There is an agency most people have never heard of, the Office of Mortgage Settlement Oversight. Created as part of the national foreclosure fraud settlement between 49 state attorneys general, the Justice Department and 5 major lenders; the agency was created to insure compliance with the settlement. Ask most people threatened by foreclosure from Ally Financial, Bank of America, Citi, Wells Fargo or JPMorgan Chase and they will tell you that the banks (all signatories to the deal) have not lived up to their promises. The agency’s official monitor, Joseph Smith, doesn’t disagree.
As part of the global mortgage fraud settlement, the 5 lenders – services were required to pay approximately $5 billion in fines and provide another $20 billion in relief to homeowners. That latter includes mortgage write-downs, principal reductions and refinancing assistance.
Has that happened? Apparently not.
The most recent report filed by Smith on June 19th is quite troubling. While some banks did better than others, a full 7 years after the mortgage meltdown began the “too big to fail” banks still can’t seem to address the many problems faced by struggling homeowners.
Smith says, “These findings, combined with the complaints I have heard from attorneys general, counselors and distressed borrowers, tell me there is still work to be done. While I believe distressed servicing is better this year than it was last, it is not yet where it needs to be. Specifically, I have heard regularly in the last year about issues with the loan modification process, single points of contact and billing and statement inaccuracies.”
Smith is kind in his words. After only a year on the job, Smith has already received 60,000 complaints from homeowners. Many of the clients we represent are so frustrated they don’t even bother calling to complain. Many have already lost their homes. Thousands feel that the $1000 or so compensation checks they are offered is simply an insult.
We understand that many people facing foreclosure have simply not paid on their loans. Whether or not they are a victim of predatory lending is a much larger societal and legal issue. Our biggest beef with the big banks is their abysmal failure to address modification applications and follow correct foreclosure procedures.
In many instances, the loan servicers can’t even prove who owns the mortgage and who should be paid. In other cases, the banks have simply refused to honor mortgage modification programs such as HAMP and HARP even though they signed agreements with HUD to do so and entered into the national settlement deal. Sometimes, we have found banks that are foreclosing even though the homeowner never missed a payment! That’s right, we have seen cases where banks have refused payments, sent checks back and then initiated foreclosure proceedings claiming the homeowner is in default.
We have no sympathy for these lenders. None. The big banks took billions in taxpayer dollars – TARP monies – yet can’t seem to honor a settlement they voluntarily entered. While its nice to see that some progress has been made on foreclosure fraud, it is obvious that for many homeowners, these efforts are too little, too late.
The monitor’s reports are all available to anyone. They are free and on-line.
The foreclosure fraud lawyers at Mahany & Ertl help people facing illegal or wrongful foreclosure. We are not bankruptcy lawyers nor are we traditional foreclosure defense lawyers. Instead, we believe the best defense is a good offense. Given the right facts, we sue banks for wrongful foreclosure and improper denials of HAMP modifications.
Although we are a national boutique practice with offices in multiple states, we only take foreclosure fraud cases in select jurisdictions. Presently we are accepting cases in Wisconsin, Michigan and Arkansas. (Cases in Arkansas and Michigan are handled by outside counsel.)
For more information, please contact attorney Brian Mahany at
Please note that if you are facing the imminent loss of your home, contact a mortgage foreclosure or bankruptcy lawyer in your area immediately. We sue banks for money and compensation and can’t take foreclosure cases with impending eviction or hearing dates.
Mahany & Ertl – America’s Foreclosure Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and San Francisco, California.
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Posted by Brian Mahany, Esq.