Thursday, May 31, 2012

Homeowner advocates seek mortgage modifications, other help

A new advocacy group is urging big banks to slash principal, halt foreclosures and otherwise help millions of underwater homeowners, the latest wave of backlash against the country's largest lenders.

The Home Defenders League, a national coalition of homeowners and community groups, kicked off its effort with a conference call today. The goal, organizers said, is to reboot the nation’s still-struggling housing market with the help of banks and politicians.

Top mortgage servicers, including Charlotte-based Bank of America Corp. and San Francisco’s Wells Fargo & Co., agreed in February to a $25 billion settlement with government officials over improper foreclosure practices. Under the terms, the lenders will reduce principal and modify loans for some homeowners, among other steps.

Bank of America began sending more than 200,000 letters this month offering principal reductions as part of the settlement, for instance. A bank spokesman today declined to comment on the Home Defenders League, saying he was unfamiliar with the group.

Coalition organizers said they want to help homeowners who qualify for assistance under the deal, as well as others who are struggling to stay in their homes. Among the group’s demands: that banks implement widespread principal reductions, allow people to stay in their homes after a foreclosure by paying rent and allow those homeowners a chance to buy back their homes at today’s market value.

“I know first-hand how hard it is to fight the millionaire banks and win,” homeowner activist Ruby Brown of Minnesota said. “But that’s what we’re doing.”