S. California Lender Accused Of Pushing Homeowners Into Foreclosure By Jacking Up Escrow Payments After Borrowers File Bankruptcy

In Pasadena, California, the Whittier Daily News reports:

• Allegations that OneWest Bank is systematically pushing home loan borrowers toward foreclosure has elicited concerns from two Southland lawmakers. Rep. Adam Schiff, D-Pasadena, said the claims contained in several lawsuits - if true - don't bode well for people who are trying to remain in their homes. "I personally don't know what the evidence is, but I'd be quite shocked if that was going on," he said. "I don't know how banks can unilaterally raise mortgage rates when a bankruptcy is going on."

• Rep. Linda Sanchez, D-Lakewood, also voiced concerns about the claims leveled at OneWest, or any other bank, for that matter. "I'm concerned about recent allegations that banks in Southern California may be victimizing homeowners," Sanchez said. "With the current economy, banks - especially those that received bailout funds - should be working with borrowers rather than pushing them into foreclosure."

• Sacramento attorney Peter Macaluso and Mark Wolff, another attorney from Elk Grove, recently filed several lawsuits on behalf of struggling borrowers whose mortgage loans are held by OneWest. The actions allege the bank routinely performs an escrow analysis soon after a borrower files for bankruptcy. Following that analysis, the homeowner's monthly mortgage payment is hiked - sometimes substantially.

• "They changed the mortgage payment for one of my clients eight times in eight months," Macaluso said earlier this week. The hikes place monthly mortgage payments further out of reach for financially strapped borrowers, effectively pushing them toward foreclosure, he said.

For the story, see Lawmakers concerned over OneWest lawsuits.