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
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