DALTON, Ga. — Olga Alvarez was desperate to reduce her mortgage payments and save her house when the single mother of three got a letter that suddenly gave her hope.
The letter said she could be “eligible for special modification program guidelines created in conjunction with the Governmental Economic Stimulus Act of 2008.”
“I called the number on the letter and they said they could help me for $1,250,” Ms. Alvarez said. “When I heard the amount I wanted to back out, but they explained it was for the lawyer and I decided to send them all my paperwork — income tax returns, pay stubs and other personal information.”
After a month, Ms. Alvarez has not heard back from the company.
She called her lender and was told no one had filed any documents on her behalf, she said.
The Times Free Press contacted the company and spoke with a man who identified himself as president of the company. He asked to be able to speak at another time, and has neither called back nor answered repeated follow-up calls seeking comment.
As the number of people struggling to pay their mortgage increases, loan modification companies have become more aggressive and are targeting vulnerable homeowners, according to organizations that offer housing counseling.
Some of these companies are legal, but charge far more than anyone should pay to have their mortgage modified, officials say, while other companies are outright scams that take the money and never do anything.
They send out very official-looking letters, some with Stimulus Act 2008 written in bold letters, with a small disclaimer at the bottom that says their service has not been approved or endorsed by the government.
Recent immigrants with limited English skills have a limited access to good information, which makes them an easier target, said Douglas Robinson with NeighborWorks America, a national nonprofit organization that provides financial support, technical assistance and training for community-based revitalization efforts.
Misleading and scam-type companies can be very convincing, said Mr. Robinson.
“The foreclosure crisis, while it’s certainly affecting nationally all income groups, is disproportionately affecting minorities,” he said about homeowners who often bought at the peak of the market or with less down payment.
America Gruner, housing counseling program manager with the Dalton-Whitfield Community Development Corp., emphasized that people should never pay hundreds of dollars for someone to modify their mortgage.
The Dalton-Whitfield Community Development Corp. is the only federally certified housing counseling agency in the region. Ms. Gruner said she’s been receiving an average of 25 calls per day from people — both Hispanics and non-Hispanics — who are desperate for help — many of them after layoffs or reduced work hours at companies in the region’s ailing floor covering industry.
“Right now, most of the help we offer is related to foreclosures,” she said. “We help them negotiate better payments or to modify their loan with their bank.”
Nilson Garcia said he received several letters in the mail and he twice sent all the information requested because the company promised to cut his interest rate and monthly mortgage payment.
When the company sent him the paperwork to sign, his interest rate and monthly payments had increased from the rates they had agreed to over the phone.
When he said he wanted to stop everything, a representative of the mortgage modification company said their lawyers were ready and he had to go forward.
“It was very frustrating,” said Mr. Garcia. “It was like a nightmare.”
Both Mr. Garcia and Ms. Alvarez are first-time homeowners and now are trying to negotiate with their lenders with the help of the Dalton-Whitfield Community Development Corp.
Ms. Alvarez said when she bought her $115,000 four-bedroom home five years ago, it was like a dream come true.
“But now I wonder if I made the right decision,” she said. “Perhaps I would be able to give my kids a better quality of life if I was living in a small apartment instead of that big home.”
Perla Trevizo joined the Chattanooga Times Free Press in 2007 and covers immigration/diversity issues and higher education. She holds a master’s degree in newswire journalism from Universidad Rey Juan Carlos in Madrid, Spain, and a bachelor’s degree in political science from the University of Texas. In 2011 she participated in the Bringing Home the World international reporting fellowship program sponsored by the International Center for Journalists, producing a series on Guatemalan immigrants for which she ...
This article portrays "hispanics" as victims when in fact it is the legal residents of our community who are the victims of illegal aliens.
America Gruner, the spokesperson for La Raza, continue to use federal, state, and local funds for the benefit of illegal aliens, in violation of our laws. And she has a personal spokesperson for her agenda in Ms. Trevizo. The sad thing is that she passes this off as a "news" story when it is nothing more than false propaganda from La Raza.
We, the legal residents of Dalton, are the victims.
I'm disappointed with The Chattanooga Times for, once again, printing a story about the "poor pitiful illegal" resident of Dalton. I, for once, would like to see an article written that addresses the problems we, legal hispanics and US citizens, in Dalton have with the overwhelmingly illegal population and the strain it has put on our unemployment, education, healthcare and crime. The citizens of this town have fell victim to the carpet baron's need for cheap illegal labor funded by the taxpayer. Where is our voice, where is our article? Who speaks for us...certainly not "The Race".
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