foreclosure - What We're Reading - StockBuz2024-03-29T12:06:36Zhttp://stockbuz.ning.com/articles/feed/tag/foreclosureWhy BAC "Lied and Denied" on Foreclosureshttp://stockbuz.ning.com/articles/bac-lied-and-denied-on-foreclosures2013-06-16T12:00:00.000Z2013-06-16T12:00:00.000ZStockBuzhttp://stockbuz.ning.com/members/1t2xbcvddkrir<div><p>Anyone who knows me, knows I built a career mortgage services...........and that I now detest mortgage bankers.  It's not that they don't offer an invaluable service.  I cannot tell you the countless stories of homeowners who actually wept when informed of their loan's approval, brought me homemade cakes and mailed cards, even at Christmas.  Many returned to me years later when they "moved up" to a larger home or referred their family members directly to me which I felt was an enormous compliment; that they trusted their own son/daughter in my care.  It wasn't the lender they trusted.  It wasn't because we had the lowest rates in town.  It was my ability to package even the most complicated of circumstances, anticipate and document what would be required and steer them through the process with personal service and empathy they deserved.  I rarely made a sales call on a Realtor; maybe twice a year.  My flow was 95% referral and business was good; a fact I am to this day proud of.   It was an extremely rewarding job and I can honestly say, one that I loved until sometime around 2000 when service was clearly sacrificed on the alter of "crank 'em out" profits.  This story is a result of that shift in the industry.</p>
<p>This is about the six former <a href="http://www.reuters.com/article/2013/06/14/us-bankofamerica-mortgages-idUSBRE95D10O20130614" target="_blank">Bank of America ($BAC)</a> employees who stepped up, filed suit and admitted they "lied and denied" (my phrase) <em>eligible</em> homeowners sending them to Foreclosure or an in-house modification program; possibly not justifiably and one that would yield BAC more profitability.  Shocker yes I know.</p>
<p>Now before you point a finger at the employees, that they were merely being greedy and did this on their own <em>without</em> the knowledge of Management, just do a reality check.   Any Manager worth his/her salt knows <em>exactly</em> what their internal costs are running on a month-to-month basis; especially the largest expense: payrolls, commissions and incentives.  Hell, we ran an extremely high 36% payroll but still came in as one of the most profitable branches each year due to a focus on having a well-trained staff and purely "knowing our stuff".   In fact, nowadays part of a Manager's job to promote incentives and <em>steer</em> business where upper Management wants it go.....where it's most profitable.  Talk 'em into something they <em>don't want</em> rather than counsel on what's best.  Don't fool yourself for a moment thinking these employees acted without anyone's knowledge or came up with the ideas all on their own.  From what I saw, a great percentage of current "processors" nowadays have no right being in their position.  It's disgusting.</p>
<p>The suit also aledges that those not achieving their "targets" were met with discipline (poor employee reviews I imagine) and even firing.  Still think Management didn't know what was taking place?  It's easy to turn a deaf ear and just hire another (unqualified) replacement.  Job security for a job well done is a thing of the past.  Lying is rewarded because you met a quota.</p>
<p>Sure they knew.  Just as Countrywide Regional Managers must've chuckled talking about their infamous <a href="http://www.washingtontimes.com/news/2009/oct/13/mozilos-friends-on-the-hill/" target="_blank">FOM (friends of Mozillo) loans</a>.  I didn't even work for CFC but I knew about FOM mortgages.  Talk about such things are cocktail hour and three-Martini lunch legend within the industry.  Even if a Regional Manager was somehow in the dark (impossible) each lender has their own internal auditing system which would've questioned the F.O.M. markings <em>as well as</em> the prudence of approving loans which did not meet income/asset requirements or documentation. I myself conducted internal Quality Control audits at one point in my career and my Branches themselves are continually subject to random Audit each year by Corporate.  Believe me; the numbers and documentation are thoroughly double checked and if files didn't measure up, not only was the Branch Manager informed, but so was the Regional Manager.  It's the normal business process; everyone knows what is taking place.</p>
<p>Another great example is Branch and Regional Managers throwing their weight around with Appraisers.  Appraisers are always under enormous pressure to get the value high enough.  Somehow justify it using older comparable sales or sales in other neighborhoods (both against regulations) to get the appraised value up to the sales price/refi value or you'd lose future business.  Be blackballed.  Word would spread.  Period.  Don't use so-and-so appraisal service; they won't give you value.  So much for honesty and integrity.  Ditto with Underwriters.   Approve it or you risk a poor review and job security.  It's merely swept under the carpet..........</p>
<p>You have to ask yourself "why was BAC rewarding incentives for foreclosures or in-house modifications but not government-sponsored HAMP modifications"?  Why not reward accuracy and thorough documentation over volume?  For the profits baby. </p>
<p>All that mattered was "crankin' em out".  Forget accuracy.  Sweep aside morals, ethics and honesty.  This is big business where profits are king and when push comes to shove, it's all good.  Just memorize the lines "not that I was aware of" and "not that I can recall" before you testify in front of Congress (wink wink).   After all, we're "too big to fail" and too big to find guilt and truly prosecute.  We might shake the confidence in the system; a system that is systemically vital to the nation.</p>
</div>Banks Holding REO's For Higher Priceshttp://stockbuz.ning.com/articles/banks-holding-reo-s-for-higher-prices2013-05-27T17:52:06.000Z2013-05-27T17:52:06.000ZStockBuzhttp://stockbuz.ning.com/members/1t2xbcvddkrir<div><p>If they were to pursue foreclosures in a timely fashion as well as push out the REO's sitting on the books, prices would fall.  Don't believe for a minute this is only the U.S. either.  This is/will be a global approach.  Now that values in many areas are almost back to pre-crisis levels, are we about to see a glut of inventory hit the market?  I'm willing to say so.  House hunting anyone?  <a href="http://www.realestateeconomywatch.com/2013/05/banks-seen-holding-reos-for-higher-prices/" target="_blank">(RealEstateEconomyWatch)</a></p>
</div>Bernanke and Obama - Meet Curt "What are they waiting for? My death to foreclose?"http://stockbuz.ning.com/articles/curt-what-are-they-waiting-for-my-death-to-foreclose2013-03-21T02:28:50.000Z2013-03-21T02:28:50.000ZStockBuzhttp://stockbuz.ning.com/members/1t2xbcvddkrir<div><p><span class="font-size-4"><strong>Meet "Curt"</strong></span> who, as credit lines worldwide were tightening, lost his middle management job in finance in 2006.  Of course Curt had no idea of what was to come.  He was a good worker, great work and credit history and was lucky to have a nice nest egg saved up.  He wouldn't need unemployment, no.  He'd have a job in no time so he did what every good American in his position would do.  He dusted off his resume, began to network/emailing his resume and paid his bills using his hard earned savings and waited.......for a job that would never come.  </p>
<p>Then bubble burst.  The market began it's long downwards spiral but Curt, undaunted, continued emailing and living off of his savings....and still did not file for unemployment.  Surely something will turn up any day now, he told himself.</p>
<p>For four years.  </p>
<p>Four years of bank failures, branch closings, massive consolidations and layoffs.</p>
<p><span class="font-size-4"><strong>By 2010</strong></span> the stock market was clearly rebounding however it was all over for Curt.  After four long years he had drained his savings, cashed in his CDs, sold his 2nd car and withdrawn his 401k's one by one until there were no more.  Even if he <em>wanted</em> to get back into the market to raise cash, there was no cash left to invest.  His family wasn't in any better shape.  There was no one to borrower from.  Too late to file for unemployment now.  That window was closed.  His life was collapsing further.  His once 760 credit score, was now sub 600.  He could scarcely afford his utilities much less his mortgage.  He did the only thing left to him.  He sought counsel of an Attorney file to Chapter 7 (no assets). </p>
<p>The Lawyer, hearing Curt's plea to somehow keeps his home, advised if he felt he was going to have his mortgage modified, he could leave the house <em>out</em> of the Chapter 7; reaffirm with the lender and therefore not be evicted.  If included in the Chapter 7, Steve would have to vacate the property within 30 days of the final filing.  Steve had no where else to go and his lender had be so reassuring that he'd be granted a modification.   He took the bait - reaffirmed with his lender and filed the Chapter 7.  After all, he didn't want to lose his home and he was certain something would turn up soon.</p>
<p>Oh poor Curt. </p>
<p>Having no job (and no unemployment income) he was denied for a loan modification. </p>
<p>Badly upside down in debt now, he hosted what seemed to be a perpetual garage sale to keep the lights on and food on the table.  Selling his tools, furniture, guns, even his pool in the yard simply to keep on going.  His attempt to sell his home on a short sale was rejected.  You see Curt had a 2nd lien holder who would receive absolutely nothing under the proposal AND to add insult to injury he now had enormous tax liens; a result of liquidating his 401k's and not being able to cover the tax on same.</p>
<p>The Spring of 2011 Curt finally gave up.  Temp agencies were not even returning his call.  Just sending him email links to apply.  With his skills five years dormant and his credit destroyed, he must have felt no one wanted him (my opinion not his).</p>
<p>He packed what very little he could into his car, called his lender, told them he was leaving the keys on the counter and he walked away leaving all his life long possessions behind.  A totally broken and beaten man.</p>
<p><span class="font-size-4"><strong>Fast forward to 2013.</strong></span></p>
<p>Every month since that day in 2011 Curt says he has kept in touch with his lender.  He has given them his addresses as he moves from place to place.  His cell phone number WHEN he can afford a pay-as-you-go phone.  At some point he was diagnosed as having had "a mental break with severe depression" or what you and I would call a nervous breakdown.  He hides from the public, neighbors, friends and family.  Shys away from any personal interaction including eye contact.  He doesn't want anyone to "see him" hiding behind sun glasses and wishes he was "invisible" doing small painting or carpet cleaning jobs.   He's nervous, jumps and flinches at small everyday noises, suffers panic attacks, admits he cries each day and I believe he's now agoraphobic (afraid to go outside).  His small cash jobs pay the rent but he still does not receive food stamps or a government subsidy phone.  He says he has to retain what little pride he has left. </p>
<p>He's open to the idea of being treated for his depression again but cannot afford it.  To hear him tell it, the last clinic he visited estimated his wait time to be 2-4 hours and even then, it would only be an evaluation.  He wouldn't receive medication until a subsequent visit.  He left the crowded, apparently smelly waiting room after only 20 minutes in a panic.  "<em>It doesn't matter"</em> he says, "<em>I couldn't afford meds anyway."  </em>Such is the demeanor I feel of many Americans.  Deeply forlorn, empty and broken describes him well.</p>
<p>It's been almost two years since he gave up and handed them the keys..........and his lender has yet to foreclose.  "<em>What are they waiting for</em>?" he wonders.  His death so they can saddle the bill to his children?  Indeed what <em>are</em> they waiting for?  I wonder as well.</p>
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