Schumer decried the lenders’ tactics as amounting to “death by a thousand fees.”
New York Senator and Chairman of the Senate Judiciary Subcommittee on Administrative Oversight and the Courts, Charles Schumer has decried ‘Death by A Thousand Fees’; suggests better deterrence, stiffer penalties, and more disclosure to end ‘Vulture Mentality’ of mortgage lenders and servicers.
Can everyone say, “predatory servicing?” Welcome to mortgage servicing 101.
Mortgage Servicing Chapter 1 - Gouge homeowners and fee them to a quick foreclosure death, so we get richer. Hell, we are going to take their damn house back anyway, so, we might as well fleece their pockets as they lay on their foreclosure death beds, right?
Chapter 2 - Rinse and repeat.
Chapter 3 - More of the same.
Chapter 4- Senator Schumer has a microscope on our asses.
Chapter 5 - The wool has been pulled from our nations’ eyes.
Chapter 6 - To be continued
Schumer documented a pattern of abuse of borrowers through inflated, duplicative, or made-up fees that are often undocumented, undisclosed, and occasionally unlawful. Schumer is specifically considering a number of options for legislation, including expandng the authority of the U.S. Trustee’s office, and dramatically increasing the penalties and sanctions on bad-actor lenders that skirt bankruptcy law.
“My message to unscrupulous lenders and servicers should be heard loud and clear: Congress will no longer countenance this vulture mentality,” Schumer said. “We will not stand for the continued abuse of homeowners who have worked hard and played by the rules of bankruptcy - only to have their homes and credit ratings and livelihoods threatened by misconduct at the hands of greedy corporations who made poor bets in the first place. Given the record, I think the burden has shifted to these mortgage companies to demonstrate that their bad practices do not form an intentional pattern or deliberate business strategy.”
Schumer said the burden was on Countrywide and other lenders to prove the abuses were isolated incidents and not standard practice, and said that Bank of America-whose purchase of Countrywide is expected to be completed in the third quarter of this year-should reexamine how it proceeds with the transaction.
Steve Bailey, chief executive for loan administration at Countrywide told the senate panel;
The company’s employees have made mistakes “from time to time.” He said the company will hire an outside auditor to review its actions in cases involving homeowners who have filed for bankruptcy court protection.
But he disputed accusations, made by hundreds of borrowers in Pennsylvania, Florida and other states, that the company has sought to collect inflated fees and other payments by filing inaccurate bankruptcy documents. The Justice Department is currently investigating the accusations.
“Servicers have also been accused of intentionally assessing inappropriate fees and costs to borrowers in bankruptcy,” Bailey said. “With respect to Countrywide, these allegations are simply not true.”
More from Schumer;
“Companies have repeatedly sought to foreclose on homes where owners were current on payments, sought attorneys fees in bankruptcy court for motions that they have lost, and failed to keep even the most basic records to justify their claims in bankruptcy court,” he said.
Schumer also said that Bank of America Corp., which agreed to buy Countrywide in January for approximately $4 billion, should reconsider the deal’s price tag.
If the purchase price for Countrywide was “based in part on profits from these bad practices, Bank of America should demand a lower price, because these practices will not be allowed to continue,” he said.
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May 9th, 2008 at 5:16 pm
so what are the specifics of the schumer plan
May 9th, 2008 at 9:07 pm
Have they looked into the practice of Litton?
May 10th, 2008 at 7:26 am
Abolish the Federal Reserve and give us our currency back.
May 14th, 2008 at 1:52 pm
To Whom This May be able to help,
I have recently submitted an reassesed form/statement to the county of San Bernardino, in waiting for an answer, I was wondering would I be entitled to a refund for back taxes paid when property values have been dropping for a least a year? I’ve purchased my home in 2005 and got into one of those interest only loans, which I was able to have fixed at the same intest rate as the interest only. Sounds good but since we were behind in property taxes, this company paid the back taxes and tack it on our monthly note at a rate of $2000 more a month. So I ask to extend payment from 1 year to 3 years, but this only lower the rate by $1000 dollars. As I calulated this at one thousand dollars a month for 3 years comes out to about thiry six thousands for a twelve thousand dollar repay. Now the mortgage company has sold my loan to another company which is (just the last one) service provider not a lending company, but I know a lending company must hold the deed. How do I find the lending company to modify this loan? Please e-mail me if you can help and/or if you want to know the service company. Sign, Please HELP James
May 14th, 2008 at 3:53 pm
[...] Are You Being Over Taxed? Proposition 8 Protects Homeowners [...]
May 14th, 2008 at 3:57 pm
[...] Schumer decried the lenders’ tactics as amounting to “death by a thousand fees.” [...]
May 14th, 2008 at 4:05 pm
Los Angeles county is voluntarily doing this also. From website:
“Typically, an application is required to initiate a review of your property\’e2\’80\’99s value by the Assessor. However, in 2008 the Los Angeles County Assessor\’e2\’80\’99s Office will be proactive in reviewing those single-family homes and condominiums that were purchased between July 1, 2004 and June 30, 2007. We will look at sales of comparable properties that sold near the lien date, January 1, 2008. If the market value is less than the assessed value indicated on your 2007-08 tax bill, the assessed value will be reduced accordingly. An application will not be necessary.”
Beware of scammers out there who say they will work with the county for you for a fee of course.
Also from http://www.lacountypropertytax.com:
“We are aware of at least one private company that did a mass mailing to property owners offering their services to pursue a reduction in their property taxes. Specifically, they are seeking to file an assessment appeal on the property owner\’e2\’80\’99s behalf. While there is no initial fee charged for the filing of an appeal, if a reduction is granted, this particular company will receive 45% of the amount of the tax savings for the next two years. We expect other private companies to offer similar services for a fee or a percentage of any tax savings.
Solicitations of this type may not be illegal, but property owners should be aware that the Assessor\’e2\’80\’99s Office provides a simple filing process for a reduction in their property taxes at no charge.”
May 14th, 2008 at 4:06 pm
James Lewis,
Go to http://www.loansafe.org you may be able to get some of your questions answered there.
Craig
May 14th, 2008 at 5:03 pm
[...] Are You Being Over Taxed? Proposition 8 Protects Homeowners [...]
May 14th, 2008 at 5:04 pm
[...] Schumer decried the lenders’ tactics as amounting to “death by a thousand fees.” [...]
May 14th, 2008 at 5:10 pm
[...] Schumer decried the lenders’ tactics as amounting to “death by a thousand fees.” [...]
May 14th, 2008 at 6:19 pm
FYI
Looks like San Bernardino is requiring you to submit application for consideration. http://www.sbcounty.gov/assessor/Decline.asp
May 16th, 2008 at 9:31 am
great info everyone.
this issue needs to be addressed and fast!
Jun 10th, 2008 at 9:21 am
[...] Whether it be a disgusting email to a homeowner trying to save his home, a pist off Senator Schumer letter asking Angelo how they made so many crappy loans or now, special mortgages made to “Friends [...]