The Tyranny of Foreclosure – Part 3

There was stress in his voice and countenance as he talked about his home and mortgage situation. What I thought was going to be lunch with a contractor to discuss business was turning into something unexpected, he was bearing his soul to me, confiding in me about his family and finances.

Greg lost his wife to cancer four years ago, with three school-age children still at home he had struggled to hold onto the home that represented stability and memories, but the loss of his wife’s income put pressure and more pressure on him and he just didn’t know how long he could continue making mortgage payments.

He had done the right thing, at least what he thought was the right thing, by contacting the lender on numerous occasions to seek a modification of the loan, after all, interest rates had dramatically dropped since their purchase and an interest rate reduction could be the difference between his family remaining in their home and leaving; it could also be the difference between him continuing with a superior credit rating or dropping to a poor rating.

If you’ve followed the mortgage debacle, debacle that is for consumers, not for corporations, you know what Greg was told, “We won’t discuss a mortgage modification with you until you are in arrears.”

He had, as thousands of consumers have done, given the lender his bank statements, his paychecks, his bills…he had given the lender full-financial disclosure in order to demonstrate his financial situation – but no, the lender would not discuss a loan modification until he defaulted on his loan.

Of course a loan default triggers punitive late fees, then administrative costs, then legal costs, and before the consumer knows it he or she is thousands of dollars behind to the lender, which in turn makes any conversation with the lender about a loan modification more difficult because instead of talking about how to make a monthly loan payment to keep things current you are talking about how to pay thousands of dollars in fees that you would not have incurred had the matter been deal with prior to default.

Add to the above the fact that once consumers go into default on a mortgage that the lender drags communication out over months and even a year or more and the foregone result in the vast majority of cases is that the consumer is crushed by the tyranny of thousands upon thousands of dollars in late fees and other charges.

This is a double standard in that the lenders themselves are bailed out by our tax dollars and their officers and employees held harmless from their poor judgments, predatory practices, and cruel treatment of our fellow citizens. Yes, I wrote “cruel” and I mean to use the word.

Greg shared his struggle with what to do, the financial and emotional pressure was becoming unbearable, while he wanted to continue to do what “was right” he also needed to care for his children and he saw no way that he could continue to provide for them under the burden of his mortgage; seeing no alternative he had decided to rent a home in the same school district for much less than he was paying the lender and default on the mortgage. It was a difficult decision and there were tears as Greg talked to me, but what else could he do in such an unequal contest? The taxpayer is forced to consider the plight of the mortgage companies to the point where in some bailouts we’ve guaranteed losses on loans and houses, while the lone consumer is crushed under the weight of nameless, faceless, and heartless institutions.

This would be bad enough if it were simply a matter of financial institutions and inequitable practices, but to think that this is the child of the fiscal policy of both political parties and that the child is funded by the taxpayer is sad and dark; but perhaps it is even sadder and darker that as long as such policies don’t directly affect an individual American that the individual American is not likely to ponder them, react to them, or seek the change them. This is not only true of the mortgage debacle, it is also true of health care, education, affordable housing, hunger, the conditions in which many Native Americans live…fill in the blank.

I write this as someone who is searching his own soul and coming up short. I write this as one who professes to follow the Jesus who told the story of the Good Samaritan and yet I confess that I have walked by people more often than not without seeing their need, without reaching out to them, without extending myself and my resources to aid them. I’m reminded of Francis Schaffer’s warning that the great danger to the Western church was the core value of personal peace and affluence – let me alone and allow me to be comfortable and I won’t really care what goes on around me – while I would probably have denied it for much of my life, Schaffer was talking about me. Well, just because you mess up the first three quarters of a football game doesn’t mean you can’t change the game plan in the fourth quarter and stage a comeback.

Note: Greg is not the person’s real name and I have also altered some nonessential facts in order to protect this person’s identity.