Call Kurtis Investigates: Surviving Family Members Losing Homes Left By Loved Ones

ELK GROVE (CBS13) — Some call it a trap that has taken away the homes of widows and surviving family members. Battling two different types of cancer, Alice Reding feels like she's battling a third cancer, her mortgage servicer

"There's no reason for them to treat us this way.  There's no reason for it," she said.

The 69-year-old widow says Green Tree raised her monthly house payment by $200. With her mounting medical bills, she says she couldn't afford the payment.  She says Green Tree refused a loan modification.

"They won't talk to me because my name is not on the loan."

The mortgage was in her late husband George's name. The decorated war veteran died in 2007.  Daughter, April, says she sent Green Tree his death certificate and the grant deed with her mother's name on it, but says Green Tree will not work with them.

"It makes me relive my father's death over and over again," she said.  "I just want them to acknowledge my mother."

When Barbara McGarvey's mother died, she left her the Roseville home they shared during the last months of her life.

"It just feels like I've been tricked," she said.

Barbara says she made the payments on the home for five years, until she lost her job.  She says Chase refused to put through a loan modification without her dead mother's signature.

"I don't know why you're asking her to sign when you know she's dead," Barbara recalls telling Chase.

Attorney Eric Mercer calls the issue a national problem affecting surviving family members trying to get loan assistance.

"Commonly they'll (lenders) refuse to speak to the person at all, because they're not the name on the loan," Mercer said.

Mercer has filed a class action lawsuit against Chase on Barbara's behalf.  She is hoping Chase will buy back her home which is currently on the market, so she can move back in and resume the payments.

Three federal lawmakers drafted a letter to federal agencies asking them to look into this practice and do everything in their power to help surviving family members from facing these types of situations

Chase, The American Bankers Association and the Mortgage Bankers Association would not comment on the issue.  After we reached out to Green Tree in Alice's case, they released this statement.

"Green Tree management recently spoke with Ms. Reding and obtained certain information that is required to accomplish our mutual objective of entering into a loan assumption transaction with Ms. Reding and then modifying the loan so the repayment terms are affordable for her. Please be assured that this matter is receiving high-level attention here at Green Tree and we share Ms. Reding's goal of keeping her in her home."

-Brian F. Corey, Senior Vice President, General Counsel and Secretary Green Tree Servicing

Reding hopes to win her battle with Green Tree so she can concentrate on her cancer battle.

"I'm not going to give up the home.  I'm not going to give it up."