Reflections: Bank Of America Mortgage Racket

Would you ever want to do business with an individual or an entity that lied to you? Probably not, right?

Should we add Bank of America to the list of those entities (financial institutions, regulators, our government) that have been less than forthright in engaging those with whom it was saying one thing but doing something entirely different?

A cursory review of the testimony I highlighted this past Friday, Bank America Mortgage Racket: We Were Told to Lie, might give many who read that commentary considerable reason to pause before engaging BofA.

Very simply, relationships require that both parties engaged in a matter deal in an honest and open fashion. Can you imagine the stress involved in the pursuit of a business affair if the other party were not embracing those most basic of principles?

I have read a voluminous number of documents relating to a wide array of lawsuits, investor complaints, fraudulent transactions, and much more over the course of the last four plus years but few rise to the level of incrimination and shamelessness as that embedded in my commentary the other day.

I thank those who wrote to me directly to share their insights and perspectives on this situation. There is no doubt that so many people, BofA customers and otherwise, experienced immeasurable stress and anxiety in dealing with the less than honest mortgage modification process within the HAMP program.

I hope people might care to take a few moments to gain a little bit of a sense of this stress and anxiety by reading, reviewing, and sharing these comments I received directly over the weekend. For obvious reasons, I will protect the identity of these individuals.

I have clients who paid their mortgage while trying to refinance. Sometimes they were late or tried to negotiate while making a good attempt. At the end of the year the $ was hardly applied to their mortgage but went to fees and fines. They decided to give up. There was no way to go forward. Then the bank forecloses and gets the insurance plus the sale $.

Thank you so much for taking these thugs on.

An individual who worked within a state attorney’s general office writes,

This is fascinating.

In Barofsky’s book, he quoted Geithner as having stressed the importance of “foaming the runway” for the major banks. This kind of delay tactic (stringing homeowners along) enabled “extend and pretend”, allowing BofA to put off marking its assets to market as long as possible. I was working on the problem from 2006-2010 in the state AG’s office, and I recall being baffled by the weird complexity of HAMP, given that it was supposed to bring relief.

Now it makes sense.

So sad and creepy, the whole thing.

Perhaps the most chilling comment of all comes from a regular reader who has served as an adviser to many,

Oh, this is so sad….

My best bud is 91 years old and is in the state House of Representatives. Anytime he gets any constituents finance questions or situations, he refers them to me.

One couple contacted him about the exact problem you just described with BofA. I talked to them and could not understand why they were having problems. They put their payments in a savings account while awaiting their modification papers. They never came.

They went into the foreclosure process. Their names appearing in the foreclosure section in a small hometown newspaper proved to be too much. Domestic problem arose from this situation. The young husband put a shotgun under his chin.

I will tell my bud to contact the young widow.

Thanks for keeping us informed.

Let these comments weigh heavily upon all those government officials, regulators, and banking executives involved in allowing if not promoting genuinely dishonest dealing in the charade known as HAMP.

Little wonder why there is such limited trust in our government and major banks these days.