To qualify for the refinance homeowners must be up to date on their payments and have a Loan to Value ratio between 8o and 125 percent. While most of these rules are standard it leaves out a number of consumers who have very few options.

The hope is that the Fed will open up the requirements and give more homeowners an opportunity to keep their homes at an affordable rate. In the meantime many are looking for other answers.

This week undoubtedly added insult to injury with the falling markets, and news that the Federal Reserve rejected the bank’s request to increase its current quarterly dividend of 1 cent per share.  Bank of America lost about a quarter of their value in the last week.

Even Snoopy is feeling the effect of sub-prime mortgage loans, and at this point who isn’t? Good Grief!

The Department of Justice is preparing to sue Wells Fargo for allegedly targeting African Americans during the subprime mortgage crisis and steering them into expensive subprime loans.

The city of Baltimore filed a similar suit against Wells Fargo in early 2008 alleging the bank “engaged in a pattern of predatory lending practices in Baltimore’s poorest neighborhoods, leading to foreclosure rates nearly double the citywide average.” Wells Fargo stands accused of targeting black borrowers for loans the bank knew borrowers would default on, a practice dubbed “reverse redlining.” The imminent defaults were of no concern to Wells Fargo, who later sold the loans off to investors. The city of Memphis also filed suit against Wells Fargo for discriminatory and illegal lending practices.

These multiple lawsuits paint a collective picture of lending institutions taking advantage of consumers with limited access to credit and legal resources. Banks have also recently taken heat for misleading investors, forging loan documents, “robo-signing”, and countless other illegal, unethical tactics.

The Fed announced last week that 10,000 or more borrowers were illegally pushed into costly subprime loans and had their documents falsified by mortgage servicers.

In a guest appearance on Jon Stewart’s The Daily Show, Matthew Richardson, author of “Guaranteed to Fail”, compared the subprime mortgage crisis to the aftermath of a King Kong and Godzilla battle in downtown Tokyo.

With more than a million families facing foreclosure, a Boston non-profit financial group has created an innovative program giving homeowners a second chance. CBS reports.

The central mission of the Consumer Financial Protection Bureau (CFPB) is to make markets for consumer financial products and services work for Americans—whether they are applying for a mortgage, choosing among credit cards, or using any number of other consumer financial products.

The consumer bureau is working to give consumers the information they need to understand the terms of their agreements with financial companies. We are working to make regulations and guidance as clear and streamlined as possible so providers of consumer financial products and services can follow the rules on their own.

Congress established the CFPB to protect consumers by carrying out Federal consumer financial laws. Among other things, we:

-Conduct rule-making, supervision, and enforcement for Federal consumer financial protection laws
-Restrict unfair, deceptive, or abusive acts or practices
-Take consumer complaints
-Promote financial education
-Research consumer behavior
-Monitor financial markets for new risks to consumers
-Enforce laws that outlaw discrimination and other unfair treatment in consumer finance

Original link: http://www.consumerfinance.gov/the-bureau/

Wells Fargo has also been ordered to compensate its victims, a number that may exceed 10,000.

“The $85 million civil money penalty is the largest the Federal Reserve Board has assessed in a consumer-protection enforcement action,” the Fed said in a statement.

The bank denied any wrongdoing but agreed to cooperate with the Fed in an ongoing effort to discontinue abusive mortgage practices within the industry.

“The alleged actions committed by a relatively small group of team members are not what we stand for at Wells Fargo,” said Wells Fargo Chief Executive Officer John Stumpf.

The dubious activities occurred at Wells Fargo Financial, a now-closed unit of the bank. The unit closed in July of 2010, and 3,800 jobs were lost as a result. Wells also revealed at the time that it had stopped making subprime loans.

A PBS NewsHour special on the grim state of the housing market.