For nearly five years, from 2000 to 2005, Vera Jackson drove every workday from her home on a well-manicured Elk Grove street to the hair salon she owned and operated in Sunnyvale.
It was a price she thought worth paying to own her own home, an unattainable goal in the pricey Bay Area. On the commute, she often brought along her father, who suffered from Alzheimer's and needed looking after. The pair slept at a motel in Sunnyvale when she was too tired to drive.
"I wanted the American dream," Jackson said.
Now, 10 years after moving to Elk Grove, Jackson is like millions of other Americans buried by the subprime mortgage crisis and ensuing recession: She's fighting to keep her home.
For months, Jackson has struggled to get her mortgage servicer, Bank of America, to modify the terms of her loan.
Interviews with Jackson and other homeowners illustrate how hard it remains for many people to get their loans permanently modified and avoid foreclosure, despite a variety of federal and state programs set up to help.
Lenders are reluctant to reduce the principal amount owed on loans – often the only thing that would allow people who have lost their jobs to keep their homes. In addition, many trial loan modifications never become permanent. Paperwork gets inexplicably lost.
A federal government-backed loan modification program, which offers the best terms for homeowners, has fallen short of its goals. A large percentage of homeowners receiving modifications from their loan servicers that aren't backed by the government are falling back into trouble.
Adding to these impediments, some people who took out ill-advised mortgages now are making desperate financial decisions that only make things worse.
Jackson, for instance, has put her few remaining dollars into the sort of companies state attorneys general have been warning debt-ridden Americans to avoid.
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