Woman Threatened With Foreclosure Over Two Cents - Literally

According to the San Jose Mercury News, Lisa A. Burns wants to add her two cents to the debate over our country's housing crisis.

Actually, she wants to hurl her two cents. After all, she received a letter from her lender threatening foreclosure of her house over two pennies.

A 51-year-old woman with an expertise in computers and a keen sense of the absurd, Burns deems herself an upstanding citizen with solid home equity.

She's owned the same small home in Mountain View since 1988. Her monthly mortgage payments of about $1300 are automatically deducted from her checking account.

Last November, though, she was laid off from her job as a project manager at Stanford University.

And that was when the wild excursion through the shadowy domain of refinancing with government aid began.

The story has a happy ending. Burns has found work in a financially sound company. And she is refinancing her house with another lender.

Nevertheless, her story provides insight into the obstacles that people on the edge are confronted with.

Towards the end of last year, Burns went about putting her finances back in order. She approached her lender, Wells Fargo Home Mortgage, about refinancing.

You have a problem, they eventually told her. You don't have a job. Well, yes, she said. That's why I need you to decrease my interest rate of 6.75%. Sorry, they said.

So in April, Burns took up Wells Fargo's suggestion to apply for assistance through the Obama administration's Making Home Affordable program.

The Obama Plan

Essentially, the program provides incentives to lenders to decrease mortgage payments. Critics say the program has been off to a disappointing start, partly due to some of the banks being slow in processing paperwork.

Burns completed her paperwork by the middle of April. She then had to resend them to the bank at least four more times. "I have better things to do than hang around my fax machine,'' she said.

Finally, earlier this month, she received a loan application, which was a request to start over with a new process. "I wanted a rate, not an application,'' she said.

In fairness, bankers say the government's standards have changed several times in six months - and income changes can make the program more difficult to apply. Burns is not particularly appeased.

"If anyone in government thinks this "Making Home Affordable'' program is working, they're deluded,'' she said.

The Final Indignity

The final blow arrived two weeks back, when Wells Fargo Home Mortgage sent her a letter informing her that her mortgage account was delinquent by two cents — and that she had until September 15 to pay.

"If funds are not received by the above date, we will proceed with acceleration,'' the letter said. "Once acceleration has occurred, we may take steps to terminate your ownership in the property by a foreclosure proceeding.''

A Wells Fargo spokeswoman, Teri Schrettenbrunner, said the letter was caused by a "glitch in our system.'' "We apologized to her for inaccurately applying her payments. And we explained that her loan had not been made to go into foreclosure.''

As it has been said before, the story has a happy ending. However, it has left Burns wondering what could happen to someone in a far worse predicament.

"What if in April, I really had been on the edge?'' she said. "It happens I'm not, thank God. But there are people who are.''