Some stressed homeowners say Chase is still chasing them. The bank says it is just collecting payments in opposition to others

By Christopher Palmeri

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Some homeowners say they are still receiving foreclosure notices, even from banks that have before-mentioned they would halt the process until the New Year.

Over the past month several large financial institutions have sworn to halt foreclosures for the time of the anniversary season. JPMorgan Chase (JPM) started the ball rolling on Halloween by an announcement saying it would "not put any additional loans into the foreclosure continued movement" (BusinessWeek.com, 10/31/08) for 90 days. The pile declared it hopes to maintain 400,000 borrowers in their homes by modifying terms of their loans, opening more mortgage counseling centers, and reaching aloud to borrowers in distress.

Yet a BusinessWeek.com reader who lives in Washington State says he started receiving notices asking him to call the "loss mitigation" function at Chase on Nov. 25. But that wasn’t all, says the homeowner, who wrote into BusinessWeek and asked that his name not be used.

"Foreclosure is scary in the manner that abode of the damned," he writes. "They project strange men to your house after dark on Saturday obscurity to hand-deliver copies of documents from a metal lockbox. Every day brings more certified mail-bag. The mailman has to knock and wait for us to sign things—three different certified copies of everything, one to ‘occupant’ and one to my wife and I."

Another homeowner who says her loan is also from Chase wrote to BusinessWeek: "They esteem not stopped the foreclosure process on my home. I have to pay $4,800 on Christmas. … Sad, so sad."

Thomas Kelly, a spokesman as far as concerns Chase, says that in some cases loans are owned by not the same lender and Chase is just collecting payments. In those situations, Chase has to proceed along the course of the foreclosure course. The Washington State homeowner, for model, had a loan with Washington Mutual, which was taken over through Chase in September. His loan is ultimately owned by mortgage giant Freddie Mac, Kelly says.

Fannie Mae (FNM) and Freddie Mac (FRE) also swore to freeze foreclosures, on Nov. 20. The pair firms agreed to not take throughout any occupied single-family homes or evict residents from Nov. 26 until Jan. 9. The companies, two of the nation’sitting largest holders of mortgages, were recapitalized by the federal government in September.

Brad German, a spokesman for Freddie Mac, says that time foreclosure filings may in some cases be action, the company does not intend to take the houses back. German says Freddie Mac hopes to have final plans in order of importance by Dec. 15 that have a mind allow it to quickly soften loans to more affordable rates to keep borrowers in their homes.

"We want to make it easier to help [mortgage] servicers modify loans," says German.

The Fannie Mae and Freddie Mac programs are borrowing from initiatives first begun by the Federal Deposit Insurance Corp. (BusinessWeek, 10/8/08) after its takeover of IndyMac Bank in July. The programs aim to reduce borrowers’ pledge payments to 38% of their monthly income. Some states are also following along: On Dec. 1, Florida Governor Charlie Crist announced some agreement with the Florida Bankers Assn. trade group to hold off on foreclosures for 45 days.

On Nov. 25 the Federal Reserve announced it would pump some other $800 billion into the economy, including half a trillion dollars to purchase mortgage-backed securities. This was attached top of the $700 billion the Treasury Dept. is spending, mostly by purchasing preferred stock in banks to encourage lending.

Still, pressure is structure (BusinessWeek, 11/26/08) to have the federal form of sovereignty arrive with a larger and more direct solution by reason of homeowners in trouble. On Dec. 2 the credit bureau TransUnion reported that nearly 4% of all homeowners nationwide were 60 days or more late on their payments in the third part quarter, compared by 2.5% in the same period one year ago. The body said the percentage could approach 5% in the fourth quarter.

Meanwhile, the stress continues for those who are caught in the middle.

"It’sitting really bad, and is affecting my physical health and my family’s intellectual health," writes the Washington State homeowner. "Another lady came and surveyed our house and then knocked onward the door to hand us a slip of paper from the bank. She warned us that foreclosure was impending. We’re definitely not having a happy holidays."