This is an update from one of our contributors: “I’ve posted my entire saga here and this site has been gracious enough to post each and every one including giving visitors the opportunity to read the entire saga by including a link to the entire saga. Unfortunately two of the posts are in different places therefore visitors really don’t have the entire saga.
One post is in the February 2009 archives and posted February 9, 2009 and is titled on your site as ” HSBC and Foreclosure Prevention Seminar Experience” and the other post is listed under foreclosure issues posted May 22, 2009 and is titled ” HSBC Doesn’t Like To Extend Loans To Older People”. I will be sending another update as soon as I post this. Thanks again for exposing HSBC for what they really are!”
Here is the latest update
This is an update to my May 22, 2009 posted titled “HSBC doesn’t like to extend loans to older people”. Since my last post it is no surprise that I haven’t gotten any further with HSBC than the last post so I went on a letter writing and email campaign to anyone and everyone including the CEO and CFO of HSBC. Here is my letter sent to them end of May 2009:
I am writing in regards to the above referenced mortgage loan with your company. I previously sent a letter to you in November 2008, certified# 7008 0500 0000 3687 5197, signed by one, Kevin Taylor. I received no reply or acknowledgment of this letter other confirmation of its receipt.
As I am well aware at this point in time that I am in no position to complain due to the amount of the delinquency on my mortgage loan with your company. I am out of options and have been unsuccessful in getting a realistic answer to or a resolution to my unique circumstances, which caused the delinquency in the first place.
Beginning in July 2008, well before the economic downturn I have been in contact with various representatives from HSBS/HFC/Beneficial. I have spoken to everyone from collections to loss mitigation to no avail. I have verbally given information as well as faxing numerous times documentation requested by various representatives. Yes, I was offered a hardship, which amounted to my payment going down a little over $ 100.00.
While I appreciated this offer given the circumstances of my situation, this would not come close to helping me. I have attended foreclosure seminars, which were sent via mail on behalf of your company. Twice I have met with representatives of HSBC at these seminars.
The first took place in October of 2008 in Delaware at which time I met with Tom who was going to take my information back and speak with someone in upper management to see what options were available to me. We spoke a few times and apparently, he was out of the office due to circumstances I was not made aware of therefore nothing was accomplished.
The end of December 2008 Lettia Wilson called me since she was the one who was taking over Tom’s responsibilities while he was out of the office. We spoke back and forth and she was the most understanding and polite person I had spoken with to date since this fiasco started. She in turn was working with her manager Allison who I eventually spoke to since Lettia advised me that there was nothing more she could do.
Right at the time, I was dealing with Tom I started to record all conversations with representatives from HSBC due to consistently being told something different depending upon who I was talking with. During my last conversation with Lettia, she advised me the reason they would not work with me is my home was valued at $ 335,000.00 per Allison who advised she got this information from a website at Zillow.com. I exclaimed there is no way this house would come close.
We spoke about deed in lieu and a short sale and I agreed to let a broker sent by HSBC come and do an appraisal, which to no surprise the house did not even come close to $ 335,000.00. When I asked Allison why no consideration had been given to extending the loan out another five or 10 years her reply was that they don’t like doing that with older people.
I find that statement to be discriminatory in and of itself. My loan will not amortize until 2024 so it didn’t hurt to ask. My last conversation at the end of April 2009 consisted of being offered to bring the account current by making two standard payments of $1719.54. I appreciate the offer but this is not a long-term solution and akin to putting my finger in a dike.
The next representative I spoke with is Larry Suhr who I assume also works in the loss mitigation department. The same issues were rehashed getting me nowhere and I took the advice of contacting HUD and PHFA and trying to get approved for a HERO loan, which I submitted documents that were not received by them and will resend these by certified mail tomorrow.
The next seminar I attended was in West Chester, Pennsylvania, also by invitation via mail sent from HSBC for foreclosure prevention. The representative I met with from HSBC spent all of 15 minutes reviewing what little information he asked along with looking at my account on the computer. Unfortunately, due to the complexity of my situation he appeared to want nothing more than for us to go away.
Considering the fact, we bought with us two laptop bags filled to the brim with all dealings and documentation with HSBC as well as documentation concerning the auto accident, which caused the delinquency in the first place. I felt so rushed that I wasn’t able to get the representative name or number I spoke with.
He advised us that he would take this back with him and have someone within upper management review our account and we would be getting a phone call. I have yet to get that call other than contact with Larry Suhr who was involved prior to us going the West Chester.
I have had subsequent conversations with Larry and have yet to get an understanding of why given the circumstances of my situation I cannot get a reasonable explanation of why the loan cannot be extended. If I had a dime for every time someone within HSBC told me, they didn’t want my home; I could pay my mortgage for the next year.
I’ve explained the circumstances which led to the delinquency to so many people I’ve lost count. I’ve sent documentation for anything and everything that was asked for. I’ve been to more agencies for help that cannot assist me due to HSBC not working with these including President Obama’s plan since I have a conventional mortgage.
Numerous times, I’ve been told we don’t work with this agency or Obama’s plan then told we are looking into Obama’s plan. I looked on the Edgar website and noticed that initiatives were discussed regarding mortgages and what options might be available to homeowners including rewriting the loans. This option was also discussed previously and at one point, I was told that since the branches are now closed this is not possible since this would be considered lending money.
I’ve taken every possible step I can to hold onto this home. From February 2009, I have deposited payments in the amount of $850.00 until I knew where I stood and continue to do so. These amounts, although way less than the regular payment are all I have been able to afford with one income only.
Now all I am asking for is the chance to keep my home. I’ve explained to anyone that would listen that my circumstances are beyond my control and the reason for my current unemployment is due to the car accident and my car insurance company refusal to authorize the necessary surgery so that I can work again.
I have no other medical coverage, was denied state medical assistance, denied Social Security disability, which I appealed. I currently have an attorney working on the Social Security appeal and another attorney handling the litigation of the car accident case. I have been notified that the car accident litigation is close to trial and notification of depositions will be forth coming in June or July 2009. I have no ideal of the amount of monetary damages being offered until then.
In closing, I would like to thank you in advance for taking the time to read this somewhat lengthy letter and eagerly await a response.
End of my letter to the CEO
Although I wrote to the top management the response came from HSBC Customer Resolution Department from J. Hauser. This is verbatim from the letter.
Dear Ms. (redacted),
This letter is in response to your correspondence we received on June 5, 2009. You state that you have spoken to numerous Collection Representatives regarding your account and your current financial hardship.
You state that you have been approved for a six month hardship reducing your payment approximately $100.00 which you appreciate but still cannot afford. You state that you have been advised that the term of your loan cannot be extended due to your age. You are requesting assistance with your account as you want to stay in the property.
We apologize for any inconvenience and frustration you experienced while attempting to resolve this issue. Our records do indicate that you have spoken with Loss Mitigation Specialists and Department Managers in regards to your current financial hardship. Your current interest rate is 6.120% and payment is $ 1719.54, which was a modification completed on August 15, 2004.
Unfortunately, as stated previously, we cannot offer a rate lower than 5.25%, which would reduce your payment to $1626.96. We also cannot offer to extend your loan based on current policy and procedures and not based on your current age or when your loan’s maturity date is. You were advised with two standard payments your account could be brought current, which can still be completed.
Your account is currently 227 day delinquent with an amount due of $13,935.38. Please contact our collection Department at (800) 333-5848 to discuss payment arrangements. We are willing to work out a hardship modification; however, as previously stated the rate can only be reduced to 5.25%.
Please contact our Hardship Department if you would like to apply at (800) 340-7505 extension 3435.As part of our long standing commitment to home preservation, and because we are especially sensitive to our customer’s situation, HSBC continues to evaluate the different programs we offer to provide the best solutions possible to our customers.
HSBC is currently assessing the details of the Home Affordable Modification Program (HAM). Additional details regarding the plan can be found by visiting the following website: http:// www.ustreas.gov.
As HSBC continues to utilize existing standards and procedures for our modification process, you are welcome to contact our Default Services Department at (800) 958-2540 to determine what options are available for your account.If you have any questions regarding this response please contact our Customer Resolution Department at (888)245-9364.
Sincerely,
J. HauserEnd of letter from J. Hauser in The Customer Resolution Center
Ok isn’t that a nice letter? HSBC of course had to bring up the modification that was their settlement to me since I opted out of the $464 million dollar class action lawsuit and filed my own at the time I was forced to file bankruptcy due to HSBC’s reluctance to provide options when I was laid off back in 2002.
When I wrote my letter I preferred to stick with the issue at hand instead of rehashing the same S*** again but they had to go there. I say this is not an adequate response from anyone within HSBC considering the article I found in the Wall Street Journal dated November 2008 which I am pasting here because when I tried to post the link it did not bring up the correct article when I checked it in my browser.
Wall Street Journal Article: November 18, 2008
By CARRICK MOLLENKAMP and SARA SCHAEFER MUñOZ
In early 2007, HSBC Holdings PLC was one of the first big banks hit by what became a global tidal wave of subprime-mortgage woes. Now there’s a new problem: Changing the terms of some shaky loans has failed to keep borrowers from defaulting.
The U.K. bank, which bought an Illinois subprime lender called Household International Inc. in 2003, has modified since the start of last year 238,000 home loans with a combined outstanding balance of $28.8 billion.But even as HSBC tries to stem surging defaults and foreclosures, some borrowers are falling further behind on their payments. About 21% of the consumer loans modified under a program that essentially declares a loan current had fallen into default as of Sept. 30, up from 18% three months earlier, according to HSBC.
With the economy putting even more pressure on struggling borrowers, HSBC is changing the types of assistance it offers, including by freezing interest rates and extending help for longer periods of time.
“It’s not a particularly easy route to chart,” said Niall Booker, chief executive of HSBC Finance Corp., the U.S. consumer-lending arm of HSBC. “Our program has stood up pretty well.”
The difficulty in steadying borrowers and avoiding charge-offs is another ominous sign as the credit crisis drags on. As lenders from Citigroup Inc. to Bank of America Corp. to J.P Morgan Chase & Co. rev up their own loan-modification efforts, HSBC’s results show hard it is to rehabilitate troubled mortgages.
Banks can modify loans in a host of ways. They can freeze the rate to help a borrower avoid pain from an adjustable-rate mortgage that changes from a low, teaser rate to a higher interest payment. Or they can reduce rates and forgive part of a loan’s principal, which reduces homeowners’ monthly costs, for example. In the rush among banks to come up with plans this month, Credit Suisse analyst Rod Dubitsky says they have confused borrowers and established a “cluttered landscape of complex loan features.”
Lenders want to avoid foreclosing, which costs them as well as borrowers. A recent study by Alan White at Valparaiso University in Indiana cited an Illinois property acquired with a $630,000 loan in late 2006. In June 2008, the home foreclosed and sold at a loss of $332,000. Modifying the loan likely would have produced “a smaller ultimate loss for investors,” Mr. White said.
HSBC’s problems trace back to its purchase of Household, which was renamed HSBC Finance. HSBC bought subprime loans in an effort to boost profits in 2005, a time now seen as one when lenders were reducing underwriting standards.
In February 2007, HSBC said its portfolio of subprime mortgages was souring more sharply than expected and increased its bad-debt costs. That warning kicked off months of banks reporting losses tied to subprime loans and related securities.
Initially, to modify loans, HSBC tried a strategy called “re-aging.” If a borrower fell behind on payments by two months or more, HSBC effectively allowed some to catch up by declaring the loan current and adding the delinquent amount to the balance owed.But even consumers with such loans defaulted. As of Sept. 30, 21%, or about $6 billion, of HSBC’s $28.7 billion in re-aged consumer loans subsequently experienced defaults, HSBC disclosed in its third-quarter regulatory filing. The default rate was higher than in the period ended June 30, when 18% fell into default.
HSBC said it is scaling back on re-aged loans, saying consumers need more help “in the current marketplace.”
HSBC is making more options available to more people. For example, it is contacting customers before their adjustable-rate loans reset to higher rates and freezing the current rate or allowing the borrower to pay a rate below what the new rate would be. The bank also is lowering fixed rates for selected borrowers.
HSBC also is increasingly willing to provide relief for as long as five years, longer than in May 2007, when the bank told analysts and investors that a “temporary solution” worked best for “the largest component of our customers.”
In offering such aid, HSBC and other lenders risk that borrowers seek to get their loans adjusted even if they don’t need it or take on riskier loans with the belief they will be bailed out. When loan modification programs receive publicity, the “moral hazard risk is high,” said analyst Mr. Dubitsky in his report.
After the issue receives publicity, “we do tend to get an increase in phone calls from people saying, ‘I want to be part of this process,’” HSBC’s Mr. Booker said.
HSBC is also reaching out to customers who aren’t delinquent but who soon could fall behind. To identify candidates, for example, the bank used data about the impact of a steep downturn in California home prices and the impact on defaults and then applied it to other states. The bank then contacted borrowers who weren’t yet delinquent and modified their loans, says Tom Detelich, president of consumer and mortgage lending at HSBC Finance.
“The sooner you can intervene with the customer … the more likelihood that that modification will be effective,” he says.
End of Wall Street Journal Article
Considering the time frame of the article and my attempts when I first attempted to get help way back in June 2008, I’d like to know who, what,where and when HSBC modified loans prior to my first knowledge of them modifying loans at the second seminar I attended around May 2009? Wish I had found this article prior to sending my response to the CEO of Household. It would be interesting to see how HSBC would explain away a quote from HSBC’S CEO in a Wall Street Journal article.
What follows is my response back after getting the letter from J. Hauser of The Customer Resolution Center. Again I sent my response to the CEO, certified/return receipt but this time restricted delivery. Of course anyone working for the CEO will screen his mail and reroute presidential complaint letters but no harm in trying for the third time and just maybe my letter will cross his desk due to restricting the delivery. I can only hope.
My response:
Dear Mr. Booker,
I am in receipt of a letter dated June 12, 2009 from J. Hauser from the customer resolution department. While I appreciate the prompt response in regards to my original complaint letter dated May 26, 2009, I am no closer to a resolution than previously.
My intent was to focus on the current situation rather than the past in respect to my association with your company. Let me clarify one issue mentioned in J. Hauser’s letter. A modification was completed on my mortgage on August 15, 2004 due in part to a predatory lending lawsuit that was filed which I opted out of and filed my own suit as part of my Chapter 13 Bankruptcy filed in August 2003.
I filed the bankruptcy in the first place due to the mortgage company’s unwillingness to explain a hardship, contrary to what records HSBC has at the time this occurred. Ultimately, I had no choice but to file bankruptcy due to a layoff, which ended up in a dramatic loss of income if I wanted to keep my home.
This modification was to my knowledge a resolution to my lawsuit in regards to predatory lending and negotiated by my attorney and Household with regards to violations of TILA, etc that were discovered on my original loan contract executed sometime in November 2001.
I agreed with the modification and not complaining about the outcome but J. Hauser thought important enough to remind of this as if the company modified the mortgage once therefore we cannot modify the loan again.
While I am on this subject let me add that on more than one occasion since this loan was modified I have tried to get one payment that was posted to the original loan moved to the current mortgage I have now. I finally gave up after sending numerous documentation and letters. To my knowledge, this payment made in 2004 has never been applied to my current account.
I have yet to find out what current policies and procedures each representative is referring to. If this is proprietary information then just tell me but the reason I am not satisfied with varying explanations over the course of time is the enclosed approval letter for a hardship request in 2006. How it is today the rate cannot go below 5.25% yet in 2006, it was zero percent?
Pardon me for being facetious but depending upon who and what department you speak with determines your answer, which is never consistent. I cannot help but feel that rules are made as the situation warrants regardless if it is policy or not otherwise how could I get a hardship with zero percent interest?
My point is not to be ungrateful for the assistance but trying to understand the method to the madness.
This brings me to the current offer extended in the letter from J. Hauser. Who in the collections area at 1-800-333-5848 am I going to speak with who can work with me with the income that is available?
I am also welcome to contact the Default Services Department at 1-800-958-2540. Are they kidding me? No offense but I have had my fill of this department who has representatives that do not or cannot speak English and through no fault of their own are not versed in the Fair Debt Collection Laws.
I have the call lists from my home phone showing numerous calls from 1-800-958-2540 since I started my attempt in June 2008 to get assistance as well as calls I have made to various departments with HSBC. It was only after getting different answers that I started taping telephone conversations starting in the fall of 2008.
I was referred to the Pennsylvania Housing Finance by HSBC, and did in fact send a request for assistance and resent the application in May 2009. They are in receipt of this application, but due to overwhelming requests for assistance, I have not received a reply.
I have received notification by my attorney that my deposition for the car accident is scheduled for July 7, 2009 at which time either one of two things will occur, a monetary settlement will be offered that sufficiently compensates for the accident or a date for a jury trial.
I have been told that HSBC is assessing various programs including HAM, which I am assuming is President Obama’s Making Homes Affordable Program, which is my only option left but to date no decision, has been made by HSBC in participating. I am not comfortable in the fact that at any given time considering the serious delinquency on my mortgage account just how close I am to having this home foreclosed upon and not a fool to think I should have received notification by now of intent to foreclose for which I am grateful for but graciousness is not getting my mortgage paid.
I apologize for the length of the letter and appreciate the consideration your company has given to date in their attempts to work with me unfortunately; I am still left with no resolution.
End of letter
I apologize for the length of this post but I’d like whatever information I send to be accurate especially if other consumers are reading these posts. You may edit out whatever you feel is appropriate if it is necessary due to the length.
Regards,
MJ
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