Are Banks And Servicing Companies Trying To Insulate Themselves Again For More Problems?
If you are a homeowner who has been trying to modify your home mortgage, you know that the only way to get a modification is to stop making your payments. After making your trial period payments, you will be sent modification papers for your permanent modification, then that final paperwork never comes or has different terms than were set forth on the phone.
"We didn’t receive your paperwork in time to finish the paperwork" or "parts of the paperwork were missing so we can no longer consider you for modification." These statements or statements with only slight variations are all too familiar to the thousands of Southwest Floridians currently experiencing the frustration of dealing with their lender or servicing company while trying to obtain a loan modification.
Recently a number of people have received notices that the servicing of their loans is being transferred yet again from BAC Home Loan Servicing to Bank of America N.A. or from Chase Home Finance LLC to JPMorgan Chase Bank N.A. In many instances these transfers involve loans which are currently in the HAMP program or are otherwise being considered for modification.
Why would these transfers occur on loans that are in default and in the process of modification? One can only speculate, and I am fairly certain that that the banks will argue that these transfers are being done to improve the process and/or become more efficient. Yet, could there be a more sinister reasoning behind this transfer of loans?
Are banks looking to insulate themselves from potential litigation arising from their unfair and deceptive trade practices? Many of these loans were transferred from Countrywide Home Loans to BAC Home Loan Servicing; why not transfer them directly to Bank of America N.A. then?
Florida’s Unfair and Deceptive Trade Practices Act specifically does not apply to banks or savings and loan associations regulated by federal agencies. Thus by transferring the servicing from an entity that potentially could be liable for the misleading and some times outright false statements and practices related to the home loan modification process, to the bank itself which is exempt from facing the consequences for their future unfair and deceptive trade practices, the banks are once again asking for protection while leaving the homeowner to face the burden of their misdeeds.
This blog was written by David Lampley, Esq. of the Dellutri Law Group, P.A. Mr. Lampley focuses his practice on Consumer Law Issues where he helps consumers through the Bankruptcy Process, and litigates Credit Reporting Issues, Unfair Debt Collection Issues, Mortgage Foreclosure Issues and other Consumer Law Issues.
