Happy New Year and wish me a happy anniversary, too. I'm celebrating the first anniversary of my effort to modify my mortgage through Aurora Loan Services. You are going to see a lot of this post in the near future, because I'm going to cross-post it everywhere until I find someone who knows someone in Aurora Loan Services or its regulator. I've never wanted to bring a company down before, but I do now. I wasn't quite angry enough until today, when I read an article in the Times that told me I was not an isolated case, but an example of a widespread and toxic policy on the part of this particular servicer to deny homeowners programs the government has sought to extend. Failing to extend these programs helps no one except Aurora itself.
Background: It all started in 2008, when Lehmann Brothers collapsed. Aurora is a unit of Lehmann. Right after that came the collapse of Bear Stearns, and then the disappearance of all my investments, my real estate deals, and my consulting clients.
Ooops! Those were supposed to be my retirement. No matter. I'm not in a hurry to retire. But I didn't have any cash flow all of a sudden.
The first time I called Aurora, I thought they'd say yes to modification, because I had no income for November and December 2008
But they said no, because they said I couldn't afford the house.
Then came Obama's Making Home Affordable Program.
I applied, and Aurora said no, because I wasn't a Fannie and Freddie mortgage. Nothing in the Bay Area is a Fannie and Freddie Mortgage. We pay the big bucks here for a 1500 square foot house that would cost $150k anywhere else in the country. Here, in 2005, my house cost $769,000. I could afford it. I documented it with tax returns. I'm not stupid, and my loan is not subprime, However, the world has changed, and with it, the value of my house.
Aurora bought my first mortgage from Princeton Capital, and probably tore it into a million little pieces. Citibank has my HELOC. You couldn't get JUST a mortgage in northern California in 2005; you had to buy a house with a mortgage and a HELOC. My 30-year old house is a starter home in my community, not a McMansion. It was where I wanted to retire, because my kids live here.
Want to know what it's worth now? Mint says $511k. But let's not talk about that. I don't want to sell it. I want to own it. And I couldn't sell it anyway. In my neighborhood, houses don't sell anymore unless they are foreclosed.
I waited a while, following the news, and then, because Obama had put out some new programs, I applied again. This time I spoke to someone on the phone who told me my business didn't break even so I wasn't eligible. She explained that I had to break even and could then re-apply..
I waited three more months. All this time I paid out of savings and lines of credit while the value of the house dropped. Obama came into office with the audacity of hope, and yet another a new program had me apply again.
This time they lost my information. And, oh by the way, I kept on paying. And I kept on working. In May, I broke even.
I applied again. They lost my information again. I re-sent it again.
I have a system by now for assembling stuff. My last two years' tax returns and last two months' financial statements and bank statements, along with my hardship letter, are in a folder on my desktop. I update my age in the hardship letter. I update the statements every month of so. And I fire off the package again
Now they have an automated email system that tells me they have my materials. They also tell me it takes 90 days to get an answer. In 90 days I get another letter in response to my inquiries that says my materials are out of date again. In July, re-submitted. In October they told me they didn't have an snwer yet. In November I told them to hurry. They sent me another email referring me to yet another program.
I have now been through the Making Home Affordable Program, the Home Retention Program, and the Mortgage Modification Program.
For the mortgage modification program, I was told last week that I am not eligible. Why? Because I have $22,000 left in savings, which they say is enough tfor three months of mortgage payments. Having this much money (my mortgage is nearly $5000 a month) makes me ineligible.
But the helpful cheery voice said, "please call us back again. In a few months, you may qualify." When? When I have eaten up the very last of my savings? And then they will tell me I don't qualify because I don't have any savings?
Why don't I just keep paying for thirty years? Because I have an adjustable mortgage, and when it adjusts I will not be able to refinance the loan because the house has no equity. It will be a numbers game, and I will lose the house whether I've been paying or not.
Help me out by forwarding this to anyone you know, anywhere. I want to call these people out for what they're doing. It's not the house, and it's not the money — it's the principle. I will never be in the street. I will never starve. But other people will, like the four homeowners from Queens in the NY Time story. They're not writers, though, and I am. Perhaps I can use my pen, supposedly mightier than the sword, to help us all.