by Brian Mahany
A lawyer recently asked about Bank of America’s policy of confidential settlements. It’s a good question and one in which we know some of the answers. But of course, we can’t answer because, well… homeowners (and their attorneys) who sue Bank of America typically are not allowed to discuss the terms of their settlements.
Bank of America isn’t the only large lender with a confidentiality clause in settlement agreements. Big banks do not want homeowners to know that people who take on foreclosure fraud and other lending abuses can actually get paid. They fear the flood gates would open and tens of thousands of pissed off homeowners would learn how much their aggravation is really worth.
The Attorney General of Arizona filed suit against Bank of America last year claiming that the bank was impeding its investigation into loan modification practices by settling with homeowners and requiring them to keep the terms of the settlement confidential. That suit was dismissed in February of this year.
Arizona was particularly frustrated because the bank claimed it did not centrally store settlement records making it difficult to learn how many people had complained to the bank and how the bank responds to those claims.
We know that Bank of America will negotiate if the facts are not in their favor. Common problems that have plagued the bank include improper lockouts, steering customers away from more affordable loans and improperly denying a HAMP mortgage modification even though the homeowner was qualified and made all trial payments.
Unfortunately, many clients never seek counsel either because they are just too “beaten down” by daily interactions and delays from their lender or because they simply don’t know that the banks are willing to settle if a formal claim is filed.
Foreclosure actions generally are not heard by a jury but a suit for money damages against the bank can be heard by a jury. In the current political climate, banks are afraid of juries. Especially if the homeowner is represented by counsel and has a well documented file. In those cases, lenders will typically settle and require that both parties keep their month shut about the terms of the settlement.
The mortgage foreclosure fraud lawyers at Mahany & Ertl have helped many homeowners with claims against Bank of America, Allied Home Mortgage and other lenders. If you feel you were wrongly denied a HAMP modification or improperly treated, give us a call. All inquiries are protected by the attorney – client privilege and kept in strict confidence.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine & San Francisco, California. Services available in many jurisdictions.