Mortgage Shark Attack

Photo: Wikimedia Commons

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The economic meltdown has been rife with villains, from corporate execs who turned their TARP payouts into multimillion dollar paydays, to corrupt politicians who favored Corporate America for their own financial gain.

Another group for the scoundrel list? Loan servicers, the mortgage middlemen who literally cheat Americans out of house and home because (you guessed it) it lines their pockets. While fact-checking a story about these sharks, I rifled through a thousand legal complaints against the nation’s ten largest mortgage servicers, and spoke with homeowners who have been cheated out of thousands of dollars—all while fearing they may literally be kicked to the curb.

Last year, as the problem worsened, Obama established the Home Affordable Modification Program to try to get servicers to negotiate with homeowners to keep their homes. But after months, the program has not done nearly enough to prevent predatory servicing or skyrocketing foreclosure rates.

In her testimony (pdf) to Congress last year, attorney and mortgage expert Diane Thompson called the epidemic a “foreclosure tsunami.” And with little to suggest a systemic change, it doesn’t look like it will stop raging anytime soon.

Read the full story here.

See a list of subprime lenders who are reaping the benefits of HAMP here.

And click here for a list of resources to help homeowners deal with mortgage hell.

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If you're new to Mother Jones or aren't yet sold on supporting our nonprofit reporting, please take a moment to read Monika Bauerlein's post about our priorities after these chaotic several years, and why this relatively quiet moment is also an urgent one for our democracy and Mother Jones’ bottom line—and if you find it compelling, please join us.

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