Refi Your Home Loan

In Wayne County, Michigan, 195 homes go into foreclosure each day. According to the Congressional Oversight Panel, nationally, 1.8 million homes were lost to foreclosure from July 2007 through August 2009. And yet, in spite of these haunting numbers, as the New York Times blogged last week, bank executives seem more concerned about winning the blame game than anything else. Testifying before the House Financial Services Committee, the CEO of JP Morgan Chase insisted the foreclosure crisis is really the fault of the mortgage brokers. However, the New York Times revealed details of JP Morgan Chase’s circulation of subprime loan advertisements advocating the loans’ loose requirements to mortgage brokers back in 2005. The headlines of the leaked ads [pdf] read, “The Top 10 Reasons to Choose Chase for All Your Subprime Needs,” “Chase No Doc,” “Got Bank Statements?” and “Get Approved!”

Too many companies like JP Morgan Chase rushed into this sub-prime mortgage spotlight of praise and profit to the demand of the investors, but now after being invited to take their rightful places on the stage of reality and responsibility, nobody’s walking. The stage is too bare and the call too faint. Such seems to be precedence. The call to rewards and favor is always loud and clear while the call to justice resounds barely above a whisper. It is mind-boggling to believe that with such a vast chain operation, banking giants like JP Morgan Chase were not the least bit aware of the wrongful lending practices being undertaken. Nonetheless, now we know that JP Morgan Chase was more than hands on. They advertised and promoted this unscrupulous lending scheme. They were hands on when the money was flowing and hands off when critics were looking. Not only should they own up to the responsibility and take their rightful places of shame, but they should change their modus operandi to make sure that this doesn’t happen again.

While last week’s annual Dow Jones record high may breed optimism for many, I cannot help but be fearful of a possible repeated cycle emerging in which the run of record high revenues may continue to fuel these greedy practices that create inevitable losses, disproportionately felt by the hard-working individuals on Main Street. Sadly, a year after the supposed push for heightened financial reform, countless individuals are still left unemployed and financially plagued with burdensome mortgage loans. We cannot continue to allow Wall Street greed to solely drive revenue at the expense of others’ welfare. Something must be done not only to stop this cycle, but most importantly, to provide relief. And I have a plan.

With Detroit being among the worst hit cities of this crisis, I have been tirelessly and intimately engaged in getting out better tools for people who are stuck in this downward spiral. First, since countless individuals facing foreclosure lack legal representation to protect their rights, I am working to increase funding for Legal Services Corporation (LSC) and lift the restrictions on whom LSC can service. LSC provides civil legal assistance for low-income individuals, but currently inadequately funded, in the category of foreclosures — LSC-funded programs have been projected to turn away two for every person served. Should such restrictions get lifted and funding increased, more people will be empowered with the necessary resources to battle these scheming banking giants. In fact, next Tuesday, I will be holding a hearing on the fine points of these needed changes.

Second, Treasury Secretary Timothy Geithner recently announced that approximately 500,000 American families were participating in the home loan modification program first initiated in March by the Obama Administration. Paling in comparison to the great number of those facing foreclosure, this rather skim number indicates the mere few who have broken down the barriers to qualify for the program. The Home Affordable Modification Program (HAMP) neglects a large portion of those in need, because it requires unreasonably complex paperwork and unfair qualification restrictions. Revamping the program’s administrative process will allow the program to carry out its intended purpose. To make matters worse for borrowers, bankruptcy judges are prohibited in modifying home mortgages, such as reducing excessive interest notes and hidden charges. Eliminating this anomaly in law will encourage more lenders to voluntarily modify mortgages and broaden bankruptcy foreclosure relief for the larger sums.

I will continue to fight and demand for all these remedies in the coming weeks in order to get out better solutions to help those facing such financial hardships. Like many of the other nationwide debates we find ourselves immersed in today, this debate on the subprime mortgage crisis is sadly shifting in focus at the detriment of people’s welfare. We must now refocus and bring back into the spotlight the need for change and aid those who have fallen victim during these financially perilous times.

Read more: JP Morgan Chase, Treasury Department, Legal Services, Foreclosure Crisis, Subprime Mortgage Crisis, Hamp, Mortgage Crisis, Foreclosure, Timothy Geithner, Politics News

WASHINGTON — Home resales in September clocked the largest monthly increase in 26 years as buyers scrambled to complete their purchases before a tax credit for first-time owners expires.

Sales jumped 9.4 percent to a seasonally adjusted annual rate of 5.57 million last month, from a downwardly revised pace of 5.1 million in August, the National Association of Realtors said Friday.

Read more: Real Estate Market, National Association of Realtors, Housing, Housing Crisis, Home Prices, Home Sales, Business News

A Huffington Post analysis of recent mortgage-modification data shows that even those relatively few homeowners fortunate enough to renegotiate their loans are almost never getting lenders to forgive any of the principal. Instead, monthly payments are being cut either by lowering inflated interest rates, extending the duration of the loan repayment, or simply postponing the day of reckoning by setting up large balloon payments decades down the line.

Furthermore, President Obama’s much heralded $75 billion plan to prevent foreclosures is essentially limited to people who still hold a job — leaving many of the approximately 10 percent of Americans who are unemployed with no more options than they had before.

In short, there is some relief for homeowners who haven’t lost their jobs and were paying high interest rates – but not so much for people who’ve lost their jobs, bought a house that they can’t afford, or now have significant negative equity due to the bursting of the housing bubble. For them their burdens remain.

The relative failure of Obama’s plan is a particular disappointment, consumer advocates say. After spending hundreds of billions of dollars in bank bailouts, the administration proposed a plan that would pay mortgage servicers for successfully modifying eligible delinquent home loans. Investors that owned securitized mortgages that were modified would get paid, too. Most importantly, distressed homeowners would get to keep their homes.

Despite the incentives, the program hasn’t been a roaring success. The administration originally said it would “help up to three to four million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments.” Thus far, about 500,000 homeowners have been placed in three-month trial plans. Though it’s still early on (the program was launched in March), as of Sept. 1 only 1,711 of the trial modifications had become permanent.

Here is a summary of the plan’s progress from the Congressional Oversight Panel:

For those lucky enough to get a permanent modification, principal forgiveness is not in the cards. While interest rates are being brought down, as are monthly payments (on average a $500/month decrease), the overall amount owed isn’t changing.

In fact, in some cases the amount of the loan is actually going up. That’s because the life of the loan is expanding. Rather than reducing the overall amount owed, lenders and servicers are mostly lowering the monthly payment (temporarily) and making borrowers pay for longer. So instead of having 20 years left on a mortgage, for example, it could be 25 years. Loan modifications outside of the government’s program are no different. Principal forgiveness is rare, and virtually non-existent in securitized mortgages.

In fact, balloon payments — instances when a large amount of the money owed is due at the end of the mortgage in full — are more common than principal forgiveness. From data on modifications of securitized home mortgages, courtesy of Fitch Ratings:

All of this suggests that investors and lenders are willing to take the hit for having enabled and charged high interest rates — but are still refusing to take responsibility for having underwritten excessively large loans, at overly inflated prices.

More bad news comes from a recent report from the Congressional Oversight Panel, which concluded that “it increasingly appears that [the program] is targeted at the housing crisis as it existed six months ago, rather than as it exists right now.”

What’s changed is the rising unemployment rate. Because eligibility under Obama’s plan requires certain levels of income (depending on one’s monthly mortgage payment), the unemployed — without other sources of cash — could be shut out.

And the panel doesn’t expect the modification rate to go up, seeing as “servicers may initially move to modify the easiest surest cases, and the most motivated and organized homeowners are likely to be among the earlier applicants.”

And unfortunately, in the end, a significant number of modified loans will eventually re-default. A sobering chart:

And don’t expect anyone to ride to the rescue. Freddie Mac, the agency empowered to police the Obama plan — like getting to the bottom of why otherwise-eligible homeowners are getting rejected for loan modifications — is falling down on the job, according to a recent government watchdog report described by the nonprofit investigative news organization ProPublica.

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Read more: Subprime Mortgages, Loan Modifications, Subprime Mortgage Crisis, Mortgage Crisis, Home Affordable Modification, Financial Crisis, Homeowners, Congressional Oversight Panel, Business News

I found myself in possession of a few extra dollars the other day. Overcome with glee, I ran right out to put my minimal money back into the local economy! I was certainly not on a quest for retail therapy: I visited the vitamin store to replenish some supplements, stopped in the drugstore for supplies, and popped into the beauty supply shop to replace depleted shampoo.

My foray back into stores after a long, involuntary hiatus was very disturbing. The parking spaces were unfilled and the store aisles vacant, and in each establishment my very presence was immediately greeted with gratitude. Like the first guest to show up at a dinner party given by an extremely nervous host, I felt unease radiating through the hearty and too-loud welcome that met me as I came through each store’s front doors.

Clerks chatted with each other while I shopped at one store, uneasy with how low the sales figures for the week had dropped. One was certain she’d be let go after having her hours cut back, but another figured the ax would fall her way as she earned almost one dollar more per hour. In a retail shop, I asked if I could get an advertised “web only special”. The manager replied: “No problem — I’d be nuts to turn away any sale.” At another store, the solitary staff person apologized for her “dusty” appearance, as she had been cleaning the shelves all day “just to keep busy.”

Was it any coincidence that, while driving to the first store, I heard a news report that my county was now leading New York State in foreclosures? I’m positive that the absence of people in local stores on a bright, sunny October afternoon was not a fluke; there was a definite correlation between the stores being deficient in customers and the surge of homeowners being delinquent on their mortgage payments.

I made conversation each time I checked out my purchases, hearing tales of woe and apprehension about individual jobs and, in one case, doubts about the ability of the store to survive much longer in this economic climate. The retail disquiet was quite similar to the despondency expressed almost daily by callers to my law office who are three, four, five or more months behind in paying their mortgages. No sales clerk expressed any unwillingness to accommodate customers; there were just no shoppers to be found. The same with the delinquent mortgage borrowers seeking my counsel: They are not unwilling to work matters out with their lenders; they just don’t earn enough (or have any other resources) to dig themselves out of their financial holes.

Without a line of impatient store patrons to speed her along, one store employee was eager to chitchat. She related how the big department store that anchored her shopping center was almost always empty. On her lunch hour, she would go from rack to rack of clothes, amazed at the bargains. “Did you get any great deals?” I idly asked. “Nope. I don’t get paid enough nowadays to afford any new clothes.”

That sums up fairly eloquently why swelling foreclosure figures dovetail into the absence of retail shoppers. When you lose your house to foreclosure, your closets go, too.

Read more: US Economy, Attorneys, Retail Industry, Foreclosure Crisis, Unemployment, Employees, Economy, Economic Crisis, Stores, Foreclosure, Real Estate, Housing Crisis, Home Foreclosures, Business News

Despite some tentative signs of recovery, the U.S. housing market remains vulnerable to further price drops–especially in areas where large numbers of mortgages are headed toward foreclosure over the next few years.

Read more: Foreclosures, Mortgages, Housing Market, Housing, Real Estate, U.S. Housing Market, Business News

Mortgage companies are more likely to foreclose on homeowners than modify their loans because they make more money off foreclosures, argues a new report by a consumer advocacy group.

While homeowners, lenders and investors typically lose money on a foreclosure, mortgage servicers do not, says report author Diane E. Thompson, of counsel at the National Consumer Law Center. Servicers are the companies that manage the mortgages and collect payments.

“Servicers may even make money on a foreclosure,” she writes. “And, usually, a loan modification will cost the servicer something. A servicer deciding between a foreclosure and a loan modification faces the prospect of near certain loss if the loan is modified and no penalty, but potential profit, if the home is foreclosed.”

Thompson attributes this to a system of perverse incentives created by lawmakers and rulemakers in the market, like credit rating agencies and bond issuers. The private rulemakers typically dictate how a servicer can account for potential losses and profits. They hold enormous sway over securitized mortgages, which are owned by investors. More than two-thirds of mortgages issued since 2005 have been securitized, notes the report, using data from the industry publication Inside Mortgage Finance.

In those cases, the servicer is empowered to handle virtually all aspects of the mortgage, from collecting the monthly payments to initiating foreclosure proceedings. While they’re obligated to do what’s best for the ultimate owners of the mortgage — the investors — servicers have some latitude in deciding what course of action to pursue, be it a foreclosure or loan modification.

When a homeowner is delinquent on a mortgage that’s been securitized, the servicer must front the late payment to the investors. When a home is foreclosed, the servicer is typically first in line to recoup losses. But if a mortgage is modified, the servicer typically loses money that isn’t necessarily recoverable.

“Servicers lose no money from foreclosures because they recover all of their expenses when a loan is foreclosed, before any of the investors get paid. The rules for recovery of expenses in a modification are much less clear and somewhat less generous,” she said.

That’s part of the reason why the Obama administration created a $75 billion program to limit foreclosures. The money is to be distributed to servicers who successfully modify home loans, with the hope that the incentives to modify outweigh the incentives to foreclose.

Thompson’s report outlines eight specific steps to reverse this trend. They include mandating that servicers attempt to modify a loan before initiating foreclosure proceedings and reforming bankruptcy laws so judges can modify distressed mortgages.

Read the full report:

NCLC Report on Mortgage Servicers –

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Read more: Foreclosures, National Consumer Law Center, Foreclosures Over Loan Modifications, Housing Crisis, Foreclosures Favored, Business News

In my new book, LOVE LEADERSHIP: The New Way to Lead in a Fear Based World (Jossey-Bass), I make the case that there are only two things in the world: Love and fear, and what you don’t love, you fear. I go on to say that the reason our world seems all screwed up is that “most of our so-called leaders have led by fear.”

Fear may seem to work in the short term, but over the long-term fear flat out fails (The Second of Five Laws of Love Leadership in my book is entitled “Fear Fails”). Worse, I say that “fear is the ultimate prosperity killer.” If you want to paralyze an organization, your family, your community, or your own life, insert a culture of fear.

So you say, “If this is the case, and if fear is so corrosive and so bad for us,” as I state over and over again in Love Leadership, “then why, John Hope Bryant has fear seemingly done so well in our little world?” The answer is the feel-good, me-based, immediate gratification disease called “short-termism.”

Fear Leads to Short-Termism

The problem is that the entire business world seems to have come down with a case of A.D.D. (Attention Deficit Disorder). The disease goes by another name: short-termism. Short-termism is similar to fear and laziness, in that it relies on shortcuts to achieve results.

For most people looking for a short-term fix, fear-based leadership wins out, hands down. If you’re satisfied with flash-in-the-pan, short-term thinking, there’s no better way than to lead based on fear. With luck, your business will take off like a rocket, for a while. Eventually, however, it will implode.

My friend and mentor Quincy Jones says “it takes 20 years to change a culture.” Well, over the past 20 or so years we have made dumb sexy. We have dumbed down and celebrated it. Over the next 20 years, we need to make “smart sexy again” (see www.5MK.org for our initiative to make “smart sexy again” with our youth, helping to break the high-school dropout epidemic and encouraging kids to stay in school).

A Perfect Storm

In Love Leadership, I say that the first cousin of fear is short-termism, and short-term’s best friend is laziness, the roommate of laziness is greed, and the most popular word ever uttered by fear, short-termism, laziness or greed, is “me.” Translation: What do I get? But in a world seemingly obsessed with only one question, which is “What do I get,” in order for us to succeed over the long-term, we must ask ourselves an entirely different question, which is “What do I have to give?”

Fear is a lazy bastard.

It comes from the most primitive part of what evolutionary psychologists call the reptilian brain, the part of the brain that governs instincts, heartbeat and breathing. It takes no work and no intelligence. Even a lizard can be afraid.

Love though, comes from the most advanced part of the mammalian brain — the forebrain — the region that thinks, remembers and finds meaning. Fear is a feeling and nothing more. Love, in contrast, is feeling plus thought. It’s an emotion that stays in your memory forever. That’s why love survives, long after fear dies. Love is so strong that it’s the only real reason the human race is still here, after all the opportunities we’ve had to destroy ourselves.

This crisis is not about some sophisticated or complex failure of free enterprise and capitalism as we know it, but the rather simple-minded failure of greed itself. In other words, this is an example of short-termism taken to its most fundamental and core inner-flaw: An expediency strictly for one’s own individual benefit; over any sense of (higher) purpose.

As I have said, and will continue to say, as I tour the nation in my “Conversation on Leadership” series, this crisis is more a crisis of virtues and values, than any sort of classic economic crisis. No doubt you are feeling this crisis economically, but this is no different than when you have a cold, you feel or sense it when you sneeze.

As I state in Love Leadership, “the basic cause of the original mortgage crisis was a fundamental lack of a relationship with customers. The broker and the borrower in the mortgage deal were not really connected or committed in a real way; the broker and the banker were not really connected or committed; and this is key: the banker and the borrower were not connected or committed. Likewise, the banker and Wall Street were not connected or committed, and fatally, Wall Street securitization firms and the investors around the world to whom they sold these complex products were not connected or committed. There was no real relationship between any of these channels (other than the financial transaction itself).” I continued, “Put even more simply, as long as the broker, the banker, the Wall Street player and others in the deal got their fee, they were happy — or so they thought. This behavior was further supercharged by shareholder pressure for firms to hit aggressive quarterly profit targets, a short-term focus that conveniently translated into huge performance bonuses for executives.” Finally, I summarize in this section, “I am all for free enterprise and capitalism. Without a clearly defined profit motivation, a business simply will not be viable for long. My problem is that the relationship between all these various individuals and groups was simply the financial transaction. The concern was for the buck, not for the borrower.”

Everyone needs to have an enlightened self-interest in the outcome of a business transaction, and it should start with a genuine understanding of and concern with what’s best for the client, the customer, the borrower. That concern — what I call love — was fundamentally absent during the events that led up to this economic crisis. There simply was no relationship with the borrower.

An Example And Examination of Doing It Right

Richard C. Hartnack, an Operation HOPE board member, understands well this problem of the transactional approach. He is in charge of consumer banking as vice chairman of US Bancorp, the Minneapolis-based parent company of US Bank, the sixth-largest commercial bank in America. Prior to that he served as vice chairman of Union Bank of California from 1991 to 2005.

US Bank was roundly criticized in 2006 and 2007 for having slower revenue growth than many of its peer banks. A big reason was its decision to largely ignore the mortgage market, except for the prime loans that it had mostly specialized in.

Hartnack recalls that when the financial crisis hit in 2007, US Bank took a hard look at its adjustable rate mortgage (ARM) loans. The bank didn’t make these loans with the intention that they were going to be a problem, but it saw in September, 2007, that interest rates at that time were expecting to go up. The bank did the math and knew that the change in the rates would be a big shock to its mortgage holders.

US Bank had a choice: It could try to deal individually with thousands of households and figure out the exact right loan for each one, and while it was doing that, could watch people get into serious trouble paying their loans (and simultaneously watch their reputation take a hit in similar fashion). Or the bank could simply not raise the rates.

Hartnack knew that the bank was either going to have to deal with a lot of bad loans, or it could make this concession, and see a set of problems just go away. The bank opted for love leadership. It held the interest steady, and told customers they had to opt out of their ARM into a fixed rate loan. And as you would expect, a large percentage of the bank’s clients accepted the offer.

Hartnack’s decision turned out to be prescient, one that did well for the bank and did good for its customers. It helped people stay in affordable mortgages, and it avoided foreclosures, where everyone loses. He says:

This example is proof that a short-term focus has a lot of temptations. It’s a rare set of circumstances — combining the board of directors, CEO, top management, investors, analysts, the culture and everything else — that creates an environment in which people are willing to look at the long haul and avoid short-term temptations. When you’re operating for the short-term, there are a thousand little trade-offs where you find yourself faced with choices that are terribly uncomfortable. And it takes a huge amount of character on the part of a management team to stand up to those.

In the end, all you really have is your reputation, when you’re dead and buried, they’re not going to bury your money with you. When you’re dead and gone, what people are going to look back on is your reputation, and people are going to judge if you’re a leader in business with your customers, your community, your employees and your shareholders.

Your reputation depends on something greater than making money. It depends on creating prosperity for all.

Where We Go From Here

My friend Daniel Sachs, CEO of Proventus, a $750 million private investment company in Stockholm, Sweden, said in an interview for my book, “It’s up to the people who believe in markets and believe in globalization and believe in free trade, to make the case for an open society as appealing as can to the many. Because if it’s not good for the many — if it’s only good for the few — then it’s not going to win. It’s up to us who believe in markets and in capitalism to devise a model of capitalism that is more long term.”

As Sachs has shown, if you want to still be in charge a year from now — or five, 10 or 20 years from now — you’ve got to build something that lasts. To perpetuate your power into the future, whether you’re growing a business, leading a government, nurturing a family, or running a team, you need to earn the love and respect of those around you, and you need to love and respect them back.

If you lead with love for the long term, people will follow you forever, wherever — for their own good as well as yours — and you will be remembered as a person of greatness.

John Hope Bryant is the founder, chairman and CEO of Operation HOPE, vice chairman of the U.S. President’s Advisory Council on Financial Literacy as well as chairman of the Council Committee on the Under-Served, financial literacy advisor to the World Economic Forum Global Agenda Council, a Young Global Leaders for the World Economic Forum, and author of LOVE LEADERSHIP; A New Way to Lead in a Fear-Based World (Jossey-Bass), which debuted in August, 2009, #8 in the CEO Reads Top 10 Best Seller List.

Read more: Operation Hope, Love Leadership: The New Way to Lead in a Fear-Based World, Subprime Mortgage Crisis, John-Hope-Bryant, Global Economic Crisis, Business News

DENVER — An auction last month of loans from the failed New Frontier Bank generated $157 million on a portfolio once valued at more than $500 million, according to government records.

The federal government salvaged 27 cents on the dollar in the auction, underscoring the poor quality of agriculture loans that were stranded when the Greeley bank failed in April, The Denver Post reported Tuesday.

Read more: Mortgage Crisis, Agricultural Loans, Banking Crisis, Bank Auction, Greeley Colorado, New Frontier Bank, Colorado Farm Bureau, Cattle Consultants LLC, Denver News

A retirement community in Largo, Florida is fighting to evict six-year-old Kimberly Broffman from the home of her grandparents Jimmy and Judie Stottler, the only parents she’s ever known. According to the development’s bylaws, all residents must be older than 55.

Kimberly is the only person expected to vacate the home.

Kimberly’s grandparents have tried selling their house to leave the neighborhood, but because of the crash in the housing market, there are no buyers. They have lowered the price from $225,000 to $129,000.

The fight between Kimberly’s grandparents and the community has been going on for years, but soon a judge will decide if the girl must leave. According to NBC News, there is a real possibility that she could be placed in state foster care.

WATCH:

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Read more: Kimberly Broffman, Senior Citizens, Children, Eviction, Retirement Community, Florida, Housing Crisis, Kimberly Stottler, Parenting, Grandparents, Real Estate, 6 Yearold, Home News

Huffington Post ran a story last week about Ocwen Financial patting themselves on the back for the amount of delinquent mortgages they’ve modified using the Making Home Affordable plan. According to the article, Ocwen is responsible for 45 percent of all the successful loan modifications in the country. Wow, 45 percent. If I hadn’t almost flunked math, I’d think that was almost half. That’s quite an accomplishment.

If you’re one of the millions of homeowners trying to get a modification these days you’re probably wishing Ocwen was servicing your loan, and if you’re an Ocwen customer you’re probably feeling pretty hopeful right now. But if you have anything more than a fourth or fifth grade education (around the time they start teaching fractions) this number is far from impressive. Even if it is almost half.

This is where it gets fun, so bear with me: Treasury planned on 1.3 million modifications a year for the next four years. That’s a “robust goal” of 25,000 modifications a week, as Richard Neiman calls it in a report from the Congressional Oversight Panel.

The program was introduced at the end of March and so far there has been a total of, hold on to your hats … 1,711 permanent modifications through the MHA program. Allowing for the three-month required trial period we should have close to 300,000 modified loans since July. Instead we have 1,711. That’s 298,289 modifications shy of what Treasury wanted and expected from the banks. The 1,711 actual modifications compared to Treasury’s goal amounts to a percentage so low it’s not worth mentioning, but I will. It’s .0057 percent. And Ocwen is taking credit for almost half of that dismal failure.

Time for some more numbers: Ocwen services close to 300,000 loans. Three months ago Treasury reported that 16 percent, or 50,516, of the 300,000 loans Ocwen services were delinquent. Of the 50,516 delinquent loans, Ocwen offered modifications to a whopping 6,502 of those delinquent homeowners and consequentially, approved 2,517 for the three-month trial modification (twelve percent and five percent of the total delinquencies respectively).

I’m sure someone could argue (and Ocwen has) that modifying 770 loans passes for success when compared to the lack of effort made by other banks, but bigger questions need to be asked when it comes to how banks and servicers are modifying loans. Like what happened to the other 95 percent? Why did 1,800 homeowners not get modifications? And why were nearly 4,000 denied the trial period?

Executive VP, General Council, and millionaire Paul Koches is quoted in a press release as “being more proactive about helping borrowers early on, before they face the prospect of foreclosure.”

If Ocwen offered 6,502 loan modifications, why did only 2,517 move onto the trial? Did homeowners decline the offers because they distrust the terms of the modification and previous unscrupulous actions of the servicer?

Furthermore, one of the only things that could keep a borrower from not completing the trial successfully is missing or being late with a payment during those three months. Ocwen has faced hundreds of charges from the Better Business Bureau and judges in respect to its accounting practices, including waiting to deposit checks. In May a Louisiana judge went so far as to issue an order forcing Ocwen to follow specific accounting practices.

As mentioned in another Huffington Post article, “Ocwen, which is in line to receive up to $553.4 million from the Treasury, faces a federal class-action complaint for harassing homeowners with excessive phone calls, charging illegal fees and adding unnecessary insurance premiums to borrowers’ bills. Ocwen engaged in “a nationwide scheme of illegal, unfair, unlawful, and deceptive business practices.”

In many cases modifications could actually push payments higher, depending on how the loan is calculated. In the case of Nestor Estrada, “[he] will pay rent to the bank for 30 years and still owe almost the entire balance,” said Stephanie Haffner, an attorney at Neighborhood Legal Services of Los Angeles. “He’s now trapped in that house.”

“I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want,” Margery Golant, a Florida lawyer who worked in the law department of Ocwen Financial told the New York Times.

A Former Ocwen account officer said in court that the company trained its sights on customers who had substantial equity in their homes. In those cases, the company had the most to gain if customers lost their homes in foreclosure, according to an article in McClatchy.

“As for the suits against it, Koches said they represent a fraction of the firm’s customer base,” the article continues. What fraction? Half or 45 percent?

Of course, we won’t know exactly what any of these numbers mean or if they’re even accurate until the media and Treasury start auditing and asking questions. Right now, relying on a spreadsheet and Power Point presentation from banks that have notoriously deceived us is a little flimsy.

So while being responsible for 45 percent of the success may seem pretty good in theory, in raw numbers it’s not much to brag about. Why not look at Lake National Bank? They’ve modified 100 percent of their troubled loans. Granted, they only had one delinquent loan, but they modified it. One hundred percent – that’s an accomplishment worth mentioning.

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Read more: Mortgage Crisis, Loan Modifications, Ocwen Financial Corp., Making Home Affordable, Business News