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The paperwork plague

Chase is having it's own paperwork and bureaucracy problems

According to a recent article in the Wall Street Journal, it seems that even when folks get a modified loan, they are still being plagued by mishandled paperwork and confused bureaucrats.

In one case mentioned in the article, a borrower who had worked out a new modified loan found that her bank, J.P. Morgan Chase & Co. said it had no record of her loan and then warned her that she would be foreclosed on if she did not pony up $4,091.94!

Thinking that was worked out, some time later the bank came back to tell her that she made too much money for the modification that she already got. Apparently, the banks numbers were wrong in this case. So here we have a borrower jumping through the hoops she was told to jump through and finding that the entire process is mired down with bad paperwork handling and behemoth bureaucracies that cannot seem to keep adequate track of what they are or are not doing.

All this does is continue to delay a process that should be handled quickly. It ends up causing more and more homes to be stock piled in the “To Be Sold” bin of foreclosed homes. Remember, those foreclosed properties you see out in the market for sale are just a small set of what has actually been foreclosed on. Banks fear that dumping all the foreclosed properties on the market at the same time would collapse the market. So thousands of homes sit foreclosed and empty, deteriorating and suffering under deferred maintenance, waiting for their turn to go onto the ┬ámarket to be sold.

So I realize that this is not the actual logo for the HAMP program. However, the whole "pig in a poke" vibe seemed appropriate for this utter failure of a program.

Even worse than all this is that the programs that are supposed to be helping people are leaving many worse off than when they started! The profound failure that is HAMP is documented all over the web. Find horror stories here, here, here, here and here. It’s like watching a train wreck.

But remember, this complete screw up is not limited to the individuals who have put their faith in this government and its programs. This is creating the circumstances where the market will be held back indefinitely by the backlog of homes that need to go on the market and get out of the system. It would seem that on every level, this only makes things worse for everyone.

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