JP Morgan Chase opens local loan modification center

The office at 500 N. Rainbow Blvd. is set up for customers to walk in and meet with loan specialists about modifying their loans, a process that has frustrated many homeowners.

Chase, which acquired Washington Mutual and EMC Mortgage, is using part of its $25 billion in federal bailout money to open the loan centers. About 700,000 customers with a total of $110 billion in home mortgages are expected to benefit from the initiative.

Chase spokeswoman Cynthia Thompson said hundreds of people showed up at loan modification centers, or “homeowner retention hubs,” in California, Florida and Arizona, some of the hardest-hit regions for foreclosures. Chase is the first lender to set up such centers.

The goal is to keep people in their homes for the long haul rather than delay the inevitable foreclosure, Thompson said.

“Customers are hearing sound bites of principal forgiveness, that we’re required to do that,” she said Wednesday in Las Vegas. “That’s not commonplace here.”

The more common approach to loan modification is changing the terms, such as by lowering interest rates, temporarily reducing payments or deferring payments, Thompson said.

Loan officers will first determine whether the customer is eligible for loan modification. They’ll need supporting documents of any hardship — job loss, death of a spouse, severe medical condition.

“Maybe they secured another job but not at the same earnings level, so they’re underemployed,” Thompson said. “They need to bring in documents on what has occurred, as well as expenses.”

Mary Jane Rogers of Chase’s Phoenix office said all eight phone lines started ringing as soon as Chase put the sign up.

“These centers are not like a typical branch,” Rogers said. “These are by and large private spaces for people who get pretty emotional telling their story. There’s no judgment in how they got there. This is about making a difference with customers.”

The loan centers are designed to help people who are at least 30 days delinquent on their mortgages. Homeowners who are not yet in default but are teetering on the edge can visit Chase’s Web site at www.chase.com for help.

Steve Hawks of Re/Max Platinum in Las Vegas said the loan-modification centers could save homeowners time and trouble. They won’t be talking to people who have no decision-making power and sending in paperwork that gets lost or shelved, he said.

“Another positive note to their plan is it will put a big dent in foreclosure rescue scams,” Hawks said. “If homeowners can go down to their local branch and get answers, there will be no window of opportunity for foreclosure rescue scams to squeeze money out of unsuspecting victims.”

But there is at least one skeptic.

Chase is “absolutely the worst” bank to work with on loan modifications, said Richard Byrd of Home 2 Home, a nonprofit mortgage modification assistance corporation.

“I’ve spent three or four hours on the phone with them and at the end of four hours, they say, ‘My shift is over. You’ll have to call back tomorrow,'” Byrd said. “We’ve got two or three proposals with Chase. There is no rhyme or reason to it. It seems to be who you get on the phone from the loss mitigation department and how they’re feeling that day.”

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.