Thousands of homeowners lined up outside the Los Angeles Convention Center on Thursday with pay stubs, mortgage documents, credit reports and letters from their lenders.
They came from throughout the region hoping to get better terms on their mortgages in what was billed as a free, five-day, around-the-clock mortgage modification bonanza, with hundreds of counselors and scores of bank representatives in attendance.
Put on by the Boston-based nonprofit Neighborhood Assistance Corp. of America, the event was a stark reminder that a weak economy, high jobless rate and precipitous drop in home prices still threaten to put massive numbers of people out of their homes. The group expects about 30,000 people to attend the event that will end at 8 p.m. Monday.
Many borrowers waiting to participate Thursday said they weren't behind on their mortgage payments, but had grown frustrated trying to work with lenders on their own, and were hoping that face-to-face meetings with bank representatives and counselors might yield results.
"As soon as the market collapsed, all I wanted was to convert to a fixed-rate mortgage because my big concern was nobody would want to touch my mortgage once I was underwater — and that's what happened," said Brad Posin, 44, an Orange County attorney who stood near the end of the long line Thursday morning wearing a T-shirt, plaid shorts, running shoes and carrying years worth of correspondence with his bank.
"I am not looking for a handout from them, I am looking for what I thought the Obama administration's plan was supposed to do," Posin said. "I don't want to walk away from my debts."
Banks have been repossessing homes at a brisk clip this year, pushing properties through foreclosure that had been delayed last year by several moratoriums. And many borrowers who got temporary relief from the Obama administration's $75-billion program to help troubled borrowers haven't been able to get permanent changes to their mortgages, leading many experts to categorize the program a failure.
In recent weeks, the practices of banks taking back homes through foreclosure have also increasingly become a concern. Wall Street titan JPMorgan Chase said Wednesday it was delaying foreclosure proceedings on thousands of homes after it discovered that some employees signed affidavits about loan documents on the basis of file reviews done by other people instead of personally reviewing those files.
The JPMorgan Chase foreclosure delay follows a similar move by Ally Financial Inc. last week, when its GMAC Mortgage unit suspended evictions and foreclosures in 23 states while it conducted a review of its processes.
Neighborhood Assistance Chief Executive Bruce Marks said the goal of his organization and the event, was to fill a void left by policymakers in Washington.
"This perception, the happy talk in Washington that the foreclosure crisis is over, or that it's not that bad is just that: happy talk," he said. "On the ground, it is just as bad as ever and the worst thing is that the government is not doing anything to address it. They are actually making it more difficult."
Marks said that Neighborhood Assistance has done more than 130,000 modifications over the last year and that only about 10% to 12% of the people who get a modified loan through the group default on those modified loans.
Inside the cavernous event center, Hakeem Shaheed, a tall and bulky NACA outreach coordinator from Newark, N.J., led a group of hundreds of homeowners through the first orientation of the day. Sporting a shaved head, baggy blue jeans and a white polo shirt, he cracked jokes as he walked the group through a sobering power-point presentation on the different options the lenders amassed nearby might be willing to offer.
He also cracked the occasional down-economy joke.
"Remember you used to whisper your social security number?" he said. "Now you blab it out in the middle of the mall because you know you can't get ice in Alaska with that number."
Moments later, Marks entered the orientation and faced the crowd. The balding, gray-bearded CEO was dressed all in black, with a megaphone strapped to his back, and addressed the crowd with fervor.
"Everything we have said about Chase has borne out to be true," he said, his voice rising. "So we are going to get it done. We never take no for an answer. So your job is not to take no for an answer!"
Marks is one of the most visible and loudest critics of the banking industry, and his organization has been accused of using guerrilla tactics against some lenders on behalf of troubled borrowers. Last year his organization descended in hundreds on the Greenwich, Conn., home of one mortgage investor wearing T-shirts with pictures of sharks and the words "Stop Loan Sharks." They scattered furniture across the man's lawn in the simulation of an eviction after a foreclosure.
