Posts Tagged ‘HAMP’


February 2, 2012 4 comments

I have spent a good thirty years as a consumer on this planet. I made a living buying and selling bonds to multi billion dollar corporations and small boutique firms. As a bond sales woman it was my job to take in house research reports and explain bond covenants to other market participants so they may buy a bond at a lower price than where it was valued.  As a bond trader, I was responsible for making markets without taking too much risk, yet provide liquidity to small and medium size market participants. With all that in mind, I find it absolutely fantastic that the president has the audacity to lay the deleveraging of a 600 trillion dollar credit bubble on ‘predatory’ consumers. His lack of action this far into the fraudclosure crisis is a complete disconnect from reality. It is noblesse oblige at its finest.

The stone cold blind belief in the existence of millions of predatory borrowers is a wide spread form of mass hysteria. That would mean millions of credit thieving homeowners walked into financing companies and forced credit extending ‘victims’ to extend credit against their will, by lying and getting away with it, for years. OR perhaps we are still reluctant to finger out the real culprits: Washington DC and a handful of kleptocratic corporations. (I refuse to call them banks. True banking provides a social benefit. Control fraud as a business model actively protected by government is not banking. It’s organized crime).

It's the leverage, stupid.

The belief in the dead beat homeowner is even more insane. Until 2007, I had paid all of my bills. Then one morning, I woke up and said, “Nah,  I am going to change that policy. I’m going to stop paying my mortgage and see what happens. I hear people are getting free homes. I’ll see if that happens to me. Maybe I’ll get something for nothing.” Now, I had paid my mortgage on time, flawlessly for five years. Before that I paid rent, never got an eviction notice, not once. I rented my first apartment in 1987, right out of high school. During the years 1987 to 2007 I paid student loans, car loans, medical bills, utility bills, health insurance bills. Most homeowners in fraudclosure that I have met, did the same. They worked, paid the bills, and were happy. How does anyone believe that millions of Americans woke up one day and said “I’ve had enough of this, I think I’ll try to get one over on a large global bank. Get me a free home. Yeah baby!” Our nation, has never experienced this level of foreclosure.  The “logical” answer is that 5 to 10 million people decided to say to hell with moral hazard. I’m going to be a dead beat?

In September 2007, I had been under employed for almost two years. I lost my job as a bond trader at a small boutique bond firm in February 2006. I had my then unemployed former NYSE floor trader living with me and his children part time. I took menial jobs to keep the lights on. It wasn’t sustainable. I realized we were in trouble. We had spent all of our savings, retirement to meet our financial obligations. I called the bank, I said “I need  six months forbearance, I’ll put the house up for sale and will either sell it and take a loss OR I will find employment that will allow me to pay back any missed payments and stay current on the mortgage. The servicer said “No, you don’t have enough money to maintain the house. We are going to foreclose if you default.” I should have realized something was wrong, right then and there. I panicked. I ran out of money to pay the mortgage in December 2007 and scrambled to hire a bankruptcy attorney. In March of 2008, I got a job trading at a small boutique firm. I called the Citimortgage, and offered “Let me pay the missing payments over the next 12 months and I will keep current on the mortgage.” Control fraud servicer Citimortgage said “No, we are going to foreclose”. Again, I should have realized something was wrong. Here we are well into a foreclosure crisis and one of the worst criminal enterprises of financial system wanted more declining housing stock and less mortgage payments. I was scared out of my mind and too shocked to really examine what was going on. I had absolute confidence I could negotiate a work out on a three hundred thousand  credit agreement. I had negotiated trades as large as $50 – 100 million in seconds without any problems, with clients from all over the world. I would guess that if I put all my trades together from 1996 to 2010 I’d bet that the face value of the bonds were a couple dozen trillion, easy. How could I be intimidated by this puny ‘odd lot’ trade was going to be a lay up. I stupidly ASSUMED the other side was interested in making a credit agreement perform.

I voted for Obama. I believed, I drank the KoolAid.  Our main man Obama would re boot Main Street like Wall Street. It’s the right answer. Easy peasy Japanesey. I’ll be able to payoff my debts and grow out my business just like we gave the banks.  I let my bankruptcy attorney go and cheered “Bring it on Obama!”

(I’m not even asking to change the accounting rules so I can mark assets to whatever I think they are worth. Can you imagine getting a child’s drawing, framing it and then mark the value of the asset to whatever I chose? The banks still mark their assets to fantasy prices).

The HAMP program wasn’t what I had wanted, but it was something. I applied and got into one of four HAMP modifications. In one of the early modifications, I was shocked to find out that Citimortgage, while I was in COMPLETE COMPLIANCE WITH THE HAMP MODIFICATION sold my home, to themselves for a $100.00 credit bid. LET ME REPEAT ” IN ADDITION TO TAKING MY PAYMENTS THEY SOLD MY HOME AT SHERIFF’S SALE TO THEMSELVES!”

Wall Street had just gotten a 16 trillion dollar bailout. I ASSUMED they would be model corporate citizens. In my experience, if there is a trading mistake, and there is a loss, typically the loss is shared between the market participants. There are some hard feelings occasionally, but both sides take some of the pain and we all move on. RARELY does one side of the trade force the other side to take the whole loss. In fact, if that happens it usually indicates the other side was deliberately setting up the trade to cause a loss to the other side. We call it “getting hooked”. I should have realized that’s what was going on, and still is going on. Everybody that got credit in the last decade was going to be on the hook for the maximum amount of pain. When the HAMP charade arrived, I thought we were going through a massive amount of trade breaks and it was going to take some time to work through all the mortgages that were broken and get everyone back on track.

In February of 2009 I was slowly dying of shame. I had almost a year battling to get my career back on track and hide my ever growing and flowing humiliations with Citimortgage. It was surreal. On February 19th  Rick Santelli had his meltdown on the floor of the CME ranting about not wanting to bailout his neighbor for what he saw as willful irresponsibility. The fifteen men on the trading floor were cheering and hollering like a wild mob. I had stabbing, chest pains, was feeling dizzy, and steadied myself on my chair. I picked up the phone and pretended to be on the phone with a client. That night, I got home and found a bright red EVICTION notice taped to my door. I had until March 2nd to vacate my home or be forcibly evicted and be charged for the eviction.

Citimortgage took my money and my home!

Despite the fact that I was making payments, on time and had spent hundreds of hours on the phone to assure Citimortgage that I had the means to meet my responsibilities. I was deep in the rabbit hole. I could barely manage to function day to day. Somehow, I did. I spent the next week on the phone with Citimortgage’s attorney to get the sale vacated. It was the most insane transaction I have ever worked on. I received an email from the attorney during that time that read “Miss Jakes, I am concerned that you are so emotional about this.” I fell further down the rabbit hole. This was the same attorney that had told me just a few weeks before that no sale of my home was going to occur. She had personally taken care of it. UNBELIEVABLE! I called her up and was telling her in no uncertain terms “You can take my money or you can take my home. YOU CANNOT TAKE BOTH!”

I don’t know what kind of ex parte communication that attorney had with the judge, but  the sale of my home was vacated. I spent the rest of 2009 and 2010 fighting to stay in trial modifications. The servicer did everything to keep me in trial modification limbo. They dropped me while paying, sent letters apologizing and then started another one. Wash, rinse, repeat. I did not realize until the end of 2010 that was for their own benefit. As long as I was making trial payments, my principal balance was increased with massive fees and charges for services I had NO IDEA were taking place. I lived in fear everyday that I was going to come home to a padlocked door and my cat Lestat sent to an animal shelter to be destroyed and personal belongings gone. At night, when I could sleep, I managed to grind my teeth so hard I had lost two of my molars. I’m almost through a third one.

In late March of 2010, after FOUR trial modifications, I received my permanent HAMP offer. Almost $50,000.00 in principal was added on the original amount. I found myself falling even further down the rabbit hole.  I waved at the Cheshire Cat, danced a jig with the Mad Hatter while continuing to fall. Then I landed in front of the Queen of Hearts into financial Armageddon.

On April Fool’s Day, (no the irony is not lost on me) I FedEx-ed my permanent HAMP loan modification back to Citimortgage. On top of the agreement, I put a notarized letter asking where did that $50,000.00 in extra principle come from, and was that legal? I was ignored. I made three more payments. I was beyond feeling ashamed. I had lost almost everything that mattered. My family, my boyfriend, most of my friends, my job and my reputation, my physical health.

In fall of 2010 I called the Citimortgage and  requested six months forbearance while we examined the accounting and I set up my own firm. I had an investor that handed me a $20,000.00 check to go put a down payment on a broker/dealer to open my own firm.  Citimortgage said “You can do a deed in lieu or a short sale”. I said, “Excuse me, you didn’t just drag me through the worst two years of my life to tell me you still want my home?” The representative said cheerfully “I am sorry ma’am you don’t qualify for a modification you already received one.” I hung up the phone and went into a fugue-like state.

A month later, my investor called me. He had checked my credit score, he asked “Jylly, you haven’t paid your mortgage in three years?” He backed out of the deal. I was now not a job creator, but an unemployed dead beat, and no longer able to work in my field. How can I be hired to handle financial transactions when my credit score showed me as being a dead beat? My depression expanded exponentially. I slowly searched for answers of how I could let this happen to me? What had I done wrong?  I spent Christmas of 2010 despairing that I had not gotten my financial house back in order. In a month I relentlessly read through thousands of articles, books, court transcripts, depositions, white papers, prospectuses, federal laws, state laws, tax laws, trust laws, security laws. I had no idea the derivative market had exploded in just a few years. I looked at the numbers, I read about the collateral managers ripping off everyone and re selling non performing loans. I even recognized a few names of people I had worked with.

Early one morning in January 2011, I was smoking a cigarette, drinking coffee and looking out a snow covered Sandy Hook Bay from a friend’s highrise apartment building. I watched the sun rising with a thousand yard stare. It dawned on me, with horrifying clarity what was happening. Millions of  unspeakably destructive decisions that lead to bankrupting millions of families was to be the answer to our country’s crisis. A few dozen behemoth corporations will rob us with impunity and get away with it.  Homeowners still current on their mortgage think they will be spared. Smugly thinking “Dead beat homeowners are evil doers and should be punished without mercy”.

The numbers of people in financial ruin, or slowly sinking in negative equity are epic. I have read there are 60 to 80 million active mortgages in the US. Close to 7 million families have been foreclosed on so far. The conservative numbers of projected foreclosures are 11 million over the next four years. How can ‘punishing’ close to 20 million mortgages solve our problems?  How does anyone think that letting financial institutions get immunity for their crimes will stop home prices from entering what one well respected analyst called a ‘death spiral’? The answer is, it won’t. If you are reading this and think that 20 million mortgages going into foreclosure from 2006 through 2016 is not going to effect your home or your financial life, you are wrong. Unless, of course, you are one of the criminals involved. I read a research report this last year that claims that 50% of the toxic deals were created by 29 deal managers. How about that? Just 29 people responsible for 7 million people being evicted from their property and another 11 million in the pipe line.

I’m living this foreclosure in real time. My investigations over the last year have been hard to accept coming from my perspective. I despair at the mean spirited way homeowners in trouble are eviscerated in the media, the courts, their communities. Most still feel a cloak of shame around them at some part of the day, every day. People compulsively asking themselves what they could have done differently,  mentally flagellating themselves over perceived crimes. I sometimes get mentally paralyzed by the enormity of the challenge. I spend everyday looking for possible solutions. I help others in my position navigate the financial documents that may one day help them in court. I joined a group this year, The Anti Foreclosure Network. Here is our website The group has grown from two people in March 2010 to well over a 100 and everyday we keep adding new members. We come from all walks of life. We all have one thing in common. We have been harmed by predatory financial institutions that use the courts of New Jersey to deprive us of our homes, illegally.  We no longer will accept that every document the banks’ show us are the truth. We will not blindly accept the accounting of our credit histories with the servicers. We will not be bullied in court rooms to signing anything without verifying what EXACTLY are we agreeing to. We will not be fooled again.