This Long Island couple certainly has something to be thankful for this Thanksgiving.
Greg Horoski and his wife, Diane Yano-Horoski, were on the verge of being tossed out of their ranch home in East Patchogue. They owed $525,000 in mortgage payments, had no equity on the house, and their California bank threatened foreclosure.
Then Suffolk Judge Jeffrey Spinner gave them a Thanksgiving gift they'll remember all their lives. He erased their debt and slammed their bank, OneWest, for its "harsh, repugnant, shocking and repulsive" behavior, according to The New York Post.
Now Yano-Horoski and her husband owe practically nothing on their home. And OneWest, which accepted a whopping $814.2 million in federal bailout money, was excoriated by the judge.
"The bank was so intransigent that he [the judge] decided to punish them," Horoski, 55, told the Post about Spinner's ruling last week. "I think the judge felt it was almost a personal vendetta. [Dealing with the bank was] like dealing with organized crime."
Horoski and his wife had only been paying interest on their mortgage; they had pleaded with OneWest to restructure their loan to no avail. Spinner's decision negated up to $291,000 in principal and $235,000 in interest and penalties, reports the Post.
In response, the bank said, "We respectfully disagree with the lower court's unprecedented ruling and we expect that it will be overturned on appeal," according to the Post.
The Horoskis bought the 3,400-square-foot home nearly two decades ago for less than $200,000, reports the paper. Greg is an online seller of collectible dolls and Diane works as a college professor. The couple had to refinance in 2004, using part of a subprime loan from Deutsche Bank to pay off their initial mortgage and the rest to support Greg's business and pay for health care, reports the Post.
Then the interest rate skyrocketed and the loan ended up being held by IndyMac, which the private company that owns OneWest bought when it failed. Greg had health problems, however, and the couple had to spend a lot of money on his medical bills. They couldn't afford to continue paying off the loan at its current rate and the bank sued them in 2005 for failure to pay.
Last January, the bank got the go ahead to foreclosure and a court granted Yank-Haroski's request for a settlement conference, reports the Post. During that time, Spinner blamed the bank for treating the couple poorly, deceiving them about the money involved in the case and not doing enough to help them out, according to the Post.
In his opinion, Spinner wrote that OneWest's actions were "inequitable, unconscionable, vexatious and opprobrious." He eliminated the debt because he wanted to prevent the bank "from imposing further mortifying abuse against [the couple]," reports the Post.
For its part, OneWest claimed it's been working hard with homeowners on loan restructuring in accordance with Presidnt Barack Obama's affordable home plan and evaluating other loan options. However, the company is currently involved in a similar case in California, where the bank is trying to foreclose on an 89-year-old woman's home despite court orders demanding it cease and desist.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org.
For more information on this story please visit: www.nbcnewyork.com
Sunday, December 20, 2009
Friday, November 27, 2009
Predatory Lending Lawsuits on The Rise
NEW YORK (CNNMoney.com) -- During the housing boom, mortgage lenders were doling out the dough, giving loans to people who could never have qualified before.
Now, homeowners and government officials are increasingly taking these institutions to court, alleging unfair and predatory practices. While many of these suits are still winding their way through the legal system, some banks have already settled for millions of dollars.
The defendants include the biggest names in the business -- from Wells Fargo (WFC, Fortune 500) to Countrywide Financial to Citigroup (C, Fortune 500).
"Borrowers are looking to the legal system for help in keeping their houses," said Gary Klein, a partner in Boston-based Roddy Klein & Ryan, which focuses on consumer law. "There are more cases pending than I've ever seen in my 23-year career."
Homeowners are seeking the courts' help either individually or as part of class action lawsuits. With foreclosures continuing to rise, borrowers are looking to force banks to modify unaffordable loans or to stop them from foreclosing on homes. Often, they also seek money.
To be sure, banks have faced unfair lending lawsuits for years and have paid millions of dollars in settlements. But the recent housing boom was fueled by questionable and exotic loans that many borrowers had no hope of repaying.
Some of the cases involve the classic predatory lending schemes, where certain borrowers were given mortgages with high interest rates, while other suits are combating loans that are ultimately unaffordable.
In addition, the mortgage industry preyed on a wider group during the housing boom, capturing more middle-class borrowers. These homeowners have more means to hire attorneys.
Those in more dire financial straits are turning to lawyers who work for non-profit legal services agencies or who agree to seek payment from the banks if they win the case.
Some borrowers who hire lawyers to defend them against a foreclosure sale are successful in getting the courts to stop or delay the proceeding, at least until the bank considers whether a loan modification would be more appropriate.
Then, there are class action suits on behalf of hundreds or thousands of homeowners. In one of his current class action cases, Klein is suing Wells Fargo because one of the banks Wells Fargo now owns originated payment option adjustable-rate mortgages. This type of loan allows borrowers to make very low monthly payments, and the unpaid interest is then added to the principal. Many borrowers end up defaulting on their payments.
The suit's goal is to get Wells Fargo to restructure the borrowers' mortgages to make them affordable, Klein said.
"They are looking for a second chance," he said of the homeowners.
The suit also seeks damages, particularly for those borrowers who've already lost their homes or paid off their loans.
Wells Fargo said it was filing a motion to dismiss the case, calling the claims baseless and a mischaracterization of the bank's long-standing commitment to responsible lending and the pricing practices.
Attorneys general file suit
Meanwhile, state attorneys general are likewise filing suit against the mortgage industry's major players, alleging predatory lending and deceptive business practices. Banks are also getting hit with suits from the NAACP, some cities and individuals claiming discrimination against minority borrowers.
In Massachusetts, Attorney General Martha Coakley reached a $10 million settlement in June with subprime lender Fremont Investment & Loan for its unfair lending practices. The state will distribute $5 million to state residents with Freemont loans, and another $3 million will go foreclosure relief and homeowners education. The rest will go to the state and to cover costs.
The California-based lender agreed to do more loan modifications and not to foreclose upon up to 2,200 loans without notifying the attorney general's office first and seeking court approval in certain circumstances.
"The American dream of homeownership has turned into a nightmare for many borrowers because of predatory lending practices," said Massachusetts Attorney General Martha Coakley, when the settlement was announced in June. "We will continue to hold companies responsible for their role in the foreclosure crisis."
The Fremont settlement came a few months after Coakley negotiated a $60 million settlement with Goldman Sachs (GS, Fortune 500) over its role in bundling subprime loans into securities and selling them to investors. As part of the deal, the Wall Street investment bank agreed to modify loans of more than 700 troubled borrowers.
Attorneys general reached the largest predatory lending settlement a year ago. Bank of America agreed to spend $8.4 billion to lower the interest rates or loan balances of nearly 400,000 Countrywide customers with subprime loans or payment option ARMs.
"This settlement holds the number-one mortgage lender in the country accountable for deceptively putting borrowers into loans they didn't understand, couldn't afford and couldn't get out of," Illinois Attorney General Lisa Madigan, one of the lead negotiators, said at the time. "These are the very practices that have created the economic crisis we're currently experiencing."
Bank of America said the agreement was in the best interest of its customers and investors in mortgage-backed securities, though a group of investors is suing the bank over the settlement terms.
Not as many suits as expected
Despite the increase, there aren't as many lending lawsuits as one might expect, considering the subprime mortgage explosion during the housing boom, experts said.
That's because these suits are expensive and difficult to win. Cases could take anywhere from months to years to resolve. Also, there are not that many attorneys who specialize in consumer law and who want to take on these labor-intensive cases.
Therefore, many troubled homeowners cannot hire attorneys to help them.
"These are not easy cases," said Ira Rheingold, executive director of the National Association of Consumer Advocates.
Also, many of the biggest subprime lenders -- such as New Century Financial --have gone out of business, declared bankruptcy or been put into receivership by the Federal Deposit Insurance Corp.
So there's no one worth suing, said Stuart Rossman, director of litigation at the National Consumer Law Center.
"Litigation has not been the primary avenue for getting someone to pay for what took place," Rossman said
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Now, homeowners and government officials are increasingly taking these institutions to court, alleging unfair and predatory practices. While many of these suits are still winding their way through the legal system, some banks have already settled for millions of dollars.
The defendants include the biggest names in the business -- from Wells Fargo (WFC, Fortune 500) to Countrywide Financial to Citigroup (C, Fortune 500).
"Borrowers are looking to the legal system for help in keeping their houses," said Gary Klein, a partner in Boston-based Roddy Klein & Ryan, which focuses on consumer law. "There are more cases pending than I've ever seen in my 23-year career."
Homeowners are seeking the courts' help either individually or as part of class action lawsuits. With foreclosures continuing to rise, borrowers are looking to force banks to modify unaffordable loans or to stop them from foreclosing on homes. Often, they also seek money.
To be sure, banks have faced unfair lending lawsuits for years and have paid millions of dollars in settlements. But the recent housing boom was fueled by questionable and exotic loans that many borrowers had no hope of repaying.
Some of the cases involve the classic predatory lending schemes, where certain borrowers were given mortgages with high interest rates, while other suits are combating loans that are ultimately unaffordable.
In addition, the mortgage industry preyed on a wider group during the housing boom, capturing more middle-class borrowers. These homeowners have more means to hire attorneys.
Those in more dire financial straits are turning to lawyers who work for non-profit legal services agencies or who agree to seek payment from the banks if they win the case.
Some borrowers who hire lawyers to defend them against a foreclosure sale are successful in getting the courts to stop or delay the proceeding, at least until the bank considers whether a loan modification would be more appropriate.
Then, there are class action suits on behalf of hundreds or thousands of homeowners. In one of his current class action cases, Klein is suing Wells Fargo because one of the banks Wells Fargo now owns originated payment option adjustable-rate mortgages. This type of loan allows borrowers to make very low monthly payments, and the unpaid interest is then added to the principal. Many borrowers end up defaulting on their payments.
The suit's goal is to get Wells Fargo to restructure the borrowers' mortgages to make them affordable, Klein said.
"They are looking for a second chance," he said of the homeowners.
The suit also seeks damages, particularly for those borrowers who've already lost their homes or paid off their loans.
Wells Fargo said it was filing a motion to dismiss the case, calling the claims baseless and a mischaracterization of the bank's long-standing commitment to responsible lending and the pricing practices.
Attorneys general file suit
Meanwhile, state attorneys general are likewise filing suit against the mortgage industry's major players, alleging predatory lending and deceptive business practices. Banks are also getting hit with suits from the NAACP, some cities and individuals claiming discrimination against minority borrowers.
In Massachusetts, Attorney General Martha Coakley reached a $10 million settlement in June with subprime lender Fremont Investment & Loan for its unfair lending practices. The state will distribute $5 million to state residents with Freemont loans, and another $3 million will go foreclosure relief and homeowners education. The rest will go to the state and to cover costs.
The California-based lender agreed to do more loan modifications and not to foreclose upon up to 2,200 loans without notifying the attorney general's office first and seeking court approval in certain circumstances.
"The American dream of homeownership has turned into a nightmare for many borrowers because of predatory lending practices," said Massachusetts Attorney General Martha Coakley, when the settlement was announced in June. "We will continue to hold companies responsible for their role in the foreclosure crisis."
The Fremont settlement came a few months after Coakley negotiated a $60 million settlement with Goldman Sachs (GS, Fortune 500) over its role in bundling subprime loans into securities and selling them to investors. As part of the deal, the Wall Street investment bank agreed to modify loans of more than 700 troubled borrowers.
Attorneys general reached the largest predatory lending settlement a year ago. Bank of America agreed to spend $8.4 billion to lower the interest rates or loan balances of nearly 400,000 Countrywide customers with subprime loans or payment option ARMs.
"This settlement holds the number-one mortgage lender in the country accountable for deceptively putting borrowers into loans they didn't understand, couldn't afford and couldn't get out of," Illinois Attorney General Lisa Madigan, one of the lead negotiators, said at the time. "These are the very practices that have created the economic crisis we're currently experiencing."
Bank of America said the agreement was in the best interest of its customers and investors in mortgage-backed securities, though a group of investors is suing the bank over the settlement terms.
Not as many suits as expected
Despite the increase, there aren't as many lending lawsuits as one might expect, considering the subprime mortgage explosion during the housing boom, experts said.
That's because these suits are expensive and difficult to win. Cases could take anywhere from months to years to resolve. Also, there are not that many attorneys who specialize in consumer law and who want to take on these labor-intensive cases.
Therefore, many troubled homeowners cannot hire attorneys to help them.
"These are not easy cases," said Ira Rheingold, executive director of the National Association of Consumer Advocates.
Also, many of the biggest subprime lenders -- such as New Century Financial --have gone out of business, declared bankruptcy or been put into receivership by the Federal Deposit Insurance Corp.
So there's no one worth suing, said Stuart Rossman, director of litigation at the National Consumer Law Center.
"Litigation has not been the primary avenue for getting someone to pay for what took place," Rossman said
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Saturday, November 21, 2009
Why the Bank Doesn’t Want You to Hire a Lawyer or other Expert…
When a homeowner hires an attorney to help negotiate a loan modification, that attorney is not going to be made to feel ashamed, guilty, or afraid… the borrower can be made to feel all of those things and more, but the lawyer, not so much. He or she is a hired gun, if you will. That’s why the banks don’t want homeowners to be represented, and why they want homeowners to call them directly.
Treasury looks the other way on this “put-the-borrower-through-hell” process because it understands that banks have to make sure that they are not throwing away money by modifying loans for borrowers who would have self-cured. Nor does the government want the banks to modify loans for people who won’t be able to make the modified payment. And since the only way for the bank to really know either of those things is to put the borrowers through their paces, as it were. Many will self-cure, some should be foreclosed upon… blend, shake, stir and pour,,, see what comes out. And of those that fall somewhere in the middle, some will have more or less equity, and some will be in markets where houses are selling relatively faster than others.
Out of that psycho-social-financial-market analysis, the bank will modify some loans… but the process used to conduct the so-called analysis is guaranteed to frustrate the hell out of everyone who enters it that’s determined to obtain a loan modification.
Being represented by an attorney or other expert throughout the process is unquestionably better than not being represented, mostly because that attorney won’t be subject to the bank’s tactics of trying to shame, guilt or scare, and as a result of that, is likely to think more clearly than you would be able to. And also because of the attorney’s or other expert’s knowledge of the law related to the foreclosure process and the HAMP guidelines, that attorney is more likely to get a result that’s acceptable to you, the homeowner… and by acceptable, I mean a modification that’s sustainable over time.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 351-7779. You can also email us at help@nafmainc.org
Treasury looks the other way on this “put-the-borrower-through-hell” process because it understands that banks have to make sure that they are not throwing away money by modifying loans for borrowers who would have self-cured. Nor does the government want the banks to modify loans for people who won’t be able to make the modified payment. And since the only way for the bank to really know either of those things is to put the borrowers through their paces, as it were. Many will self-cure, some should be foreclosed upon… blend, shake, stir and pour,,, see what comes out. And of those that fall somewhere in the middle, some will have more or less equity, and some will be in markets where houses are selling relatively faster than others.
Out of that psycho-social-financial-market analysis, the bank will modify some loans… but the process used to conduct the so-called analysis is guaranteed to frustrate the hell out of everyone who enters it that’s determined to obtain a loan modification.
Being represented by an attorney or other expert throughout the process is unquestionably better than not being represented, mostly because that attorney won’t be subject to the bank’s tactics of trying to shame, guilt or scare, and as a result of that, is likely to think more clearly than you would be able to. And also because of the attorney’s or other expert’s knowledge of the law related to the foreclosure process and the HAMP guidelines, that attorney is more likely to get a result that’s acceptable to you, the homeowner… and by acceptable, I mean a modification that’s sustainable over time.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 351-7779. You can also email us at help@nafmainc.org
Thursday, November 19, 2009
Another wave of foreclosures looms
A second wave of foreclosures is poised to hit the market, potentially undermining housing recovery efforts as more homes add to the glut of inventory and drive down prices. These homes largely represent loans that are delinquent but have not yet resulted in foreclosure sales.
About 7 million properties are destined to go into foreclosure, according to a September study by Amherst Securities Group, compared with 1.27 million properties in early 2005.
"There's a huge supply out there," says Dean Baker, co-director of the Center for Economic and Policy Research in Washington, D.C. "The foreclosure process can take a long time. When it comes to (the housing recovery), we're not home free."
There is often a long lag time between a borrower going delinquent and the bank taking the home. Here's why:
•Moratoriums. New state laws imposing short-term moratoriums have slowed the timeline from delinquency to foreclosure.
•Overwhelmed lenders. Banks dealing with a surge in refinancing, mortgage modifications and defaults are overwhelmed with demand, so it can take longer to initiate a foreclosure sale.
•Modifications. Many loans now are first examined to see if they might qualify for a modification. This drags out the timeline and means it is taking longer for homes to go into foreclosure.
•Asset write-downs. Banks may in part be waiting to liquidate homes through foreclosure because they don't want to write down the value of the asset. Lenders can keep homes on the books at a higher value until they are sold at foreclosure.
"There is a lot of foreclosed property in the pipeline that will hit the market and depress prices," says Mark Zandi at Moody's Economy.com. Foreclosed homes often sell at prices below those on the market and can therefore drag down overall home values.
The shadow market of foreclosed homes eclipses the number of homes lost this year. Zandi anticipates there will be about 2.4 million homes lost next year through foreclosure, short sales and deeds in lieu of foreclosure. That compares with 2 million homes lost in 2009.
Jumana Bauwens, a spokeswoman at Bank of America, says the bank is projecting an increase in foreclosures in part because customers will not be qualifying for existing loan-modification programs.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
About 7 million properties are destined to go into foreclosure, according to a September study by Amherst Securities Group, compared with 1.27 million properties in early 2005.
"There's a huge supply out there," says Dean Baker, co-director of the Center for Economic and Policy Research in Washington, D.C. "The foreclosure process can take a long time. When it comes to (the housing recovery), we're not home free."
There is often a long lag time between a borrower going delinquent and the bank taking the home. Here's why:
•Moratoriums. New state laws imposing short-term moratoriums have slowed the timeline from delinquency to foreclosure.
•Overwhelmed lenders. Banks dealing with a surge in refinancing, mortgage modifications and defaults are overwhelmed with demand, so it can take longer to initiate a foreclosure sale.
•Modifications. Many loans now are first examined to see if they might qualify for a modification. This drags out the timeline and means it is taking longer for homes to go into foreclosure.
•Asset write-downs. Banks may in part be waiting to liquidate homes through foreclosure because they don't want to write down the value of the asset. Lenders can keep homes on the books at a higher value until they are sold at foreclosure.
"There is a lot of foreclosed property in the pipeline that will hit the market and depress prices," says Mark Zandi at Moody's Economy.com. Foreclosed homes often sell at prices below those on the market and can therefore drag down overall home values.
The shadow market of foreclosed homes eclipses the number of homes lost this year. Zandi anticipates there will be about 2.4 million homes lost next year through foreclosure, short sales and deeds in lieu of foreclosure. That compares with 2 million homes lost in 2009.
Jumana Bauwens, a spokeswoman at Bank of America, says the bank is projecting an increase in foreclosures in part because customers will not be qualifying for existing loan-modification programs.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Mortgage delinquencies hit record-high in 3Q
More than 14% of American homeowners with a mortgage were either behind on their payments or in foreclosure at the end of September, a record-high for the ninth straight quarter and a problem that could threaten the U.S. economic recovery.
The Mortgage Bankers Association's report Thursday adds to fears that the housing market and broader recovery could be thwarted by the continuing surge in home loan defaults, especially as the unemployment rate keeps rising. Lost jobs, rather than the shady loans made during the housing boom, are now the main reason homeowners fall behind on their mortgages.
After three years of plunging prices, the housing market started to rebound this summer. While optimists hope the worst is over, pessimists say there are simply too many foreclosed properties that have yet to be dumped on the market and expect further price declines.
About 4 million U.S. homeowners were either in foreclosure or at least three months behind on their mortgage payments as of September, according to the mortgage bankers group. Even if a quarter of those borrowers are able to stay in their homes, "there's a lot of potential inventory coming into the market next year," said Jay Brinkmann, chief economist with the Mortgage Bankers Association.
Those foreclosures will push home prices downward, especially in the hardest-hit California and Florida cities, places that are also coping with soaring unemployment, he said.
The record-high foreclosure numbers are being driven by borrowers with traditional fixed-rate mortgages, rather than the shady subprime loans with adjustable rates that kicked off the mortgage crisis.
Fixed-rate loans made to so-called prime borrowers with good credit histories caused nearly 33% of new foreclosures in the July-September quarter, compared with 21% a year ago.
Subprime loans with adjustable rates have fallen to 16% of new foreclosures from 35% a year earlier.
Loans backed by the Federal Housing Administration also show increasing signs of trouble. More than 18% of FHA borrowers are at least one payment behind or in foreclosure.
Among states, the worst of the trouble is still concentrated in California, Nevada, Arizona and Florida, which accounted for 44% of new foreclosures in the country. Nearly 13% of all loans in Florida were in foreclosure, the highest in the U.S., followed by Nevada at more than 9%.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
The Mortgage Bankers Association's report Thursday adds to fears that the housing market and broader recovery could be thwarted by the continuing surge in home loan defaults, especially as the unemployment rate keeps rising. Lost jobs, rather than the shady loans made during the housing boom, are now the main reason homeowners fall behind on their mortgages.
After three years of plunging prices, the housing market started to rebound this summer. While optimists hope the worst is over, pessimists say there are simply too many foreclosed properties that have yet to be dumped on the market and expect further price declines.
About 4 million U.S. homeowners were either in foreclosure or at least three months behind on their mortgage payments as of September, according to the mortgage bankers group. Even if a quarter of those borrowers are able to stay in their homes, "there's a lot of potential inventory coming into the market next year," said Jay Brinkmann, chief economist with the Mortgage Bankers Association.
Those foreclosures will push home prices downward, especially in the hardest-hit California and Florida cities, places that are also coping with soaring unemployment, he said.
The record-high foreclosure numbers are being driven by borrowers with traditional fixed-rate mortgages, rather than the shady subprime loans with adjustable rates that kicked off the mortgage crisis.
Fixed-rate loans made to so-called prime borrowers with good credit histories caused nearly 33% of new foreclosures in the July-September quarter, compared with 21% a year ago.
Subprime loans with adjustable rates have fallen to 16% of new foreclosures from 35% a year earlier.
Loans backed by the Federal Housing Administration also show increasing signs of trouble. More than 18% of FHA borrowers are at least one payment behind or in foreclosure.
Among states, the worst of the trouble is still concentrated in California, Nevada, Arizona and Florida, which accounted for 44% of new foreclosures in the country. Nearly 13% of all loans in Florida were in foreclosure, the highest in the U.S., followed by Nevada at more than 9%.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Monday, November 9, 2009
Hundreds of loan modification complaints filed against Bank of America
Hundreds of struggling Florida homeowners have filed complaints with Florida Attorney General Bill McCollum in the past year about failed or stalled home mortgage loan modifications with Bank of America.
Angry borrowers, desperate to hold on to their homes, say they've made dozens of calls to their lender and spent months asking for a change in their loan terms, only to be denied or to learn that Bank of America revoked their loan modifications a few months after they reached a deal.
"I wrote letters to the governor, I called the bank every single month," said Yvonne McBride, a disabled former state worker who received a loan modification for the Sunrise home she shares with husband Herman Acosta. But the bank retracted the deal – after, she said, she'd paid more than $9,200 to cover mortgage payments through next January.
"When they said I was noncompliant [with the terms of the loan] I said, 'What?' " McBride said.
The Attorney General's Office has logged 452 complaints about Bank of America, Florida's largest mortgage lender, concerning mortgages and loan modifications. With its acquisition of Countrywide Financial last year, Bank of America had almost 82,000 mortgage loans outstanding in Florida worth $15.3 billion in 2008, according to National Mortgage News.
Next largest is JP Morgan Chase, which had almost 69,000 mortgage loans in Florida. JP Morgan Chase has 69 complaints on file at the Attorney General's Office. Wells Fargo, which acquired Wachovia, has a combined 51 complaints on file and almost 57,000 mortgage loans in Florida.
Bank of America's spokesman Rick Simon would not comment on the volume of complaints. But he said that in individual cases, some customers are not providing necessary financial information or have not been communicating with the bank.
"Bank of America has been more aggressively pushing loan modification and foreclosure assistance than anyone else," said economist Ken Thomas, an independent banking consultant from Miami. Thomas is not a consultant to Bank of America. He said the bank may have more complaints than others because it is interacting with more borrowers. "The biggest lender in South Florida was Countrywide and they are under more scrutiny and making a bigger effort than anyone else," he said.
The Attorney General's Office is responding individually to those who complain, providing borrowers with information on mortgage fraud, the state's legal settlement with Bank of America calling for foreclosure relief, and suggesting that borrowers contact federal regulators and local attorneys. The complaints are also being sent to the lender involved.
Spokeswoman Ryan Wiggins of the Attorney General's Office said the complaints are being reviewed to determine the validity of the claims.
One year ago, McCollum, who is a candidate for governor, reached a settlement with Bank of America that was supposed to provide $150 million in foreclosure relief nationwide for its borrowers.
Under the terms of the settlement, Bank of America was to launch a loan modification program that would help 52,000 Florida homeowners get new mortgage loans.
"Bank of America has stated its willingness to cooperate in our investigation," Wiggins said.
But until the complaints from borrowers have been reviewed, Wiggins said, she could not answer the question of whether Bank of America is complying with the settlement.
Bank of America told the state it has modified more than 10,000 loans in Florida through June of this year.
Millions of troubled borrowers nationwide are candidates for loan modifications.
In Washington, the Obama administration has promoted its program to entice lenders to offer loan modifications as a key tactic to turn around the troubled housing market. The Making Home Affordable program – which says payments are past due on 3.1 million loans nationwide -- pays lenders to offer modifications.
But borrowers in Florida have run into a logjam. Stories abound of loan modifications taking months or even a year to complete.
The complaints at McCollum's office also include those from borrowers like McBride who say they completed a deal, only to have a bank revoke it..
McBride provided the Sun Sentinel with copies of notarized paperwork showing the loan modification process had been completed for her home. It took place in February.
Of McBride, Bank of America spokesman Simon said in an e-mail, "The loan modification had to be declined because the borrowers did not provide necessary documentation of financial information in a timely fashion, despite three contacts with a home retention specialist over a 12-day period."
McBride said she doesn't know what the bank is talking about.
Nicholas Gonzalez-Pardo has filed complaints with the attorney general and the federal agency that regulates national banks, the Comptroller of the Currency, over a similar story, saying Bank of America accepted his payments for six months for his home in Sebastian and then told him he did not qualify for a loan modification.
"I feel like I have nowhere to turn, the deck is stacked against me," he said.
Bank of America's Smith said Gonzalez-Pardo's modification actually begins in November, but Gonzalez-Pardo disputes that. The bank spokesman also said the bank has tried to reach Gonzalez-Pardo several times to discuss the situation.
If Bank of America is found to not be in compliance with the state's settlement, Wiggins said the state could return to court and ask for penalties, fines and attorneys fees.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
For more on this story click on the following link: http://www.sun-sentinel.com/business/sfl-loan-modification-103009,0,2675667.story
Angry borrowers, desperate to hold on to their homes, say they've made dozens of calls to their lender and spent months asking for a change in their loan terms, only to be denied or to learn that Bank of America revoked their loan modifications a few months after they reached a deal.
"I wrote letters to the governor, I called the bank every single month," said Yvonne McBride, a disabled former state worker who received a loan modification for the Sunrise home she shares with husband Herman Acosta. But the bank retracted the deal – after, she said, she'd paid more than $9,200 to cover mortgage payments through next January.
"When they said I was noncompliant [with the terms of the loan] I said, 'What?' " McBride said.
The Attorney General's Office has logged 452 complaints about Bank of America, Florida's largest mortgage lender, concerning mortgages and loan modifications. With its acquisition of Countrywide Financial last year, Bank of America had almost 82,000 mortgage loans outstanding in Florida worth $15.3 billion in 2008, according to National Mortgage News.
Next largest is JP Morgan Chase, which had almost 69,000 mortgage loans in Florida. JP Morgan Chase has 69 complaints on file at the Attorney General's Office. Wells Fargo, which acquired Wachovia, has a combined 51 complaints on file and almost 57,000 mortgage loans in Florida.
Bank of America's spokesman Rick Simon would not comment on the volume of complaints. But he said that in individual cases, some customers are not providing necessary financial information or have not been communicating with the bank.
"Bank of America has been more aggressively pushing loan modification and foreclosure assistance than anyone else," said economist Ken Thomas, an independent banking consultant from Miami. Thomas is not a consultant to Bank of America. He said the bank may have more complaints than others because it is interacting with more borrowers. "The biggest lender in South Florida was Countrywide and they are under more scrutiny and making a bigger effort than anyone else," he said.
The Attorney General's Office is responding individually to those who complain, providing borrowers with information on mortgage fraud, the state's legal settlement with Bank of America calling for foreclosure relief, and suggesting that borrowers contact federal regulators and local attorneys. The complaints are also being sent to the lender involved.
Spokeswoman Ryan Wiggins of the Attorney General's Office said the complaints are being reviewed to determine the validity of the claims.
One year ago, McCollum, who is a candidate for governor, reached a settlement with Bank of America that was supposed to provide $150 million in foreclosure relief nationwide for its borrowers.
Under the terms of the settlement, Bank of America was to launch a loan modification program that would help 52,000 Florida homeowners get new mortgage loans.
"Bank of America has stated its willingness to cooperate in our investigation," Wiggins said.
But until the complaints from borrowers have been reviewed, Wiggins said, she could not answer the question of whether Bank of America is complying with the settlement.
Bank of America told the state it has modified more than 10,000 loans in Florida through June of this year.
Millions of troubled borrowers nationwide are candidates for loan modifications.
In Washington, the Obama administration has promoted its program to entice lenders to offer loan modifications as a key tactic to turn around the troubled housing market. The Making Home Affordable program – which says payments are past due on 3.1 million loans nationwide -- pays lenders to offer modifications.
But borrowers in Florida have run into a logjam. Stories abound of loan modifications taking months or even a year to complete.
The complaints at McCollum's office also include those from borrowers like McBride who say they completed a deal, only to have a bank revoke it..
McBride provided the Sun Sentinel with copies of notarized paperwork showing the loan modification process had been completed for her home. It took place in February.
Of McBride, Bank of America spokesman Simon said in an e-mail, "The loan modification had to be declined because the borrowers did not provide necessary documentation of financial information in a timely fashion, despite three contacts with a home retention specialist over a 12-day period."
McBride said she doesn't know what the bank is talking about.
Nicholas Gonzalez-Pardo has filed complaints with the attorney general and the federal agency that regulates national banks, the Comptroller of the Currency, over a similar story, saying Bank of America accepted his payments for six months for his home in Sebastian and then told him he did not qualify for a loan modification.
"I feel like I have nowhere to turn, the deck is stacked against me," he said.
Bank of America's Smith said Gonzalez-Pardo's modification actually begins in November, but Gonzalez-Pardo disputes that. The bank spokesman also said the bank has tried to reach Gonzalez-Pardo several times to discuss the situation.
If Bank of America is found to not be in compliance with the state's settlement, Wiggins said the state could return to court and ask for penalties, fines and attorneys fees.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
For more on this story click on the following link: http://www.sun-sentinel.com/business/sfl-loan-modification-103009,0,2675667.story
Bankruptcy Court Wipes Out $461,263 Mortgage!
On October 9, 2009, a federal bankruptcy court in the Southern District of New York ruled that a servicer, PHH Mortgage, could not prove its claim to the debt owed on a home in White Plains, New York. Instead, Judge Robert D. Drain wiped out the entire $461,263 mortgage debt on the property.
We all know the story too well. A homeowner falls behind in her mortgage payments. The bank sues to foreclose. And without an attorney, the bank wins and the homeowner has to move out.
Not this time. Initially the homeowner hired a bankruptcy lawyer in an attempt to modify her loan with PHH. After months of getting nowhere fast with that, her lawyer asked for proof from PHH that they had the right to sue his client. PHH wrote a letter in response saying that it was the servicer of the loan, but that the holder of the note was U.S. Bank. So her lawyer asked for proof that U.S. Bank was the actual holder. He got an affidavit from the vice president for PHH, saying that PHH was the servicer for the note held by US Bank. This same vice president also signed the assignment of this mortgage to the Mortgage Electronic Registration System, better known as M.E.R.S. This document also showed that the note was assigned to M.E.R.S. was signed well past the filing of the action. That means PHH sued on behalf of U.S. Bank before it had any claim to the property by the assignment.
PHH's attorney even admitted at the hearing that, “In the secondary market, there are many cases where assignment of mortgages, assignment of notes, don’t happen at the time they should. It was standard operating procedure for many years.” In rejecting the argument, Judge Drain responded, saying “I think that I have a more than 50 percent doubt that if the debtor paid this claim, it would be paying the wrong person. That’s the problem. And that’s because the claimant has not shown an assignment of a mortgage.”
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
We all know the story too well. A homeowner falls behind in her mortgage payments. The bank sues to foreclose. And without an attorney, the bank wins and the homeowner has to move out.
Not this time. Initially the homeowner hired a bankruptcy lawyer in an attempt to modify her loan with PHH. After months of getting nowhere fast with that, her lawyer asked for proof from PHH that they had the right to sue his client. PHH wrote a letter in response saying that it was the servicer of the loan, but that the holder of the note was U.S. Bank. So her lawyer asked for proof that U.S. Bank was the actual holder. He got an affidavit from the vice president for PHH, saying that PHH was the servicer for the note held by US Bank. This same vice president also signed the assignment of this mortgage to the Mortgage Electronic Registration System, better known as M.E.R.S. This document also showed that the note was assigned to M.E.R.S. was signed well past the filing of the action. That means PHH sued on behalf of U.S. Bank before it had any claim to the property by the assignment.
PHH's attorney even admitted at the hearing that, “In the secondary market, there are many cases where assignment of mortgages, assignment of notes, don’t happen at the time they should. It was standard operating procedure for many years.” In rejecting the argument, Judge Drain responded, saying “I think that I have a more than 50 percent doubt that if the debtor paid this claim, it would be paying the wrong person. That’s the problem. And that’s because the claimant has not shown an assignment of a mortgage.”
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Wednesday, September 9, 2009
Don't Try This at Home or You Just Might Lose it; Your Mind and Your Home!
Thinking of negotiating a loan modification on your own?
STOP! Before you venture forth into the land of 45 minute holds, 9 digit extensions and dropped calls, I encourage you to grab a seat and watch the following video.
Congresswoman Maxine Waters spent hours on end testing the loan modification approval process with "Bank of America" and "Indymac" only to be placed on hold, misdirected and told to complete an online application before any definitive information could be provided. To make matters worse, the people on the other end knew they were talking to a member of Congress and still proceeded to place her on hold. At one point she was given an extension that didnt work and in the end nothing was done to resolve the problem for any one of her constituants.
THE MORAL OF THE STORY?: You only get one chance at a loan modification. Make it count! Have your loan documents evaluated for predatory lending practices and mortgage fraud before hiring a professional to negotiate on your behalf. If you've already been served with foreclosure papers, hire an attorney that specializes in foreclosure defense to represent you in stopping the foreclosure.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
STOP! Before you venture forth into the land of 45 minute holds, 9 digit extensions and dropped calls, I encourage you to grab a seat and watch the following video.
Congresswoman Maxine Waters spent hours on end testing the loan modification approval process with "Bank of America" and "Indymac" only to be placed on hold, misdirected and told to complete an online application before any definitive information could be provided. To make matters worse, the people on the other end knew they were talking to a member of Congress and still proceeded to place her on hold. At one point she was given an extension that didnt work and in the end nothing was done to resolve the problem for any one of her constituants.
THE MORAL OF THE STORY?: You only get one chance at a loan modification. Make it count! Have your loan documents evaluated for predatory lending practices and mortgage fraud before hiring a professional to negotiate on your behalf. If you've already been served with foreclosure papers, hire an attorney that specializes in foreclosure defense to represent you in stopping the foreclosure.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Thursday, August 27, 2009
Wells Fargo Ordered to Testify on Loan Modification Practices
[Scroll down to view video]
When it comes to obtaining a loan modification, Wells Fargo’s reputation is a long way from being stellar. In fact, they’re one of the worst, according to several attorneys who have had significant experience working with the bank on behalf of clients over the past six months. So, when I read this past week that a woman in Phoenix had filed a complaint claiming that Wells Fargo had ignored her request for a modification, it was hardly news to me.
According to a story from KPHO.com, Channel 5 in Phoenix, the woman’s name is Bobbi Giguere, and apparently she applied to Wells Fargo for a modification this past December after losing her job, and got nothing but lies, the run-a-round, and finally a foreclosure notice in return. The KPHO.com story quoted her as saying:
“I sent them everything they asked for, and then when I called to follow up they said, ‘What paperwork? What modification? We don’t know what you’re talking about,’” said Bobbi Giguere.
So, now a federal bankruptcy judge in Phoenix, Judge Randolph Haines, has ordered that a top Wells Fargo executive must come and testify about the bank’s loan modification policies.
Ms. Giguere’s bankruptcy attorney was also quoted in the story as saying that it’s “very unusual” for a judge to issue such an order. “The judge is trying to send a message to Wells Fargo and other banks that they need to pay better attention to customers who want to modify their home loans,” Nussbaum told Phoenix’s Channel 5.
Okay, so what? Big deal, right? Yet another story about a bank or servicer not doing what they’re supposed to do under the president’s Making Home Affordable program. Well, here’s the rub…
Again, according to the KPHO.com story, Wells Fargo responded by issuing the following statement from Mary Coffin, the bank’s head of home mortgage servicing. It said:
“We appreciate the court giving us the opportunity to share our servicing practices, which include working with all customers facing hardships — even if they declare bankruptcy — until every reasonable option to prevent foreclosure has been exhausted.”
The bank “appreciates” the court providing the opportunity to “share” servicing practices? Does anyone not see just how far from contrition we are here. We, and by “we” I mean anyone involved in obtaining loan modifications from servicers, all know what’s going on here… Wells Fargo is full of you know what.
They routinely deny having received paperwork, routinely refuse to comply with the rules of the president’s program, and obviously aren’t the slightest bit concerned that they be called to task for their widely known shortcomings that are putting people out of their homes and onto the street. Their practices are costing our president a great deal of credibility, and preventing our economy from even coming close to starting on a path to recovery.
CBS 5 News also reported that after running the story, many other homeowners contacted the station, “sharing remarkably similar frustrations”.
According to the station:
“Getting the runaround about lost paperwork was amongst the most common complaint. The complaints came from customers using a variety of loan providers, including but not limited to Wells Fargo and Bank of America.”
Channel 5 also quoted Arizona Attorney General Terry Goddard as giving banks and servicers “a D minus” when he was asked to grade them as related to helping homeowners obtain loan modifications. He went on to refer to the servicers’ response to the president’s program as “pathetic”.
Apparently, Channel 5 called Wells Fargo for a comment on the case and Ms. Coffin replied that the bank “could have offered better customer service and definitely could have communicated better.” Well, gee golly whiz… could they now? Is that all they could have done?
Listen, I’ve had enough with the sugarcoating that surrounds this issue. What the bank/servicer could have done is live up to its agreement to participate in the Making Home Affordable program. Wells Fargo took billions of dollars from taxpayers and they agreed to the terms of the president’s program. They need to live up to that agreement and they’re not… not even close. What was the percentage of Wells Fargo loans modified under the program that was reported last week in the administration’s “report card”?
Oh yeah… 6%. And in response, Wells Fargo’s Mike Heid, co-president of Wells Fargo’s mortgage unit issued the following statement:
“We know we’ve fallen short of our customer service goals in some cases.”
They’ve got to be kidding.
According to Phoenix’s Channel 5, “a Wells Fargo executive is scheduled to testify in federal court on September 3rd. The hearing was originally scheduled for this week, but the judge granted Wells Fargo an additional two weeks to research internal records and prepare their case.”
Wells Fargo needed a little extra time? In my view, they should have been given the same amount of extra time they’ve too often given homeowners before they’ve foreclosed on their homes… none.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you believe you or someone you know has been a victim of Predatory Lending and/or Mortgage Fraud, please call the following number TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
When it comes to obtaining a loan modification, Wells Fargo’s reputation is a long way from being stellar. In fact, they’re one of the worst, according to several attorneys who have had significant experience working with the bank on behalf of clients over the past six months. So, when I read this past week that a woman in Phoenix had filed a complaint claiming that Wells Fargo had ignored her request for a modification, it was hardly news to me.
According to a story from KPHO.com, Channel 5 in Phoenix, the woman’s name is Bobbi Giguere, and apparently she applied to Wells Fargo for a modification this past December after losing her job, and got nothing but lies, the run-a-round, and finally a foreclosure notice in return. The KPHO.com story quoted her as saying:
“I sent them everything they asked for, and then when I called to follow up they said, ‘What paperwork? What modification? We don’t know what you’re talking about,’” said Bobbi Giguere.
So, now a federal bankruptcy judge in Phoenix, Judge Randolph Haines, has ordered that a top Wells Fargo executive must come and testify about the bank’s loan modification policies.
Ms. Giguere’s bankruptcy attorney was also quoted in the story as saying that it’s “very unusual” for a judge to issue such an order. “The judge is trying to send a message to Wells Fargo and other banks that they need to pay better attention to customers who want to modify their home loans,” Nussbaum told Phoenix’s Channel 5.
Okay, so what? Big deal, right? Yet another story about a bank or servicer not doing what they’re supposed to do under the president’s Making Home Affordable program. Well, here’s the rub…
Again, according to the KPHO.com story, Wells Fargo responded by issuing the following statement from Mary Coffin, the bank’s head of home mortgage servicing. It said:
“We appreciate the court giving us the opportunity to share our servicing practices, which include working with all customers facing hardships — even if they declare bankruptcy — until every reasonable option to prevent foreclosure has been exhausted.”
The bank “appreciates” the court providing the opportunity to “share” servicing practices? Does anyone not see just how far from contrition we are here. We, and by “we” I mean anyone involved in obtaining loan modifications from servicers, all know what’s going on here… Wells Fargo is full of you know what.
They routinely deny having received paperwork, routinely refuse to comply with the rules of the president’s program, and obviously aren’t the slightest bit concerned that they be called to task for their widely known shortcomings that are putting people out of their homes and onto the street. Their practices are costing our president a great deal of credibility, and preventing our economy from even coming close to starting on a path to recovery.
CBS 5 News also reported that after running the story, many other homeowners contacted the station, “sharing remarkably similar frustrations”.
According to the station:
“Getting the runaround about lost paperwork was amongst the most common complaint. The complaints came from customers using a variety of loan providers, including but not limited to Wells Fargo and Bank of America.”
Channel 5 also quoted Arizona Attorney General Terry Goddard as giving banks and servicers “a D minus” when he was asked to grade them as related to helping homeowners obtain loan modifications. He went on to refer to the servicers’ response to the president’s program as “pathetic”.
Apparently, Channel 5 called Wells Fargo for a comment on the case and Ms. Coffin replied that the bank “could have offered better customer service and definitely could have communicated better.” Well, gee golly whiz… could they now? Is that all they could have done?
Listen, I’ve had enough with the sugarcoating that surrounds this issue. What the bank/servicer could have done is live up to its agreement to participate in the Making Home Affordable program. Wells Fargo took billions of dollars from taxpayers and they agreed to the terms of the president’s program. They need to live up to that agreement and they’re not… not even close. What was the percentage of Wells Fargo loans modified under the program that was reported last week in the administration’s “report card”?
Oh yeah… 6%. And in response, Wells Fargo’s Mike Heid, co-president of Wells Fargo’s mortgage unit issued the following statement:
“We know we’ve fallen short of our customer service goals in some cases.”
They’ve got to be kidding.
According to Phoenix’s Channel 5, “a Wells Fargo executive is scheduled to testify in federal court on September 3rd. The hearing was originally scheduled for this week, but the judge granted Wells Fargo an additional two weeks to research internal records and prepare their case.”
Wells Fargo needed a little extra time? In my view, they should have been given the same amount of extra time they’ve too often given homeowners before they’ve foreclosed on their homes… none.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you believe you or someone you know has been a victim of Predatory Lending and/or Mortgage Fraud, please call the following number TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Monday, August 24, 2009
Sleazy Servicing Companies
AP News reported recently that mortgage servicers, the same mortgage servicers that have received and continue to receive hundreds of millions in federal funds to modify mortgages as part of President Obama’s Making Home Affordable program, are engaging in practices that would make the worst loan modification company in history look like the Boy Scouts of America.
According to the AP’s report, which came out today:
Julia Gordon, senior policy counsel with the Center for Responsible Lending, was quoted by AP as saying: “Servicers have flown under the regulatory radar.”
The AP story also described the plight of Jerry Turner, who was promised a loan modification as part of a court ordered settlement, but instead his loan’s servicer, Select Portfolio, foreclosed on the property and then the bank took the house back at auction.
It gets worse… Select Portfolio never told Turner that his house had been sold. And they kept sending Turner invoices and continued cashing his monthly checks. Incredibly, Mr. Turner didn’t find out that he had lost his home until it was sold a second time at auction – because Select Portfolio failed to pay the property taxes on the home on which they had long since foreclosed. There’s a lawsuit pending in West Virginia courts, it should come as little surprise.
According to AP, “Many servicers in line for government money are accused of ongoing, systematic abuses”. Read that again. “Many” servicers? “Many”? I don’t remember hearing that during Obama’s speech on the Making Home Affordable program… or on the news at anytime since.
Select Portfolio, as part of its 2003 settlement with government regulators, pledged to stop collecting illegal fees and forcing borrowers to buy insurance. But the company is now owned by Credit Suisse, and since then they’ve been sued dozens of times for the same sort of thing.
And check this out: Craig Bullock, a spokesman for Select Portfolio, said the company doesn’t comment on inquiries “about our practices and so forth.”
Is that right, Craigers, you spineless sycophant? What is it that the company does comment on?
How about I write up all the crap you’re company has obviously been involved in… and I mail it in an invitation style envelope to your Mom. How would that be, Craigy-poo? Do you think you could comment on that, ass-face?
Another servicer, Ocwen, is apparently in line to receive more than $500 million from the Treasury, but is defending a federal class-action suit for harassing homeowners, charging illegal fees, and adding unnecessary insurance premiums to borrowers’ bills. The complaint states that Ocwen was involved in:
“A nationwide scheme of illegal, unfair, unlawful, and deceptive business practices.”
Get involved in a national scheme of illegal, unfair, unlawful, and deceptive business practices that harm homeowners and cause them to lose their homes, and this government’s response seems to be: No problem, Sir, the line for the $500 million is right over there.”
Get involved in trying to help homeowners get their mortgages modified and they’ll shut you down, call you a scammer, and possibly even file criminal charges… because you failed to give someone 100% of their money back in 72 hours after working on the file for six months.
Paul Koches, Ocwen’s general counsel, in an email said: “We have a deep and continuing commitment to foreclosure prevention.” Jackass.
Now, please pay particular attention to this next part:
According to AP, at least 28 other mortgage servicing companies on Treasury’s list also have been charged with, and in many cases settled, similar accusations.
And Treasury still says that it has no choice but to work with all servicers, no matter how dubious their records. Treasury spokeswoman Jenni Engebretsen said that refusing to work with a particularly bad player would “deprive homeowners who have mortgages with that servicer from getting modifications.”
Oh, I see. Like the way working with those servicers is getting people modifications now, Jenni? Well, I suppose it’s working 9% of the time, according to data published today (August 4th) by the U.S Treasury.
President Obama, Secretary Geithner… this isn’t funny… you guys should be ashamed of what you’ve done here. And the fact that neither of you have had the decency to say anything to the American people, the fact that you paid these corporate hooligans hundreds of millions while people were losing their homes and their jobs… well, it is repulsive.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
According to the AP’s report, which came out today:
- At least 30 servicers are being sued for charging illegally high fees, using illegal collection practices, and foreclosing on homes prematurely.
- At least 14 have been accused lying to homeowners about whether they would qualify for loan modifications or how low their payments would be if they did receive a modification. And in many cases, the servicers are accused of telling borrowers not to make payments because their applications for modification were being reviewed… and then moving to foreclosure anyway.
Julia Gordon, senior policy counsel with the Center for Responsible Lending, was quoted by AP as saying: “Servicers have flown under the regulatory radar.”
The AP story also described the plight of Jerry Turner, who was promised a loan modification as part of a court ordered settlement, but instead his loan’s servicer, Select Portfolio, foreclosed on the property and then the bank took the house back at auction.
It gets worse… Select Portfolio never told Turner that his house had been sold. And they kept sending Turner invoices and continued cashing his monthly checks. Incredibly, Mr. Turner didn’t find out that he had lost his home until it was sold a second time at auction – because Select Portfolio failed to pay the property taxes on the home on which they had long since foreclosed. There’s a lawsuit pending in West Virginia courts, it should come as little surprise.
According to AP, “Many servicers in line for government money are accused of ongoing, systematic abuses”. Read that again. “Many” servicers? “Many”? I don’t remember hearing that during Obama’s speech on the Making Home Affordable program… or on the news at anytime since.
Select Portfolio, as part of its 2003 settlement with government regulators, pledged to stop collecting illegal fees and forcing borrowers to buy insurance. But the company is now owned by Credit Suisse, and since then they’ve been sued dozens of times for the same sort of thing.
And check this out: Craig Bullock, a spokesman for Select Portfolio, said the company doesn’t comment on inquiries “about our practices and so forth.”
Is that right, Craigers, you spineless sycophant? What is it that the company does comment on?
How about I write up all the crap you’re company has obviously been involved in… and I mail it in an invitation style envelope to your Mom. How would that be, Craigy-poo? Do you think you could comment on that, ass-face?
Another servicer, Ocwen, is apparently in line to receive more than $500 million from the Treasury, but is defending a federal class-action suit for harassing homeowners, charging illegal fees, and adding unnecessary insurance premiums to borrowers’ bills. The complaint states that Ocwen was involved in:
“A nationwide scheme of illegal, unfair, unlawful, and deceptive business practices.”
Get involved in a national scheme of illegal, unfair, unlawful, and deceptive business practices that harm homeowners and cause them to lose their homes, and this government’s response seems to be: No problem, Sir, the line for the $500 million is right over there.”
Get involved in trying to help homeowners get their mortgages modified and they’ll shut you down, call you a scammer, and possibly even file criminal charges… because you failed to give someone 100% of their money back in 72 hours after working on the file for six months.
Paul Koches, Ocwen’s general counsel, in an email said: “We have a deep and continuing commitment to foreclosure prevention.” Jackass.
Now, please pay particular attention to this next part:
According to AP, at least 28 other mortgage servicing companies on Treasury’s list also have been charged with, and in many cases settled, similar accusations.
And Treasury still says that it has no choice but to work with all servicers, no matter how dubious their records. Treasury spokeswoman Jenni Engebretsen said that refusing to work with a particularly bad player would “deprive homeowners who have mortgages with that servicer from getting modifications.”
Oh, I see. Like the way working with those servicers is getting people modifications now, Jenni? Well, I suppose it’s working 9% of the time, according to data published today (August 4th) by the U.S Treasury.
President Obama, Secretary Geithner… this isn’t funny… you guys should be ashamed of what you’ve done here. And the fact that neither of you have had the decency to say anything to the American people, the fact that you paid these corporate hooligans hundreds of millions while people were losing their homes and their jobs… well, it is repulsive.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you or someone you know is a victim of Predatory Lending and/or Mortgage Fraud, please call NAFMA TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Friday, August 14, 2009
Lenders Collect a TON of Fees On Foreclosures!
If you've ever thought to yourself "Isnt it in my mortgage company's best interest to work with me and keep me in the property considering how much they stand to lose in a foreclosure sale?" If so, think again. It's already common knowledge that lenders couldnt care less about you or where you end up if you lose your home. But to make matters worse, according to the following artical posted in the New York Times just recently, lenders may be reluctant to help homeowners in financial trouble because they actually collect a TON of fees on homes in foreclosure! Interested? Read on.
This week, the Obama administration summoned mortgage company executives to Washington to demand they move faster to lower payments for homeowners sliding toward foreclosure. Treasury officials called on the companies to hire and train more people quickly to field applications for relief.
But industry insiders and legal experts say the limited capacity of mortgage companies is not the primary factor impeding the government’s $75 billion program to prevent foreclosures. Instead, it is that many mortgage companies are reluctant to give strapped homeowners a break because the companies collect lucrative fees on delinquent loans.
Even when borrowers stop paying, mortgage companies that service the loans collect fees out of the proceeds when homes are ultimately sold in foreclosure. So the longer borrowers remain delinquent, the greater the opportunities for these mortgage companies to extract revenue — fees for insurance, appraisals, title searches and legal services.
“It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen,” said Margery Golant, a Florida lawyer who defends homeowners against foreclosure and who worked in the law department of a major mortgage company, Ocwen Financial. “I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want.”
Reluctant to modify loans?
Rich Miller, a governance project manager at Countrywide Financial and Bank of America before he left in January, said Bank of America had been reluctant to modify loans, which hurt the bottom line. The company has been waiting and hoping the economy will improve and delinquent customers will resume making payments, he said.
“That’s the short-term strategy,” said Mr. Miller, who oversaw training programs at Countrywide, which was bought by Bank of America. He now works as an industry consultant.
Bank of America disputed that characterization. “To think that somehow or other we would jeopardize investor relationships and customer relationships for the very small incremental income we would receive by delaying seems ludicrous,” said Robert V. James, the bank’s senior vice president for mortgage operations and insurance. “It’s not the right thing to do.”
Mortgage companies, some of which are affiliated with the nation’s largest banks, are paid to manage pools of loans owned by investors. The companies typically collect a percentage of the value of the loans they service. They extract their share regardless of whether borrowers are current on their payments. Indeed, their percentage often increases on delinquent loans.
Chance to add revenue
Legal experts say the opportunities for additional revenue in delinquency are considerable, confronting mortgage companies with a conflict between their own financial interest in collecting fees and their responsibility to recoup money for investors who own most mortgages.
“The rules by which servicers are reimbursed for expenses may provide a perverse incentive to foreclose rather than modify,” concluded a recent paper published by the Federal Reserve Bank of Boston.
Under the Obama administration’s foreclosure program, a servicer that modifies a loan for a homeowner collects $1,000 from the government, followed by $1,000 a year for each of the next three years. A senior Treasury adviser, Seth Wheeler, said these payments amounted to “meaningful incentives to servicers to help overcome the challenges and competing demands they face in considering and completing loan modifications.” He added that mortgage companies “are contractually obligated to the terms of this program, which require them to offer modifications to qualified borrowers.”
But experts say the administration’s incentives are often outweighed by the benefits of collecting fees from delinquency, and then more fees through the sale of homes in foreclosure.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you believe you or someone you know has been a victim of Predatory Lending and/or Mortgage Fraud, please call the following number TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
This week, the Obama administration summoned mortgage company executives to Washington to demand they move faster to lower payments for homeowners sliding toward foreclosure. Treasury officials called on the companies to hire and train more people quickly to field applications for relief.
But industry insiders and legal experts say the limited capacity of mortgage companies is not the primary factor impeding the government’s $75 billion program to prevent foreclosures. Instead, it is that many mortgage companies are reluctant to give strapped homeowners a break because the companies collect lucrative fees on delinquent loans.
Even when borrowers stop paying, mortgage companies that service the loans collect fees out of the proceeds when homes are ultimately sold in foreclosure. So the longer borrowers remain delinquent, the greater the opportunities for these mortgage companies to extract revenue — fees for insurance, appraisals, title searches and legal services.
“It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen,” said Margery Golant, a Florida lawyer who defends homeowners against foreclosure and who worked in the law department of a major mortgage company, Ocwen Financial. “I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want.”
Reluctant to modify loans?
Rich Miller, a governance project manager at Countrywide Financial and Bank of America before he left in January, said Bank of America had been reluctant to modify loans, which hurt the bottom line. The company has been waiting and hoping the economy will improve and delinquent customers will resume making payments, he said.
“That’s the short-term strategy,” said Mr. Miller, who oversaw training programs at Countrywide, which was bought by Bank of America. He now works as an industry consultant.
Bank of America disputed that characterization. “To think that somehow or other we would jeopardize investor relationships and customer relationships for the very small incremental income we would receive by delaying seems ludicrous,” said Robert V. James, the bank’s senior vice president for mortgage operations and insurance. “It’s not the right thing to do.”
Mortgage companies, some of which are affiliated with the nation’s largest banks, are paid to manage pools of loans owned by investors. The companies typically collect a percentage of the value of the loans they service. They extract their share regardless of whether borrowers are current on their payments. Indeed, their percentage often increases on delinquent loans.
Chance to add revenue
Legal experts say the opportunities for additional revenue in delinquency are considerable, confronting mortgage companies with a conflict between their own financial interest in collecting fees and their responsibility to recoup money for investors who own most mortgages.
“The rules by which servicers are reimbursed for expenses may provide a perverse incentive to foreclose rather than modify,” concluded a recent paper published by the Federal Reserve Bank of Boston.
Under the Obama administration’s foreclosure program, a servicer that modifies a loan for a homeowner collects $1,000 from the government, followed by $1,000 a year for each of the next three years. A senior Treasury adviser, Seth Wheeler, said these payments amounted to “meaningful incentives to servicers to help overcome the challenges and competing demands they face in considering and completing loan modifications.” He added that mortgage companies “are contractually obligated to the terms of this program, which require them to offer modifications to qualified borrowers.”
But experts say the administration’s incentives are often outweighed by the benefits of collecting fees from delinquency, and then more fees through the sale of homes in foreclosure.
For more information on how our FMA (Forensic Mortgage Audit) program and loan modification processing services can help you to be more effective in your fight to save homes, or if you believe you or someone you know has been a victim of Predatory Lending and/or Mortgage Fraud, please call the following number TODAY: (888) 201-8608. You can also email us at help@nafmainc.org
Tuesday, August 11, 2009
Obama's Plan: Over 500 Bad Reviews!
CNNMoney.com reported recently that an overwhelming amount of reviews from nearly 500 homeowners just like you have been pouring in regarding their experiences with the new making Homes Affordable Plan. The following are a few of the complaints found on the CNNMoney.com list:
“Obama’s plan is a joke,” wrote Jean in Michigan. “The banks are a joke… fax, fax, fax, call, call, call and no response for months. Even Washington representatives can’t get an answer or help, what a sham!!!!”
“I have a Fannie Mae loan through Bank of America and have been fighting with Bank of America since May to work with me. They continue to indicate that I do not qualify during this phase, but yet Fannie Mae says I do. BofA has given me every possible roadblock and excuse. They are definitely doing this intentionally.”
“Litton Loan serving is the worst. I did an informal email survey received responses from 123 people who applied for Load Modification…NOT ONE got the Modification. All were lied to and dragged along for weeks until finally they were told they did not qualify. Who can stop this madness?”
So you call your lender, spend 15 minutes on hold, 10 minutes verifying your identity to Sergio in India and another 20 minutes explaining why you need a loan modification, only to be told you're calling the wrong department. For some reason the lender is lacking the cutting edge technology required to transfer the call which means you'll have to hang up and start the process all over again...splendid.
After being treated like a number (more specifically number 2) and wasting another hour of your life on the phone speaking to a long line of people who couldn't care less about you or your home, you're told to complete a financial worksheet, send in your income documents and "wait". Wait for what? How long does it take to determine your eligibility for a modification? It took the lender less than 20 minutes to approve the loan, yet its taking them no less than 20 days to approve a work out plan. Reality sets in as you realize the banks already received their stimulous package and simply couldnt care less about you or your home. That being said, you decide to give the same bank that set you up for failure once before the benefit of the doubt. After all, whats the worst that can happen?
So you rush to gather your documents, only to spend the next two days faxing and refaxing until the lender finally confirms their receipt. According to your lender, the process may take between 30-60 days to complete. FYI: A pending modification does not obligate your lender to stay any active foreclosure proceedings. As one hand dangles a carrot, the other hand may be reaching in your pocket for your house keys!
After a month of sleepless nights haunted with visions of the County Sheriff showing up at your door with a foreclosure notice, your heart sinks as you're told the modification has not been approved (why? because their computer said so) and your only options would be to sell your home, accept a repayment plan or lose it to foreclosure. Now what?
If this sounds like an experience you or someone you care about has had with a lender, please call NAFMA today at (888) 201-8608. You can also email us help@nafmainc.org. Our abundant network of industry professionals will provide you with all the information, tools and advice you need to even the playing field with your lender and win the fight to save your home!
“Obama’s plan is a joke,” wrote Jean in Michigan. “The banks are a joke… fax, fax, fax, call, call, call and no response for months. Even Washington representatives can’t get an answer or help, what a sham!!!!”
“I have a Fannie Mae loan through Bank of America and have been fighting with Bank of America since May to work with me. They continue to indicate that I do not qualify during this phase, but yet Fannie Mae says I do. BofA has given me every possible roadblock and excuse. They are definitely doing this intentionally.”
“Litton Loan serving is the worst. I did an informal email survey received responses from 123 people who applied for Load Modification…NOT ONE got the Modification. All were lied to and dragged along for weeks until finally they were told they did not qualify. Who can stop this madness?”
So you call your lender, spend 15 minutes on hold, 10 minutes verifying your identity to Sergio in India and another 20 minutes explaining why you need a loan modification, only to be told you're calling the wrong department. For some reason the lender is lacking the cutting edge technology required to transfer the call which means you'll have to hang up and start the process all over again...splendid.
After being treated like a number (more specifically number 2) and wasting another hour of your life on the phone speaking to a long line of people who couldn't care less about you or your home, you're told to complete a financial worksheet, send in your income documents and "wait". Wait for what? How long does it take to determine your eligibility for a modification? It took the lender less than 20 minutes to approve the loan, yet its taking them no less than 20 days to approve a work out plan. Reality sets in as you realize the banks already received their stimulous package and simply couldnt care less about you or your home. That being said, you decide to give the same bank that set you up for failure once before the benefit of the doubt. After all, whats the worst that can happen?
So you rush to gather your documents, only to spend the next two days faxing and refaxing until the lender finally confirms their receipt. According to your lender, the process may take between 30-60 days to complete. FYI: A pending modification does not obligate your lender to stay any active foreclosure proceedings. As one hand dangles a carrot, the other hand may be reaching in your pocket for your house keys!
After a month of sleepless nights haunted with visions of the County Sheriff showing up at your door with a foreclosure notice, your heart sinks as you're told the modification has not been approved (why? because their computer said so) and your only options would be to sell your home, accept a repayment plan or lose it to foreclosure. Now what?
If this sounds like an experience you or someone you care about has had with a lender, please call NAFMA today at (888) 201-8608. You can also email us help@nafmainc.org. Our abundant network of industry professionals will provide you with all the information, tools and advice you need to even the playing field with your lender and win the fight to save your home!
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