Join the Newwark Essex Foreclosure Taskforce and La Casa de Don Pedro for a “Neighborhood Walkaround” in lower Broadway. The Walkaround begins on Tuesday June 12, 2012, from 1pm – 3pm, starting at the corner of Martin Luther King Boulevard and Crane Street in Newark.
La Casa de Don Pedro offers foreclosure mediation, as well as housing counseling for residents looking to buy homes. They also offer First Time Homebuyer courses to educate new owners on the difficulties of attaining and retaining a home.
Some of the biggest banks in the country are reportedly close to a settlement with authorities over the so-called robo-signing scandal in which mortgage company officials signed and notarized foreclosure documents without properly reviewing them. Many lenders and mortgage servicers acknowledged making serious mistakes in foreclosure paperwork.
But the much-delayed settlement still faces challenges. New York Attorney General Eric Schneiderman is raising objections, and may reject the settlement because he believes authorities have done too little to investigate the role of big banks in the financial crisis. Read More.
State Attorney Generals critical of foreclosure fraud settlement with banks. Many did not plan to show up, for meeting with HUD and DoJ officials to go over a proposal for a foreclosure fraud settlement.
Justice Department reaches $335 million settlement to resolve allegations of lending discrimination by Countrywide Financial Corp.
More than 200,000 African-American and Hispanic Borrowers who Qualified for Loans were charged higher Fees or placed into Subprime Loans. The Department of Justice today filed its largest residential fair lending settlement in history to resolve allegations that Countrywide Financial Corporation and its subsidiaries engaged in a widespread pattern or practice of discrimination against qualified African-American and Hispanic borrowers in their mortgage lending from 2004 through 2008.
The settlement provides $335 million in compensation for victims of Countrywide’s discrimination during a period when Countrywide originated millions of residential mortgage loans as one of the nation’s largest single-family mortgage lenders. Read More.
WASHINGTON — The Office of the Comptroller of the Currency today announced that the independent foreclosure review required under the agency’s enforcement actions taken in April 2011 has begun.
Under the enforcement actions taken in April by the OCC, the Federal Reserve, and Office of Thrift Supervision, 14 large mortgage servicers were required to correct deficiencies in their servicing and foreclosure processes and to engage independent firms to conduct a multi-faceted independent review of foreclosure actions that occurred in 2009 and 2010. Independent consultants are charged with evaluating whether borrowers suffered financial injury through errors, misrepresentations, or other deficiencies in foreclosure practices and determining appropriate remediation for those customers. Where a borrower suffered financial injury as a result of such practices, the consent orders require remediation to be provided. Read More.
Did you face foreclosure in 2009 or 2010? If so, the Office of the Comptroller of the Currency says you may be eligible for a free independent review of your case. Independent foreclosure reviews let borrowers who faced foreclosure on their primary residences between January 1, 2009 and December 31, 2010 request reviews of their cases if they believe they suffered financial injury as a result of errors in the foreclosure processes of these servicers. Read More.
Although the Treasury Department has vowed to hold mortgage servicers publicly accountable for their adherence to Home Affordable Modification Program (HAMP) guidelines, some senators want to go one step further.
They have proposed establishing a new federal agency as a means of recourse for “families who face foreclosure but believe their mortgage servicers are breaking the rules,” as Sen. Al Franken (D-Minnesota) put it.
The Homeowner Advocate Act of 2011 (S.690) would create an Office of the Homeowner Advocate for the purpose of protecting homeowners seeking mortgage modifications through HAMP.
The bill was introduced by Franken, along with U.S. Sens. Olympia Snowe (R-Maine), Robert Menendez (D-New Jersey), and Jay Rockefeller (D-West Virginia), and has been referred to the Senate Banking Committee for consideration.
According to the bill, the Office of the Homeowner Advocate would have three primary functions: to assist homeowners, housing counselors, and housing lawyers in resolving problems with HAMP; to identify areas where homeowners are having problems in dealing with the program; and to identify possible administrative and legislative changes to HAMP.
Although the Dodd-Frank Reform Act established the Consumer Financial Protection Bureau to serve as a consumer advocacy agency — with jurisdiction over mortgage lending regulation and, according to bureau officials, oversight of mortgage servicing rules as well — the proposed Office of the Homeowner Advocate would deal directly and exclusively with the government’s mortgage modification program. HAMP has come under heavy fire for unmet goals in terms of homeowners helped and inconsistent treatment of borrowers.
The legislators say the new HAMP office would be modeled after the Office of the Taxpayer Advocate at the Internal Revenue Service (IRS). It would be funded from money that is available for the costs of administering the HAMP program, but is not otherwise committed.
As laid out in the language of the legislation, the office would be run by an independent director, appointed by Treasury andHUD. The bill explicitly states that this director cannot have worked for a servicer or for the Treasury Department within the past four years.
The office would be staffed with officials who have the authority, on a case-by-case basis, to implement servicer remedies, subject to the approval of the assistant Treasury secretary for financial stability, who currently oversees Treasury’s mortgage relief programs. According to the senators, this assistant secretary backing will help to ensure that the staff of the Office of the Homeowner Advocate “actually has the ability to make servicers follow the rules.”
“As recent news has shown, there have been serious problems with the current foreclosure modification program that have caused problems for too many homeowners,” said Sen. Rockefeller. “By creating an Office of the Homeowner Advocate, we would enable those homeowners who are receiving unfair treatment to have their issues resolved….[W]e should reward those who are working to modify and pay off their mortgages, not punish them.”
According to Rockefeller and his colleagues, if the legislation to establish an Office of the Homeowner Advocate passes, as many as 3 to 4 million homeowners would benefit from HAMP.
That target is the initial goal set for the program by President Obama – a goal that right now seems far out of reach. According to the latest figures from Treasury, as of the end of February, there were just over 557,000 active permanent HAMP mods in place. The federal program is set to expire at the end of next year.
Last month, Treasury announced that beginning in April, it will start publishing scorecards on individual servicer’s HAMPperformance. Officials say they will withhold financial incentives from servicers that receive unsatisfactory grades.
According to the senators behind the Homeowner Advocate Act, Treasury’s “acknowledgement that further action is needed to prevent abuse in the mortgage servicer industry highlights the need to establish an entity that would advocate on behalf of homeowners.”
The nation’s top mortgage servicers are expected to sign legal agreements by the end of this week compelling them to change their foreclosure procedures, regulatory officials said Tuesday.
The servicers, which violated state and local laws and regulations governing foreclosures, are agreeing to improve their methods in numerous ways. They will be required to have more layers of oversight and proper training of their foreclosure staff. The oversight will extend to third party groups, including the law firms that do much of the actual work of eviction.
Under the new rules, every homeowner in default will have a single point of contact with the servicer. The servicers will end their practice of foreclosing while borrowers are pursuing loan modifications that might allow them to stay in their homes.
One of the most significant measures in the consent agreement will require servicers to hire an independent consultant to review foreclosures done over the last two years. If owners were improperly foreclosed on or paid excessive fees, they will be compensated.
The reforms were described by individuals who spoke on condition of anonymity because the consent agreements were not yet public. The banks either could not be reached or declined to comment.
Bringing in a consultant to establish the amount of damages will give individuals who feel they were abused by their servicer some means of redress. While the servicers have acknowledged violating the laws they maintain that very few if any people lost their house who were not in severe default.
Jamie Dimon, chief executive of JPMorgan Chase, addressed the issue Tuesday at a banking conference in Washington. “Some of the mistakes were egregious, and they’re embarrassing,” he said, according to Bloomberg News. “But we made a mistake, and we’re going to pay for that mistake.”
Many of the reforms that the servicers are agreeing to were also being sought by the state attorneys general, who began their own search for reform last fall. For several weeks in January, the regulators and the attorneys general attempted to work with officials from the Justice Department and the Department of Housing and Urban Development to produce one comprehensive settlement, but the attempt proved unwieldy.
The attorneys general met face to face with the servicers for the first time last week at the Justice Department. A spokesman for Iowa Attorney General Tom Miller, who is leading the effort, said more meetings are planned but declined to be specific.
The attorneys general have larger goals than the regulators. They are seeking to make the banks to cut the debt of delinquent owners. The servicers are balking at this.
As a result of the changes being imposed by the banking regulators, servicers will have two options: either hire more employees to give the millions of households in default closer attention, or slow the pace of foreclosures.
Foreclosure is already a ponderous process, and has grown more so since the controversy over the servicers’ procedures erupted last fall. The average household in foreclosure has been delinquent for more than 500 days.
Regulators expect to issue their report on foreclosure practices at the top 14 servicers within the next few weeks. Preliminary consent agreements were sent to the servicers in February.
The report, whose conclusions have been foreshadowed by regulators in Congressional testimony, derives from an investigation this winter by the Office of Comptroller of the Currency, the Federal Reserve Board, the Office of Thrift Supervision and the Federal Deposit Insurance Corporation. It will not name individual banks but rather describe their aggregate behavior.
The investigators reviewed the policies and procedures, structure and staffing of the top servicers, as well as their use of law firms and other third parties. They examined 2,800 foreclosures in various stages.
The banks examined were Bank of America, Citibank, GMAC, JPMorgan Chase, Wells Fargo and nine others. The examination found critical deficiencies and shortcomings in foreclosure preparation and oversight, resulting in violations of state and local foreclosure laws, regulations and rules.
The servicers will probably be assessed fines at a later point.