16 CFR Parts 317 and 318: Mortgage Assistance Relief Services Rulemaking
First of all, it should be easy enough so that a distressed homeowner could negotiate his or her own modification. Unfortunately, I don't think that is the case. Unknowledgible individuals, whether negotiating on their own behalf or for another, who do not truly understand the tenets of debt and repayment, often obtain a modification which does not truly solve the problem. Hence we see so many who have received a modification re-defaulting in a short period of time. So, some kind of guidelines to insure that the modification will truly fix the problem. I have a hard time believing that the loss mitigation people are always dealing in good faith. I have heard numerous stories of lost paperwork, disrespectful language, long telephone waits ending in disconnect and telephone systems so byzantine that they are virtually uneffective. Either these people are inept or these departments are so overloaded that chaos reigns. Staffing and knowledge levels on the lender side so effective modification can be negotiated. Then, the people on the side of the consumer need to be vetted. The non-profits, for the most part are wonderful, they usually know their business and do a great service on behalf of the consumer. But they are so overloaded that a consumer often has to wait 2, 3 4 weeks or longer to be able to accesss this service. Too often a Realtor, out of work loan officer or other individual has seen this as his or her way to wealth.I think upfront fees should be banned altogether or, at the very least limited to a nominal fee to look at information and decide if a consumer is a candidate for a loan modification. If a viable modification is sucessfully negotiated, then a fee could be charged. It should be disclosed by these non-HUD approved individuals or firms that these same services can be obtained for free. I have been in the title insurance and escrow business for over 30 years and it sickens me that there is so much fraud in virtually every step of the process. States are floundering with passing laws and rules which would stop this from happening. Something needs to be done!