Titus seeks the story of your loan

By Lisa Mascaro

Sunday, Aug. 9, 2009 | 2 a.m.

Las Vegas-area homeowners struggling to have their mortgages modified are being invited to share their stories so the federal government can determine which lenders are helpful, and which are not.

The invitation comes from Rep. Dina Titus. She is asking homeowners from her district to share stories of their dealings with mortgage lenders on a new Web site and — if they wish — ask the congresswoman’s office to get on the phone with the banks on their behalf.

The freshman congresswoman’s goal is to produce a running tally that would show which mortgage lenders are helping Southern Nevada homeowners and which are not answering their calls.

“I believe that it is important that lenders communicate with their clients, and I will do what I can to encourage them to do so,” Titus says on her Foreclosure Fighter Web site. “Your story can shine a light on lenders that have not been responsive to their customers in hopes that they will be encouraged to take action.”

Neighborhoods across Nevada are filled with tales of homeowners whose lenders refuse to work out a plan to save their homes or, even worse, simply ignore their pleas.

Many have called or written to the Las Vegas Sun asking for help. Nationwide, the same story has been playing out, as homeowners complain of being required to submit arduous amounts of paperwork only to sit in limbo waiting for the non-reply.

The Obama administration released a Treasury Department report last week as the first of what will be monthly checkups showing how many homeowners are being helped by the White House plan and whether banks are responding to homeowners’ requests.

President Barack Obama launched the Making Home Affordable program in March, an ambitious effort to slow the spiral of foreclosure activity nationwide.

The administration is providing $75 billion in incentives to help lenders rewrite the loans of those at imminent risk of foreclosure. The program gives banks $1,000 for every loan they rewrite, with extra pay for those that succeed in halting foreclosure.

The goal is to help homeowners stay in their homes by reducing the interest or extending the life of the loan so the mortgage payment consumes no more than 31 percent of their monthly income.

The report released last week showed that as the result of the nearly 1.4 million requests for help since March, 400,000 offers for loan modifications were extended. Of those, 230,000 trial modifications are under way.

At that rate, the program is on target to meet Obama’s goal of helping 3 million to 4 million homeowners over the next three years.

But as the foreclosure crisis continues, the administration wants to ratchet it up.

Perhaps the most striking development in this first report was the disparate rate of participation among the 38 loan servicers in the program.

The big banks, including Bank of America and Wells Fargo, had some of the lowest levels, modifying just 4 percent and 6 percent of the troubled loans.

Watching the banks sit on the sidelines often infuriates struggling homeowners because many of the same financial institutions received government bailouts.

The Obama administration recently hauled a group of lenders to the White House for a one-on-one discussion about the shortcomings.

Lenders have said they are rewriting more loans than the program shows, and consumer advocates explain that banks have had difficulty staffing offices fast enough to handle the onslaught of calls.

Some consumer advocates say lenders would be more responsive if Congress would pass a bill allowing bankruptcy judges to rewrite mortgages, legislation the banking industry has opposed.

The Obama administration has given lenders a new goal of modifying a cumulative 500,000 loans over the next three months — encouraging them to double their current output by Nov. 1.

“Servicer performance has been uneven,” the Treasury Department said in a statement. “The administration has asked servicers to ramp up.”

Titus, Nevada’s newest congresswoman, has made the foreclosure crisis the top priority of her office.

Nevada has led the nation with the highest foreclosure rate for two years in a row, and Titus’ Southern Nevada district is among the hardest hit in the nation. One in every 16 homeowners in Nevada has faced a foreclosure filing, she said.

Virtually every week Titus has made a move on housing — delivering floor speeches, arranging workshops at home to help homeowners get aid, sharing her concerns during talks with Obama and his staff.

But with the launch of the Foreclosure Fighter Web site last week, Titus opened a new front in the housing battle as she begins tracking the data herself. Titus and Housing and Urban Development Department Secretary Shaun Donovan discussed the idea, and she will share her findings with his office.

“It is important that we know which servicers are doing their part to help Nevada and which servicers are lagging,” she said in announcing her plan.