We knew TARP money was diverted away from modifying home mortgages. That happened before President Barack Obama took office. So the president put up $70 billion as incentives for the banks to modify loans. But from the numbers released this week, it doesn't appear to be working.
Demonstrators were at Bank of America and Wells Fargo on Friday afternoon demanding to know why the banks aren't doing more to renegotiate mortgages and stem foreclosures.
Maria Rubio was at the protest at Bank of America. Earlier in the day, she showed ABC7 her home in Discovery Bay.
"The houses around here are going for around $240,000. I paid $600,000," she said.
Rubio told ABC7 this summer she sent in an application for a loan modification, but Bank of America told her they never received it.
"So I submitted my papers again to them in September and kept calling back and calling back and they told my husband they were looking at our papers," said Rubio.
But on October 30, instead of a loan modification packet, the Rubios got a notice posted to their door saying the house was going up for auction. Since then, they've gone back and forth with Bank of America; five times she's had to submit the same set of documents.
"I still haven't heard from them. I'm still waiting," she said.
Rubio is one of 728,000 homeowners who've turned to the federal government's mortgage modification program for help, but data released this week shows nationwide Wells Fargo permanently modified just 3,500 home mortgages and for Bank of America only did 157,000 temporary revisions and a total of 98 nationwide.
"It's appalling, not surprising, but appalling. We need to do more to get this money down to regular folks," said Assembly Majority Leader Alberto Torrico, D-Fremont.
Assm. Torrico is holding a hearing on Monday to investigate why the $700 billion bailout of the nation's banks didn't trickle down to mortgage modification.
"The bailout is taxpayers' money. It needs to get out to the people on Main Street to preserve these homes, to protect these neighborhoods," he said.
In a statement, Bank of America said it expects to move more homeowners into permanent modifications this month, adding: "This clearly demonstrates bank of America's committeemen to this important program and to our distressed customers who are seeking solutions to sustain homeownership."
Wells Fargo states that "from the beginning the goal has been to work with customers to avoid foreclosures wherever possible" and that there's no incentive for the bank to go to foreclosure sale.
Rubio sat down inside the Bank of America branch in San Francisco and refused to leave until she got some answers to her application for a mortgage modification.
"If this doesn't help me I'm going to keep fighting for somebody else," she said.
The police came to the bank, and fearing she'd be arrested, Rubio left.
Late on Friday afternoon, a spokeswoman e-mailed ABC7 and said the bank is setting up a meeting with the protestors to discuss their concerns.
