Regulators Investigating Complaints Against Bank of America About Loan Modification Fiascos

Everyone has heard the stories about how poorly banks are fairing when it comes to processing and granting loan modifications. There have been complaints filed against virtually every lender, but Bank of America leads the pack.

When loan modification programs began rolling out, first during the Bush Administration (the HOPE) program, and next with the Obama administration Home Affordable Modification Program (commonly referred to as HAMP), there were high hopes that modifying loans would stem the rate of foreclosures and would provide much needed relief to those who seriously needed help to stay in their homes. It was hoped these programs would stop the precipitous drop in home values across the country.

The modifications were never intended to lower rates or payments for those who were not dealing with a financial hardship, which is why a "hardship letter" is one of the required pieces of paperwork to qualify for a modification. Some banks have truly reached out to help home owners in need, which largely includes people who have experienced a reduction in income (due to job losses or reduction in pay or hours)or have had to deal with ARM (Adjustable Rate Mortgage) rate re-sets which resulted in significantly higher payments.

Bank of America has a dismal record of assisting home owners. They have offered one excuse after another for their failures, but the bottom line is their system is wrought with issues that are not acceptable, either to those trying to get a modification, nor to regulators who are investigating the complaints against the bank.

Initially Bank of America ignored the guidelines about debt ratio, and denied modifications citing "too much income" even when debt ratios were above 60%.

Even today, IF a home owner is told that they qualify for a modification program,the borrower receives nothing in writing from the bank about the terms of the trial modification, or the final modification terms. Borrowers are expected to call in payments monthly, with no way to track where the funds have been applied. The bank continues to call these same homeowners, basically harassing them, and sends out notices of intent to foreclose, in spite of collecting trial modification payments. In addition, they continue to report delinquencies to the credit bureaus for payments received. There have even been cases of foreclosure auctions taking place on homes when the home owners were paying trial modification payments.

Some states are taking action against Bank of America to force them to be accountable to the people. The state of Florida Attorney General reports that his office has spent approximately $4 million over the last two years just investigating complaints and trying to help home owners. One South Florida mayor has announced that he wants his city to reconsider doing any business with Bank of America.

The issue regarding loan modifications and mistreatment of home owners has gotten so bad that state and federal regulators are investigating all complaints to determine how many people have had modifications denied who were actually eligible. The U.S. Treasury Department has begun auditing all lenders now.

If you believe you were erroneously denied a modification, or were otherwise mistreated during a modification attempt, perhaps you should join the masses and file a complaint with your state regulators.

Since the economic crash began, Bank of America has had class action lawsuits filed against them in several states for issues dealing with credit card fraud, racial discrimination, and of course, failure to deal in good faith with home owners in need of assistance.

For their part, Bank of America is finally stepping up and starting to actually modify loans. Is this a case of "a day late and a dollar short?"

Check out Regulators ramp up efforts on loan modification complaints

Written by Shelby Bateson
HULIQ.com

Comments

Submitted by John Wright (not verified) on
am in a lawsuit with BofA for a nearly identical situation. I paid my mortgage payment on time for nearly 5 and half years until the economic crisis and housing crisis hit and cut my 25 year small business revenue in half. Which incidentally cut my income in half. These greedy banks caused this by flooding the markets with loans where people did not qualify. They caused this whole thing and we all lost all our equity. But I would appreciate anyone who would like to support me in comments in regards to my lawsuit at : http://news.yahoo.com/s/prweb/20100323/bs_prweb/prweb3766544_1 I have been told that some of the higher ups at BofA read my article. So it would be a perfect opprotunity for you to express what you feel about BofA. We need to all stand together on this! It reminds me of that song by John Lennon and George Harrison titled "Piggies" I invite you to listen to this song on youtube and see if it appropriately fits.   Have you seen the little piggies Crawling in the dirt And for all the little piggies Life is getting worse Always having dirt to play around in. Have you seen the bigger piggies In their starched white shirts You will find the bigger piggies Stirring up the dirt Always have clean shirts to play around in. In their ties with all their backing They don't care what goes on around In their eyes there's something lacking What they need's a damn good whacking. Everywhere there's lots of piggies Living piggy lives You can see them out for dinner With their piggy wives Clutching forks and knives to eat their bacon.

Submitted by Anita (not verified) on
My husband and I are in the same situation we were denied loan modifications with no reason 3 times 1st time we made all trial payments the told we dont' qualify and to reopen the process. Then we were going to do another trial which then was increades by another 350.00 which we were barely able to do the first time but did since it was a trial and would be modified it didn't we have stopped paying and are doing a short sale but if there is any hope I woul like to try it a last time. My situation was the decrease of income from my husband who was in the realestate and I parttime work. The banks are just pulling a string to string the people along as far as they can . Send me emails of any infor that would help us and or other to break down the banks crap.

Submitted by Anonymous (not verified) on
I can't read anymore stories on Loan Modification because they all sound like mine. SOMEONE IN OUR GOVERNEMENT SYSTEM NEEDS TO TAKE CARE OF THIS

Submitted by Niecy (not verified) on
Have you written letters to anyone?

Submitted by Anonymous (not verified) on
yes, that's true! it is plain power abuse!

Submitted by eqsinc (not verified) on
I have been trying to get a loan modification for almost 2 years now. It started when the film and TV writers went out on strike and I was out of work for almost 8 months. This was about the same time when the economy crashed and the housing market also crashed. I got some work at the Art Institute of CA. I was forced into retirement last October 2011, because the union had raised the number of hours needed for medical benefits and I couldn't find work since companies were hiring kids out of school for 25% of what I made. I filed for a loan mod with B of A and it was turned down because I hadn't missed any payments. I didn't matter that I had lost just about all my savings trying to pay the mortgage. I tried again, no dice. I went to the Mortgage Law Center, they just had me file out the same paper work over and over again, what a scam and a waste of money, they made it seem like they have teeth, what a joke, they didn't even have dentures. To this day I'm still trying to get a modification through NACA, we'll see how that goes. Trying to get though to anyone at B of A without getting hung up on is also a joke. These guys are the worst. This will be the first month I won't be able to make my payment, maybe things will change after that. B of A, you took a lot of our money in the government bail out, now it's time for you to step up to the plate and help us out after you've taken away all of our equity, helped to reduce what the middle class gets paid and took us to the bank, so to speak!

Submitted by John Wright (not verified) on
Please,help me and United Law Group send a message to BofA which states, that we will no longer tolerate their potentially irregular, fraudulent and abusive business practices. In the end, the American tax payer did not fail to deliver the BofA bail out in record time, but BofA failed to deliver the American Tax Payer’s bail out in the form of a loan modification. It reminds me of that song by John Lennon and George Harrison titled "Piggies" I invite you to listen to this song on youtube and see if it appropriately fits. http://www.youtube.com/watch?v=MIopI2isIKc&amp;feature=related</P Have you seen the little piggies Crawling in the dirt And for all the little piggies Life is getting worse Always having dirt to play around in. Have you seen the bigger piggies In their starched white shirts You will find the bigger piggies Stirring up the dirt Always have clean shirts to play around in. In their ties with all their backing They don't care what goes on around In their eyes there's something lacking What they need's a damn good whacking. Everywhere there's lots of piggies Living piggy lives You can see them out for dinner With their piggy wives Clutching forks and knives to eat their bacon. This scripture Also reminds me of BofA: Revelations Chapter 18: "THEY LIVED IN SHAMELESS LUXURY ......" I think of the BofA and the people at the top when I read this. I am not suggesting that this scripture actually means that it is BofA. I am just simply suggesting that there are similarities. Never the less, these CEO people probably live in their mega mansions in no fear of foreclosure. After all, we do not read anything about the CEO of BofA being foreclosed on. Instead we read in USA Today: “Bank of America and two former top executives were charged with securities fraud.” Was anybody really surprised? I remember it seemed like the Countrywide CEO retired the minute the housing crisis broke out. Remember those articles that stated: “Countrywide Financial Corp. CEO Angelo Mozilo, under fire over the size of his potential payout from the proposed sale of his troubled mortgage company, says he is forfeiting some $37.5 million in severance pay, fees and perks he was scheduled to receive upon his retirement.” Wow! I wonder what his house looks like!? Well at least he got his bail out or modification from BofA. Too big to fail banks such as Countrywide and BofA, were basically giving out loans that they knew that people would default on. This was done with practically no verification of income. Subsequently, these piggy banks would make millions upon millions of dollars. Leaving the American economy holding the bag full of bad loans. Once the piggy banks realized they had zero accountability, because Wall Street would buy these bad loans, they did not care. This is really where the problem starts. In the end, it seemed that their love of money, would be more important than their love of country. Basically because they knew that it was going to severely damage the American economy. Which incidentally Communist Russia was not brought down by nuclear weapons, but a failing economy. I mean if this were Iran or some other country, it would be considered an attack on the American economy. Ironically, the potential enemy here would not be named Iran, but MORE IRONICALLY NAMED Bank of America. Talk about being hung with your own rope! Maybe they should be named more appropriately “Bank of Defrauding America.” The little piggy banks potentially caused the whole crisis by: One: Giving out loans to people who could not afford the loan. In retrospect, they sort of controlled the price of houses with their invisible money, as well as qualifying unqualified borrowers. Thus resulting in flooding the housing market with people who actually could not afford the home they were purchasing. Less homes available on the market will drive the price of homes up. All this was done with them knowing that the market would eventually be flooded with foreclosures on the people they gave loans, that could not afford the payments. It was like a dam broke open flooding the market with foreclosed homes. Two: Making us lose our equity. The result of the instant flood of foreclosed homes on the market would result in driving the price of our homes instantly down. It seemed like we all lost our equity over night and we all became upside down on our loans. Basically our houses were not worth even what we bought them for or borrowed the money for. All potentially caused by the piggy banks. Three: Asking for a Bail out: BofA would have the audacity to barrow something like 25 billion dollars from the American Tax Payer. Then they turned around and said they didn’t need it. Of course they didn’t! They sold the loans off! But what did they do with the nearly 25 billion dollars while they had it? They probably put it in an account and collected millions in interest. Basically free money! So the piggy banks would actually be paid and rewarded for their bad behavior and potential crimes. Well how about giving us a billion to put in the banks and collect interest on for a few months. We will also give it back after we make all the interest off of it. Four: False promise of a modification: Then piggy banks promise the American people a bail out in the form of a modification. In which they delay, harass and abuse the people asking for them. Which makes us all suspicious and wonder what are they are actually up to now? But what a slap in the American peoples face, after we delivered their bail out in record time. What have they done with that three month trial period money that we gave them? Probably put in the bank and made interest on it again! Sounds like we are being used over and over and over again! Depending on BofA’s integrity and empathy in the form of a loan modification, is insinuating that they had any integrity or empathy to not cause it all in the first place. I see it as equivalent as asking the bully who just stole your lunch money for a loan! Five: In the end Thomas Jefferson was right: Thomas Jefferson 1802 ‘I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their ufathers conquered..’ Revelations: “RENDER HER EVEN AS SHE HERSELF RENDERED, AND DO TO HER TWICE AS MUCH , YES TWICE THE NUMBER OF THINGS SHE DID; IN THE CUP WHICH SHE PUT A MIXTURE PUT TWICE AS MUCH AS THE MIXTURE FOR HER. TO THE EXTENT THAT SHE GLORIFIED HERSELF AND LIVED IN SHAMELESS LUXURY.” Is it time to start pouring twice the measure into BofA’s cup! I have filed a lawsuit against BofA . Please read article at http://news.yahoo.com/s/prweb/20100323/bs_prweb/prweb3766544_1 I have heard that the BofA higher ups are looking at this site and I could use your supporting comments. Thank you for your support. John Wright Homeowner and Taxpayer God Bless

Submitted by Janyth Cheryll ... (not verified) on
I totally agree with you! I just received the denial call for the third time after I had to re-submit my paperwork so many times I lost count. Each time they "did not get it" or "I submitted it late and need to wait 30 days"..... where do I join this lawsuit and how can I help crush their monopoly? This is absolutely ridiculous!

Submitted by Janyth Cheryll ... (not verified) on
I totally agree with you! I just received the denial call for the third time after I had to re-submit my paperwork so many times I lost count. Each time they "did not get it" or "I submitted it late and need to wait 30 days"..... where do I join this lawsuit and how can I help crush their monopoly? This is absolutely ridiculous!

Submitted by John Wright (not verified) on
Look! One of the little Piggies was before a commission yesterday! Guess what he said in regards to himself and his management team? "We all bear responsibility for not recognizing this, and I deeply regret that" My Answer: NOT HALF AS MUCH AS WE ALL REGRET WHAT YOU DID! I mean after all, I am sure his mega mansion is not in threat of foreclosure. I wonder if the CEO of Bank of America and Citigroup live in the same neighborhood? Because I know they do not live in ours after I read this: “Prince left the bank in 2007 with almost $40 million in bonuses, shares and options. Citigroup paid Rubin more than $120 million for his work at the bank over several years. Bad bets on repackaged debt securities, consumer loans and other assets forced Citi to take three separate government rescue packages totaling $45 billion, more than any other major bank. When the dust settled, taxpayers held about a third of Citigroup's common stock and $27 billion of its debt.” See guys, shameless luxury! (Yahoo News) My Answer: See! They did too do modifications! THEY MODIFIED THEIR INCOME! So lets not say they did not do any modifications. Here Comes The Apology!: "Chuck" Prince, former chief executive of Citigroup, apologized for his role in the crisis that roiled the U.S. economy." (Yahoo News) My Answer: Does that mean if Bin Laden apologized, we will forgive him and he can go back to his palace too? Because the last time I checked, Bin Laden played a part in a crisis that roiled up the U.S. economy. What did the Commission Think Of His Testimony? “Some members of the Financial Crisis Inquiry Commission -- charged by Congress with explaining the origins of the worst U.S. financial crisis since the Great Depression -- did not buy the two executives' half-hearted mea culpas.” (Yahoo News) My answer: AND NEITHER DO WE! “Vice Chairman Bill Thomas pushed the Citi executives for some explanation of how they personally square the bank's financial calamities with their own lavish compensation packages, “saying, "Behavior has to have consequences.” (Yahoo News) YAH LITTLE PIGGIES! HOW DO YOU ANSWER THAT QUESTION?! Please feel free to support my lawsuit against BofA with your comments at: http://news.yahoo.com/s/prweb/20100323/bs_prweb/prweb3766544_1

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