A California man has been sentenced to 16 years in federal prison for his part in what prosecutors believe is the largest mortgage modification scam in history, defrauding victims out of $31 million. [More]
An effort to consolidate 26 separate homeowner lawsuits against Bank of America hit a huge roadblock yesterday when a federal judge ruled that while the individual cases appear to have merit, they can not be heard as a group in a class action. [More]
According to the latest report from the Special Inspector General for the Troubled Asset Relief Program (or the much-cooler SIGTARP), the nation’s mortgage servicers have received more than $800 million in incentives for making modifications on mortgages that have ultimately resulted in the homeowner redefaulting on the loan. [More]
Last month, it was revealed that six former Bank of America employees and one ex-contractor for the bank, had given sworn statements in a lawsuit filed against BofA, and that these statements painted a picture of a system that deliberately lost mortgage modification paperwork and rewarded staffers for pushing employees into foreclosure. Now BofA has issued a detailed rebuttal of those allegations and why it believes that these statements misrepresent the truth. [More]
Following the recent revelations from former Bank of America employees that the nation’s most-hated financial institution allegedly engaged in deliberate schemes to delay and deny mortgage modifications, a group of three homeowners have sued BofA, alleging violations of federal anti-racketeering laws. [More]
Former Staffers: Bank Of America Rewarded Us For Lying To Homeowners, Losing Paperwork, Denying Modifications
In sworn statements provided for a lawsuit by homeowners against Bank of America, a half-dozen people who reviewed loan modification applications for BofA say the company encouraged staffers to lose applicants paperwork so that it could later be denied, putting homeowners at further risk of losing their homes. And if these people are to be believed, some folks out there may have lost their homes so that a BofA employee could get a Target gift card. [More]
When a retired Michigan homeowner applied for a mortgage adjustment back in 2009, little did she know that it would result in years of ongoing legal wranglings, a sizable increase in the amount of her mortgage and possible eviction. [More]
The latest numbers on the government-backed Home Affordable Modification Program are in, and there’s some good news in there for most of the homeowners who participated. About 77% of those who went through modification (and didn’t have a mortgage tied to Fannie Mae or Freddie Mac) in July enjoyed a nice little cut to the principal amount they owe.
Getting a mortgage modification has been hard enough for homeowners, what with disorganized big banks not having enough well-trained people on staff to deal with the necessary ins and outs of the process. But a new study says that things should’ve been easier under the Home Affordable Modification Program and resulted in 800,000 fewer foreclosures than we ended up with.
Since the Treasury Dept. began releasing quarterly report cards on big banks’ efforts to improve their mortgage modification processes, Bank of America and JPMorgan Chase have consistently received subpar marks, leading the feds to withhold a total of $171 million in incentives. That money is now set to be released to BofA and Chase — but not necessarily because they suck any less at mortgage mods.
For the third quarter in a row, the Treasury Dept. has released its report card detailing how the country’s largest mortgage servicers are doing with processing loan modifications. And for the third consecutive quarter, both Bank of America and JPMorgan Chase will not receive incentive payments from the Treasury because the banks are doing such a craptastic job at complying.
Getting a mortgage is difficult enough. Having that mortgage modified because your house has dropped in value can be a Minotaur’s maze full of unscrupulous types looking to cash in on your uncertainty about the often complicated process.
A judge in Georgia is quickly becoming an internet folk hero after he publicly slammed U.S. Bank for taking billions in government bailout money and all the while refusing mortgage modifications for homeowners in need of help.
Yesterday, the Treasury Department released a scorecard of just how well (and poorly) the largest mortgage servicers are doing at meeting certain benchmarks of its Making Home Affordable program. Not surprisingly, Bank of America, Wells Fargo and JPMorgan Chase — the three largest servicers — were called out for needing “substantial improvement,” meaning that the banks will not receive millions of dollars in federal incentives until they get their acts together.
For all its tough talk, the Treasury can’t do jack to reign in lenders who are wrongfully denying home owners loan modifications. After seeing reports that some banks were basically modifying no loans at all, Treasury staffers huddled up to talk about withholding payments and levying fines on the baddest of the bunch. Unfortunately, they were told by their own lawyers that they don’t have that power. ProPublica reports, “staffers were walked back by Treasury lawyers, who said the government was only party to a commercial contract with servicers and not acting as their regulator.”
Consumerist’s Hero of the Weekend is attorney and writer Wajahat Ali, who fought an epic battle for a home loan modification against Wells Fargo and won. Eventually. It’s a well-written and terrifying look into the financial crisis, the state of America’s megabanks, and how homeowners in need seemingly stand no chance against the towering indifference, incompetence and confusion of those megabanks.