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2 Underwater Mortgage Help | March 8, 2012 | A paid publication for Louis White, Attorney-at-Law | www.LouisWhiteLaw.com

Why Won’t My Lender Modify My Loan?

In 2007, the nation began the devastating downward

spiral into what is now considered one of the

worst mortgage crises in recent history. Before the

mortgage crisis hit, people were optimistic that owning a

home would be a good investment. Banks were offering

easy access to financing with low teaser interest rates and

the availability of financing caused home appraisals to

skyrocket. Most buyers were not prepared for what was to

come when the bottom fell out – home prices plummeted,

the banks were bailed out, and the homeowner was left

holding the bag.

“The banking institutions sold thousands of loans that

they knew could never be paid back,”

said Jamil White, principal attorney

at Louis White Attorneys at Law. “It’s

a racket. They sold loans to people

and took out insurance on those loans,

so when the day came that

people could no longer afford

their mortgages, the banks

made off like bandits. Today, it

is more profitable to a bank to

foreclose on a homeowner

than it is to keep them in

their house, otherwise we

wouldn’t be seeing this

widespread foreclosure

crisis.”

Some people have tried to get loan modifications

on their own but are continuously given the run around.

White said, “There are certain ‘thresholds’ that need to

be met in order to be eligible for loan modifications and

many people don’t understand how to position themselves

in those thresholds. In most circumstances an experienced

attorney can achieve the best results.”

Louis White Attorneys at Law has sued many banks for

improper conduct and has leveraged those lawsuits into

hundreds of thousands of dollars in principal reductions.

In one recent case, White negotiated an agreement with

Bank of America that resulted in a $200,000 principal

reduction in a client’s loan amount and a 2 percent

interest rate.

For the vast majority of homeowners out there, they

just want a mortgage payment that is fair, something

that can help them stay in their home and build equity.

However, many of these people don’t know how to

attack the banks to get what they want.

There are certain circumstances where banks act

wrongfully. For instance after 2009, many homeowners

contacted their banks for a refinance when they were

current on their loan but were instead steered into a

loan modification and told to stop paying their mortgage.

With promises that they were “qualified” or “pre-

approved,” the banks mislead homeowners into believing

the ease with which they could obtain a loan modification.

Instead, these same banks essentially engineered the

foreclosure. Homeowners were given the run around until

their payments were so far behind that it was impossible

to cure.

Another common situation among those facing

foreclosure is what White called a “bait and switch

tactic.” Borrowers were quoted fixed rate loans at low

teaser percentage rates but were not shown the required

documents prior to closing. Then, on the spot, borrowers

were forced to make a decision to accept loans they did

not bargain for such as adjustable rate mortgages that had

no beneficial features. If borrowers expressed concern over

the types of loans offered, the brokers or lenders stated

they would simply refinance them out of the loan in the

future. In reality, that refinance would never come.

Again, such practices were and are illegal.

There are so many legal remedies homeowners

can use to place themselves in better financial position.

Homeowners who have a combination of high debt,

a home that is worth less than what they owe and a

second mortgage can be given the opportunity to have

the second mortgage completely eliminated, the credit

card debt discharged, and a loan modification granted

on their primary loan.

Louis White Attorneys at Law have helped with

the short sale process and emergency cases involving

fast approaching trustee sales as well.

“If you give us 7 days before a trustee sale, in all

likelihood, we can stop it,” White said. “However, if you

wait that long, other potential solutions will expire.”

by SukHI k. brar

For the vast majority of homeowners out there, they just want a mortgage payment that is fair, something that can help them stay in their home and build equity.


Things were looking up for Alice and Elliot Baker in

2003 when they bought their first house together, a

five-bedroom home on one-third of an acre dotted

with birch trees and rose bushes.

The couple lived fairly liberally on credit, they admitted,

but never missed a monthly payment on their assortment

of credit cards or their $4,600 mortgage. They had solid

government jobs, made good money and watched their

$535,000 custom home in Carmichael appreciate 40 percent

over the years.

Then the recession hit and their fortunes began to

change. Banks started lowering the Bakers’ credit limit and

raised their rates. Their debt load soon surpassed their

income. Given that the federal government was in bailout

mode, Alice asked for modification on the couple’s home

loan. The bank denied the request.

That set the Bakers on a seemingly unending campaign of

letter-writing and phone calls to get help for their increasing

financial troubles. After the bank rejected their first loan

modification request, they wrote to the state attorney

general. The letter was forwarded to the Bakers’ bank,

which took nearly a year to respond. What they learned was

dispiriting. Since they had not defaulted on their payments,

they were told, the bank could not help them out.

That’s when the Bakers did what, for them, was previously

unthinkable: They stopped sending in their mortgage checks.

By then, Alice’s state salary had been cut by 15 percent. Elliot

was laid off from his job in county government. The two

hoped that defaulting on their loan would be a red flag to the

bank that they needed help.

“It was a major decision to decide

not to pay, but we counted on the bank

saying, ‘If you’re not paying, we’ll have

programs for you.’ We stopped paying;

they had no programs. It was shocking,”

Alice said, who is in her 50s and has grown

children from her first marriage. “Every day

was so stressful. ‘Are we going to keep the house? Are

we going to keep it?’ I would only be able to sleep an

hour or two at night.”

It took nearly two years before they finally found a

lifeline: Jamil White, principal attorney of Louis White

Attorneys at Law. The Bakers had paid for an audit of

their home loan – which confirmed Alice’s suspicions

that the paperwork on their refinance was rife with

errors and omissions – and the auditor referred them

to Louis White for counsel. In the weeks ahead, the

tension eased.

“It just felt so much better having somebody hold

our hand throughout the process,” Alice said. “Knowing

we had someone like Jamil made all the difference.”

Last summer, less than a year after securing the law

firm’s services, the bank agreed to shave $205,000 off

the Bakers’ loan, bringing their mortgage payments

to $2,500 a month. The Bakers were stunned when

they received the bank’s proposal. Neither expected to

get such a big break and they suspect it reflected the

breadth of the lenders’ mistakes. They also gave a lot

of credit to White and his staff and appreciated their

speedy response to the couple’s phone calls and

e-mails.

“Jamil cares about people that get ripped off . . .

Everything he told us was legit,” Elliot said. “We

spent months on our own trying to get to the

right people. We know we couldn’t have gotten

there without Jamil. He knows the ins and outs of

these banks.”

The two sought credit counseling early on and will

continue to follow a structured payment plan for the next

year or two. They no longer use plastic. And they have a

deeper appreciation for what they nearly lost.

“We still don’t have any money coming in until [Elliot’s]

retirement kicks in, but we can make it,” Alice said. “Now

that we’re going to stay here, it’s just like a settled feeling.

by Jan FerrIS Heenan

Couple finds mortgage lifeline

We spent months on our own trying to get to the right people. We know we couldn’t have gotten there without Jamil. He knows the ins and outs of these banks.

Did you know?If the first mortgage is “underwater,” a second

mortgage has a zero equity interest in the property

and essentially becomes unsecured. If there is not

enough value in the home to cover the value of

a second mortgage, the second mortgage holder

cannot foreclose because there’s no money to gain

from doing so.


Hard work pays off by Jan

FerrIS Heenan

Gary and Kimiko Gill had enough to worry about

when they took a major pay cut. Then the law firm

they hired to help modify their home loan went

belly-up. A bank foreclosure notice soon followed, giving the

couple nine days before their Contra Costa County house of

nearly 20 years was set to be sold.

An additional affront: the foreclosure notice came just

days before Christmas 2010.

“When you’re 65 like I am, it’s kind of hard to start over,”

Gary Gill said, who lives with his wife in Pittsburg, slightly

northeast of Concord. “This was something we’d worked

hard for and it was going to be taken away from us.”

Then a timely brochure arrived in the Gills’ mailbox

with a letter from the Sacramento law offices of Louis White

Attorneys at Law offering its services. Gill was skeptical

at first, having paid monthly to the bankrupted Southern

California firm with no return. Lacking other options and up

against a deadline, he and his wife took a leap of faith.

“[Jamil White] told me, ‘Mr. Gill, I will work for you. I’m

not going to give you any BS. I can’t promise you anything,

but I will do my best for you,’” Gill recalled. “As I’d talked to

him, I got the feeling that he was going to help us.”

Like so many Americans caught up in the once-

robust real estate market, the Gills never expected to find

themselves in need of help. Gary had held two jobs for 16

years – one in in a food manufacturing plant, the other as a

daily newspaper deliveryman for an independent contractor.

In 2001, he and his wife took over the business. They

earned good money and employed more than a dozen

subcontractors. That lasted several years until the newspaper

farmed out its home-delivery services and left the Gills with

rack and store deliveries only.

“I was making good money. The economy was booming

and I was booming,” Gill said. “Then the market crashed.”

Gary and Komiko resorted to completing the rack and

store deliveries themselves. They started their days at 1

a.m., returned home five hours later for what Gill called “a

little power nap” and then made the rounds again to collect

unsold newspapers and money from the stores. Without the

home-delivery portion of the business, they could no longer

afford their mortgage payments.

In 2009, Gill and his wife secured the services of an

Irvine-based law firm that they learned about on TV. They

paid a monthly retainer and, several months later, agreed to

join the firm’s class-action suit against their bank. Once they

signed on, they never heard from the company again. When

they checked the web site for updates on the case, they

learned the law firm had declared bankruptcy.

That’s when the Gills got the Louis White Attorneys at

Law mailer and drove to Sacramento to meet with White in

person. He and his team quickly secured a 30-day stay on

the Gills’ foreclosure and got to work on their case. Two more

month-long extensions followed. By March, White’s office

called with good news: a deal had been reached with the

bank. The couple’s monthly mortgage payments had been

reduced by $1,100.

Gill was delighted; his wife of 42 years even more so.

She said, “We’re just so happy, so relieved that we can stay

here. I can never, never say thank you enough to Louis White

for helping us, and Alex – who handled my case – was on top

of everything. She let me know exactly what was going on.

They kept pushing and pushing and it worked out great.”

Life has returned to normalcy this past year for the two.

They still get up in darkness to start their day and make their

delivery rounds. The difference these days, Gill said, is that

they’ve got a little extra money to get them through the month.

Did you know?Many borrowers don’t have a broad understanding of

the duties of a real estate agents, brokers or lending

institutions. They may not realize when these agents

or institutions are out of compliance with the law,

and an evaluation of the loan may be required to

determine compliance.

We’re just so happy, so relieved that we can stay here.


A dream worth fighting fora llen Smith and his wife designed and built their

dream home themselves. They never fell behind in

payments on the mortgage and even offered the bank

cash to buy out the loan when the bank refused to honor the

agreed-upon interest rate. Allen owned his own business in the

mortgage industry, and felt he could tackle the issue himself.

But they still ended up in the middle of a foreclosure.

“Where did we go wrong?” Allen wondered. “We worked

really hard and saved our money. We had a picture of our home

design plans on the wall and touched it every day – that was

our motivation for eating beans. When we built the house, we

were finally able to realize our dream. We did everything right.”

The trouble couldn’t have started at a worse time.

Allen, his wife and his daughter had finally moved into their

new home. They were expecting baby number two, but the

baby came two months early and faced an extended hospital

stay. After $120,000 in medical bills, they were able to finally

bring their son home with a diagnosis of cerebral palsy.

About this time, the rate on the Smith’s mortgage was

supposed to have dropped from the construction phase rate to

its new, lower permanent rate – a relief since their income had

been reduced. But the bank mailed back the first payment; the

interest rate had not been reduced.

Allen fought for a modified loan and was eventually

approved. Meanwhile, the bank sold his loan with other high-

risk loans to another bank. The interest rate at the new bank?

The incorrect, higher rate.

“It was over-the-top stressful,” Allen said. “We found

out later as a result of investigation that it fell into that pool

accidentally. It wasn’t supposed to be sold.”

The new bank would not honor the modification,

sent back every payment Allen made, and filed a notice

of default. Allen even tried to pay cash to settle the

loan – in essence, to buy his own home back – but

the bank changed the sale date without telling

Allen and he was foreclosed on.

Allen said, “I built a lot of the house myself.

I planted every single blade of grass and every

plant around the house. I’ve got blood on some

of those boards!”

That’s when Allen turned to Louis White

Attorneys at Law. The attorneys at Louis White

helped him understand that the bank had broken

the law and committed fraud. They helped Allen

take the bank to court by filing a lawsuit for wrongful

foreclosure and fraud.

“He’s been able to keep us in our home,” Allen

said. “He’s been able to expose the fraud that we didn’t

understand. Not everybody can do that. You have to know

where to go to find the rules because they are obscure.”

The Smiths are now waiting for the bank to decide whether

to accept a settlement offer. Otherwise, the case will go to trial.

Either way, Allen is confident that he will get to keep his home

for good with the help of Louis White Attorneys at Law. Allen

said God has helped too, and described little miracles along

the way.

Allen said, “By the grace of God it turned out the way it

did. The bank’s attorney has made tons of mistakes. I think

it’s totally because of God! It’s just really unusual mistakes.”

Louis White is handling all the details, so the Smiths can

focus on their children. Their son is 5 now, and he barely shows

any signs of cerebral palsy.

“He has a problem walking, but you can’t really tell unless

you look really close,” Allen said. “He’s smart as a whip and the

most tender, loving child I’ve ever seen.”

Their daughter is 9 and sometimes worries they will have

to move. Allen just tells her, “You don’t need to worry about

if we’re going to move. The only thing I need you to know is

I am going to fight for you.”

He’s been able to keep us in our home. He’s been able to expose the fraud that we didn’t understand. Not everybody can do that.

by anna barela

• Contact the borrower at least three times by telephone

before filing a notice of default.

• Send the borrower a notice of default by mail.

• Provide the borrower with a notice of trustee sale 20 days

before the sale date is to occur.

Did you know? If a lender intends to foreclose on a property,

the lender is required by state law to fulfill

certain requirements. The lender must:


wITH

Jamil WhiteIf I am in foreclosure, behind in my payments or owe more than my home is currently worth, what should I do?

Contact our firm right away because we have

done the footwork and have the experience and

knowledge necessary to present the best possible

case to the banks on behalf of our clients. Often

when people try to seek assistance from the banks on

their own, they fail to give the banks the necessary

information to lead to the best result possible.

What should I bring?When coming to see us for the first time, a client

should bring their loan documents, a chronology

of any communications they have had with their

lenders, an explanation of why the client feels they

have been wronged by a lender and a picture of their

financial circumstances so we can evaluate and

choose a strategy that helps the client get financially

healthy.

What will happen at the appointment?

At the appointment, we will discuss the various

tools we have at our disposal and explain what works

and what doesn’t work. We will evaluate the client’s

financial circumstances and make decisions on

how to put the client in the best housing and credit

situation possible. We will explain what the client

can reasonably expect, explain the risks and benefits,

and enlighten the client on all of the tools available

to relieve their overall debt burden.

What does the initial appointment cost?

The initial appointment is generally a free

consultation and lasts for about 30 minutes to

an hour.

What usually happens after the first appointment?

If there is a sale date, the first thing we want

to do is stop that sale. Otherwise, we contact the

lender and open up a dialogue to determine if an

informal resolution can be achieved. If not, we draft

a complaint and file it in court to leverage the lender.

If the client is a good bankruptcy candidate we

would evaluate its benefits. From loan modifications

to shortsales, whatever benefits the client the most,

we obtain it.

How long does it take?The whole process can take as little as three to

eight months to reach resolution.

Can I still stay in my home during the process?

Ninety percent of the time, our clients are able to

stay in their homes throughout the process. Of the

roughly 10 percent who do not stay in their homes, 5

percent are generally people who want to transition

out of their homes. The rest are clients who came to

us very, very late in the process to the point where

there was not enough time to do an adequate work

up of the case, or their circumstances were such that

staying in the home was not feasible.

Do I have to continue to deal with the lender?

We become our clients’ legal representative. We

do not tell our clients not to talk to the lender, but

we prefer to communicate with the lender so we can

present the facts in the light most favorable for the

client and prevent the client from creating a harmful

situation for themselves.

Why did you choose to focus your practice in this area?

I have studied and put in hundreds of hours

of research into the 2008 financial crisis and the

factors that created it. I learned that the financial

institutions are culpable in this financial mess. The

banks made a ton of money by selling a lot of loans

people could not afford and by selling them on a

secondary market. Then, when things went south,

the banks insured these mortgages from default. Not

only have the banks received years of homeowners

monthly payments, but when they foreclose they

keep the house at today’s fair market value and

insurance pays the difference. This results in a huge

windfall to the banks at the expense of homeowners.

It’s just not right.

California law requires that banks have a limited

duty to keep homeowners in their homes instead of

foreclosure if it is economically feasible. Obviously

telling by the number of foreclosures out there, the

banks don’t view keeping people in their homes as

economically feasible. Statistics show that that only

4 to 8 percent of people

requesting loan modifications

in this country are actually

getting them, thus the

banks are not working

with the majority of

people who want to

negotiate to save their

homes. It’s my job to

help people fight against

big banks, to make it

more expensive for the

banks to foreclose, to make

it a little more feasible to keep

those homeowners in

their properties.

Ninety percent of the time, our clients are able to

stay in their homes throughout the process. Of the

roughly 10 percent who do not stay in their homes, 5

percent are generally people who want to transition

out of their homes. The rest are clients who came to

us very, very late in the process to the point where

there was not enough time to do an adequate work

up of the case, or their circumstances were such that

We become our clients’ legal representative. We

do not tell our clients not to talk to the lender, but

we prefer to communicate with the lender so we can

present the facts in the light most favorable for the

client and prevent the client from creating a harmful

factors that created it. I learned that the financial

institutions are culpable in this financial mess. The

banks made a ton of money by selling a lot of loans

people could not afford and by selling them on a

secondary market. Then, when things went south,

the banks insured these mortgages from default. Not

only have the banks received years of homeowners

monthly payments, but when they foreclose they

economically feasible. Statistics show that that only

4 to 8 percent of people

requesting loan modifications

in this country are actually

getting them, thus the

banks are not working

with the majority of

people who want to

negotiate to save their

homes. It’s my job to

help people fight against

big banks, to make it

more expensive for the

banks to foreclose, to make

it a little more feasible to keep

those homeowners in

their properties.


DO if you are having trouble paying your mortgage,

contact an attorney right away. Because of the expedited

nature of foreclosure proceedings, the sooner you

take action, the more options you have available to you.

Time is of the essence!

DO keep a record of your conversations with bank

representatives. Note the name of the person you speak

to with, keep track of the information exchanged, and note

the date and time.

DO ask for a reinstatement quote if you are

threatened with foreclosure. The bank has an absolute

duty to allow the borrower to reinstate the loan at least

five days prior to a trustee sale date.

DOn’T sign any bank paperwork without

understanding exactly what you are signing. An attorney

can help you interpret confusing language.

DO your due diligence to ensure that the lender you

are dealing with actually owns your loan and has the right

to collect money or foreclose on it.

DOn’T let the bank fool you into believing

they have your best interests in mind. Obtain legal

representation to give you the best chance at obtaining

a reduced mortgage. Some people try on their own, but

make crucial mistakes that eliminate their chances of

receiving a modification or loan reduction.

DO be aware of non-attorney marketing scams

related to foreclosure and loan audits. No matter what

they promise, they probably can’t help you and may

just take your money without performing any valuable

services. Licensed attorneys are governed and regulated

by the State of California, but non-attorneys have no

regulation.

DO evaluate credit card debt and other unsecured

debt for ways to save money and maximize your financial

potential. Sometimes filing bankruptcy is a great way to

eliminate debt.

DOn’T wait until it’s too late. Contact

Louis White Attorneys at Law today to handle all of the

confusing paperwork and stressful negotiations for you.

Set your mind at ease while our team of experts creates

and executes a plan of action to protect and preserve

your legal rights.

Underwater Mortgage DO’S&DOn’TS

Is your home “underwater?”

When the value of the property is less than the

first mortgage, the home is underwater. Paying

significantly more than a home is worth turns it into a

toxic asset. Louis White Attorneys at Law can provide

a comprehensive analysis of your mortgage loan to

evaluate whether you have a toxic asset.

This publication does not create a client-attorney relationship. It is meant for informational purposes only and does not constitute legal advice. The stories and information herein are purely illustrative examples and do not apply to every circumstance. Contact Louis White Attorneys at Law for advice pertaining to your unique situation.

Sacramento County Office5600 H Street, Suite 100

Sacramento, CA 95819

Southern California Office2067 W. Whittier Boulevard

La Habra, CA 90631

both locations:Phone: 877-992-5291

Fax: 916-594-7247

[email protected]

www.louiswhitelaw.com

• Stop foreclosure and eviction proceedings

• Reduce your mortgage

• Reduce your interest rate

• Obtain financial compensation

• Eliminate your second mortgage

• Short sales & bankruptcies

• Debt consolidation and credit restoration

At Louis White Attorneys at Law, we offer affordable legal representation to help:

Know your rights and get your life back. Contact your friendly team of experts at Louis White Attorneys at Law, your California attorneys with offices in Sacramento and Southern California.

Louis White Attorneys at Law has experience with claims involving wide variety of banks, including:

Bank of AmericaJPMorgan ChaseWells FargoCitigroup

GMACAHMSIUS BankOneWest Bank

If your mortgage loan is with one of these institutions, Louis White has dealt with them before and can help you, too!

underwater mortgage help

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