Distressed Homeowners Denied Loan Modifications By Dishonest Bankers
Bank of America employees knew they had reams of loan modification documents already in the system in a vast number of cases.
But that reportedly didn’t stop bankers from systematically and repeatedly demanding those same documents from distressed homeowners trying to hang on to their houses. Deposition statements from former BofA employees, added recently to a multi-district federal lawsuit, indicate that the banking giant lied to homeowners about knowing it already had possession of these records in an effort to deny thousands of home loan modifications.
Our Miami foreclosure lawyers are no longer surprised by the lengths to which these financial powerhouses will go to protect their huge bottom lines. May times these actions disregard fairness to customers, the well-being of families and sometimes even the law. Anymore, the only surprises come when these banks are held accountable to any substantial degree.
We hope this lawsuit has the power to do just that. It seeks class action status. It’s spear-headed by a Boynton Beach homeowner who alleges the lender intentionally hindered home loan modification requests made through the federal government’s Home Affordable Modification program.
The case got a huge jolt in recent days when former employees at the North Carolina-based firm gave statements attesting to single agents handling up to 400 cases at any given time. Eligible borrowers, they said, were cattle-herded into foreclosure actions that the employees called “blitzes.” During these “blitzes,” any foreclosure file that contained documents older than 50 days was flat-out denied.
This was even the case for homeowners who had done everything right – fully complied with the trial period terms and turned over all mandated financial records. The rejection and delay programs, according to one underwriter, were “methodically carried out.” That employee said when he complained that the denials were not fair, he was fired.
Of course, Bank of America denies all of this, but again, that’s not really a surprise. The firm has a lot to lose – not only in this case but in potentially thousands of others, not to mention federal government reprisal, if it admits to these actions.
But it’s not just one disgruntled former employee making such allegations. Those standing in line to testify continue to mount.
Another underwriter, who worked for the firm for five years, ending in February 2012, told attorneys in the case that she was directly instructed to lie and say documents had not been received, when in fact they had. The claims would then become stale and then the whole process would have to start over again.
It also had the added bonus of making it appear as if the homeowner wasn’t taking decisive or proper action to save his or her home.
It’s also worth noting that bank workers who were able to get 10 or more accounts into a foreclosure within a month’s time frame could receive sizable retailer gift cards and cash bonuses of up to $500. So there was real incentive NOT to help the homeowner – despite what the bank was telling the government and consumers.
This information is particularly interesting in light of recent Florida legislation that seeks to curb homeowner rights in the name of speeding up the foreclosure docket. As our Miami foreclosure lawyers have said all along: It’s not the homeowners who have been stalling. It’s the banks. So tell us again why homeowners should be punished?
These statements by former workers validate years-old complaints from homeowners alleging that banks asked over and over again for the same documentation, only to turn around and deny the modification and push the case into foreclosure – for no reason.
This lawsuit combines legal actions from a number of states, and is being handled in a Massachusetts federal court.
The revelation comes shortly after Florida’s Attorney General Pam Bondi penned letters to both Bank of America and Wells Fargo, expressing concerns that both lenders were breaking the loan servicing rules established in the National Mortgage Settlement reached last year.
If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Legal for a confidential appointment to discuss your rights. Call 305-358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Mortgage Wars,” discussing foreclosure topics that matter to YOU.