Economy

Massachusetts suit: Banks not helping modify mortgages

More frustrated homeowners turned to federal court this week for help with their mortgages, saying Bank of America and Wells Fargo failed to provide promised payment modifications.

The two cases, filed Tuesday in Massachusetts, seek class action status.

Three specific families are identified, one with a loan serviced by Bank of America and two by Wells Fargo — the nation's two largest mortgage servicers. They were granted trial modifications, according to court documents, but haven't received long-term modifications despite having submitted all required documents and made timely payments for more than three months.

The claims are simple, the two filings say: "When a large financial institution promises to modify an eligible loan to prevent foreclosure, homeowners who live up to their end of the bargain expect that promise to be kept."

The Home Affordable Modification Program (HAMP) is the main federal plan for reducing mortgage payments, part of a $75 billion plan to stem the national foreclosure crisis. HAMP calls for a three-month trial period, intended to give time for the homeowner to demonstrate an ability to keep up with the lower payments. However, there are growing reports of homeowners in trial plans ultimately being rejected for modifications despite making their trial payments or even being foreclosed on during the process.

The modification process has generated so many complaints that regulators and lawmakers are pressuring lenders to improve.

To read the complete article, visit www.charlotteobserver.com.

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