Shafted! Why are Homeowners Still Left to Struggle Against Big Banks Alone?

[xchrom]

http://www.alternet.org/economy/155477/shafted%21_why_are_homeowners_still_left_to_struggle_against_big_banks_alone/

It was with great fanfare that the Obama administration, alongside nearly every state’s attorney general, announced in February that a $25 billion accord had been reached with the nation’s five biggest banks, settling charges that the banks engaged in widespread foreclosure fraud. Those billions were intended to provide relief to struggling homeowners, using the banks’ own money to help the victims of Wall Street malfeasance.

“These banks will put billions of dollars towards relief for families across the nation,” President Obama said. “They’ll provide refinancing for borrowers that are stuck in high interest rate mortgages. They’ll reduce loans for families who owe more on their homes than they’re worth. “

However, more than a dozen states across the country are doing their best to undermine the settlement by diverting the funds to other areas of their budgets. Arizona recently became the latest state to do so, taking $50 million meant to aid homeowners and instead plowing it into the state’s general fund (after scrapping an earlier plan to use the money to pay for prison construction).

Under the terms of the settlement, each participating state receives a lump sum to craft its own housing aid programs. (The banks are also responsible for directly helping homeowners with a large share of the settlement money.) The funds directed to the states were intended to support counseling, foreclosure mediation, mortgage modification programs, and legal services for those facing the prospect of losing their homes.

[2pooped2pop]

1. the "help" is only for a select few that fall within the guidelines

the banks will only even consider working with those that fall in very strict guidelines. In this way Obama has more or less picked which of us to help and which to let be destroyed.

everyone who wanted to work it out should have been allowed to. These are not ordinary times and special rules should have applied. The way it stands, the banks which caused the financial meltdown have been allowed to further it by foreclosures that have left homes rotting, taken away everyones life savings, made them homeless and further crippled the housing market with millions of homes standing empty and being sold off for a fraction of their worth.

[midnight]

2. "states are taking advantage of loose wording in the settlement to use the funds "

But states are taking advantage of loose wording in the settlement to use the funds for, essentially, whatever they want, since a pot of free money is simply too tempting for state legislators who have faced years of budget woes. “There’s a lot of pressure on the budget,” said Arizona House Speaker Andy Tobin (R) to justify his state’s move.

[Grantuspeace]

3. In Wisconsin, Walker took most of the settlement money.....

To balance his "balanced budget". Where is the outrage?

[dixiegrrrrl]

4. kicking.....because it is an important issue.