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Source: Tulsa World, Okla.迷你倉最平Oct. 21--The lone defense in CitiMortgage v. Arehart was a handwritten note on lined yellow legal paper:"We don't want to lose our home and we would like the mortgage company to work with us on a plan."The Areharts' letter dated Nov. 3, 2010, asked for a copy of the contract and questioned where some of their payments to CitiMortgage had gone. They told the Tulsa County District Court judge of financial hardships that had caused them to come up short.But CitiMortgage wouldn't take their calls and the Areharts never received a response from the company, its attorneys or the Tulsa County District Court judge overseeing the civil suit, David and Margie Arehart said.The following February, nearly the same day the judge ruled in favor of foreclosure, the Areharts got another letter from CitiMortgage:"You may be eligible for the Home Affordable Modification program ... We will work with you in an effort to make your mortgage affordable," the letter states.It mentions options such as a modification, reducing the 8 percent interest rate on their loan or extending its terms. It was all too little, too late.Fighting foreclosure without an attorney puts homeowners at a disadvantage against lenders, who typically have attorneys representing them in court.In the vast majority of cases, homeowners fighting foreclosure do not have legal counsel and the cases are decided without any examination of evidence in open court, consumer advocates say.Resolution Oklahoma, the attorney general's mortgage settlement program, aims to change that through two options for struggling homeowners.Oklahomans who find themselves in a similar situation to the Areharts can now apply for vouchers to hire a private attorney or free foreclosure defense assistance through Legal Aid, depending on their income.The money to hire the attorneys comes from an $18.7 million fund from the nation's five largest mortgage servicers that state Attorney General Scott Pruitt used to design his own program after he decided to opt Oklahoma out of the National Mortgage Settlement.Oklahoma was the lone state to opt out of that $25 billion settlement, with Pruitt declaring that it veered too far into housing policy and deviated from the focus of helping defrauded homeowners. His decision left an additional $10.1 million on the table that could have gone to help an estimated 6,800 borrowers who lost homes.Though some states spent their settlement money on other needs, many states who participated devoted those funds to helping homeowners who were underwater, struggling to make house payments and falling behind.Pruitt opted to launch his own program that would offer legal assistance and direct payments to homeowners who could prove harm.So far, 326 cases have been approved for vouchers to hire foreclosure defense attorneys, with $1.6 million from Resolution Oklahoma committed to their cases.Legal Aid also received a separate $1.285 million grant from Resolution Oklahoma to assist homeowners with mortgage modifications, refinancing, short sales, housing counseling and foreclosure defense.Opt-out reasoningA memo emailed from Pruitt's staff to the Tulsa World elaborates on some of his reasons for opting out: "You need to be clear that there were two groups of people. There were people who lost their homes or were on the verge of losing their homes because of something the banks did. These were the people who were harmed. Then, there were people who were just in a bad financial situation and experienced foreclosure at no fault of the banks. Oklahoma's settlement helped the people who had something happen to them because of the banks. The servicers helped the rest of the people who were just in a bad financial situation with modifications and write-downs. These are NOT the same groups of people."Margie and David Arehart want to know which group of people they fall into and exactly how much harm they must prove to get help from Pruitt's program.The legal assistance won't help now, but the direct payments to defrauded homeowners -- between $5,000 and $20,000 for documented cases -- could help them shake some debt. They wish they'd heard of the program sooner, but they plan to apply for the second phase.The Areharts said they learned about the attorney general's settlement program when they overheard someone talking about it "in line at the Walmart one day."It was after the fall 2012 deadline to apply. They called the Attorney General's Office to find out more and no one returned their calls, they said.Diane Clay, a spokeswoman for Pruitt, said neither the mortgage settlement claims nor consumer complaints divisions of the Attorney General's Office has records regarding the Areharts.Now in a crowded apartment bordered by a block of crime-riddled public housing in Tulsa, the Areharts live off Social Security disability income and are struggling to make ends meet. They still can't figure out where things went wrong with the home they lost in Turley.It was the first home they'd bought, for $70,000. They were able to put about $15,000 down from a settlement David had received. They financed the remaining $55,000 through a loan from a local bank, which quickly sold the servicing of the Areharts' loan to CitiMortgage.For three years, the Areharts made their payment of about $600 on time each month to CitiMortgage through automatic drafts from their bank account. They showed the Tulsa World records documenting three years of on-time, automatic payments.In June迷你倉2010, they began to have trouble with someone skimming money out of their checking account. The Areharts didn't realize the automatic payments for June and July 2010 weren't received by CitiMortgage until letters arrived telling them they were in default and needed to pay more than $1,200 in back payments and fees to get caught up.David Arehart also had mounting medical bills from various health issues. He needed time and a little leniency to get caught up, so he asked his servicer to work out a hardship plan."I didn't know what to do," he said. "No one at CitiMortgage would talk to me."Getting anyone on the phone was next to impossible, he said. No one would help him.And the Areharts didn't have the money to hire an attorney to fight back.Public Affairs Director Mark Rodgers said Citi's biggest priority is to help borrowers avoid potential foreclosure and remain in their homes."Under our standard practice, we attempt to reach distressed borrowers, often multiple times, to try to help identify a solution for their situation," he said. "Unfortunately, if we cannot establish contact, we are unable to provide assistance."Day in courtAmong homeowners in foreclosure surveyed by the World, court records show defendants did not have legal representation in 83 percent of the cases. The World reviewed nearly 370 foreclosure cases in 12 Oklahoma counties.Diane Thompson of the National Consumer Law Center estimated that in 90 percent of foreclosures, there's not even a handwritten note like the Areharts' offered for the defense."It's very difficult for the homeowner to prove what they've experienced," she said.Without an attorney, Thompson said, homeowners are lucky if they can make it past a motion for summary judgment, a common step by firms representing mortgage servicers to expedite the foreclosure process. In most cases, there is no trial or contesting of the facts in open court.In foreclosure, the deck is stacked against homeowners and is heavily in favor of the mortgage servicers, she said.Pruitt said in most cases his office reviewed, "the homeowners were simply trying to get right" with their mortgage servicer and up-to-date on payments.In the end, most homeowners find it's their word against the servicers.Through their grant from Resolution Oklahoma, Legal Aid Services of Oklahoma opened 389 foreclosure prevention and defense cases from December 2012 to June 2013, and nearly half are resolved, data show.Michael Figgins, executive director of Legal Aid Services, said many of the calls the agency received reflected homeowners in "dire circumstances," and the Oklahoma City and Tulsa areas were "especially needy.""The thought of just one Oklahoma family losing their home just because they did not have legal help is very troubling," Figgins said.Oklahoma City attorney Scott Harris has the largest caseload of attorneys participating in the voucher program, 54 cases so far. He said the funds make a difference for troubled homeowners."I think it's a great program," Harris said. "It keeps our clients from having to decide whether to hire an attorney or put money aside to save their home."Servicer indifferenceCitiMortgage won, the Areharts lost. They had to move out by April 2011, before the sheriff auctioned off their home."I loved that house," Margie Arehart said.Hard times and a bug infestation at their apartment mean the family's living room furniture has been replaced with fold-up camping chairs.Because their monthly mortgage payment was only $650, it appears as though it wouldn't have cost CitiMortgage a huge amount of money to help get the Areharts caught up. But servicers such as CitiMortgage typically don't hold the actual mortgage note and don't make much profit on timely monthly payments.Thompson said that before a federal incentives program known as HAMP -- the Home Affordable Modification Program -- the servicers had virtually no experience modifying loans. Modifications require staffing and training expenses.Foreclosure, however, is a standard procedure where most of the costs are outsourced. Servicers such as CitiMortgage get reimbursed for the expense, Thompson said."They get paid fees off the deal," she said. "It's a real moneymaker for them to go through foreclosure like this."On paper, it would appear CitiMortgage lost money when it came time to sell the Areharts' home. It appraised for $65,000 but sold at auction for about $43,000 to CitiMortgage, which bid on behalf of the underwriter, Fannie Mae. County property records suggest it was sold a year later for as low as $22,000.Servicers, unlike homeowners or investors, generally do not lose money on foreclosures. The lender/underwriter or investment pool behind the mortgage takes the biggest loss (next to the homeowner).In general, the way companies earn money servicing home loans gives them little incentive to offer sustainable loan modifications and some incentive to push loans into foreclosure, Thompson said.Though HAMP and the National Mortgage Settlement may have improved the odds for homeowners fighting foreclosure, they're not enough, Thompson said.And they're both set to expire in the next few years."There are a lot of reasons to expect things will get worse when those expire," Thompson said.Cary Aspinwall 918-581-8477cary.aspinwall@tulsaworld.comCasey Smith 918-732-8106casey.smith@tulsaworld.comCopyright: ___ (c)2013 Tulsa World (Tulsa, Okla.) 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