Banks Work Together to Save Senior’s Home

NewImage.jpgWill a little positive reverse mortgage news help brighten your day?  If so, check out the article from the OC Register.

The 77 year old Gilma Gurdon was about to lose her home to foreclosure after she was no longer able to pay her mortgage from GMAC.  There was equity in the home, so Gurdon turned to a reverse mortgage and Bank of America tried to help her out.

Even after bank of America was willing to cut their fees for her loan, she was still $1,600 shy of being able to close.  According to the article, GMAC wasn’t cooperating.


Want to hear how it ended? Check it out.

Happy ending: Senior won’t lose home

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  • With the decline in property values and the implementation of the HVCC this scenario is playing out to often. Also the servicers and investors have become more reluctant to approve principle reductions. To combat this we now order mortgage forensic audits for all of our homeowners that are underwater. If you can find state and federal violations in the origination of the loan this gives you more leverage when negotiating a principle reduction. There are a number of government agencies and legal aid organizations that will perform the audits at no cost. It is our fiduciary duty to help our senior homeowners facing the deli mina of being evicted from their home. Far too many times I have received calls from a senior citizen facing foreclosure that had been denied a reverse mortgage to lack of equity. We need to develop new methods and skills in combating this problem. In an industry that is starved for positive PR saving a senior homeowner from foreclosure and allowing them to live out the rest of their lives in the home they love would provide our industry with PR that is priceless. But the greatest incentive we have as reverse mortgage professionals is this: IT IS THE RIGHT THING TO DO!

    • Greg,rnrnYou address the HVCC issue but it has little relevance in HECM land. Perhaps you are right about “principle” reductions but you probably, actually meant “principal” reductions. Many would also be happy with reductions of accrued interest and in interest rates. Some would be happy with reductions in payments even if they are just deferrals.rnrnWhile these legal aid and government agencies may promote they perform some lofty notion of an audit but they do not. That is their funny way of bloating the magnitude of the services they actually perform. Sometimes those services are valuable, sometimes they are mediocre, and then sometimesu2026. Remember you u201cget what you pay for.u201d To whom and in what way are they accountable for their audits?rnrnAs to the most important issue you bring up, there is no such u201cfiduciaryu201d duty. Many in this industry have done far more than your exhortations even suggest. They have gone far beyond the call of mere duty. We can all learn by their EXAMPLE. rnrnOne such person is John Smaldone. You can read his three part adventure on this website at:rnrn you for your admonishments. And please feel free to provide stories of how you have gone beyond the call of duty in saving the home of a senior. You can always send those stories to NRMLA.rn

    • Louise321,rnrnWhile your depiction of B of A may be a little too much, GMAC is another story. rnrnWikipedia states that u201cas of Dec. 30 2009, approximately 56.3%” of GMAC was owned “by the United States Treasury.u201d It then states: u201cOn December 29, 2008, the United States Department of the Treasury invested $5 billion in GMAC from its $700 billion Troubled Asset Relief Program (TARP).u201d And then u201con May 21, 2009, the U.S. Treasury announced it would invest an additional $7.5 billion in GMAC LLC which gave the U.S. government the majority stake.u201drnrnWikipedia states that today GMAC is Ally Financial Inc, a bank holding company headquartered in Detroit, Michigan, providing many financial, insurance, and other products and services including financing to 75 percent of the 6,450 GM dealers. rnrnSo how did GMAC get into this fine fix? Well here is one story from the New York Times:rnrnu201cJohn McNamara, the Long Island car dealer and philanthropist, admitted yesterday that he had bilked General Motors in a $6 billion loan scheme and that he had used some of the money to bribe officials at all levels in the town of Brookhaven to win approvals for his vast real-estate developments. rnrnMr. McNamara, 53 years old, pleaded guilty to fraud in Federal District Court in Brooklyn. For 11 years, he said, he had borrowed billions from General Motors for cars that did not exist, plowing the money into a $400 million business empire built in part on bribery and fraud.u201d rnrn seems no senior is going to take GMAC for a “ride” without a fight. GMAC may not know how to monitor car dealers but are they extremely good about standing up to seniors who owe them less than $2,000. Way to go GMAC (oops, I mean Uncle Sam)!!!rn

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