Word: walked
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...some stage of foreclosure. So when a company claims to offer distressed homeowners both relief from their mortgages and revenge against the bankers who saddled them with too much debt ("Give the lenders back their own headaches"), there are plenty of people eager to hear more. For $695, the Walk Away Plan promises to extract homeowners from the agony of mortgages they can no longer afford or from houses now worth far less than the amount they owe. A similarly named outfit called You Walk Away croons on its website, "Before you know it, you will have this behind...
Much like homes with similar exteriors, walk-away companies can look very different on the inside. Some use the phrase to reel in the desperate and then help them try to save their homes (what a concept), while others don't do much more than hand-holding through the foreclosure process--guidance that's given elsewhere for free. The whole idea of walking away is troubling to consumer advocates, who worry that these firms are whitewashing the fact that foreclosure is a traumatic experience--both financially and emotionally--that takes years to recover from...
...Walk Away Plan sounded pretty good to Paula Bond. A bookkeeper at a battered Florida construction company, she first heard about the plan on TV at 3 a.m., not long after her salary was cut in February by $100 a week and she realized she couldn't keep making her mortgage payments. Selling the house was hardly an option. Properties on her block were going for $135,000; two years ago, she'd paid $188,000. She had phoned her bank and tried to renegotiate the terms of her loan. "Every time I called," she says, "they gave me another...
When she called the Walk Away Plan's toll-free number, she thought losing her home was inevitable. But Paul Helbert, who started the company last fall as an extension of his real estate--investing business, drafted a letter explaining her situation--an appeal based on the fact that banks, deluged with loans going awry, would like to avoid foreclosure too, since it can cost tens of thousands of dollars in legal and rehab fees to repossess and sell a house. "We wrote a beautiful distress letter together," says Helbert. "We told her story." He was eventually able to talk...
There's a problem, though, with Helbert's whole operation: a nonprofit housing counselor might have gotten Bond the same result without charging her hundreds of dollars. In fact, many of the flashiest benefits these new walk-away companies advertise are ones homeowners can procure on their own. Are you willing to pay someone to force the bank to stop harassing you with phone calls? O.K., but you can achieve the same result for the cost of a stamp by sending a letter citing the Fair Debt Collection Practices Act, which says lenders can call only if they're taking...