IndyMac is calling. Will you answer?

The L.A. Times goes out front today with the story of the difficulty IndyMac is having in its efforts to reach troubled borrowers to talk about loan modifications. (Hey, if I had lied about my income to get a mortgage, and a government-run bank wanted to talk to me about said mortgage, I probably wouldn't answer the phone either.)

Seriously:

...when the FDIC, which is running IndyMac, mailed out 35,000 letters offering homeowners a chance to rework the terms of their mortgages, more than half the borrowers were apparently so discouraged, scared or stressed out that they didn't bother to respond.

Relatedly, from Reuters:

JPMorgan Chase & Co is making changes to about $110 billion in mortgages to help its borrowers and is temporarily halting foreclosures while it alters the loans.    

The bank said on Friday it is expanding efforts to renegotiate loans for more borrowers, including customers it inherited when it bought struggling Seattle-based bank Washington Mutual last month.

Two cents, way off topic: The news that IndyMac's ambitious loan modification program is off to a slow start was reported last week by Tanta at Calculated Risk, in one of her typically insightful, well-written posts. I mention that not as a hat tip to Tanta (or to myself for linking to Tanta's post), but to make a larger point: There is much discussion these days about shrinking newspapers and the decline of journalism. No doubt, newspapers are in trouble. But journalism is not. It is being practiced today by more smart, passionate people than ever before -- people like Tanta. True, she is not a traditional journalist -- she doesn't work for a newspaper or a wire service, and her identity is a mystery. But she knows her stuff (her online bio says she's a former bank officer and mortgage lending specialist) and she's an enterprising, engaging and informative writer. She's a journalist, in the best sense of the word. And she's part of a growing army of smart, passionate, serious-minded bloggers, an army that didn't exist when I started in this business 21 years ago. It's a good thing.

-- Peter Viles

Your thoughts? Comments? And yes, I have a crush on Tanta. So sue me. I think Laker does too.

Photo Credit: A.P.

Comments

[CD]

Tanta and CR rock, their commentators are a riot. If you can handle the truth it is a must ,everyday every hour. Lefty's booze is good.On another note, I am so glaaaaad you are leaving the Titanic (LA Times) Now you will be a civilian journalist, the revolution will be on the internet and it is happening now...These are exiting times.

[NewtoLA]

So how will the "new" price for these homes be reflected in comps, or will they?

Pete, one request before you leave. Please ask your mainstream colleagues why they are not asking about the downside to mortgage bailouts. I know that national policy should not be made on the basis of what happens to renters in FL, CA, and NV, but I really want that question discussed--Why should that piece of junk in Mar Vista cost 750,000?

[The Original RZ]

So in CA, we now have to 90 days or so for homes to be put up for foreclosure so that banks and homeowners have a chance to talk to each other. Yet now we are finding out that the homeowners are not talking to the banks! So us potential buyers of foreclosed homes are waiting an extra 90 days for what exactly?

[firesale]

It should be obvious. Most of these are the same
folks who lied on their documents and put nothing
down. Now, they just intend to stonewall the
banks with no response so that they can stretch
out the number of free-rent months they can get
before they bail to the new foreclosure
they've managed to purchase at half-price with
the money they've saved not paying their mortgage.

The banks and the Feds need to stop concentrating
on how they can fix these mortgages for
people who have no intention of staying. They need
to come out with a strong policy with big teeth
that forces these mortgagees into recourse positions
for their bad behavior while also insuring there are no
loopholes, tax or ownership wise, which they can
escape through. If they've already wriggle through one,
find creative punitive ways to keep them indentured servants
of the tax man for life. We need to focus on the outright
persecution of the opportunistic scum that caused this mess
and are still finding ways to benefit from it.

[MAD AS HELL !!!]

From today's N.Y. TIMES --

Countrywide says it will write down pay-option mortgages to as low as 95 percent of the current value of the home. The borrowers must either be in default or “reasonably likely” to default.

“I guess they are forcing me to deliberately stop paying to look worse than I am,” said one borrower with a Countrywide pay-option loan. “Crazy, don’t you think?”

The borrower, who lives in suburban Los Angeles, took nearly $200,000 in cash out of his house and then paid less than the monthly interest due on his new loan.

He now owes about $350,000 on a house that is worth only $150,000. He asked not to be identified for fear he would not get a modification, which could reduce his mortgage to $142,500.

HOW DO WE STOP THEM FROM HELPING SCUMBAGS LIKE THIS ??? !!!