Unions to Banks: Modify More Mortgages Or We’ll Pull Our Deposits

July 19, 2010 No Comments »

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Several very large unions representing some 500,000 working families may pull their money out of certain financial institutions if they don’t do more to help those facing foreclosure.

The so-called “Move Your BIG Money campaign” aims to put pressure on large banks that have done what they feel has been very little to prevent avoidable foreclosures and prop up the fragile housing market.

The movement is tied to a letter sent to the big banks from NYC Comptroller John Liu and union leaders last week, which laid out a number of concerns and asked for solutions by September 1.

Specifically, they want to know what banks are doing to increase loan modifications, including principal balance reductions, what’s being done to expedite the process, and what’s being done to improve performance so homeowners don’t lose their homes in the process.

Back in December, it was revealed that Bank of America, the largest mortgage servicer in the United States, had completed just 98 permanent loan modifications under HAMP.

Those numbers later improved, but are still far below those seen at smaller banks and servicers.

Permanent modifications under HAMP have increased in the past few months thanks to measures like verifying income documentation (go figure), but still aren’t up to expectations.

The unions involved include 1199 SEIU, the largest of all union locals in the United States, DC 37, the largest public employees local in the US, United Federation of Teachers, the largest teachers union in the nation, and several others.

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