HI MY NAME IS PHILIP S.C.
I BELIEVED I AM THE WORST VICTIM OF CHASE BANK ,WITH A LOAN 12 1/2% RATE.
I STARTED BEGGING AN CRYING TO CHASE SINCE AFTER THE FIRST MONTHLY BILLS. FOR THE PAST TWO YEARS.
UNTILL NOW THE CASE REMIND UNSOLVED. MY EXPERIENCE AFTER WRITING CHASE OVER 20 LETTERS NOT EVEN ONE REPLY.REALIZE IS NOT CHASE FAULT.IS THE REGULATION LAW GIVING THEM A LICENSE TO KILL .TO MUCH TO TELL ,FOR ANY PROOF CONTACT ME ON BROTHRHOODSF@AOL.COM OR SEVENSUNGARDEN@AOL.COM
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First, the banks servicing these loans traditionally haven't considered modifications. They'd rather do "short sales" where the owner hands over the keys and walks away.
Second, the institutions that own the mortgages don't believe they have to accept modifications to avoid losses down the road. They're holding AAA-rated bonds backed by these subprime loans. When some go bad, they'd rather foreclose, take their money and run.
But quick foreclosures won't save the bondholders today, says Lewis Ranieri, the man who created the mortgage-backed securities market in the late 1970s. A tsunami of defaults will overwhelm the mortgage servicers in the next few months—setting off death spirals in local housing prices. "Every house that's foreclosed drags down the value of four houses around it," he says. In such a world, even AAA-rated bonds lose money.
Sheila Bair, chair of the Federal Deposit Insurance Corp., sees a way out. She's proposing that the banks automatically modify every subprime loan if the borrower lives in the house and has been paying on time. Payments would continue at the starter rate, without a step-up. That could prevent foreclosure on about 1 million loans, Bair says, freeing overtaxed bank staffs to focus on the borrower's default.
Would Bair's idea help some undeserving people who overstated their income on the loan application? Yep, but there are no good options here. "Lenders are misguided if they expect to ride this out," she says.
They may be starting to see the light. Over the past three months, more loans have been modified, says Mike Shea, head of Acorn, a nonprofit that helps lower-income homeowners. Countrywide, among others, is starting to modify loans by the batch. For those that don't, "the losses could be severe," Shea says.
So here's the message for subprime borrowers who could afford their homes if their interest rate doesn't rise: try to hang on for six months, keeping payments up to date. As the housing disaster deepens, lenders will cut deals that they're avoiding now.
Reporter Associate: Temma Ehrenfeld
© 2007
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