Tag Archives: Bank of America

Real Estate

Banks Close To $10B Settlement Over Foreclosure Abuses

give a man a gun rob bank

Fourteen banks are reportedly nearing a $10 billion settlement with banking regulators over the banks’ past involvement in foreclosure mishandlings that included faulty paperwork and excessive fees, The New York Times reports.

About $3.75 billion of the reported settlement would go to aid home owners who lost their homes to foreclosure — more than double what was set aside from a $26 billion settlement reached in 2012 among the state attorneys general and five of the nation’s largest banks.

The majority of the money from the latest settlement would go to help home owners struggling to make their payments and remain in their homes, such as with aid like loan modifications or lowering the amount of principal on their mortgages.

Banks have faced several settlements with government officials and home owners in recent months that have aimed to hold them accountable for the 2008 financial crisis and subsequent housing slump. From 2007 to early 2012, four million Americans faced foreclosure.

“It’s certainly a victory for consumers and could help entire neighborhoods,” Lynn Drysdale, a former co-chairwoman of the National Association of Consumer Advocates, told The New York Times about the latest proposed settlement. “But the devil, as they say, is in the details, and for those people who have had to totally uproot their lives because of eviction it may still not be enough.”

The same banks involved in the $26 billion mortgage settlement–JPMorgan Chase, Bank of America, Wells Fargo, Citigroup and Ally Financial — also are included in this recent settlement, The New York Times reports.

Sources: “Settlement Expected on Past Abuses in Home Loans,” The New York Times (Dec. 30, 2012)  Daily Real Estate News

 

 

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Real Estate

$1 Billion To Be Paid By Bank Of America For Mortgage Fraud

Photo of Bank of America ATM Machine by Brian ...
Image via Wikipedia


 

 

 

 

 

 

Largest False Claims Act Settlement Relating to Mortgage Fraud 

As part of the global resolution between the United States of America and the five largest mortgage servicing banks in the country, which will bring much needed relief to financially distressed homeowners nationwide, Loretta E. Lynch, United States Attorney for the Eastern District of New York, today announced that the government will also resolve its claims against the Bank of America, Countrywide Financial Corporation and certain Countrywide subsidiaries and affiliates (Countrywide) for underwriting and origination mortgage fraud.

As part of the global settlement, Bank of America will pay $1 billion to resolve the wrongdoing uncovered during the office’s investigation. The settlement will entail an immediate payment of $500 million to provide a recovery for the harm done to the FHA by Countrywide’s conduct. Payment of the second $500 million will be deferred to fund a loan modification program for Countrywide borrowers across the nation with underwater mortgages. Under the terms of the program, Bank of America will solicit all potentially eligible borrowers and provide a loan modification to anyone with an eligible mortgage who accepts the offer. If, after the expiration of three years, the bank has not met its obligation to apply the full $500 million to provide such relief, any remainder will be paid directly to the United States.

“We announce today the largest ever False Claims Act settlement relating to mortgage fraud. Through their underwriting and origination of tens of thousands of government-insured loans to unqualified borrowers, Countrywide Financial subsidiaries systematically abused the Federal Housing Administration and became some of the main players in this country’s financial crisis. We are committed to protecting the FHA’s ability to provide assistance to qualified low-income and first-time home-buyers, and this settlement goes a long way toward that end. It also puts lenders on notice that they will face serious financial consequences for violating their obligations under the FHA’s programs,” stated United States Attorney Lynch.

“This agreement is demonstrative, and should serve as a model, of what results can be achieved when agencies of the United States Government join forces in a united effort to combat fraud in the FHA insured mortgage program,” said Inspector General Montoya. “OIG staff served IG subpoenas, conducted multiple interviews, reviewed loan files, and worked closely with the U.S. Attorney’s office in developing this case.” He further added, “I am appreciative of the tenacity with which the Assistant United States Attorneys approached this matter, the expertise and effort of my OIG auditors, investigators and legal team, and the assistance of the HUD Office of General Counsel and its Office of Program Enforcement and Philadelphia Home Ownership Center throughout this endeavor.”

Source: The United States Attorney General

For more information about the task force visit: www.stopfraud.gov.

 

 

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Real Estate

Distrassed Bank of America Homeowners in California Have Chance of Principal Reduction

Bank of America Nevada City Photo by John J. O'Dell
Bank of America Nevada City Photo by John J. O'Dell


Bank of America has joined the Keep Your Home California principal-reduction program, making it the largest loan servicer involved in lowering loan balances for those with economic hardships.

Making sense of the story

  • Keep Your Home California is a program offered through the California Housing Finance Agency to help struggling homeowners avoid foreclosure.
  • Bank of America, which services more than two million home loans in California, joins others servicers involved in the program, including: California Dept. of Veterans Affairs, the California Housing Finance Agency, Community Trust/Self Help, GMAC, Guild Mortgage Company, and Vericrest Financial.  Agency officials hope the list will continue to grow, and that the program will continue to gain momentum.
  • Under the program, qualified homeowners may be eligible for up to $50,000 in assistance.  The program requires the mortgage investor to match dollar-for-dollar the amount provided by the program.
  • Bank of America borrowers who do not qualify for the principal-reduction program will be evaluated by bank representatives to explore other options, including a loan modification.
  • To be eligible for the program, applicants must: Own and occupy their homes as their primary residence; not exceed $729,750 in current unpaid principal balances on first mortgages; meet low- and moderate-income limits; complete and sign a hardship affidavit to document reasons for hardships; have mortgage loans that are delinquent or “in imminent default;” and have enough income to pay modified mortgage payments according to guidelines from servicers participating in the programs.
  • For more information about Keep Your Home California, visit keepyourhomecalifornia.org or call (888) 954-5337(KEEP).

Read the full story

 

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Real Estate

Banks Stop Accepting Certain Mortgage Applications

 

In anticipation of the expiration of current loan limits on Sept. 30, 2011, Bank of America has decided to stop accepting conventional and government applications for loan amounts that will exceed the permanent loan amounts.  The deadline to submit loan applications was July 1.

According to an email from Bank of America, conventional loans that exceed the permanent loan limits will now be required to use non-conforming programs.

Barring Congressional action, the maximum FHA, Fannie Mae, and Freddie Mac conforming loan limit will decline to $625,500 beginning Oct. 1, 2011, from the current $729,750 limit, though the majority of counties will fall far below the $625,500 maximum.  The conforming loan limit determines the maximum size of a mortgage that FHA, Fannie Mae, and Freddie Mac government-sponsored enterprises (GSEs) can buy or guarantee.  Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan and require a higher down payment, increasing the monthly payment and negatively impacting housing affordability for California home buyers.

 

 

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John J. O’Dell Realtor®
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O’Dell Realty
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jodell@nevadacounty.com

Real Estate

Bank of America Gets Foreclosed

httpv://youtu.be/MBuCSTFJffY

How screwed up are the banks? They foreclose on a home that has no mortgage! So the attorney for the couple forecloses on the bank (really a sheriffs sale). Great!

Between “robosigning” where banks make up false mortgage notes, to not doing mortgage modifications, the banks continue the drive this country into the ground. Of course, none of the banks CEO’s responsible for this mess have gone to jail. Where do you think you and I would be if we forged mortgages?

For all your real estate needs, call or email:

John J. O’Dell Realtor®
Real Estate Broker
O’Dell Realty
9530) 263-1091
jodell@nevadacounty.com

Real Estate

Online Mortgage Shopping Made Easier

Moss on Rocks Photo by John J. O'Dell
Moss on Rocks Photo by John J. O'Dell


The vast amount of information available online about mortgages – such as interest rates, loan benchmarks, prepayment penalties, and the like – can cause home buyers to feel confused and overwhelmed when shopping for a mortgage.  Most surprisingly, a recent survey found that only 61 percent of homeowners surveyed said they comparison shopped for a mortgage, and 39 percent said they took out a home loan based on just one quote.

MAKING SENSE OF THE STORY

  • Resulting from consumer feedback about lending Web sites being unhelpful or difficult to navigate, some of the nation’s leading mortgage sites have responded by working to become more consumer-friendly.  The revamped sites allow borrowers to not only browse lender rates and terms, but also learn about market trends and read comments from other loan shoppers.
  • One of the challenges borrowers have, according to Keith T. Gumbinger, the vice president of HSH Association, is that while there is plenty of mortgage information available, consumers often have difficulty understanding the technical aspects of a mortgage, such as when an adjustable rate mortgage actually adjusts, and when a prepayment penalty applies.
  • One site, LendingTree, allows consumers to browse quotes from various lenders, read an array of industry articles, use research tools and calculators, and peruse consumer-generated ratings and reviews of lenders.  In December, the company created an online feature in which borrowers can post a mortgage-related question to be answered by a LendingTree loan specialist.
  • Online direct lender, Quicken Loans, offers an expanding number of customer-written reviews on buying and refinancing.  Beginning in March, consumers can download Quicken Loan’s iPhone app and track when appraisals come in, closing dates are set, and when other time-sensitive hurdles in the home-buying process are reached.
  • Some major lenders also are making changes, including Bank of America, which offers articles and tools specifically for first-time buyers, and another set for more experienced borrowers.
  • Of course, borrowers also can forgo the online aspect of mortgage shopping, and instead work with an experienced mortgage broker who can help guide the buyer through the process, including locking in the best rates available for their situation.

Read the full story

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Real Estate

Countrywide Financial Executives Settles With State of California for $6.5 Million

Sunset over Scotts Flat Lake from my deck 2/3/11 In the background is the Coast Range
Sunset over Scotts Flat Lake from my deck 2/3/11 In the background is the Coast Range

By John J. O’Dell

Finally some justice against Countrywide Financial Corporation for all of their shady lending practices..  They created mortgage loans which were bound to be foreclosed on.  Here’s a press release from the office of the Attorney General of California explaining what they did:

Attorney General Kamala D. Harris today (February 2, 201) announced a $6.5 million settlement of a predatory lending case against Angelo Mozilo and David Sambol, former officers of Countrywide Financial Corporation. Attorney General Harris announced the settlement money will be used to establish an innovative statewide California Foreclosure Crisis Relief Fund to combat the effects of California’s high rates of foreclosure and mortgage delinquency.

“Our prior settlement with Countrywide provided restitution for foreclosed homeowners and set in motion loan modification programs that have helped tens of thousands of consumers,” Attorney General Harris said. “We will use the current settlement to help Californians affected by the mortgage crisis by providing grants to agencies that help homeowners facing foreclosure with relocation assistance and providing money to state and local agencies to prosecute mortgage fraud.”

This settlement concludes litigation filed by Attorney General Edmund G. Brown Jr. in June 2008 against Countrywide Financial Corp., Countrywide Home Loans and Full Spectrum Lending, as well as Mozilo and Sambol. The financial relief provided under the current settlement augments the Attorney General’s October 2008 settlement with Countrywide to provide loan modifications and other foreclosure relief valued at $8.68 billion nationwide, with $3.5 billion provided to California borrowers.

According to the lawsuit, leading up to the mortgage crisis, Countrywide lured borrowers with low “teaser” rates often as low as 1 percent adjustable rate loans. Its loan officers obscured the downsides of these loans, which included rapidly rising rates after teaser rates expired, big prepayment penalties, and negative amortization in which a borrower’s total loan costs rose even as additional payments were made. Countrywide also loosened its mortgage standards and verification procedures in order to write more loans.

As a result of these practices, tens of thousands of homeowners with Countrywide loans ended up in default and foreclosure. The Attorney General’s lawsuit alleged that Mozilo and Sambol knew of these practices and allowed them to continue.

The complaint alleged that Countrywide sought to increase its share of the nationwide mortgage market to 30 percent through a deceptive scheme to mass produce loans – with little concern about borrowers’ long-term ability to afford them. It then would sell the loans on the secondary market to earn the highest possible premiums.

The settlement with Mozilo, the CEO of Countrywide, and Sambol, its president, was filed today in Los Angeles Superior Court. Mozilo and Sambol left Countrywide when it was purchased by Bank of America in July 2008.”

Source: Attorney General’s Office

So what do you think?

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Real Estate

The States of Arizona and Nevada Sues Bank of America for Foreclosure Fraud

Bank of America Nevada City, CA

The states of Arizona and Nevada has sued Bank of America for alleged foreclosure fraud.  The lawsuits are very similar in scope, and basically allege that Bank of America engaged in deceptive practices specifically with regard to mortgage servicing, loan modification, and foreclosure.

Arizona Attorney General Terry Goddard said in a press release:

“Bank of America has been the slowest of all the servicers to ramp up loss mitigation efforts in response to the housing crisis.  It has shown callous disregard for the devastating effects its servicing practices have had on individual borrowers and on the economy as a whole”.

The Arizona complaint alleges that Bank of America committed fraud in Arizona, and mislead borrowers about foreclosure and loan modification programs in the following ways (quoted from the press release):

• Whether homeowners must be delinquent on their mortgage payments to be considered for a loan modification.

• How much time it would take to receive a decision from Bank of America on a modification request or a short sale request.

• Whether foreclosure would proceed while a modification or short sale request was pending, or while a homeowner was making trial payments.

• Whether the homeowner had been approved for a loan modification.

• Failure to provide valid reasons why the homeowner was declined for a modification.

• Whether the homeowner would be approved for a permanent modification if the consumer successfully made all trial modification payments.

The Nevada lawsuit has essentially similar allegations.  Nevada Attorney General Catherine Masto said in a press release:

“We are holding Bank of America accountable for misleading and deceiving consumers.  Nevadans who were trying desperately to save their homes were unable to get truthful information in order to make critical life decisions”.

Real Estate

Bank of America’s Contractor Confiscates Parrot

Bank of America Nevada City, CA

A contractor for Bank of America went into the home of a borrower which was not vacant nor in default with the mortgage. While Angela Iannelli was away, under instructions from Bank of America, the contractor cut off utilities, padlocked the door and confiscated her pet parrot, Luke.  Maybe the contractor was thinking the woman was in default with her mortgage, would make her payments current if he took the parrot for ransom.

According to the Wall Street Journal:

“Angela Iannelli, 46 years old, alleged in a lawsuit Monday that the October incident—which separated her from her 11-year-old parrot for more than a week—caused so much “emotional distress” that she needed a prescription medication for anxiety.

A Bank of America spokesman said Wednesday a bank employee erroneously believed the house was vacant and sent the contractor there with instructions to install a new lock and otherwise “secure” the property. The bank spokesman said those instructions were inappropriate because Ms. Iannelli wasn’t in default and the house wasn’t vacant.

Mortgage lenders have struggled in the past three years to hire and train enough people to deal with the biggest wave of foreclosures since the 1930s. Nearly eight million households, or 15% of those with mortgages, are behind on their payments or in the foreclosure process.

Many borrowers complain they get the runaround when they call their lenders for help, receive contradictory information from different employees and are required to repeatedly fax the same documents.”

You can say that again. Dealing with banks, you can expect multiple answers to your mortgage problems and repetition of them asking for the same paper work over and over.  You are also transferred to a different person each and every time you call them, so that it appears that they are in complete chaos. In the final analysis, it seems that the last thing they want to do is modify your mortgage or help you in any way.

You can read the full story by clicking here: Wall Street Journal

John J. O’Dell
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Real Estate

Foreclosures, The Good and The Bad

Former mortgage company Countrywide Home Loans failed because of their risky mortgage practices and was taken over by Bank of America
Former mortgage company Countrywide Home Loans failed because of their risky mortgage practices and was taken over by Bank of America

The good and bad of foreclosures is a mixed bag.  The bad is that banks which pushed these risky loans are going to take a bath.  The bad is that people who are being foreclose on either because of being tricked into a bad loan or loss of income, are going to have bad credit ratings.

The good is that those people who have lost their homes will now have more money to spend.

According to the Wall Street Journal

“Analysts at Deutsche Bank Securities expect 21 million U.S. households to end up owing more on their mortgages than their homes are worth by the end of 2010. If one in five of those households defaults, the losses to banks and investors could exceed $400 billion. As a proportion of the economy, that’s roughly equivalent to the losses suffered in the savings-and-loan debacle of the late 1980s and early 1990s.

The flip side of those losses, though, is massive debt relief that can help offset the pain of rising unemployment and put cash in consumers’ pockets.

For the 4.8 million U.S. households that data provider LPS Applied Analytics estimates haven’t paid their mortgages in at least three months, the added cash flow could amount to about $5 billion a month — an injection that in the long term could be worth more than the tax breaks in the Obama administration’s economic-stimulus package.

“It’s a stealth stimulus,” says Christopher Thornberg of Beacon Economics, a consulting firm specializing in real estate and the California economy. “The quicker these people shed their debts, the faster the economy is going to heal and move forward again.”

So as everything in life, there is the good and the bad, what do you think?