Fighting Foreclosure on Staten Island, etc.

new_york_times:http://www.nytimes.com/2008/06/22/realestate/22cov.html

Published: June 22, 2008
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They refinanced anyway with an adjustable-rate mortgage, they say, because a mortgage broker told them that it was a step toward improving their credit and that in another six months he would give them a loan with better terms. After the papers were signed, the broker stopped returning their calls and the loan never materialized. Mr. and Mrs. Miele are now in a much tighter spot than they were before they refinanced. Nine people, including their children and grandchildren, depend on that house as a place to live.
Mary LaPointe, with her mother, Mary Eva LaPointe, used money borrowed against her house to put her children through school. More

The bank that gave them their loan, First Franklin, has since sold it — a standard practice in recent years. Now, it is part of a mortgage-backed security sold by Deutsche Bank to investors. The Mieles, who are about a year behind on their payments, are fighting foreclosure in court. Their next court date is in July.
Deutsche Bank, which acts as trustee, said in a statement: “The trustee is not responsible for foreclosures or selling foreclosed property. Such decisions are made exclusively by the servicing companies.” The servicer attached to the Mieles’ loan, Specialized Loan Servicing, would not comment.
When thousands of people own a small piece of a home loan, it’s unclear who has the authority to make decisions about the mortgage when it comes to things like working out payments.
Thomas Cunsolo has been going back and forth with his bank for four years. When Mr. Cunsolo refinanced six years ago to consolidate bills, he was a union carpenter making up to $80,000 a year. Two years later, two decades of work in heavy construction caught up with him. After two knee surgeries and ongoing battles with a host of other ailments, Mr. Cunsolo lost his job.
While waiting for his disability benefits to kick in, he fell behind on his payments. He contacted his lender, Guaranty Bank. He said he thought the parties had arranged a payment plan. He paid a lump sum of $10,000 and sent checks of $2,300 every month for four years.
This year, he received a letter saying that his next payment due was for some $41,000. Now it is unclear to him what sort of payment plan he agreed to —and what he signed at the closing. A representative of Guaranty Bank would not comment.
Margaret Becker, the director of the Homeowner Defense Project at Staten Island Legal Services, has been helping Mr. Cunsolo. “He can afford to keep the house; he’s been making payments for years,” Ms. Becker said. “It should be easy to fix, the problem is getting through the layers of servicing and ownership to somebody who’s able to make the real decisions about modifying the loans.”
Some homeowners like Diana Wilson-Ballard have found success renegotiating their mortgages.
Three years ago, Ms. Wilson-Ballard, a public school teacher, and her husband, Forest Ballard, a retired Verizon technician, bought a $500,000 house for about $20,000 down.
“We were told that interest-only loans were the best thing going,” she said. “Well, you know from nothing, and you hear that this way you can get in with little money down and then, in a few years, you can refinance. Who wouldn’t want that?”
This fall, Ms. Wilson-Ballard took time off from work because she was having heart problems. She and her husband fell behind on their mortgage payments — even before their adjustable rate reset. After months of telephone calls and negotiations, and with the help of a member of Senator Savino’s staff, Ana Tinsly, the couple were able to consolidate their loans.
A representative of their bank, Wells Fargo, said in an e-mail message, “The result is she can remain in her home, and Wells Fargo and the investor who owns the loan avoid the cost of going through foreclosure — a win for everyone involved.”