Friday, September 16, 2011

Homeowners Foreclose On Bank of America

Homeowners Foreclose On Bank of America

Call it poetic justice, or even karma. . .

During the past few years Bank of America has been at the subject of harsh criticism for business practices that range from the mean-spirited (such as doubling credit card interest rates without notice, up to 28% for cardholders in good standing), to irresponsible (such as foreclosing on the wrong homes), to even fraudulent (such as the recent robo-signing scandal involving mortgage documents).  Bank of America is the nation’s largest servicer of mortgage loans, and the second largest mortgage loan originator. You’d think good record keeping would be important to such a large company, but apparently mistakes abound at Bank of America.

Take for example the case involving Florida couple Warren and Maureen Nyerges. In 2009 the couple moved from chilly Cleveland, Ohio, to warm Naples, Florida. They purchased a foreclosed home from Bank of America and paid $165,000 cash. However, in February 16, 2010, Bank of America filed a Complaint to Foreclose on Mortgage against them, claiming the Nyerges owed almost $141,000 in unpaid mortgage debt.

Warren Nyerges, 46, a former sheriff’s deputy in Ohio, spent months trying to dismiss the suit and clear up Bank of America’s error. In April of 2010, the lawsuit was dropped, and in December the Nyerges were awarded $2,534 in attorney fees. The bank did not respond to the repeated requests to pay the court judgment. Warren called the bank, sent certified letters, called the bank’s attorney, but nothing worked. Then, in January, he hired an attorney to pursue the case. The attorney sent letters and made phone call, and still Bank of America failed to respond or pay the judgment.

On June 3, the attorney for the Nyerges, accompanied by Collier County deputy sheriffs and a moving company, arrived at a local branch of Bank of America and presented the bank manager with a writ of execution to seize assets: either pay up or the movers will start taking things. An hour later checks were cut to satisfy the court judgment.

This may seem to be an extreme example of one case that has fallen through the cracks, but the truth is that banks make errors regularly. In Utah and Nevada courts issued foreclosure injunctions against Bank of America for improper practices. Other banks have also had their share of problem in producing mortgage documents and verifying that the bank is the rightful holder of the mortgage.

If you are facing foreclosure, don’t get steamrolled by the bank! You have legal options to negotiate a lower payment or possibly strip away a junior mortgage. Call today and discover how the federal and state laws can help you save your home and protect your rights.

Beware Of Debt Settlement Company Promises

Beware Of Debt Settlement Company Promises

In theory debt settlement is simple: the debtor negotiates with the creditor to reduce a debt to an amount that is regarded as payment in full. It sounds honest enough: the debtor cannot afford to repay a debt, so the creditor agrees to accept a reduction. The creditor is paid something and the debtor avoids bankruptcy.

In practice debt settlement is a nasty game of chicken. The debt settlement company advises the debtor to stop making monthly payments to the creditor. In response, the creditor pressures the debtor to pay through harassing telephone calls, damage to the debtor’s credit report, mounting interest and fees, and perhaps legal action. The resolution comes when one side blinks: either the creditor is convinced that it better take a settlement or risk discharge in bankruptcy; or the debtor realizes that his or her credit is ruined and actually files bankruptcy.

Debt settlement is big business, but many debt settlement companies have caused big trouble for their clients. Take for example Debt Relief USA. This company, like many debt settlement companies, advised its customers to stop paying its creditors and instead deposit money into a Debt Relief USA settlement account. This money, held by Debt Relief USA, was to be used as settle funds for the individual’s debts. Customers were assessed fees for services including burdensome “administration fees” and monthly “maintenance fees” that further damaged its customers’ financial situations. When a debt was settled, the Debt Relief USA charged a 13 percent “negotiation fee.”

In 2009 Debt Relief USA filed a Chapter 11 bankruptcy and claimed that it owed its clients $5 million from these settlement accounts.  In December 2010, the bankruptcy court approved a $3.7 million disbursement to Debt Relief USA’s clients. The case was also converted to Chapter 7 and Debt Relief USA is no longer conducting business.

Bankruptcy attorneys regularly see the damage caused by debt settlement companies. In some cases money is not returned to debt settlement customers, or the company itself files bankruptcy, or the individual’s credit is destroyed. Before agreeing to any debt relief program, discuss your financial situation an experienced bankruptcy attorney. There are powerful federal laws that can protect you from overwhelming debt, and a bankruptcy attorney can review your legal options without risking your cash.