Welcome to The Home Equity Theft Reporter, a blog dedicated to informing the consumer public and the legal profession about Home Equity Theft issues. This blog will consist of information describing the various forms of Home Equity Theft and links to news reports & other informational sources from throughout the country about the victims of Home Equity Theft and what government authorities and others are doing about it.
Tuesday, July 10, 2012
More Homeowner Casualties From The Frontlines Of Banksters' Force-Placed Insurance Racket
In Fort Lauderdale, Florida, the South Florida Sun Sentinel reports:
Florida led the country in its share of force-placed insurance premiums the past three years, including 35 percent, or $1.2 billion, in 2011 — more than three times the amount sold in the next-largest state, California.
That's according to sworn testimony provided last month for the United States Judicial Panel on Multidistrict Litigation.
Florida has one of the country's highest numbers of foreclosures, and most people stop paying insurance premiums when they default on mortgage payments. That means a lot of policies are imposed on consumers without coverage.
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The policies should cost less because they typically exclude coverage offered by most homeowners and the insurers don't have to pay agent commissions and advertising or customer service costs to attract and keep policies, said David "Birny" Birnbaum, a former insurance regulator in Texas who is now an economist and consumer advocate with the Center for Economic Justice in Texas.
Birnbaum provided the testimony on Florida and other states' shares of force-placed insurance policies, calculating the numbers using thousands of records from the National Association of Insurance Commissioners. "Some of these charges are so outrageous that they push people into default and foreclosure," Birnbaum said.
Just how much are South Floridians paying?
Lord Toussaint said he's being charged a whopping $90,000 a year for coverage that used to cost $5,600 for his home in Coral Gables. Toussaint, owner of an electronics business, said he has been trying to get the mortgage servicer to reduce the coverage since he was notified last year of the higher cost.
The problem, he said, is the imposed policy covers the home for $3 million — what may be considered the new value of the home since he made major renovations — instead of the $560,000 amount of the loan.
Christina Ulbrich, of Fort Lauderdale, was allegedly billed $12,787 and $9,708 for a year of force-placed hazard insurance and windstorm insurance, respectively, when she already had hazard coverage for the same period. Nationwide Insurance had charged her $892, and her mortgage doesn't require windstorm, according to a lawsuit she filed in November in U.S. District Court for the Southern District of Florida. The policies were backdated up to 17 months, and the windstorm policy had expired months before the mortgage company purchased it on her behalf, the suit alleges.
Hilda Sultan, of Davie, was charged $33,199, including a $7,138 commission for an insurance agency that is a subsidiary of her mortgage servicer, according to 2009 court documents in a lawsuit pending against the mortgage company.
She "always maintained appropriate insurance coverage," but the servicer imposed the policy anyway — costing her eight times more than the roughly $4,000 it should have cost, according to the suit. "I had no awareness whatsoever that anything lapsed. I thought it was coming out of my mortgage payment and the escrow [account]. They didn't notify me. I didn't know until I was refinancing my loan ... during my divorce," said Sultan, a full-time mother who said she spends her spare time working on child advocacy legislation. "I felt devastated, absolutely devastated. I was counting on that money for my children's education."
Jeff Golant, an attorney representing borrowers in about 20 lawsuits over force-placed coverage, including Sultan's, said even when companies provide notice, it doesn't give them the right "to rip people off."
CBC News: Betrayal of Trust (A CBC investigation reveals how lawyers across Canada have misappropriated and mishandled clients money, to the tune of tens of millions of dollars, or sometimes even charging vulnerable people top dollar for shoddy services)
Land Contract/Contract For Deed/Rent-To-Own Rackets
The New York Times: The Housing Trap (In the wake of the housing crisis, low-income families have turned to seller financing to buy homes but these deals can be a money trap)
Beware The Fine Print: Consumers Forced To Sign Away Their Rights To Use Court System
The NY Times: Arbitration Everywhere, Stacking the Deck of Justice(Part 1 in series examining how clauses buried in tens of millions of contracts have deprived Americans of one of their most fundamental constitutional rights: their day in court)
Foreclosure Mills' Abysmal Record In Complying With New NYS Foreclosure Requirements
Justice Deceived: How Large Foreclosure Firms Subvert State Regulations Protecting Homeowners
MFY Legal Services Report On Questionable Practices By Process Servers In Debt Collection Cases
Justice Disserved: A Preliminary Analysis of the Exceptionally
Low Appearance Rate by Defendants in Lawsuits Filed in the Civil Court of the City of New York
Mortgage Mess Redux: Robo-Signers Return (A Reuters investigation finds that many banks are still employing the controversial foreclosure practices that sparked a major outcry last year)
CNN Video: As Foreclosures Mount, Florida Court Turns To 'Rocket Docket'
The Wall Street Journal: A Florida Court's 'Rocket Docket' Blasts Through Foreclosure Cases (2 Questions, 15 Seconds, 45 Days to Get Out; 'What's to Talk About?' Says a Judge)
"Produce The Note" Strategy When Dealing With Missing Promissory Notes In Foreclosure Actions
ABC Video: Fighting Against Foreclosure (Some homeowners have found a new tactic to keep the banks at bay)
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