The Huffington Post has a story about a homeowner who fell for Bank of America’s mortgage modification bait and switch routine scored a small, but significant victory, when a small claims court awarded him $7,595.
Facing a reduced income, the homeowner sought a loan modification under the Home Affordable Modification Program (“HAMP”) with the monolith lender. Borrowers are supposed to be given a permanent modification after several months in a temporary modification, where, typically they make smaller mortgage payments. When B of A declined his approval for a permanent modification, they told him he had to make up the difference between his small payments and his regular payments.
The story goes on:
It’s the classic HAMP bait-and-switch: Homeowners are told they’re eligible for the program but eventually discover the foreclosure process, triggered by the reduced payments, moved faster than the modification process.
More people have been bounced from the program than have received permanent modifications, and federal auditors have even pointed out that the program sometimes causes the foreclosures it was created to prevent.
You can read the story here.
