HSBC Settles Mortgage Abuse Claims with US DOJ and States

A recent press release issued by the United States Department of Justice reports that the Justice Department and other federal agencies along with almost every State Attorney General have reached a settlement resolving allegations that HSBC committed mortgage loan origination, servicing and foreclosure abuses. The settlement appears to total $470 million of which $370 million is scheduled to be available for consumer relief including modifications and other forms of mortgage relief.

The implementation of the settlement will be overseen by Joseph A Smith, Jr., who was the monitor for the $25 billion National Mortgage Settlement which was reached in February 2012. It is estimated that approximately 345 New Jersey consumers may be eligible for relief under this program if they either lost their homes or where the victim of abuse by HSBC from January 1, 2008 to December 31, 2012.

Unfortunately, it appears that the selection of current or former HSBC mortgage holders will receive assistance under this program will be done by HSBC. HSBC will also determine what relief to offer to eligible consumers.

We are urging anyone who believes that they might benefit from this settlement to contact us for assistance in filing a mortgage modification application. If you would like to review the Department of Justice press release regarding this issue click on the following link:US DOJ Press Release

Mortgage Fraudster Sent to Jail

A recent item in Newsday reports that Aaron Wider, a mortgage broker who lured people into mortgages which they could not pay, has been sentenced to 30 years in prison. It is about time that those who perpetrated these frauds on consumers receive the punishment which they deserve. We still wait anxiously to see if any of the executives of the nations biggest banks, who orchestrated the massive collapse of the economy are brought to justice. Unfortunately, his conviction will do little to help those who have already lost their homes or who are still in foreclosure. If you are still looking to obtain a mortgage modification, call us to discuss your options. For more information click on the following link — Newsday

Bank of America Mortgage Modifications

The United States Department of Justice recently anounced that it had reached a new settlement with Bank of America. As a result of this settlement, Bank of America is resolving many outstanding claims against it which were made by the various Departments of the US government and also matters outstanding with several State Governments.

The settlement is valued at 16.65 billion dollars. Of greatest interest to consumers is the fact that of the 16.65 billion, 7 billion is earmarked for relief to consumers. Those eligible for relief include consumers who had mortgages with Bank of America, Countrywide and Merrill Lynch. The relief may come in the form Mortgage Modifications and possibly may include Principal Loan reduction for some homeowners.

If you have a mortgage which was with Bank of America, Countrywide and/or Merrill Lynch, now is the time to seriously consider filing for a mortgage modification.

Our office stands ready to assist you should you choose to apply for a mortgage modification. Do NOT let this opportunity pass. If you would like to schedule an appointment to meet with us call us at 732-752-8834

For more information click here

9/22/2014

New Jersey Foreclosure Future Bleak

Foreclosure levels in New Jersey are the second highest in the nation, according to a report by the Wall Street Journal. New Jersey’s 7% of homes in foreclosure just barely rank behind Florida’s 7.1% of homes in foreclosure. New Jersey also has the second highest level of mortgage delinquencies of more than 90 days.

While most states appear to be on track to get caught up with foreclosures by spring of 2014, New Jersey will likely require at least another year to clear its backlog. This means that the frustration of New Jersey homeowners who are stuck in foreclosure will likely continue for another 18 months, if not more.

There are many options available for struggling homeowners. Among these are loan modifications, debt reorganizations, and bankruptcy. We have over 50 years of combined experience dealing with troubling financial situations. We are glad to talk to anyone free of charge regarding their situation and options for the future.

To read the Wall Street Journal article about foreclosures, please click here.

If you want to speak to an experienced professional about your financial situation, please feel free to contact us using the form on this website or by calling the office at 732-752-8834.

Foreclosure Bonuses – Is the Mortgage Modification Plan Phony?

According to court documents filed this week in Boston, Bank of America employees were routinely awarded for forcing (sometimes undeserving) homeowners into foreclosure. Yes, that’s the same company appearing nightly on your television set promising to help you through your hard times.

Former bank employees allege that they were told to lie to customers about why their federally-mandated loan modifications were being delayed or failing. They were told to request documents and information they already had in some instances. The bank even had twice-monthly “blitzes,” when scores of loan modifications would be denied without a second glance at the merits of the application.

To top it all off, the bank would do all of this and then turn around and lie to the federal government and the public about how many loan modifications were being granted. Why do all of this instead of helping homeowners as promised? Simple: the bank and its servicers make a ton more money that way.

In a regular mortgage situations, mortgage servicers make only a modest fee for taking in and distributing payments. When borrowers begin to go into default, however, the servicers make many more fees. If a loan modification is granted, the servicers go back to making their modest fee, assuming borrowers can keep up with the payments. If the modifications are denied, though, borrowers likely continue to default and the servicers collect fees.

Why lie about giving loan modifications? First, it gives the public a better impression of the bank. It allows the public to believe the television commercials claiming that the bank will help. Another reason to lie, however, is because the bank gets even more money that way. The government HAMP program, requiring some banks to grant loan modifications under certain situations, pays the banks a set amount for each loan modification that is granted. The government pays for successful loan modifications because they understand the financial incentive for banks to deny them. In an effort to prevent what is happening with Bank of America, the government established this incentive program.

From the court documents filed this week, though, it seems like Bank of America thought that the best route was to lie in order to collect both the government incentive and the fees from customers.

To read more about this, please click here.

If you want to discuss your loan modification, mortgage situation, or foreclosure with an experienced professional, please contact the office using the contact form on the website or by calling 732-752-8834.

Fannie Mae and Freddie Mac Streamlined Modifications

The reports are out on the first quarter of 2013. So far this year, credit card debt is down and mortgage debt is up. Likewise, 90-day late payments on credit cards are less frequent while similar payments on mortgages are rising. This data points to a trend of paying credit cards while allowing mortgages to fall by the wayside.

The current administration’s stance on mortgage debts may be partly to blame for that trend. The Obama Administration’s most recent plan for helping distressed homeowners went into effect on May 13, 2013 – unexpectedly earlier than its originally announced July 1, 2013 launch date. Known as “Streamlined Modification,” the plan requires mortgage loans from Fannie Mae and Freddie Mac that are at least 90 days, but no more than 720 days (almost two years), in default to be automatically offered a modification with no proof of hardship, subject to a few other restrictions.

Homeowners who can provide proof of hardship under this program can receive more significant savings than others, but any loan that falls 90 days delinquent and hasn’t been modified more than two times in the past will be eligible for modification. Further, it is the job of the agency to alert eligible homeowners to the program. People struggling to make their mortgage payments will not have to seek out Streamlined Modification, but will instead receive a notice about the program and an offer for modification automatically upon 90 day default. Under the program, an offered modification only becomes finalized after the homeowner makes three “trial” payments under the plan.

While seemingly a great plan to curb foreclosure, the program has been criticized as encouraging people to default 90 days in order to be offered a modification. With no mortgage payment to make, some have turned to paying down other debts, like credit cards. No direct link between the Streamlined Modification program and the reduction in credit card debt has been found. Whatever the reason for the decrease, however, consumers must be careful not to shift resources as a matter of course. While it may seem attractive, robbing Peter to pay Paul will only work to keep creditors at bay for short periods of time, if at all, and usually leads to more trouble in the end.

For more information on the Streamlined Modification program, please click here to read about it, or here for an FAQ.

If you have any questions about the content of this article or want to discuss debt management, please contact the office at 732-752-8834.

Finally, Foreclosure Relief to Borrowers… But is it Enough?

At the end of February 2013, the Office of the Comptroller of the Currency and the Federal Reserve Board came to an amended agreement with thirteen mortgage servicers. As seems to be the case with every major settlement involving mortgage servicers, there is good news and bad news to report. The good news is that borrowers who were in foreclosure during 2009 and 2010 with the included banks will receive cash payments and other relief totaling $9.3 billion. The bad news is that some people will get less than they deserve.

The included mortgage servicers are: Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo. The 3.8 million borrowers who were in foreclosure with one of these thirteen servicers in 2009 and 2010 are entitled to cash payments of up to $125,000. Each of these borrowers will receive a notice from the Paying Agent by the end of March 2013 with payment details. Borrowers DO NOT have to take any additional steps to receive these payments.

In order to understand the downside to this arrangement, a little background information is necessary. Prior to the amended agreement that was reached last month, the banks and the government had an agreement that was constructed in 2011. That agreement required the banks to hire independent consulting services to review foreclosures from all of 2009 and 2010, looking for signs of wrongdoing on the part of the banks. Specifically, the contractors were looking for instances where banks foreclosed when borrowers were current on payments, charged inappropriate fees, or botched loan modifications.

Ultimately, the contractors racked up over $1 billion in fees and reviewed only 104,000 of the 4 million foreclosures from 2009 and 2010. Now, though, the February settlement requires payments be made to all 3.8 million borrowers who were in foreclosure, with no regard for harm caused by bank mistakes. Thus, a person who was properly in foreclosure may receive the same payment as someone who was wrongly evicted from their home.

Borrowers who were in foreclosure in 2009 or 2010 with one of the thirteen named mortgage servicers can call the Paying Agent at 1-888-952-9105 to update their contact information or to verify that they are covered by the agreement. To read more about the agreement, click here and here.

If you have any questions about the contents of this article or the foreclosure relief agreement, please contact the office at 732-752-8834.

INDEPENDENT FORECLOSURE REVIEW PROGRAM ENDS 12/31/2012

INDEPENDENT FORECLOSURE REVIEW PROCESS
EXPIRES DECEMBER 31, 2012

We are writing to remind all of our friend and clients that the deadline to file a Request for an Independent Foreclosure Review is December 31, 2012.

If you had a foreclosure in process(initiated, pending or completed) between January 1, 2009 and December 31, 2010; and the property securing the loan was your principal residence and the mortgage was serviced by one of the lenders identified on the following link, we urge you to request an Independent review.

Link to list of lenders who must offer the Independent Foreclosure Review is at the Federal Reserve Governors website explanation of the program, listing of lenders informative video

http://www.federalreserve.gov/consumerinfo/independent-foreclosure-review.htm

These reviews were ordered by the Federal Reserve and the Office of the Comptroller of the Currency in a effort to give homeowners who were unfairly treated and financially harmed by the actions of the listed banks and opportunity to make a financial recovery from the banks for the errors, misrepresentation or other deficiencies that may have occurred during the foreclosure process.

A very informative short video which further explains the program is noted above.  If you think you are eligible, we urge you to apply for a Review.

The deadline is December 31, 2012.  You can make the request over the internet.

An Independent Foreclosure Review process has been set up by Order of the Board of Governors of the Federal Reserve System and by the Office of the Comptroller of the Currency.

Additional information can be obtained from the Borrowers Quick Reference at the website below:

    http://www.occ.gov/topics/consumer-protection/foreclosure-prevention/framework-summary.html

Before you complete your application be sure to review the on the  Request for Review Help Sheet on following website:

 http://www.federalreserve.gov/consumerinfo/files/independent-foreclosure-review-form-help-sheet.pdf

To submit an application go to:

   https://independentforeclosurereview.com/

Once again, we urge everyone who believes that they are eligible request a review.  There is no fee for the review.