The government and the banks have come up with a new propaganda program designed to provide artificial hope to the declining real estate markets. Purported to help homeowners in foreclosure work with their mortgage companies, Project Lifeline, as it has been named, is another poor effort by the bureaucrats and their paymasters to solve problems they created with the same tools that created the problems in the first place.
One of the drawbacks of the plan is that the proposed foreclosure freeze is only temporary, lasting a mere thirty days. Most homeowners and people who work in the foreclosure industry know that it can take a mortgage company thirty days just to acknowledge it has received fax, let alone that they will begin working on a solution.
But, to qualify for the program at all, homeowners need to be at least 90 days late on the mortgage, by which time the lender may have begun repeatedly calling, seeking to collect on the loan. Destroying their credit rating and allowing 90 days’ worth of interest and late fees to accrue, just for the chance to qualify for a mortgage loan modification of some sort is very little to look forward to, for most homeowners.
The program itself is being offered through a joint effort by six of the largest lenders in the country, Bank of America, JPMorgan Chase, Citigroup, Countrywide, Washington Mutual, and Wells Fargo. This leaves out nearly 50% of the rest of the population that holds a mortgage, and the Project Lifeline program is voluntary even to the companies that have chosen to participate.
While all of this may seem quite benign, and even somewhat positive, the banks and government have allowed themselves an excuse to explain the eventual failure of the program. The banks have stated that they will be proactively calling homeowners to offer the modification or forbearance programs, and government officials have stated that it is up to the homeowners to meet the banks halfway and work together on a solution to stop foreclosure.
This is probably the most ironic statement made regarding Project Lifeline, and the effectiveness of banks proactively calling homeowners after they are behind by 90 days to offer them foreclosure solutions is simply absurd. The question is, will the lenders be calling their defaulted clients to offer Project Lifeline before or after the collections department scares off any potential participants with dozens of threatening phone calls every day?
If the lenders simply keep on making the same threatening phone calls for the first 90 days, as they do now with all of their clients behind on the mortgage, then all of the Project Lifeline propaganda is just a ploy and will be used as an excuse, later on, to steal the homes from the foreclosure victims and reap monetary benefits while doing so. Ninety days of voice mails and threats from the collections department often affect homeowners of no longer responding to any call from the lender and deleting voice mails without even listening to them.
One call from the loss mitigation department will surely be lost in all of the collection calls, and then homeowners will lose another chance to save the home, and the banks and government will be able to blame the foreclosure victims for this. “We called the homeowners — they never responded. We are the good guys who wanted to help and these people refused to take a step and call us back to request our assistance.”
More than likely, after this failure of Project Lifeline, the blame will be put squarely on the homeowners themselves, rather than the ironic and self-defeating actions of the mortgage company. But this failure will also be used as another excuse to give the banks a bailout courtesy of the inflation machine at the Federal Reserve.
The banks will be perceived as the real victims when it was their own policies and business practices that helped create the real estate bubble, profit mightily from bad loans, eat up vast swaths of the country as Real Estate Owned properties and then earn their unjust reward in the form of billions of dollars of free money. Homeowners, the only victims to suffer actual losses of their homes, will be propagandized as greedy and lazy, denying the wonderful help the government offered.
The ForeclosureFish website has been designed to provide homeowners in danger of losing their homes with important foreclosure advice and resources. The site describes various methods that may be used to save a home, such as foreclosure loans, loan modification, short sales, deed in lieu, loss mitigation, and more. Visit the site to read more articles about the foreclosure process and how it may be prevented before it is too late: http://www.foreclosurefish.com/