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Mortgage settlement yields website to help struggling homeowners

By Al Heavens, The Philadelphia Inquirer –

You know that mortgage modification you’ve been trying to get for a year, the one where the servicer keeps losing the paperwork and no one is able to tell you anything when you call?

There may be hope for the millions who are trying to find an alternative to foreclosure — if they are willing to be patient.

If this sounds like an answer to a prayer, you can thank the bureaucrats who crafted the National Mortgage Settlement, which mandates a consumer-friendly Web portal.

It’s called Homeowner Connect ((, and is designed to offer another option for consumers who are unwilling to contact their servicers directly and who want to have some control of their applications for help, as well as a guarantee that their documentation is retrievable if it is misplaced.

Five of the largest mortgage servicers paid $25 billion to settle state and federal investigations that found they routinely signed foreclosure-related documents outside the presence of a notary public and without really knowing whether the facts they contained were correct.

Homeowner Connect is a “neutral” portal connected to servicers’ systems, said Cam Melchiorre, president and CEO of Hope LoanPort, a free Web portal available to housing counselors nationwide that provides access to servicers representing 80 percent of the mortgage market.

The difference between Homeowner Connect and Home LoanPort is that the latter is designed for use by HUD-approved mortgage counselors assisting borrowers with applications, while the former allows consumers to handle their own applications.

Borrowers using the new portal, available at the moment only to customers of GMAC Mortgage, can find HUD-approved counselors and call on them at any time during the process.

GMAC Mortgage funded development of the site and is the first servicer to adopt it. Melchiorre expects most of the nation’s servicers to be on board with the new website in six to nine months, he said during a recent teleconference from Washington.

“Consumers will be given the opportunity to see the status of their applications without using the traditional (means) that have been weak and confusing,” he said.

The mortgage settlement requires that the status of these applications be updated automatically every 10 days, which “establishes transparency in the life cycle of these submitted applications,” Melchiorre said.

The consumer “has one consistent audit trail and continuity,” he said. “Even in the cases in which applications are denied, there is at least documentation that the consumer did receive the benefit of every option available.

“It solves the stubborn problem of lost documents — not that it will prevent them from ever getting lost,” but the centralized, shared database will make that more difficult.

Home LoanPort is partnering with MortgageKeeper Referral Services, a Web-based database application containing information on more than 6,000 nonprofit groups and government agencies. MortgageKeeper offers distressed borrowers access to additional local services, such as employment services and agencies offering help with food or rent, all free, he said.

Melchiorre expects that the new website will encourage more borrowers to seek out approved mortgage counselors, thus “protecting them against scammers.”

The site was launched a month ago, but not actively marketed, Melchiorre said. As of last weekend, there were 5,000 hits on the site, and “200 borrowers whose loans are serviced by GMAC Mortgage have created application packages.”

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