I read this New York Times article (click here) to say that a Bank of America subsidiary was doctoring accounts in order to sell force-placed insurance on accounts that didn’t need it. (Do you agree with my reading? I think that’s one of the problems with relying on blogs as a news source: you may get it faster, but it may be sloppily written and not checked for accuracy in the same way. I tend to think that’s the world we’re headed towards–a world of opinion rather than fact. Did Nietzsche call it 130 years ago or what?) In other words, the homeowner had insurance in place, and the subsidiary would put a more expensive policy in place and then bill the homeowner. Naughty.
Bank of America profiting from defaults?
March 15, 2011
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foreclosure, mortgages | Tagged: Balboa, Bank of America, default, force-placed insurance, fraud | 
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Posted by Ron
Know When to Walk Away (Know When to Run)
January 25, 2011Wow, I haven’t blogged in some time! I wanted to point out, though, this useful article on NYTimes.com today running down the factors to consider when deciding to keep or walk away from your upside-down house. Typically, big banks don’t pursue deficiencies in Texas, so that’s not as much of a factor as you would guess.
Click here to read the article (it’s short).
Leave a Comment » | debt, foreclosure, mortgages, unemployed | Tagged: default, foreclosure, mortgage, rent, underwater, upside-down | Permalink
Posted by Ron
Facing Foreclosure? Yes, Bankruptcy Helps!
July 22, 2010Great article in CNN today. The banks and even the government play down how helpful bankruptcy can be to prevent foreclosure, so I am always thrilled to see articles like this one (click here).
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Posted by Ron
The Unforgiven (Home Loan Modification – Part 5)
April 5, 2010An editorial in today’s New York Times sheds some light on a new mortgage modification plan that goes into effect today. Lenders are now going to have to do modifications for people who are unemployed and for people who are current on their loans. I would add the word *supposedly* because in my experience, lenders almost always need some extra prodding in the form of a letter from an attorney or even a lawsuit. Though you would hope legal action wouldn’t be necessary to get your loan modified, it may be worth it, as you will save a lot of money over the life of the loan. I do advise clients to try modification on their own first, as I’ve had some clients who’ve had good luck with it. If you go back and forth with your lender or servicer, if they lose your documents or deny you for no reason – that’s the time to get an attorney involved.
Also, use caution selecting your representative – under Texas law, ONLY an attorney can represent you in a loan modification. Anyone else offering the service (besides your own lender, of course), is not legitimate.
Click here for the editorial.
1 Comment | foreclosure, mortgages, unemployed | Tagged: HAFA, HAMP, home mortgage, modification, mortgage crisis, mortgage modifications, unemployment | Permalink
Posted by Ron
Bankruptcy and Foreclosure
March 8, 2010I just noticed this excellent post from Robert Doggett at Texas Rio Grande Legal Aid on foreclosure buzz:
http://foreclosurebuzz.org/2009/09/21/foreclosure-guides-hide-bankruptcy/
It is not surprising that while a lot of borrowers have received foreclosure notices, they do not know that filing bankruptcy is more often than not a better option than walking away from their home. As this article points out, bankruptcy forces lenders to work with borrowers. The lender must accept a payment plan allowing the borrower to stay in the house instead of foreclosing and kicking them out.
Foreclosure does not always erase your mortgage debt. If you owe more than your house is worth, you may end up owing the bank the difference, which is called a deficiency judgment. Though rare in Texas, a borrower can lose his or her home to foreclosure and still owe the bank the difference between the value of the home and the amount of the loan. This could have been avoided by filing Chapter 13 before the date of the foreclosure sale.
Most borrowers also do not realize that a bankruptcy may be better for your credit than sitting back and doing nothing. Filing bankruptcy allows you to have a fresh financial start, often resulting in your credit score recovering within a couple of years, whereas a foreclosure will result in a poor credit score for many years to come. I have seen some of my clients approved for conventional mortgages less than three years after filing bankruptcy.
Leave a Comment » | bankruptcy, foreclosure, mortgages | Tagged: chapter 13, chapter 7, foreclosure, loan servicing, mortgage, mortgage crisis | Permalink
Posted by Ron
Trying to Negotiate a Loan Modification? (Part 4)
September 1, 2009Click here for an article from CNN.com today. Banks are supposed to give borrowers a new loan with a payment of 1/3 of their monthly income but have so far been able to help only 230,000 of 4,000,000 eligible borrowers. I’m not sure if the low percentage has to do with people not knowing about this program, the borrowers not qualifying somehow, or if the banks are just overwhelmed – even 230,000 is a pretty big number.
Leave a Comment » | foreclosure, mortgages | Tagged: help, modification, mortgage, Obama, unemployment | Permalink
Posted by Ron
Trying to Negotiate a Loan Modification? (Part 3)
July 29, 2009Now this article in today’s New York Times. Being someone who deals with mortgage servicing companies everyday, it does strike me that they act as though their duty is to themselves rather than the investors who own the loans, the homeowners who are desperately trying to stay in their homes, or the government that wants them to work with the homeowners. I had thought they aren’t competent, but it appears from the article that they don’t know what they’re doing.
Leave a Comment » | foreclosure, mortgages | Tagged: foreclosure, late fees, loan servicing, mortgage modifications | Permalink
Posted by Ron
Trying to Negotiate a Loan Modification? (Part 2)
July 26, 2009Not only is it difficult to get a modification (because of the sheer inability of mortgage companies to cope with how many are needed – see my last post), but getting a modification may result in your credit score dropping anyway. See today’s article in the Statesman (link).
I need more information before I would start recommending against modifications. I still think you should try hard for a modification before turning to Chapter 13 most of the time (see my post To 13 or Not to 13). Even taking this Statesman article into account, the credit hit is not likely to be as long-lasting from the modification as it is from a 13.
Leave a Comment » | bankruptcy, mortgages | Tagged: chapter 13, credit score, mortgage modifications | Permalink
Posted by Ron
