Anyway, I’m doing research on the Freddie/Fannie issue, and I was hoping you might know something that would help us…My organization is calling yesterday “Black Monday”, because at 9 a.m. sharp, the phones went crazy with banks calling to tell us that all deals were off. We lost about ten workouts yesterday that, on Friday, we thought were done deals. And let me tell you, calling families to tell them that is not a fun gig.

Do you have any idea how what happened over the weekend could cause banks to back out en masse from mortgage workouts? Until we know what they’re thinking, there’s no way we can come up with a solution that might address it and get them to work with us again. (It’s one of the paradoxes of our work that banks insist that foreclosures cost them all this money (40K is a number I hear often) and that they’d love to avoid them; yet when you offer a deal where they can keep the mortgage active by sacrificing a few thousand dollars max, they almost always turn you down flat. Unless you have a good lawyer to argue and negotiate with them, it’s nearly impossible lately to get even a modest workout.)

Something about the Freddie/Fannie situation and/or bailout has got banks thinking that for some reason, they’d rather let everything foreclose, and it’s devastating to hardworking families trying to recover from job losses and/or bad mortgages! If you know anything that might help us understand and address this situation, that’d be wonderful.

Thanks,
Marie L., Administrator
Better Financial Alternatives of Michigan, Inc.
(a Michigan Nonprofit Corporation)