IMMEDIATE RELEASE: June 30, 2009
Contact: Austin King, Director, ACORN Financial Justice Center, (608) 213-0104 / Bonnie Mathias, ACORN Board member, (214) 533-9032
Will Demand Participation in Obama’s Foreclosure Prevention Program from Goldman Sachs’ Litton, Barclay’s HomEq, American Home Mortgage, and OneWest
(Washington, DC) – ACORN members, allies, and struggling homeowners today are directly confronting in the streets and online those mortgage companies who have still refused to sign up for President Obama’s $ 75 billion Making Home Affordable plan to prevent up to 4 million foreclosures. Protests and rallies are taking place today in Boston, Columbus, Dallas, Houston, Little Rock, Los Angeles, New York City, Miami, Philadelphia, Pittsburgh, San Francisco, Seattle, St. Louis, and Wilmington, in which ACORN is taking its demand directly to the “Home Wrecker 4”: Litton, owned by Goldman Sachs, HomEq, owned by Barclays, American Home Mortgage Servicing, and OneWest. Collectively, these four servicers are responsible for the loans of 2 million American families, but they have not signed up for the Obama plan. (To see a list of participating companies, visit: http://www.makinghomeaffordable.gov/contact_servicer.html)
“Every 13 seconds another American family loses its home in this never-ending crisis,” said Bertha Lewis, ACORN CEO. “President Obama has proposed a real solution to attack the heart of the crisis – unaffordable mortgage payments from predatory loans. Yet the Administration’s program is voluntary and requires mortgage companies to sign up on their own. We are grateful that more than 80% of the industry has taken this simple step, but we will not rest until every homeowner is afforded the same basic protection and right to be considered for a loan modification prior to foreclosure.”
Under the Obama plan, a mortgage company must perform a simple comparison and show that a foreclosure represents the smaller loss to investors compared to a subsidized modification prior to foreclosing upon a family. If a homeowner’s loan is with Citi, Chase, Bank of America, GMAC, Ocwen, and many other companies, they are afforded this protection, but homeowners whose loans ended up with Litton, HomEq, American Home Mortgage, and OneWest do not enjoy that protection.
“Getting an affordable loan modification shouldn’t be like winning the lottery”, said Lewis. “Loan modifications should be the guaranteed result whenever it’s in the interests of all parties, but we know the industry has been incredibly slow to provide the number of affordable loan modifications needed to meet the challenge posed by the crisis. These last four major mortgage servicers who have still not signed on to the Obama foreclosure prevention plan – the ‘Home Wrecker 4’ – need to get with the program and start modifying loans, today. We have no time to spare in the fight to save American homeownership.”
Many of the companies in question have benefited from enormous US taxpayer largesse. Goldman Sachs, the parent company of Litton, received $10 billion in TARP and another $12 billion from the government’s bailout of AIG. Barclays, owner of HomEq, is a British bank ineligible for TARP funds but still took more than $8 billion from US taxpayers through the AIG bailout. OneWest, what emerged from the wreckage of IndyMac, would not exist if not for the guarantees and subsidies from the FDIC and ultimately taxpayer backing.
“Especially given how much support these companies have received from taxpayers, it seems quite reasonable that they should step up and do at least the bare minimum in foreclosure prevention,” said Lewis. “ACORN will continue to hold their feet to the fire and escalate our protests until they put their names on the dotted line and join the Obama program.”
In addition to protesting in the streets, ACORN has also already generated thousands of emails to the CEOs of the four companies and will be petitioning for the companies to join the Obama program on Twitter.
Note to media: ACORN has compiled stories from across the country of homeowners who have struggled to get a loan modification or other foreclosure prevention assistance from the “Home Wrecker 4” that are summarized below. To learn more about these stories or contact a homeowner in your market, please contact David Redlener at firstname.lastname@example.org or 212-239-7323.
Current Servicer: Litton Loan Servicing
Celina Gallegos, single mother, son of 14 years of age, is currently working part-time at Sears and has random house keeping jobs to rescue her home from foreclosure since she lost stable income six months ago. She currently has to deal with the dilemma of paying one utility bill at a time to keep food on her table. The mortgage payment entails $930.00 per month with a 8.7% fixed interest rate, without a full-time position and help from the lender she cannot afford making her payments and remaining current. “In the end, as a parent, it is vital to provide for our children, before and after anything, and regardless of anything. I also thought this could never happen to me and I am here today counting the days before Litton Loans sells my home at a foreclosure auction on July 7th 2009 at 10am and I refuse to give up.”
Anthony and Marilyn George
Current Servicer: Litton Loan Servicing
Mr. and Mrs. George have two children. Their oldest child came home from college to attend college locally in order to save money. They have depleted their 401k. The family did not know at time of purchase that property tax and insurance were not included in mortgage payment. They paid that separately. Their home was to go up for sale June 6th of this year and has been rescinded twice. Ms. George says she makes calls repeatedly to no avail. She was able to come through the intake workshop ACORN, but Litton is still not working with her.
Original Lender: Indy Mac Bank
Current Lender: One West Bank
IndyMac Bank wants to sell my house where I’ve lived for 34 years. I’m 84, I don’t have a job, nor should I have one. The bank has ruined my credit and I cannot get approved to live somewhere else. IMB advised us we would qualify for a loan based on our credit scores and the loan would solve our “problems.” They definitely preyed upon our vulnerability. My husband died a month after we received the loan. Our fixed income was $2388.81 per month. With his passing, the income dropped to $1600.00 per month. I continued to make payments, but they kept going up and up. They went up so much that even if my husband was still alive, we would not have made them. IMB's lack of response, misleading advice, and untruths caused this matter to worsen and lends itself to Senior Abuse.
Maria de la Luz Morales
Current Servicer: Litton Loan Servicing
My work slowed to only a few hours over a three-month period last year. I worked for temp agencies to try and earn a somewhat stable income. I have tried to refinance or modify three times. When the foreclosure notice eventually arrived, so did a mailing promising to help me. So, I got in touch with an agency in Florida who asked me for my papers. They charged me $2,300 to save my mortgage. I paid them, their first advice was telling me not to make mortgage payments during the process. But the problem was that they wouldn’t respond to my correspondences or return my phone messages. Now with this money lost, I am five months behind. I am so worried, but I hope that it will not ruin my mortgage. Like everyone, I don't want to lose my house. I want to save our house for my two boys, Luis who is 10 and Moises who is 8. It's for them that I have fought to save my house and with some help I hope to do so.
Sanguetta Hylton and Dwayne Thompson
Current Servicer / Lender: Litton Loan Servicing and Home Eq
Sanguetta Hylton and Dwanye Thompson have four children, ages 15,12,6, and 2. At the beginning of 2006, their mortgage changed to Litton & Home Eq. By the start 2007, they began to fall behind on their payments due to loss of income as result of less business from "Precious Waterfalls", their small business of installing rock waterfalls for pools. When Sanguetta was put on bed rest during her pregnancy she was unable to earn an income. Litton was contacted right away and made no effort to negotiate the terms of the mortgage. In April 2008, their home was to be sold but the auction was cancelled. They are now one year late on the modification. Litton says that the plan they have is better than Obama’s federal plan, therefore will not work out the current loan they’re in right now. Sanguetta and Dwayne have a monthly income of $1,300.00 and their mortgage payments are $1,550.00.
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ACORN is the nation's largest community organization of low- and moderate-income families, with over 450,000 member families organized into neighborhood chapters in 100 cities across the country. Since 1970 ACORN has taken action and won victories on issues of concern to our members. Our priorities include: better housing for first time homebuyers and tenants, living wages for low-wage workers, more investment in our communities from banks and governments, and better public schools. ACORN is an acronym, and each letter should be capitalized. ACORN stands for the Association of Community Organizations for Reform Now.
ACORN's website is http://www.acorn.org.