This is a story of persistence. In the case of Miriam Ramirez, its the story of trying to obtain a much-needed loan modification from Bank of America.
In B of As case, its the story of giving a mortgage customer the runaround for two years.
Loan modifications have been an increasingly nettlesome issue as millions of homeowners struggle to make mortgage payments during the economic slump. The Obama administration has called upon banks to be more diligent in helping customers prior to foreclosing.
But despite a $25 billion settlement last month over mortgage abuses, banks have dragged their feet on lowering peoples interest rates or forgiving a portion of money owed.
Theyre just plodding along, said Kathleen Day, a spokeswoman for the Center for Responsible Lending. You could say things are a little better now, but theyre not as good as they should be.
Ramirez, 40, owns a two-bedroom home in Los Angeles. Her mortgage payments were running close to $2,300 a month, not an easy sum for her and her husband to come up with month after month.
Ramirez works as a housekeeper. Her husband is a truck driver. Some months, they had to forgo medical and dental treatments so they could keep paying their loan on time.
Despite the financial hardship, they never missed a payment.
In 2009, Ramirezs employer, TV producer and director David J. Eagle, read about the Making Home Affordable program, an initiative from the Obama administration aimed at lowering peoples monthly mortgage costs. It looked to me like Miriam could qualify, he told me.
Eagle gathered all the necessary documents and helped Ramirez fill out the application forms. Things went downhill from there.
Bank of America put us through the ringer, Eagle recalled. They kept misplacing documents and requiring us to submit the same materials. This went on for months and months.
Finally Ramirez was given a trial loan mod that lowered her monthly payments to about $1,500. Then, in May 2010, she received confirmation of a permanent modification that required a monthly payment of nearly $2,000 not as affordable as $1,500, but better than the original $2,300.
Throughout this process, Ramirez made all her payments on time. Shed make them early, typically a week or two before they were due. And thats where the real problem began.
According to B of As records, Ramirez made her May 2010 payment April 26. She submitted the $1,500 amount, as per her trial loan modification.
What happened next shows how easily a simple process can break down. B of A applied the check to Ramirezs loan balance but didnt acknowledge it as the first payment under the now-finalized loan modification. Instead, it sent a notice to Ramirez a few weeks later saying she was late on her May payment.
I wont go into the gory details of Ramirez and Eagles subsequent correspondence with the bank. Suffice it to say that B of A simply couldnt get its story straight. Sometimes it would say the snafu had been dealt with and all was well. Sometimes it would say that a payment was still lacking. Sometimes it blamed the situation on Ramirez. Sometimes it blamed it on Fannie Mae.
Eagle, acting on Ramirezs behalf, sought answers from various levels of B of A service reps, and got nowhere. He even wrote to the head of the bank, Brian Moynihan, seeking help in untangling the mess. Nothing worked.
The long and short of it: The Treasury Department requires that when a loan mod becomes finalized under the Making Home Affordable program, all mortgage payments must be made within the month that theyre due.
Ramirezs early payment for May in April 2010 thus couldnt be counted as a regular payment. B of A, thinking Ramirez had simply handed over some extra cash, paid down her balance but left her May bill unpaid.
And for some reason that no one can explain, the bank was unable to pinpoint the problem or articulate it to Ramirez and Eagle. Instead, it merely kept insisting that the problem was Ramirezs.
Its not the level of service we would like customers to have, B of A spokeswoman Jumana Bauwens admitted. For that, we apologize.
To make amends, she said B of A will go back and credit Ramirezs account with a full payment having been made as of May 2010 and all subsequent months. Bauwens also said the bank will attempt to clean up Ramirezs credit record, which, not surprisingly, took a pounding throughout this entire mess.
Mistakes happen. But a responsible business doesnt let things slide for months and even years. It steps up and tries to solve the problem. B of A didnt do that. Thats no way to run a financial institution.
DAVID LAZARUS Consumer columnist and contributor to American Public Medias Marketplace radio program