Lawsuit filed on behalf of homeowners allegedly injured by the mortgage practices of Bank of America.
On Wednesday August 17, 2011, United Foreclosure Attorney Network (UFAN) filed suit in Superior Court in Sacramento, CA (case number 34-2011-00109314) on behalf of over 100 homeowners against Bank of America and others alleged by Plaintiffs to be involved in a scheme to defraud and otherwise take advantage of American homeowners.
According to UFAN’s managing attorney Kristin Crone, “This is a chance for homeowners to fight for their rights. And, it will be a fight.” The complaint details how a vast number of homeowners nationwide are facing mortgage debts far greater than the value of their homes. Some homeowners lost what equity investments they had in their homes when the housing market crashed.
The lawsuit levies blame for the crash of the mortgage market against big banks and mortgage lenders. According to the complaint, between 2000 and present, mortgages were packaged up in pools and the pools were sold to investors. Because a bank could quickly recoup amounts spent issuing mortgages by the sale of these pools of mortgages (otherwise known as Residential Mortgage Backed Securities, or RMBS), the banks incentivized mortgage brokers and lending institutions with high fees for origination (yield spread premiums, origination fees, and discount fees). These fee incentives encouraged the origination of highly predatory loans to individuals who could not afford the loans long term, the complaint alleges.
The complaint alleges that the terms of the loans were complex and difficult to understand even for sophisticated borrowers. Many of the loans had a two to five year period of a low fixed interest rate and interest only payments. Most homeowners were promised a refinance prior to the increased payments due at the end of the fixed rate period. But, when the time came to refinance, despite the fact that the financial situation of the borrower many times remained the same, no refinance was given. In some instances, refinances or “loan mods” were granted but they actually increased the borrower’s monthly payment and/or required a large cash payment up front of $10,000 or more.
Court documents show that the lead Plaintiff in the case, like many others, was told by Bank of America to stop her mortgage payments in order to be considered for a loan modification. The homeowner stopped her payments and began negotiations for more fair terms with the bank. Smartly, the homeowner saved money so she could bring her loan current if negotiations were not fruitful. The complaint alleges that she was promised her home would not be foreclosed while she was being considered for a loan modification. She told bank representatives that she could bring her loan current if it was going to sell. Court documents show that the bank promised her the foreclosure would be postponed. It was not. This client has now permanently lost her property to a third party buyer.
UFAN plans to bring claims against all of the major banks on behalf of homeowners within the next few months. “Our clients want to fight for their rights and they are just asking for a fair shake,” says Ms. Crone. “We are trying to give them the chance to be heard and to try to stay in their homes under reasonable loan terms. The banks have been giving everyone the runaround through loss mitigation departments that repeatedly lose documents and claim to work with homeowners while selling their homes out from under them. Filing suit was a last resort for many of our clients, but the bank made it seem as if it was the only way to really get their attention.”
ABOUT UNITED FORECLOSURE ATTORNEY NETWORK
The United Foreclosure Attorney Network (UFAN) is a Roseville, California-based law firm practicing on the cutting edge of mortgage fraud and foreclosure defense. UFAN represents clients who have been victims of predatory lending and/or wrongful foreclosure. The dedicated attorneys and staff at UFAN work tirelessly to seek justice for fraudulent mortgage practices and fight for the rights of American homeowners. For more information call toll free 1-866-400-4242.
This release may constitute attorney advertisement. The information in this release and on the United Foreclosure Attorney Network (TheUFAN.com) website is for general information purposes only. Nothing in this release or on the United Foreclosure Attorney Network (TheUFAN.com) website should be taken as legal advice. Prior successes are no guarantee of future performance. Litigation is inherently uncertain and results in litigation are never assured.
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