Friday, December 28, 2012

New Settlement Exposes More Shady Dealing

It seems that every other week Bank of America is being exposed for shady dealings in a variety of areas.  They are being successfully sued and forced to settle legal and regulatory issues all over the country.  The latest example was revealed in yet another settlement between Bank of America (and other financial institutions) and a regulatory agency.

Bloomberg reports on the latest chapter of shady dealing:
Local authorities were unfairly asked to reimburse payments that the firms made over five years to a California lobbying group to help them influence the state, the Financial Industry Regulatory Authority said yesterday in a statement.  
The firms inadequately described the fees, wrapping them into bond- underwriting expenses...
The banks...agreed to pay $3.35 million in fines and reimburse certain California bond issuers $1.13 million, according to the statement....  
 The lobbying payments spanned 2006 through 2010... 

The chief of enforcement at the Financial Industry Regulatory Authority (FINRA) made the following observation about these activities:
 "It was unfair for these underwriters to pass along the costs of their Cal PSA membership to the municipal and state bond taxpayers, neglecting to disclose that these costs were unrelated to the bond deals," 
FINRA went on to state that Bank of America and the other firms violated fair dealing and supervisory rules of the Municipal Securities Rulemaking Board.

This hardly elicits confidence from someone that is currently trying in good faith to negotiate a "fair deal" with Bank of America.  How can a simple homeowner or policymakers for that matter trust them? How do you approach a firm with this kind of persistent disregard for regulations, rules and common decency? If we can't trust them to abide by simple rules and regulations, how can we trust them to abide by their various settlement agreements and pronouncements?

UPDATE: Apparently it doesn't matter that the big banks keep violating rules, regulations, agreements and laws because it still pays off big for them.  From Huffington Post Finance today: "Finance Stocks Dominate The Market In 2012 Despite Continuous Fines, Scandals and Fraud"

Thursday, December 27, 2012

Where do you get help and will it be helpful?

Since Bank of America has apparently decided to put me blindly through their modification maze, I tried to find someone that could offer actual help.  I called Congresswoman Gwen Moore's Milwaukee office and an aide was very encouraging and helpful.  He suggested that I contact one of the local nonprofits in the Milwaukee area that specifically help homeowners that are in my exact situation (and much worse).

Today I did call one of those organizations and the counselor was the total opposite of BOA's "we are here to help" line.  She very specifically laid out exactly what she needed, what she would do and the various options involved in a possible modification.  I've scheduled a meeting with her where we will go over all of the records and build the case for modification.

Although Bank of America set a deadline for January 6th for resubmitting my documents, the counselor confirmed that the date is mostly arbitrary.  I will be meeting with her a week later and the process will start shortly thereafter.

I called Bank of America's "we are here to help" line and advised them of these developments and asked them to document the fact that I will be submitting a modification proposal through this nonprofit.  Now I also document all contact that I have with BOA on my end.

If you are going through the modification maze I would suggest that you contact a few local nonprofits that specialize in this exact issue. At the very least it will help you cut directly through all of the BOA BS and give you a fair shot.

I will report back as the process continues.

Wednesday, December 26, 2012

The settlement callback that never came

Remember when the the U.S. Department of Justice and State Attorneys General announced the $25 billion settlement with 5 of the largest mortgage servicers? That happened way back in February of 2012 and it included Bank of America.  It was meant to address their history of mortgage loan servicing and foreclosure abuses.

Here are a few of the items and ideas that were announced at that time in a DOJ press release. I agree that the settlement is not strong enough but there are elements of it that appear helpful (in theory at least). I have emphasized specific things that may have been helpful in my own situation:

  • Reduced principals
  • Refinancing loans for underwater borrowers
  • Substantial changes in how servicers do business
  • "homeowners will be protected and treated fairly"
  • Stop using deceptive practices in offering loan modifications
  • Other forms of relief including forbearance of principal for unemployed borrowers
  • Restricted from foreclosing on a borrower that is being considered for a loan modification

Only a handful of days after I heard the news about this settlement I inquired with Bank of America by phone.  The representative took my name and information and claimed that they were putting me in some sort of queue and that someone would respond in some way and some point in the future.  After months of not getting an answer on what settlement related programs I might benefit from, I inquired by phone again.  I was told that they were very busy processing similar requests and that I would get an answer of some kind at some point in the future.

I'm still waiting and my situation continues to get more perilous.  Perhaps that is the entire point behind Bank of America's delay.

Tuesday, December 25, 2012

Love Letters from an "Account Manager"

You now know that Bank of America sent me what seems to be a fictional offer to apply for a loan modification.  You also know about the "Christmas Card" that they sent me just in time for the holiday.  But now let me tell you about the love letter from an alleged "account manager". 

The letter is allegedly from an "account manager" and it talks about how she is here to help me and how she will be contacting me soon to help me through this entire process.  It was initially such a welcome note before reality actually hit.  

I have not heard from this caring "account manager" since I first received the first love letter.   In fact when I tried to make a payment by phone they kept rerouting me to this alleged "account manager".  I left multiple messages but have not received one reply yet. So one letter tells me that I must pay x before January 26th but then you make it more difficult to even make a payment? I sent the payment via U.S.P.S. with tracking. Will they receive it or will it be sent back because my "account manager"  was not available to open the envelope?

Is this a real person or isn't it? Do they have good intentions or are they simply covering their own ass?  Do they show this kind of thing to policy makers and/or judges along with their phony attempts at loan modification?  Is there any process to actually verify their claims of helpfulness? 

Modification Maze

You may have heard Bank of America crowing about its efforts to help struggling homeowners.  "Oh my goodness we have all of these wonderful ways to help you."  Usually they are referring to a modification process wherein the bank modifies your loan to make it more affordable.

I'm struggling and your asking if I would like to modify my mortgage? Of course I want to do that, tell me where to sign!  If only it were that easy.  While alleged modifications may work for some struggling homeowners, I can't imagine that it is a very big percentage of them.  In my experience so far, it seems that Bank of America has made this process into a nearly impossible maze.

Here is how the willfully dysfunctional process has worked for me so far:

  1. I got a packet suggesting that I apply for a modification.
  2. I called the listed phone number repeatedly to make 100% sure that I gave them everything that they wanted just exactly how they wanted it. 
  3. I spent hours and hours tracking down the info and docs that they requested (damn near 100 pages worth).
  4. I received a reply that basically told me to do it all over again without any real explanation.
  5. I again called that super duper "we are here to help" phone number and they were unable to tell me what was wrong with the massive package that I sent the previously.  So how the hell do I know how to fix whatever the alleged problem was in the first place?
  6. They tell me to call a national non-profit that will help me go through the process line by line. But sadly a rep from that org told me that they do NOT help in that exact way. 
  7. If I don't meet Bank of America's tight timeline on successfully submitting whatever it is that they want, I will not even be considered for a possible modification.  

How I got here

In the "About this Blog" section to the right, I tried to give a quick glimpse of how I arrived in this horrible position. But I feel like it is important to give more details to dispel any knee jerk reactions. I'm certainly not blameless in this situation but I am also not a deadbeat.

  • At the end of 2008 I lost a job and to survive I created my own business in haste. 
Admittedly I was not in the position to carefully devise the best business model.  I do blame myself for not correcting that issue long before now.  I put all of my eggs in my political research basket even though that can be a very seasonal enterprise.  If you have a decent year, it can make up for that fact but if you have a disappointing one, it can put everything else in jeopardy.

Thankfully I've recently started getting some outstanding criminal defense related work. I can only hope that part of my business grows and quickly.  It could end up being a lifesaver in many ways.  I can only hope that I didn't wait too long to start diversifying my services.

  • My home is a duplex and right after losing my job I lost an outstanding tenant.  If I could rent the upper unit out again it would solve my mortgage issues longer term.  But then there is the furnace...
Unfortunately I also lost the furnace for that unit so I can't rent it and I've been unable to make enough to fund the cost of replacing it.

  • The bank induced Great Recession has been murder for home values and mine has certainly not been immune. 
Had my home value not fallen so dramatically I would have had an early option to possibly refinance at historically low interest rates. Perhaps I could have used some cash from the refinance to replace the furnace and rent out the upper unit. Perhaps I could have at least used the savings from a lower payment to eventually fund the installation of a new furnace.

  • After my mortgage was bought and sold many times it unfortunately ended up at the Bank of America.    They have been a bad actor long before they ever bought my loan from the string of defunct banks before them.  

Well you get the point...they are threatening to drag me into a Milwaukee County courtroom and God knows that they have more than enough experience being in one of those (often as a defendant). 

Again, I've not been perfect in my choices during some challenging times but there have also been a number of things that were beyond my control and for which I will accept no ownership.  There you have it, that is a bit more detailed explanation of how I got here.

Merry Christmas from Bank of America!

I can already hear you asking, "Why start this blog on Christmas Day?"  Well, I'm just following the lead of my nemesis, Bank of America. You see they so thoughtfully sent me a Notice to Accelerate Foreclosure that arrived on Christmas Eve.

Included with the notice is a January 26th deadline which I fully intend on honoring. I've been working like hell to get work so that I wouldn't get into this position in the first place. But now I'm going to redouble my efforts no matter what it takes or how badly I have to swallow my pride. 

In the event that I am not fully successful, the Bank of America's Christmas card was sure to fully explain how hopeless they will make my situation.  Not only will they file a foreclosure action but they will apparently start charging all manner of fees.  They would have me pay their premature legal fees, I would pay them a fee to invade my privacy with all manner of inspections. Fees, fees, fees and more fees until it is literally impossible to recover. It is almost as if they are intent on issuing their harsh judgement before I've even had one second in a real court.