The homeowners named in the suits include a couple from Parma who refinanced their house four years ago. But after one family member was stricken with cancer and laid off, the Parma family applied for help under the federal Home Affordable Modification Plan, or HAMP. Under the plan, participating lenders - many of which received millions in taxpayer bailout funds - agreed to permanently modify troubled borrowers mortgages if they complete a three month trial period and submit all the necessary documents. Attorney Marc Dann.
Marc Dann: The promise was that if the homeowner made the payments during the trial period and nothing material changed in their situations, they would get a permanent modification. Well, that hasn't happened. They went through the trial period and the banks, including Bank of America and US Bank, have refused to make those modifications permanent.
Dann and his partner James R. Douglass sued US Bank and Bank of America in Cuyahoga County Common Pleas Court. Neither bank responded to requests for comment. Bank of America is facing over a dozen similar cases from other parts of the country, all of which have been combined in a multidistrict suit now pending in US District Court in Massachusetts. Dann said his Ohio case may head there.
Many have complained that the HAMP program has been ineffective. Permanent modifications have been given to only about a third of the 1.3 million borrowers in trial plans since the program's launch in April 2009.