Chase fails to get HAMP expert testimony stricken

I’ve argued for some time now that Chase’s foreclosure and loan modification tactics include denying people loan modifications they’ve agreed to provide under the governments HAMP program that people are entitled.  I would go so far as to say that legally, they have a huge exposure to quite a few wrongful (parallel) foreclosures for people that qualified for a loan modification under HAMP, but were told by Chase that they did not qualify.

Here is one such case where they attempted to get the testimony of an expert on loan modifications, especially HAMP loan modifications, stricken.  They were denied.

Chase claims they don’t lose paperwork. Yea right.

In what may be the biggest fib yet by a Chase spokesman, as quoted in a Bloomberg Business Week Article (Modifications Aren’t Stopping Foreclosures) Chase claims:

JPMorgan is able to track paperwork because it scans every document as it’s received.

In truth, Chase is one of the worst offenders when it comes to paperwork lost during the loan modification process as evidenced by the many many stories on our site and in the press, and it is disappointing that Business Week didn’t take them more to task for this.

However, the article does outline the basics of the scam Chase and the other large banks are perpetrating on borrowers:

1. Borrower is granted a trial modification with lower payments.
2. Borrower makes all trial modification payments on time and in full.
3. Bank denies permanent modification and demands difference between trial modification payments and regular mortgage payments in one lump sum.
4. Borrower can’t pay this so bank forecloses.

If you are lucky enough, there are a couple of extra steps as evidenced by the Business Week article:

1. Major news media writes an article profiling the borrower.
2. Bank has a miraculous change of heart, reverses the foreclosure, and gives the borrower a permanent modification.

State AGs pressuring banks to fix loan modifications

The Wall Street Journal reports (New Pressure on Loan Modifying, 11/17/10) that state attorneys general are said to be putting pressure on lenders, including JP Morgan Chase, to fix the loan modification system, largely seen as not offering a sufficient number of loan modifications and performing too many foreclosures, as a condition of settling the lawsuits on the false foreclosure paperwork brought by the states.

Additionally Senators of both parties are urging banking regulators to increase scrutiny of foreclosure operations.

The lead attorney general in the probe, Iowa’s Tom Miller, claims that part of the issue with loan modifications “lies with servicers who see it as more profitable to foreclose on homeowners than to undertake modifications.”

This seems clearly to be the case with Chase, who practices parallel foreclosure and seems to put up every impediment possible to people seeking loan modifications.

Chase parallel foreclosure victim wins house back

By Henni Espinosa, ABS-CBN North America Bureau . Redwood Shores, CA – 73-year Corazon Palma made history when she became the first person in California to win her house back from her lender even after her 4-bedroom house in San Jose, California was foreclosed.

Palma staged a battle against Washington Mutual through a wrongful foreclosure lawsuit – and she refused to back down.

Palma is a cancer-survivor who lives on a fixed income. So in 2008, she asked her lender to lower her monthly mortgage payments of $3,900 a month.

A year later, she said that her lender promised to send her a loan modification packet. Instead, a Coldwell Banker real estate broker came to her house to notify her that her house had been foreclosed at a Trustee Sale.

Palma said, “I was so shocked. It felt like a bucket of cold water fell on me. When they gave me the note, I called my attorney.”

She sought the help of Attorney Kenneth Graham, who represents many Filipino homeowners in Northern California.

Graham said, “WAMU deceived Mrs. Palma into thinking they were making loan modification efforts on her behalf while they were secretly planning a foreclosure sale on the property.”

Her fight in court paid off. Last January, a judge ruled that Palma be awarded back her house.

Last Friday, she attended a court hearing in San Jose to find out the terms of the judgment. Palma would have to wait until December 3 to know if she will end up getting her house back for free.

Graham said, “The best case scenario for Mrs. Palma is if a judge rules that the lender has no further right to exercise the loan against the property. Hence, Mrs. Palma gets the property for free.”

Worst case scenario for Palma – is that she continues to pay her mortage but at a lower monthly rate.

No matter the judgment, Palma said she’s glad she won the fight to keep her home.

She said, “But I know other homeowners are being abused as well and lenders really need to be taught a lesson for deceptive practices to stop.”

If you are an abused homeowner and feel that your house has been wrongfully foreclosed, you may contact the Law Offices of Kenneth Graham at (925) 932-0170 or visit their office at 1575 Treat Blvd. #105, Walnut Creek, California or their website, www.elaws.com.

Unsolicited Chase loan modification leads to foreclosure

This story is particular heinous on the part of Chase.  The homeowners were tooling along just fine in the home they owned for 17 years, having never missed a mortgage payment, when out of the blue Chase offered them an unsolicited loan modification and the chance to lower their payment.  Under the various stages of the process of working towards a permanent modification, the homeowners made all required payments.

Chase then dropped a bomb on them and told them they were behind $50,000 and needed to pay up or get foreclosed upon.  Unable to come up with the surprise balloon payment, Chase foreclosed upon them and they are now fighting eviction.

Chase’s behavior essentially amount to entrapment.

This is a new low for Chase.

Does Chase have ANY idea what it is doing with loan modifications?

This latest article from the Wall Street Journal has a prime example of Chase’s schizophrenic behavior when handling loan modifications:

After J.P. Morgan Chase & Co. agreed in January to her trial loan modification under the Home Affordable Modification Program, Stephanie Lulko made six $767-a-month mortgage payments, even though the bank said it had no record of her loan and then warned in a letter that she would be foreclosed on unless she paid $4,091.94.

The 44-year-old Ms. Lulko, of Oklahoma City, says bank employees told her to ignore the letter. Their tune changed in June, when J.P. Morgan said she earned too much to qualify for a permanent modification. The problem this time: The bank’s numbers were wrong. “I wish I had never applied for this modification,” she says.

In September, the bank rejected her request for a permanent loan modification for a second time. She faces foreclosure unless she pays nearly $5,000—the difference between her original and modified loan payments, plus late fees. Ms. Lulko has been unemployed since her temporary job at the U.S. Census Bureau ended in August.

J.P. Morgan denies any wrongdoing related to Ms. Lulko’s loan. “We worked with the borrower over a number of months and communicated the status of the loan modification during that time,” spokesman Tom Kelly says.

Did you get all that?

• Chase simultaneously claims to have no record of her loan but demand a large repayment at the same time.
• They tell her to ignore a letter they sent her.  Seriously?  What kind of respectable financial institution sends you a letter and then other people in the organization tell you to just ignore it?
• They claim she earns too much but have the numbers wrong.

One example of parallel foreclosure reversal

Kudos to the attorney that got a homeowners foreclosure reversed in Florida.  From this story we learn two things:

1. Chase often says it will do one thing but then does something else.
2. The courts finding in this case shows that by doing this, Chase is practicing fraud, misconduct, and misrepresentation.

In other words, Chase is in the wrong here and it is worthwhile to go after them legally for this.

Since February 2010, JP Morgan Chase promised to provide a mortgage modification to my client. They promised to stop the foreclosure proceedings and allow him to stay in the home. My client acted in good faith the entire time, trying to save his home from Foreclosure using the trial modification system as we set up in every modification case. Then, without ever telling my client they were moving forward, Chase went ahead and behind his back got a Summary Judgment. This gave Chase the right to sell my client’s home at Judicial Auction.

When my client was sent a copy of the Summary Judgment, he called the Bank to ask why they were not giving him the promised trial mortgage modification. The Bank assured my client they were giving him a modification and would suspend the sale so that the Trial Modification could go through. That is not what happened. What Chase actually did was sell the house at a judicial sale behind my client’s back. When my client informed us of the way Chase had treated him we felt this was an atrocity. We immediately filed a Motion to Vacate the Summary Judgment based on Fraud, Misconduct and Misrepresentation. Today we had the hearing on my motion. The Judge Ordered the Summary Judgment be vacated (overturned). My client gets to keep his house!

Read the rest of this story …

Verbal vs written modification

This particular case, where Keith and Sharon Lilley accepted a verbal modification of their mortgage and then were foreclosed upon by Chase, was unfortunately dismissed by the court.

They “applied for modified terms on their mortgage loan with a 125 page fax on April 30, 2009.”4

In June 2009, the Lilleys accepted a verbal modification of the mortgage, and made payments as agreed under the modification through November 2009.

On November 20, 2009, JPMorgan sent an Acceleration Writing (Notice of Intent to Foreclose) to the Lilleys.

The lesson here is don’t trust what isn’t written and properly signed.