Another client paid a local “law firm” that advertises on a local Dallas radio station $3,000 to get his mortgage modified; the firms first piece of advice was to intentionally get behind on his mortgage. The mortgage company posted him for foreclosure, the modification people told him that they couldn’t help him. Now he now faces the prospect of losing his home if he does not pay three months of payments all at once, plus all of the bank’s legal fees related to the foreclosure, and he’s out the $3,000. What a scam.

Then there’s the “foreclosure rescue specialist” called North American Foreclosure, LLP.  Folks need to be careful, says Polk, a bankruptcy attorney and home foreclosure expert for 15 years.

“Sadly, a person will try whatever they have to in order to keep their home and a roof over their kid’s head.  And who can blame them?,” says Polk. “But a con artist can sense that kind of desperation.   The number of so-called “loan modification counselors” has quadrupled in the last 18 months as the hucksters have opened up shop.  These fly-by-night operators target desperate homeowners– the easiest mark, but also the least able to afford such a scam.”

Here are the dirty details on qualifying:

• Must have originated mortgage before Jan. 1, 2009.
• Be an owner-occupant.
• Have an unpaid balance that is equal to or less than $729,750 (for a single-family home).
• Have trouble paying your mortgage due to financial hardship.
• Your monthly mortgage payment must also be more than 31% of your gross (pre-tax) monthly income. Duh.There’s a three-month trial period before you lock in the lower rate for five years and if your home is in danger of foreclosure the process will be halted while you apply for the program.

The Portuguese is a “working class dog,” says Dave, very appropriate for this presidency and the nation’s current pulse. Portuguese fishermen used them to retrieve fishing nets out of the water from their boats. Laborers, yet, but with much class and panache: Dave’s Henry James is more like “a naughty person with fur”, he says. The breed eats their kibble and also that of any other canine — “his favorite is really whatever is in sister Edith Wharton’s bowl.” Frisky, like our stock market — at age 12 Henry James is still jumping. As for special treats, the choice of a PWD for the White House ought to have an enormous influence on health care: Henry James’ favorite snacks are fish and apples — give that to every American once a day and you’ll slice the cost of health care right in half.

A -$8000 tax credit for first-time buyers, l like very much. Assuming this will work like a section 179 deduction and come right off the taxes, not add 5 more pages or 6 hours of CPA billable hours to the tax return, essentially using tax dollars to help fund the home purchase. 

F- Revamping U.S. bankruptcy rules, giving judges the power to reduce mortgage payments and set lower interest rates. Excuse me, but I think part of our problem was that banks got too big, unregulated and complex. So now we are going to let judges play banker? This will slow down lending and banks will have to recoup their losses from somewhere —charge more to the customers who pay their bills, or higher PMI or PMI for everyone or higher interest rates.

Not fair, folks.

C – The government will match reductions lenders make to keep borrowers home payments at 31% of their income. What income — stated income? Does that include alimony?

Incomplete – Flushing Fannie Mae and Freddie Mac with $900 billion.

Have we?

Meantime, check out this letter to President Obama from Mortgages Unzipped: we need loans and we need them now.

Meantime, Mr. Thain should go hug his commode: the Obama administration is already rubbing hands to tighten up the regulatory system on the financial world, unleashing Timothy Geithner:

“Excessive executive compensation that provides inappropriate incentives,” Mr. Geithner said, “has played a role in exacerbating the financial crisis.”

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“It was a remarkable weekend. We went to the concert at the Lincoln Memorial, a special art showing in Georgetown, Jay-Z’s concert, and the swearing-in. I had “silver” tickets to the Inauguration. We walked about 45 minutes to get there, waited about 45 minutes to get past the gates (I’ve heard some horror stories, but we didn’t have many problems), and then watched the swearing-in from our standing-room viewing area south of the reflecting pool. There was so much energy and excitement in the crowd. It was amazing and I was so fortunate to be there!”