Lawmakers urge banks to allow aid for jobless

Five Northern California members of Congress are pressuring mortgage servicers to work with a new federally funded program in California intended to help unemployed homeowners pay their mortgages and avoid foreclosure.

The Keep Your Home California Unemployment Mortgage Assistance Program provides qualified unemployed homeowners up to $3,000 a month for up to six months to help pay their mortgage. But according to the office of Rep. George Miller, D-Martinez, if the monthly mortgage exceeds $3,000, the servicers won’t accept any payment at all, even if the homeowner could send a second check to cover the difference between what is owed and what the program covers. As a result, unemployed homeowners who could avoid foreclosure proceedings thanks to this program are instead at risk of failing to pay their mortgage and landing in foreclosure.

“If this program is to have meaningful success, mortgage servicers are going to have to get on board with processing these payments,” Miller said in a news release. “Refusing to accept dual payments is unacceptable and is a disservice to the homeowners who are doing everything they can to stay in their homes while they look for work. Homeowners shouldn’t have to forfeit their homes because of bureaucratic intransigence by banks and servicers.”

Rep. Zoe Lofgren, D-San Jose, another of the letter’s signers, said “it’s time that banks and servicers become part of the solution and not the problem.

“It’s ridiculous that servicers and banks are unwilling to participate in a program that will help protect the value of the very asset on which their loan is based on,” she said. “I find it deeply troubling that servicers would have borrowers default rather than simply accepting payment.”

In their letter – also signed by Rep. John Garamendi, D-Walnut Grove; Rep. Jackie Speier, D-Hillsborough; and Rep. Sam Farr, D-Santa Cruz – they wrote that, “we believe refusing to accept supplementary payments from homeowners is inexcusable and we strongly urge you to remedy this problem expeditiously… It is unacceptable that servicers in California are unwilling or unable to figure out a workable resolution to this problem, particularly given that two viable options to address the issue exist.”

Those options, they say, are either to accept two checks (one from the program and one from the homeowner) or to forebear the amount of the mortgage that exceeds the $3,000 program payment.

Josh Richman

Josh Richman covers state and national politics for the Bay Area News Group. A New York City native, he earned a bachelor’s degree in journalism from the University of Missouri and reported for the Express-Times of Easton, Pa. for five years before coming to the Oakland Tribune and ANG Newspapers in 1997. He is a frequent guest on KQED Channel 9’s “This Week in Northern California;” a proud father; an Eagle Scout; a somewhat skilled player of low-stakes poker; a rather good cook; a firm believer in the use of semicolons; and an unabashed political junkie who will never, EVER seek elected office.

  • gregory

    This program is a farce, I does not help 80% of californinans who have an equity line on their house, It purposely drops them from participating from the program,Not right, it should help everyone.

  • John W

    Are you saying we should help people make payments on debt incurred from using their homes as ATM machines? I’m having a very hard time justifying the $3,000 per month on the primary mortgage, let alone home equity loans.

  • Truthclubber

    Hey, Johnny W — isn’t it fun being a Democrat these days? After all, isn’t this what the Democratic Party under Nancy Pelosi and Harry Reid is all about — helping those who need help continuing their dysfunctional debt behavior?

  • John W

    Truthclubber, I’ll have to give you some credit. You’re the first person on the right I’ve seen in some time to actually use the correct name of the Democratic Party. Kudos. Now, if you could just see your way to make nice and also use my real name! As for your comment, some of us actually deal with each issue on its own merits. It may come as a shock to you, but I don’t feel obligated to mindlessly agree with every Democrat on every issue or disagree with every Republican on every issue.

  • Elwood

    “I don’t feel obligated to mindlessly agree with every Democrat on every issue or disagree with every Republican on every issue.”

    You could have fooled me!

  • Truthclubber

    Whoever said I was “on the right”? Haven’t you heard about a little something called “the middle”? Oh, that’s right — everything is black and white these days — “you’re either for us, or you’re agin us” was what GWB said, wasn’t it? Or was it Keith Olbermann? (Now over at that stunning pinnicle of TV ratings, “Current”.)

  • John W

    Re: #5 Elwood, maybe that’s because you spend most of your time here engaging in snarky put-downs or scatological “comedy” rather than trying to engage in substance. I’ve even agreed with you a couple of times and made a specific point of saying so. But that’s no fun, is it?

  • John W

    Re #6

    “Whoever said I was on the right?” Just guessing, Truthclubber. One might reasonably draw that conclusion from your comments about Pelosi and Reid, especially in the absence of any similar remarks about GOP Congressional leadership. But, yes, I’ve heard of “the middle,” which I define as between the 30 yard lines on the political football field, where 60% of us live. Fox and MSNBC are obviously downfield quite a bit and don’t influence anybody except those already predisposed to agree with them. However, I defy anybody to name an MSNBC counterpart to Glenn Beck.

  • Truthclubber

    I defy anybody at (P)MSNBC to have the ratings that Glenn Beck has…

    On a serious note, the only time I watch Beck is when Jon Stewart is eviscerating his latest hysteria-fest on the Daily Show (recorded on my DVR) — that and enjoying Willie Geist from Morning Joe’s “Way Too Early” each breakfast.

    Someone on MSNBC who comes close to Beck’s foam-at-the-mouth style of fomenting hatred of anyone who disagrees with him?

    Ed Schultz.

    I loved how “Big Eddie” allowed those signs of “Hitler Opposed Unions” to float behind him live from Madison covering the uproar over Gov. Scott Walker’s merely agreeing with FDR that public employees should NEVER have been given collective bargaining rights — which gives them the ability to (s)elect their own bosses in the Legislature through campaign contributions.

    If the GOP ever gets over its love affair with the pro-life wacktifists and agrees to keep itself out of our bedrooms, there will be a LOT of people moving from blue to red thanks to the sudden outburst of fiscal adult behavior happening in the “post-Pelosi” era of American politics.

  • Truthclubber

    In case any SEIU wacktifists attack my assertion above about FDR, here’s a direct quote from the man:

    “The process of collective bargaining, as usually understood, cannot be transplanted into the public service,” Roosevelt wrote in 1937 to the National Federation of Federal Employees. Yes, public workers may demand fair treatment, wrote Roosevelt. But, he wrote, “I want to emphasize my conviction that militant tactics have no place” in the public sector. “A strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government.”

    And what are we now seeing, live on our HDTVs from Mifflin Street and other parts of “Mad Cow Town”, including the very capitol rotunda itself?

    Exactly that.

  • Elwood

    “I’ve even agreed with you a couple of times and made a specific point of saying so. But that’s no fun, is it?”

    It’s the exception that proves the rule.

  • John W

    Re: #9

    Ed Schultz like Glenn Beck. Nah. He’s just old school, down-the-line liberal. Beck is off-the-rails nuts.

    FDR was right about public employee unions, but Walker’s credibility is undermined by the fact that he exempted law enforcement from his proposal, cuz they supported his campaign. Took a page from Meg Whitman’s book.

  • John W

    Re: #11 Elwood

    Rest my case.