Servicers Squeeze Homeowners With Predatory Practices
One form of home equity theft, which I earlier mentioned in this blog, in this post, is called mortgage servicing abuse, which is discussed in this BusinessWeek Online article, reported on MSNBC.com.
The article mentions one case of a homeowner in foreclosure that was charged with $18,000 in late charges and attorney fees, on top of the past due mortgage payments.
In another, a mortgage servicer claiming that it hadn't received 19 payments from a homeowner miraculously found the payments after an investigator from the U.S. Department of Housing and Urban Development ("HUD") showed up and started looking into the matter.
Relative to other tactics used by predatory lenders, one industry expert stated, "predatory servicing has attracted little attention, yet in many respects it is more vicious and the adverse consequences are more far-ranging."
This article makes reference to a $40 million fine imposed by HUD in 2003 on one mortgage servicer for its abusive practices, to which one California law professor observed, "The FTC hoped by nailing Fairbanks it would send a message to the whole industry. It hasn't yet."
According to consumer lawyers, "the system preys on the ignorance of borrowers and creates an opportunity to add false fees and charges not authorized by law or their mortgage contract".
One attorney refers to those companies engaged in mortgage srvicing abuse as "foreclosure factories".
One case that consumer attorneys may find of some interest is the lawsuit brought by a Texas consumer lawyer who obtained an $11.5 millon jury verdict on behalf of his client, a widowed grandmother, after finding that the loan servicer engaged in fraudulent practices in servicing her home-equity loan.
For the full story, and for anyone wanting an easy-to-read primer on this form of "home equity theft" (one that hasn't received the attention that other forms have) , you are urged to read the BusinessWeek Online article: The ‘foreclosure factories’ vise
Click here for slide show
Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics zebra
The article mentions one case of a homeowner in foreclosure that was charged with $18,000 in late charges and attorney fees, on top of the past due mortgage payments.
In another, a mortgage servicer claiming that it hadn't received 19 payments from a homeowner miraculously found the payments after an investigator from the U.S. Department of Housing and Urban Development ("HUD") showed up and started looking into the matter.
Relative to other tactics used by predatory lenders, one industry expert stated, "predatory servicing has attracted little attention, yet in many respects it is more vicious and the adverse consequences are more far-ranging."
This article makes reference to a $40 million fine imposed by HUD in 2003 on one mortgage servicer for its abusive practices, to which one California law professor observed, "The FTC hoped by nailing Fairbanks it would send a message to the whole industry. It hasn't yet."
According to consumer lawyers, "the system preys on the ignorance of borrowers and creates an opportunity to add false fees and charges not authorized by law or their mortgage contract".
One attorney refers to those companies engaged in mortgage srvicing abuse as "foreclosure factories".
One case that consumer attorneys may find of some interest is the lawsuit brought by a Texas consumer lawyer who obtained an $11.5 millon jury verdict on behalf of his client, a widowed grandmother, after finding that the loan servicer engaged in fraudulent practices in servicing her home-equity loan.
For the full story, and for anyone wanting an easy-to-read primer on this form of "home equity theft" (one that hasn't received the attention that other forms have) , you are urged to read the BusinessWeek Online article: The ‘foreclosure factories’ vise
Click here for slide show
Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics zebra
posted by Home Equity Theft Reporter at 8:24 AM
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