by Charles Augustine
Rhina Alfaro (left) begs a Wells Fargo Bank official to give her another chance to modify her mortgage loan. (PHOTO BY SEBASTIAN MELO)
In an act of solidarity and protest, members of a consumer group calling itself, “Alliance of Californians for Community Empowerment” (ACCE) marched into a Wells Fargo bank, here in San Francisco, Sept. 1, to plea with the financial institution to stay the eviction proceedings of Rhina Alfaro, one its borrowers.
At issue is, “interest only adjustable rate” loan-modification programs, whereby borrowers who are having difficulty making their mortgage payments can have their home loans “stretched out” for a longer period of time; hence making the monthly payments less.
To simplify it, this is how it works. Say you have a 15-year “fixed” loan and your payments are $1,500 a month, reflecting a 6.8 percent interest rate. You can’t make the $1,500 monthly note, so to bring it down you have the loan “modified” to a 30-year “adjustable” rate one.
Now your mortgage is $850 and everything’s okay.
A year later though interest rates go up to, say, 9.7 percent and your adjustable loan payment goes up to $1,050 a month; and you can’t pay it. Not only that, but you now owe the bank a lot more money.
And this is why Americans are losing their homes through foreclosures at such an alarming rate.
This is exactly what happened to Alfaro. She shared that Wells Fargo agreed to temporary adjust her payments for six months but later withdrew their offer to modify the loan. To the contrary, they foreclosed on her loan. This occurred in 2009.
So, she hired a lawyer, to the tune of several thousand dollars. The attorney took her money, did nothing and finally didn’t even bother to return her calls.
Alfaro also has difficulty speaking and understanding the English language and feels this too factored into her situation.
“I was steered into a terrible interest only adjustable rate mortgage. I tried to work with the bank. I was given a trial modification. I made the payments for six months and was then told I didn’t qualify for a permanent loan modification,” she shares.
So, out of desperation,Alfaro ended up paying out more than $11,000 to two foreclosure “scam” mortgage companies that promised to remedy the situation. “Instead, gave me faulty advice and took my money without helping me.”
On Sept. 1, Wells Fargo informed Alfaro, she had one week to pay up or? And they made good on their threat, because two weeks later, a deputy sheriff served her with the eviction notice.
“They took everything outside. They nailed it closed; they locked the door; they changed the lock in the front door…”
And with that she was out on the street.
With no where to turn, Alfaro turned to ACCE Home Defenders League, a group of California homeowners who have united to combat unfair bank practices, with emphasis on foreclosures.
Defenders League advises homeowners to “resist the ‘unlawful’ actions of banks.”
They advise people to, “Stay in your home!”
Defenders League is currently pushing for lending institutions to change their banking practices in regards to the way they handle situations where homeowners (borrowers) are “under water” (meaning struggling or unable to make their mortgage payments). To this end, they advocate that banks only utilize the foreclosure process when it has exhausted every other effort to attempt to work with homeowner to keep them in their homes.
Because Alfaro and the ACCE stood up to Wells Fargo, the bank jack down and allowed Alfaro to stay in her home.sre”.
