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Wednesday, December 2, 2009

BANKS AND THE POWER OF BAD PRESS

Posted By on Wed, Dec 2, 2009 at 11:22 AM

Cleveland-based ESOP, a statewide community organization that advocates for homeowners facing possible foreclosure, continues to pressure big banks to be more responsive to people who need help making mortgage payments.

The group — formally known as Empowering & Strengthening Ohio’s People — took its fight last week to executives with JP Morgan Chase. During a November 21 meeting, ESOP representatives and homeowners asked Chase officials to speed up the bank’s process for helping homeowners work out late mortgage payments or to modify troubled loans.

The bankers agreed to accept and acknowledge receipt of a homeowner’s paperwork within three business days and said they would get back to the homeowner within 30 days with possible remedies, says Charu Gupta, a spokeswoman for ESOP. However, the bankers declined to guarantee their words with signatures, saying it was against their policy.

The advocates called bullshit, saying that Chase had already made a written promise to a similar advocacy group in Boston. A Chase spokeswoman declined to comment, saying only that Chase was working with many nonprofits around the country in an effort to help struggling borrowers.

ESOP’s recent actions coincide with news reports that the federal government program to assist homeowners, Making Home Affordable, is floundering, with no help from unresponsive lenders. According to a recent New York Times article, a congressional oversight panel reported that less than 2,000 of 500,000 loan modifications handled by the program in October have been permanently resolved.

ESOP continues to get attention by staging protests — or “hits” — at targeted bank branches. The protests come after months of no or little response from bank officials, says Gupta.

A protest held in front of local Wells Fargo branch on November 14 resulted in a terse phone response from a bank official who called ESOP’s tactics “unprofessional,” says Gupta. “We tried to be professional,” she explains, but the banks “didn’t answer any of the letters we sent.” — Damian Guevara

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