Is Chase down AGAIN?

We are receiving reports, as of 12:30 ET, that people are unable to log into their Chase accounts and one person sent us this link to an outage message (shown below).

A New Way to Cut a Mortgage (Wall Street Journal)

Some homeowners who already have refinanced into low-interest-rate mortgages are using a little-known strategy to make their monthly payments even smaller.

Called “recasting” or “re-amortizing,” the strategy allows a borrower to lower the monthly payment on an existing fixed-rate home loan for a small fee without having to apply for a new loan and without having to pay reappraisal and other fees.

Recasting also may enable homeowners to save on interest paid over the life of the loan, merely by putting a large sum of cash against the principal, whether or not they have refinanced already.

The bad news? Banks don’t advertise the strategy, perhaps because it is less lucrative than refinancing a mortgage. And not all loans are eligible. To find out more, you will have to ask your lender directly.

At J.P. Morgan Chase & Co.’s Chase Home Finance unit, less than 200 mortgages a month are recast out of 10 million home loans outstanding, a spokesman says. At Bank of America Corp., about 200 to 300 a month recasting requests are received out of about 14 million home loans serviced by the company, a spokesman says. Neither bank has seen increased demand.

Here is how it works: A homeowner asks his loan servicer if he can put a large sum of money against the outstanding principal on the mortgage. Ordinarily, doing so would enable him to pay off the loan early, but he would still have to pay the same monthly note. But if the lender agrees to recast the mortgage, he may be able to reduce the monthly payment over the remaining term of the loan.

For example, a person with a 30-year $300,000 fixed-rate mortgage and an interest rate of 4.75% who recasted one year into the loan by putting in $60,000 toward the principal would trim his balance to $235,371. Assuming there were 29 years left on the loan, that would result in a monthly payment of $1,247 instead of the original $1,565.

Recasting can be a good choice for borrowers who have cash and want to reduce monthly payments but who can’t refinance, such as those with no-documentation loans, most of whom can’t get the same types of mortgages today due to tighter regulations, even if they have high income and good credit. (Self-employed professionals often find themselves in this boat.) And at a time of low interest rates on certificates of deposit and U.S. Treasury bills, paying off a mortgage early is a relatively safe investment that brings a return at least equivalent to the interest rate on the mortgage itself.

Read the rest of the article here.

New roadmap for fighting foreclosure and getting your loan balance reduced

An excellent article in today’s Wall Street Journal spells out some of the growing tools that homeowners have to fight foreclosure and apply pressure to the people who actually own their sliced-and-diced loan to reduce their loan balance.

LOXAHATCHEE, Fla.—Israel Machado’s foreclosure started out as a routine affair. In the summer of 2008, as the economy began to soften, Mr. Machado’s pool-cleaning business suffered and like millions of other Americans, he fell behind on his $400,000 mortgage.

But Mr. Machado’s response was unlike most other Americans’. Instead of handing his home over to the lender, IndyMac Bank FSB, he hired Ice Legal LP in nearby Royal Palm Beach to fight the foreclosure. The law firm researched the history of Mr. Machado’s loan and found two interesting facts.

First, the affidavits IndyMac used to file the foreclosure were signed by a so-called robo-signer named Erica A. Johnson-Seck, who routinely signed 6,000 documents a week related to foreclosures and bankruptcy. That volume, the court decided, meant Ms. Johnson-Seck couldn’t possibly have thoroughly reviewed the facts of Mr. Machado’s case, as required by law.

Secondly, IndyMac (now called OneWest Bank) no longer owned the loan—a group of investors in a securitized trust managed by Deutsche Bank did. Determining that IndyMac didn’t really have standing to foreclose, a judge threw out the case and ordered IndyMac to pay Mr. Machado’s $30,000 legal bill.

First, if banks are no longer allowed to use robo-signers and actually have to review documents, they may avoid foreclosure as an option.  Second, they may not actually have the authority to foreclose, as evidenced by this story.  In any event, it is worth pursuing actually making the bank prove that it has done the proper research and has the right to foreclose.

Mr. Machado and his lawyer, Tom Ice, say they now want to convince the owners of the mortgage to cut Mr. Machado’s loan balance to between $150,000 and $200,000—the current selling price for comparable homes in his community near West Palm Beach. “The whole intent was to get them to come to the negotiating table, to get me in a fixed-rate mortgage that worked,” Mr. Machado said.

If it proves difficult for the bank to foreclose, reducing the loan balance so they at least get some payment may be their best choice, and having proved you aren’t going to let them foreclose without having done everything precisely right, they may simply give in.

Good luck!

Chase debit card skimmed? Chase won’t protect you

Debit card skimming is a fairly common occurrence these days, meaning that at least several times a year I hear about it happening in the general area where I live.  We’ve reported on why debit cards are not as well protected as credit cards in a past post, and this story confirms that fact precicely.

Details: I had and still have possession of my ATM card. On the 27th and 28th of last month 2 separate ATM withdrawals of $500 each were taken out of my account by hackers. On the 28th when I tried to use my card at a local merchant it was declined. Almost simultaneously I received a voicemail from Chasebank fraud division. I returned their call immediately and answered all their questions. They said my $1000 would TEMPORARILY be put back into my account pending their investigation. 5 HOURS later I was informed by ChaseBank fraud department that they had concluded their investigation AND THEY WERE NOT GOING TO REIMBURSE ME THE $1000 THAT WAS S T O L E N FROM MY ACCOUNT!!!
Why? Their 2 reasons: 1.) the 2 withdrawals were made in the same geograhical area in which I live. 2). there were no bad pin tries.

Of course, those reasons simply don’t add up with the reality of Chase’s very own ATMs being fitted with skimmers on occasion.  First, if your card is skimmed, it is very likely that local thieves are to blame and they will use it in your local area.  Second, if your card is skimmed, they will have your PIN number.  In any case, what idiot thief would take a debit card for which they did not have the PIN and try random PIN numbers at an ATM.

In this particular case, what Chase called the same geographical area turned out to be two places each more than 100 miles from where the customer lived.

Why does Chase do things like this that are so obviously out of touch with reality?  Until some insider leaks some emails that confirms that Chase frequently denies debit card fraud claims not because they don’t believe it is fraud but because they know they can get away with it, we’ll just have to speculate that is the reason.

Chase admits it practices parallel foreclosure

This is the first time I have seen Chase actually admit they instigate a parallel foreclosure whenever someone applies for a loan modification.  In the case of this great story from CBS 5 News in Arizona.  In this case, even though the homeowners had worked out a modification with Chase and made all required payments, Chase “accidentally” foreclosed anyways.

Incorrect documents not stopping Chase from foreclosing in Pacific Northwest

Chase has admitted that documents related to foreclosures (and the authority of Chase to foreclose on a given property) have not been sufficiently reviewed for accuracy so they stopped paused 56,000 foreclosures in order to review their process.

However, ever the opportunist, Chase chose not to freeze foreclosures in the Pacific Northwest states of Washington, Oregon, and Idaho, because those states do not have a judicial process involved in foreclosures.  In other words, they are continuing with the same practices in those states, because they didn’t or can’t get caught there like they did elsewhere.

Everything Chase does just seems to reinforce the image that they don’t actually care about the customers, just the money they bring in.