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Borrowers, Banks Gather To Save The Dream, Avert Foreclosure

Banging The Gong Signals A New Start

By KENNETH R. GOSSELIN

October 21, 2011

HARTFORD —— Alicia Lopez flew more than 3,000 miles from her home in San Francisco to Hartford, just to talk to her bank at the "Save the Dream Tour" mortgage modification event at the XL Center.

It would seem a long way to travel, but Lopez was in a hurry: She was four days away from a foreclosure auction on her home.

"I've been talking with my bank for a year, but they didn't come up with a solution," Lopez said. On the flight to Hartford, "I just kept thinking, 'If I don't get it, I'll need to find a place where I can rent.'"

On Friday, Lopez, a worker in a janitorial company, worked out new mortgage terms with her servicer, Bank of America, that will allow Lopez and her brother, an unemployed construction worker, to stay in the home they bought together four years ago.

The event brings together struggling homeowners with lenders and loan servicers to talk face-to-face. The "Save the Dream Tour," sponsored by the Neighborhood Assistance Corp. of America, or NACA, a nonprofit housing advocacy group, first helps borrowers pull together all the documents they need, develop a budget, and determine what would be affordable.

All this is done before borrowers meet with banks and servicers. That, organizers say, eliminates the confusion that often ensues when borrowers try to deal with their troubles on the telephone, getting a different person every time they call.

As many as 5,000 homeowners are expected to attend the event in Hartford, which started Thursday and continues through Monday. Save the Dream comes as Connecticut continues to struggle with stubbornly high foreclosures and little improvement in unemployment.

Kennedy Lidonde, who lives in Woodstock, started working with NACA even before he came to the XL Center. He was armed with all of his documents — including pay stubs, mortgage statement, property tax bill and tax return — and had already developed the budget that would make a modified mortgage affordable for him, his wife and four children,

Still, it wasn't a matter of just walking in and out. He spent from 8 a.m. to 7 p.m. Thursday, finishing up around noon Friday.

Unlike many borrowers seeking help, Lidonde wasn't behind on his mortgage payments. But he was in danger of missing a payment after he lost his job as a supervisor at a college in Worcester, Mass., and was forced to take a lower-paying job as a car salesman. His wife works as a clerk at the same college where he once did, but it wasn't enough to make ends meet.

"I thought, 'How am I going to keep coming up with $2,400 for the mortgage,'" on top of credit card, food and utility bills, Lidonde said. "It all started piling up."

Bank of America offered to drop Lidonde's mortgage rate from 5.89 percent to 3 percent, cutting his monthly payment to $1,600 on his four-bedroom, Cape Cod-style house near a lake. The payment comprises principal, interest, plus escrow for taxes and homeowners insurance.

While the monthly payment is lower, the term of the mortgage will stretch from 30 to 40 years, Lidonde said.

"It's going to take a little longer, Lidonde said. "It's going to be like starting over, but it's a relief."

After he was handed his new loan documents Friday, Lidonde struck a gong, a tradition Bank of America instituted at the event to signal a new start for the borrower. The sound resonated throughout the exhibition hall and was greeted by thunderous applause.

Lidonde is among the estimated 80 percent of homeowners who will secure a loan modification after attending the event.

NACA has signed legally binding contracts to ensure that homeowners get a fair shot at an affordable mortgage. Those contracts came after months of what NACA founder Bruce Marks describes as "nonviolent, bank terrorism."

Marks, who was in Hartford on Friday, said NACA pressured banks by protesting at the homes of executives and by disrupting shareholder meetings to call attention to the country's foreclosure troubles.

Marks said relations with the banks are more cordial these days. "We are strictly here to help people through the process," he said.

David Hodge, a firefighter from Springfield who has been sidelined on disability, said he was approved for an $800 reduction in his monthly payment — enough to keep his family in the Colonial-style home they built three years ago.

Of Bank of America, Hodge said: "I'm now one of their No. 1 customers. The $5 fee on the debit card won't matter now."