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Jon Lewis
Jon Lewis
Attorney • (888) 295-7409

Regions Helping Homeowners – Really?

5 comments

You know, my partner always says we go after the fleas and not the elephants. Whether you agree or not, many on Wall Street made a lot of money on the securitization of mortgages. We aren't talking thousands. We aren't talking hundreds of thousands. We aren't talking millions. We are talking hundreds of millions and billions of dollars. And, as a result, our economy was built on a house of cards, teetered, and fell.

Given all of that, we bailed out some of the major financial institutions. We helped keep the industry in tact. Blue collar workers were affected tremendously. They lost their jobs. They couldn't pay their mortgages, and they paid lip service to helping the homeowner. But, they aren't helping.

Case in point. My client is in a lot of trouble. Lost income. Divorce. In over their heads with two mortgages – both with Regions Bank. A first and a second. They have realized that they can't keep it going. So, what did they do? They offered a deed in lieu of foreclosure. This saves Regions cost and it provides a little credit help to my clients.

Regions said no. A foreclosure sale was set in April, and they came to me. I wrote Regions, and Regions' attorneys agreed to move the date to late May while we tried to work it out. The first mortgage, held by REGIONS, agreed to the deed in lieu of foreclosure. The second mortgage, ALSO HELD BY REGIONS, refused. Why? They called the Fannie Mae call center, and Fannie Mae said, "No."

So, what will happen if I don't file suit? Regions will foreclose. What does that mean? The second mortgage will be wiped out – no difference than if the second mortgage, REGIONS, agreed to the deed in lieu of foreclosure. REGIONS gets no benefit except for persecuting my clients – the same ones these mortgage companies agreed to help.

It's a vicious cycle.

5 Comments

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  1. Vern Dennis says:
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    I really wouldn’t expect a bank to help me out.

    It is very popular to blame the banks but they made a lot of unsound loans under pressure from the Clinton Administration and politicians like Barney Frank. Let’s face it – there may have been a few instances of predatory lending, but by far the bigger problem was stupid borrowing.

    I have two neighbors that cashed out the equity in their homes while residential prices were inflated – both squandered the money and I have no sympathy for whatever happened to them after residential prices returned to normal

  2. Jon Lewis says:
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    Thank you for your comments Vern. While I understand and respect your opinion, I disagree. The Clinton administration may have encouraged greater lending, but the banks and Wall Street devised the junk mortgage securities.

    I’m not discounting personal responsibility, but I am suggesting that banks not oppress borrowers. In this instance, the bank could easily do a deed in lieu, but they choose not to. Instead, they are foreclosing when they receive no additional benefit. My clients aren’t asking for money or debt foregiveness. Their proposal actually saves the ban and its shareholders the cost of foreclosure.

  3. Brandi says:
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    There are more and more forclosures in my area!!! but i think the key is not getting in over your head!!

  4. Jon Lewis says:
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    Thanks Brandi! So true. It was hard for a lot of people when the mortgage brokers and real estate agents said, “This is what you can afford based upon our analysis.”

    The drawing will be at 9:30. If you are the only commenter, you will be the winner :).

    The tickets will be at our front desk in an envelope. Our address is 2229 1st Avenue North.

  5. Jon Lewis says:
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    Vern,

    One last issue which people often forget, and that is the fact that Regions took TARP money, and they have not repaid that money. When Regions needed help to survive, they got it. When homeowners want help, not to keep the home but simply to do a deed in lieu, Regions says, “NO”!