I was talking to a friend of mine this morning who is a defense attorney, and we were discussing some of the facts of the mortgage cases our firm is handling. As I’ve mentioned in previous cases, many of these mortgage companies are representing that they will review the clients’ situation for a modification, or approving their modification, and at the same time, they proceed with foreclosure.
While we were talking, it struck me. What’s the rush? Why are these banks moving so quickly to foreclose? Why are they putting themselves in this position? It doesn’t make sense.
The current situation in the United States is unprecedented. These banks have never had so many loans in default. The banks, even though very large (Chase, Wells Fargo, Bank of America, CitiMortgage, etc.), are not equipped to handle all of these modifications and foreclosures. So, why not slow down? Quit rushing the process. You don’t have to foreclose immediately. You don’t have to commit fraud and misrepresentations. You don’t have to throw people out on the street.
Why are they rushing? Well, I can only think of a couple reasons. First, many of the people handling the modifications and foreclosures are low level employees, and they do not think outside the box. They are given their structure and told what to do, and they are scared to deviate even if it means helping the customer.
Second, there might be some accounting, tax and/or regulatory reasons why the banks have to get these bad loans off their books. If this is the case, then maybe we need new legislation to address the problem. However, if they weren’t losing documents and making people file their packages on multiple occasions, they might not need to rush to foreclosure.
We have been successful in helping a couple people with these issues, but there are thousands suffering. Hopefully, in the future, better processes will be developed, and better decisions will be made. Until then, the court dockets will continue to increase with these types of cases.
Stay tuned . . .