by Brian Mahany
It’s been several months since we wrote a mortgage foreclosure post. Our hope was that the recent national settlements and court approved monitors would help big banks clean up their mortgage messes. Unfortunately, we see little progress. Although the total number of foreclosures is down, the ones that remain are often a filled with inaccuracies. Some banks, particularly Bank of America, have become simply “too big to care”.
Presently we are litigating a case against BOA in Columbia County, Wisconsin. There, a financially strapped homeowner was able to negotiate a mortgage modification on her own through the HAMP program (Home Affordable Modification Program). In order to qualify for a permanent modification, the homeowner had to make several trial period payments over a three month period. In the HAMP materials sent to the homeowner, Bank of America promised that, “So long as you comply with the terms of the Trial Period Plan, we will not start foreclosure proceedings…”
Each of the three payments were made timely. Did that end this story? NO.
Notwithstanding the homeowners full compliance with the “trial” plan, Bank of America filed a foreclosure complaint. For reasons known only to the bank, the complaint was never served on the homeowner. That meant her credit was ruined and she had no ability to defend herself and set the record straight.
Ultimately, a year later the foreclosure complaint was dismissed but the damage to the homeowners credit standing was already done.
If the story ended here, it would be bad enough. But it doesn’t end. While the foreclosure complaint was pending with the court, Bank of America agreed to make the HAMP modification permanent.
Once again, the homeowner faithfully made all her payments. And once again, that should end the story. But in 2011, Bank of America simply stopped cashing her checks. Once again, a foreclosure action was filed. It’s been over a year and the bank has still not dismissed its complaint.
Why would the bank not take her checks? We believe that Bank of America has decided that is simply more profitable to discourage such agreements than to encourage and enter into them. The bank makes more money if they foreclose and take back the property.
The HAMP program was developed by the U.S. Treasury Department to help troubled homeowners. While Bank of America received $45 billion in TARP monies (giving rise to the claim that BOA is simply “too big to fail”), Congress also earmarked several billion for the HAMP program. In April of 2009, BOA agreed to use “reasonable efforts” to place troubled homeowners in the HAMP program.
Although it agreed to the program, BOA also knew that every person placed in the program would hurt their bottom line. According to a federal false claims action filed against the bank, “BOA developed an elaborate scheme to force down the number of successful HAMP modifications. It has done so by deliberately and unlawfully denying scores of otherwise qualified homeowners the ability to successfully qualify for HAMP modifications, while lying to those homeowners persistent enough to escalate complaints and to regulatory bodies inquiring on behalf of homeowners.” The bank was specifically charged with unlawfully proceeding with foreclosure against homeowners who were current with their payments.
In other words, even if a homeowner was lucky and persistent enough to obtain a modification, Bank of America simply wouldn’t cash their checks and would instead foreclose. A Treasury report revealed that just 30% of the people who received trial plans while BOA customers were able to convert to permanent plans. Other banks had a conversion rate near 90%.
Unfortunately, there are few lawyers in Wisconsin that are willing to sue big banks. Most foreclosure defense firms are nothing more than bankruptcy lawyers. While bankruptcy may be appropriate in some cases, our Wisconsin foreclosure lawyers make their living by suing banks. Federal courts say that Wisconsin homeowners can sue their lender if wrongfully denied a HAMP modification. In our present case, the homeowner received her modification but still faces foreclosure even though she never missed a payment.
Losing one’s home is extremely stressful. Often, homeowners suffer from anxiety and other health problems. Having to fight seemingly every day with lenders also takes its toll.
If you were wrongfully denied a HAMP modification or wrongfully face foreclosure, fight back. The foreclosure defense lawyers at Mahany & Ertl represent Wisconsin and Michigan homeowners. We are not a traditional mortgage foreclosure firm but are interested in suing banks for their predatory foreclosure practices.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and San Francisco, California. Fraud recovery available in many jurisdictions.
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