumbling and (at best) kind-hearted attempts to rescue granny from being dumped on the street.
And that the reality is far darker: they’ve dug themselves a beastly trap, the New York money man Democratic politiciian axis. They really believed their own quack medicine would work, and all that cash shoveled out would create Reagan-era growth rates, drowning the borrowing in sweet streams of IRS cash from the boomtime. Hey, it worked for the Gipper, and we’re TWICE as smart as that old clown. We have PhDs and stuff!
Now they have a tiger by the ears, and they can’t let go. The Fed simply CANNOT allow interest rates to rise, because the Federal budget will implode, and there WILL be a depression like non ever before, if not a sovereign debt crisis and whatever nightmares wake Bernanke at 3 am in a cold sweat. They will put out even the silliest cover story, because it is far, far better that everyone think they’re just silly people pushing on a string to help housing — and not realizing they’ve accidentally wired the accelerator to the floor and drained the brake fluid.
Carl is correct, except that although the Fed will do everything it can to keep interest rates low, interest rates will rise.
Report: Homeownership at Lowest Rate in Nearly 50 Years
Whether by choice or circumstance, it seems fewer and fewer people are sharing in the American dream.
A report released Monday from John Burns Real Estate Consulting revealed that the “real” homeownership rate—measured as the percentage of households that own a home and are not seriously delinquent on their mortgage—has fallen to 62.1 percent, the lowest level in almost half a century.
The firm said that the Census Bureau’s 65.5 percent homeownership estimate was a vast overestimate, as it includes 3.8 million homeowners who are 90 or more days delinquent.
While the government and various lenders have taken steps to help struggling homeowners, John Burns Real Estate forecasted that those people are “really just renters in waiting.”
The spread between published and real homeownership rates has historically stayed slightly below 1.0 percentage point. That spread has widened in recent years for several reasons, including the economic downturn and the growing number of borrowers who have figured out how to keep their homes for an extended period without paying.
Adding to the widening gap are banks’ understaffing and fears of improperly documenting the foreclosure process, problems that have delayed foreclosures but not prevented them.
While the firm remains confident in the shared dream of homeownership, writer and John Burns Real Estate manager Sean Fergus said it’s time to face facts.
“In summary, let’s stop pretending that 65.5 percent of Americans own their own, recognize that the real number is 62.1 percent, and move forward with responsible mortgage programs that allow Americans to achieve the American dream,” Fergus wrote.
Excellent post.
As long as banks continue to lie and cheat to the market in order to avoid the perception of reality, bubble-county homebuyers are essentially ‘sitting ducks’.
I feel bad for many of the buyers who overpaid this year because they feared being priced out again. When supply returns, prices will fall from the lofty peaks many people paid to get houses in this supply-constricted market. It’s just like the 2010 tax credit rush only with a different cause.
This headfake is not sustainable? Say it aint so
There are buyers out there paying 10% or more above recent comps. The prices they are paying are not affordable by the masses even with low interest rates. It isn’t a matter of resetting the comps and the market will take a stair-step higher. Either supply will return and prices will drop, or supply will remain tight, prices will remain elevated, and sales volumes will fall off a cliff. One thing we wont’ see is rising prices and increasing sales volumes. That’s what’s required for a sustained recovery.
Following the Japanese path…
Economy Expanding ‘Gradually’, Real Estate Markets ‘Improving’: Fed
The nation’s economy expanded “gradually” from early July through mid-August, the Federal Reserve reported Wednesday in its periodic Beige Book. The description of the economy, drawn from reports from each of the 12 Federal Reserve Districts differed from the usual tone of Beige Books which have recently described economic growth as “modest” or “moderate.”
Six Districts, according to the Beige Books, “indicated the local economy continued to expand at a modest pace and another three cited moderate growth,” including Chicago which said growth had slowed from the last Beige Book report which was released July 18. Two other districts — Philadelphia and Richmond — reported “slow growth in most sectors and declines in manufacturing” and the report from e Boston was “mixed” with “some slowdown since the previous report.”
The Beige Book is issued two weeks ahead of each scheduled meeting of the Federal Open Market Committee. Though closely watched, it is rarely cited at FOMC meetings or referenced in meeting minutes. Each Federal Reserve Bank gathers anecdotal information on current economic conditions in its District through reports from Bank and Branch directors and interviews with key business contacts, economists, market experts, and other sources. The Beige Book summarizes this information by District and sector. An overall sumary of the twelve district reports is prepared by a designated Federal Reserve Bank on a rotating basis.
Real estate markets were generally reported as “improving,” according to the latest Beige Book.
“All 12 Districts cited increases in home sales, home prices, or housing construction,” the report said.
Housing markets across most districts, the Beige Book said, showed “signs of improvement, with sales and construction continuing to increase.” Descriptions of housing sector activity ranged from “significant levels of buyer traffic” and, “strong pending sales” in Dallas and Richmond respectively to “slow and modest” in New York, Philadelphia and Chicago. Reports from Philadelphia and Kansas City cautioned “the possibility of shadow inventory entering the market remains a concern” while inventory declines were reported in Boston, New York, Philadelphia, Atlanta, Dallas, and San Francisco, putting upward pressure on prices.
“In general,” the report said, “outlooks were positive, with continued increases in activity expected, although the projected gains were more modest in Boston, Cleveland, and Kansas City.”
Credit conditions, the Beige Book said “have improved over the reporting period according to District reports.” The Beige Book said “credit spreads were lower and competition for high-quality borrowers among lending institutions has increased.”
Bankers in the Cleveland District mentioned a moderate loosening of lending guidelines, the Beige Book said while the New York, St. Louis, and Kansas City Districts reported “unchanged credit standards.”
Reports on loan demand were mixed. Richmond and Atlanta, for example, reported generally low demand for loans, but some pockets of growth. Chicago said growth in business loan demand was generated mostly from small and mid-size firms and for the purpose of refinancing rather than financing capital expenditures. Cleveland, St. Louis, and San Francisco cited only small positive or negative changes in business credit demand but relatively strong demand for consumer credit. Kansas City reported stable demand for commercial and industrial loans and commercial real estate loans, while Dallas noted softer demand for loans overall. Both districts though saw increases in demand for residential real estate loans and New York and Philadelphia reported growth in most lending categories.
Commercial real estate market conditions held steady or improved in nearly all Districts, the Beige Book said. New York, Philadelphia, Minneapolis, and Kansas City all reported commercial leasing increased and vacancy rates fell. New York and Kansas City reported increases in office rents as well while Kansas City also cited a rise in commercial construction.
Retail activity, including auto sales, increased since the last Beige Book report in most districts, although Cleveland, Chicago, St. Louis, Dallas, and San Francisco noted the retail improvements were small and Atlanta said retail growth had slowed. Philadelphia though indicated growth in retail sales was “somewhat faster than in the previous report.”
Most Districts, the report said, reported employment was “holding steady or growing only slightly,” adding “several Districts including Boston, New York, Philadelphia, and Richmond noted a softening in employment relative to expectations.”
The Beige Book said “upcoming layoffs were reported by a defense contractor in the Boston District and by firms in sectors such as air transportation, appliances, and business support services in the St Louis District.”
At the same time, according to the Beige Book, “almost all Districts indicated that manufacturers were continuing to hire, albeit modestly” with demand strongest for skilled manufacturing and engineering positions, as well as for IT services. Cleveland, Richmond, Atlanta, Kansas City, and Dallas all reported some difficulty meeting demand for truck drivers.
The Beige Book is often cloaked in secrecy. The district reports are sent to one of the banks to prepare the national summary. The identity of District bank which prepares the summary is closely guarded. This report was prepared by the Boston Federal Reserve Bank which last wrote the summary in January 2011 when the economy was beginning a swoon after some signs of improvement. In that report, the Beige Book said “economic activity continued to expand moderately from November through December [2010].”
The nation’s economy “expanded” gradually…
Freddie-Fannie Push Bank Bad Debt Cost to $84 Billion: Mortgages
Fannie Mae and Freddie Mac have expanded efforts to get refunds on soured mortgages, boosting the cost of faulty home loans and foreclosures at the biggest U.S. banks since 2007 to at least $84 billion.
Bank of America Corp. (BAC), Wells Fargo & Co. (WFC), JPMorgan Chase & Co. (JPM), Citigroup Inc. (C) and Ally Financial Inc. (ALLY), set aside almost $3 billion to buy back bad home loans in the first half of 2012, according to data compiled by Bloomberg. Regional lenders including SunTrust Banks Inc. (STI) disclosed at least $1.3 billion of added costs, exceeding their total for all of 2011.
“More and more financial institutions are reporting this and some of those that behaved themselves pretty well during the mortgage cycle are starting to see this happen,” said Blake Howells, an analyst with Becker Capital Management Inc., which oversees about $2.3 billion, including shares in JPMorgan and PNC Financial Services Group Inc. (PNC) “It certainly impairs earnings power.”
Fannie Mae (FNMA) and Freddie Mac are stepping up attempts to hunt down and sell back faulty mortgages bought from lenders during the U.S. housing bubble, according to bankers, investors and analysts. The goal is to whittle down the $190 billion cost of bailouts for the two taxpayer-backed firms. Investors’ concern about the potential damage helped push Bank of America’s stock down 40 percent since the end of 2010 and discouraged some banks from writing new mortgages, regulators have said.
Any Jackson Hole predictions?
What do you think will come out of the conference?
It’s almost 70 days to the election. Plus, Uncle Ben back himself into a corner by inserting comments into the Fed’s statements hinting at QE3. He’ll do QE3, but it will be over the long term. Besides the Federal government can’t afford high interest rates right now with their outstanding debt at $16 trillion. Uncle Ben will use this QE3 and try and push interest rates lower. It will be a QE aimed at US Treasuries.
If he doesn’t announce QE, watch US Treasury rates tomorrow.
One thing is for certain… we’re about to find out who has ‘closer’ ties with the fed…..
Bond king Bill Gross; “yes” to QE3
Bond king Jeffrey Gundlach; ”no” to QE3
http://www.reuters.com/article/2012/08/29/investing-bonds-gross-idUSL2E8JT67D20120829
I wonder what will happen to Pimco when interest rates begin to rise. Gross built a bond business during a 30-year bull market in bonds when interest rates went from 20% down to 2%. Bond prices get hammered in a rising rate environment. Will people keep their money with Pimco?
I asked this of a Pimco employee once, he didnt really have an answer, saying something about moving from corporate bonds from treasuries. I didnt understand how that would help.
Cant he just change business model to short treasuries?
to corporate bonds from treasuries
and change his title from bond king to bond vigilante?
Shorting bonds directly is expensive because you have to pay the coupon rate. There are derivative products you can short that simulate shorting bonds, but you can’t deploy billions using that method. They’ll have to find something else to sell because most people won’t be buying bonds.
The banks are obscuring how much they are dolling out in principal reductions. The only reason they would mask this information is because they don’t want to reveal how little they are really doing.
Principal reductions under AG settlement remain in the dark
Mortgage servicers already wrote down principal on loans bundled into private bonds in order to satisfy the robo-signing settlement, but not even the monitor will know how many for some time, according to those familiar with the agreement.
A total of 7,093 borrowers received principal forgiveness through a completed modification from four of the five largest servicers JPMorgan Chase ($37.30 0%), Wells Fargo ($34.07 0%), Citigroup ($29.91 0%) and Ally Financial, according to an initial report from the monitor Joseph Smith.
Bank of America ($8.00 0%) completed none but does have 12,000 under trial plans for a write down.
A total of 28,047 borrowers were in an active trial modification that included a write down. Combined, the completed and trial workouts equaled $3.75 billion in forgiven principal.
When the deal was first struck in February and later approved in March, mortgage bond investors complained they would be stuck paying for foreclosure abuses the servicers themselves committed.
A Chase spokeswoman did confirm some of the roughly 3,000 principal reduction modifications the bank completed as of June 30 under the settlement were done on select private-label mortgages. Most, however, were done on the portfolio loans, but an exact percentage could not be disclosed. The ones done on private-label mortgages also passed a net-present value test permitted by the investor, meaning it was more beneficial than a foreclosure.
Bond investors were told that the servicers would focus most of the effort almost entirely on the servicers’ own portfolios, not loans bundled into securities. Every dollar a servicer writes down on its own portfolio is credited toward the $20 billion in relief promised as opposed to just 45 cents of every dollar forgiven on mortgage-backed securities collateral. But to date, no exact number for how many private loans are targeted to get a write-down has been given to the investors who own a stake in them.
Joseph Smith, the monitor of the settlement, said servicers negotiated not to disclose exactly what loans were getting the write-downs until they ask for satisfaction certificates and scoring for credits to the $20 billion.
The servicers “weren’t keen to make that disclosure,” he said in an interview with HousingWire.
For now, the data is self-reported.
“The only time that break down is relevant to me is when we’re scoring and when they seek satisfaction on what they’ve done,” Smith said. “Before that, there really isn’t any requirement under the agreement to make a distinction. That’s the statute. I don’t know when that will be.”
For now, the servicers are focused on providing the relief as quickly as possible. For every dollar written down in the first year after the settlement was struck, they get an extra 25 cents credited toward the $20 billion.
“Chase is proud to lead one of the largest foreclosure prevention efforts in the country,” Frank Bisignano, head of mortgage banking at Chase, said in a statement. “From the start of the housing crisis, it has been our top priority to help homeowners who are struggling to make their mortgage payments. We are on track to fully implement the settlement well within the timeframe of the agreement.”
By comparison, BofA has completed no principal reductions under the settlement. It did provide a vast majority of the short sales and total relief through June 30.
Smith said he was happy with the initial gross dollar amount of roughly $10.5 billion in relief granted so far. Short sales took a large percentage of the early assistance, but that’s because they are booked when they are closed. The principal reduction workouts take at least three months to successfully complete the trial period.
“There will be a lot of conversation about the break down of it. There are some people who have a serious and understandable concern about all this,” Smith said. “But I’m happy some consumers are getting relief from indebtedness. I think we made a good start. I actually think we’ll have a clearer picture in November and again in February when the next reports will be released.”
This is a play out of the great depression. Banks and Farming did the exact same thing in the ’30s. Only last time the govt let people starve (propping up food commodity prices) ontop of losing thier homes.
I wonder when gangsters and bank robbers (bonnie and clyde, Billy the Kid, ec)are going to become romantacized heroes again?
Thank God for Food Stamps and American Idol.
“It was common during the Depression Era where gangsters were held in such high esteem as larger-than-life sports legends like Babe Ruth and Jack Dempsey. Newspapers, magazines and radio broadcasts routinely romanticized their exploits, portraying them as “Robin Hood” figures to an economically starved public angry at the world and the wealthy who monopolized power. ”
Read more: http://ndepth.newsok.com/gangsters#ixzz2530fV8l4
Thanks for sharing that link. I hadn’t made the connection between the rise in popularity of these outlaws and the anger against the banks for the depression era foreclosures.
You’re right, the banks ought to be very thankful for food stamps and American Idol to placate the masses.
The post and the follow-up comments give the best explanation available why banks don’t foreclose on the squatters. Thank you Irvine Renter and to all the posters. Wish more people would read this Blog and get educated.
Our system is a mess.
Thanks. I’m glad you find value in the content here.
My first and second mortgage qualified under the settlement for either a rate reduction or refinance. I couldn’t get any info from either servicer. I even asked for a decline letter saying I wasn’t going to receive assistance under the settlement, so that I could move on. Nope. Nothing.
The second was paid-off a month ago and the first is about to be paid-off in a refi. They could have reduced my rate to 5.25% under the terms of the settlement, and I’d probably have kept it for awhile and saved my cash. Now they have nothing.
They probably weren’t particularly motivated to give you an answer because you were still paying. Plus, they would have dragged their feet on any modification for the same reason.
It feels good to have this behind you, doesn’t it?
“First, it’s ridiculous that banks get relief credit for approving short sales. That was a massive loophole designed for the banks.”
Exactly. Banks are getting credit for principal reductions they are giving anyway.