Bank of America and Wells Fargo Being Sued Over National Mortgage Settlement Violations

New York Attorney General Eric Schneiderman announced that he plans on suing
Bank of America Corp and Well Fargo and Company over their mortgage modification
practices. He alleges both banks have repeatedly violated the terms of the $26 billion
National Mortgage Settlement (NMS) brokered last year. The New York Attorney
General has 339 documented cases of violations.

The National Mortgage Settlement was negotiated in February 2012 between 49 states
and the five major lenders: Ally/GMAC, Bank of America, CITI, JPMorgan Chase
and Wells Fargo. (The NMS is unrelated to the now-defunct Independent Foreclosure
Review.)

The Settlement has 304 rules or servicing standards meant to correct bad and illegal
mortgage lending practices at the above-named five banks because they “persistently
failed to provide fair and timely services to their customers” stated New York’s
Attorney General. The five banks that signed the settlement were legally required to take
specific steps to protect homeowners. The New York Attorney General (NYAG) also
stated “Wells Fargo and Bank of America flagrantly violated those obligations [from
the settlement] putting hundreds of homeowners across New York at greater risk of
foreclosure”.

Scheiderman’s office released a statement they intend to ask the court “to impose
injunctive relief and to require strict compliance under the settlement”. This lawsuit will
be the first time an attorney general has “brought a legal enforcement claim under the
auspices of the National Mortgage Settlement”.

The AG’s office also stated that Bank of America Corp and Wells Fargo and
Company violated four standards “dictating the timeline for banks to process mortgage
modification applications.” These standards include giving borrowers written approval
of a loan modification within three business days, and notifying borrowers within
five days of application if there are any missing documents that may hold up the loan
modification.

Homeowners who were calling the banks for help were having problems getting through
to a representative, could never get a single-point contact and were asked repeatedly
to send and re-send the same documents. Under the Settlement, these problems were
supposed to have been eliminated. Unfortunately, homeowners still have to send in the
same documents over and over again and have the same problems contacting the bank’s
representatives.

Due to the complexity of the mortgage market and the agreement itself, the NMS process
was expected to take three years. Most borrowers wouldn’t know immediately if they
were eligible for any relief. According to the NMS, no payments have been issued by the
NMS as of this date and payments won’t begin until mid-2013.

The settlement is supposed to have provided assistance for homeowners needing loan
modifications, including the first and second lien principal reduction, for borrowers
current with their mortgage but underwater, and for borrowers who lost their homes
to foreclosure between January 1, 2008 and December 31, 2011. Those who lost their
homes to foreclosure would receive cash payments. These borrowers were sent forms to
be filled out and returned. There was no requirement from the borrower to prove financial
harm. If you didn’t receive and return a Claim Form, it’s too late to file now.

To file a complaint in Colorado, please contact Colorado Attorney General John Suthers,
1525 Sherman St., Denver, 80203. 303 866-4500.

Keith A. Gantenbein, Jr. is a Colorado consumer advocate attorney, foreclosure
defense and real
 estate attorney located in Denver and servicing all of Colorado. His
foreclosure defense practice includes
 foreclosure prevention, foreclosure assistance, loan
modifications, short sales, and all other foreclosure
 defense legal assistance. He also
handles bankruptcies, mortgage negotiations, lender liability, real estate,
 civil litigation,
debt defense, debt harassment, contracts and landlord/tenant. If you think you
will be
 facing debt collection, foreclosure, or are in the foreclosure process, or
have had a wrongful foreclosure,
 contact Keith Gantenbein at (303) 618-2122 for
a one-hour consultation where he will discuss your
 situation and go over all your
options with you.