Steal someone’s house, then write bad checks

Here are three things that illustrate the problem:

1. An estimated 4 million Americans were wrongfully foreclosed on between 2009 and 2010.

Close to 1.2 million borrowers, or about 30 percent of the more than 3.9 million households whose properties were foreclosed on by 11 leading financial institutions in 2009 and 2010, had to battle potentially wrongful efforts to seize their homes despite not having defaulted on their loans, being protected under a host of federal laws, or having been in good standing under bank-approved plans to either restructure their mortgages or temporarily delay required payments.

2. The banks that stole those houses are now required to compensate the former homeowners — for $300 to $5,000 per stolen home.

Unless you’re a bank.

There’s no doubt that millions of homeowners were the victims of shady foreclosure practices at the country’s biggest banks when the recession hit. So many of those people were likely hoping for a positive resolution to their woes when the government said it was going to figure out how to compensate homeowners with its Independent Foreclosure Review, an investigation into banks’ mistakes in servicing mortgages. But after waiting years for an answer, about three million eligible borrowers will only be seeing checks for between $300 and $500.

3. And now those $300 and $500 checks from the banks are bouncing.

As if going through the nightmare of foreclosure proceedings wasn’t bad enough, some of the victims who have been compensated as a result of a settlement between big banks and U.S. regulators can’t even get their darn checks to cash. Most of those borrowers only received between $300 and $500, and have been told their checks were rejected when trying to get their money.

Perhaps we could help the banks out by enrolling them in an overdraft protection program. We’d only have to charge them about $32 billion a year — that’s apparently the going rate.

  • http://adammclane.com/ Adam McLane

    That’s just not true. My house was foreclosed on by the wrong bank and I got $300.

  • http://adammclane.com/ Adam McLane

    Here’s my check: http://instagram.com/p/Y5os52Mjnv/

    I deposited it on Saturday… so it’s still listed as pending. I just thought it was “hilarious” that I had to provide a state issued ID to deposit my check whereas Citibank foreclosed on a house for which Wells Fargo held the note. Had they checked some ID in the first place I never would have been in that mess.

    Lesson for me? Never get a mortgage again. Pay cash or rent.

  • http://anonsam.wordpress.com/ AnonymousSam

    Yes, but that was Michigan. Michigan, as we all know, is Hell. Or at least Hell is in Michigan. I’m sure the details are irrelevant at this point. </sarcasm>

    In all seriousness, that was terrible and what you wrote on the subject is worth far more than the word “rant” adequately conveys. In particular, the fact that they refused to settle with you for the balance of the contract is ridiculous. The only reason to screw you like that is purely to steal the home away, which goes a long way toward proving just what kind of vile predator they are.

  • http://anonsam.wordpress.com/ AnonymousSam

    Was this in lieu of, or in addition to the $800-some odd you were supposed to get from the settlement?

  • http://adammclane.com/ Adam McLane

    The $300 is from a different process as they pulled the plug on the original program. The first process, which said they’d give people at least $840 was run by an independent body assembled by the Office of the Comptroller of the Currency. They gave up last year and pushed it back on the banks… so the banks set-up what they called “Independent Foreclosure Review” and hired a company to service payments.

    The letter that comes with the $300 check says that you can’t appeal it or get it modified, but it also isn’t opting you out of any other form of litigation. Unlike the previous process, accepting the money isn’t “settling” with them.

    HuffPo has a decent article about the outrage: http://www.huffingtonpost.com/2013/05/01/foreclosure-settlement-checks_n_3193377.html

    There’s nothing we can do at this point or even really want to do. We have a little over 2 years until foreclosure rolls off our credit. The upside is that by renting we’ve got a ton more cash available overall. Home ownership, for us, was a financial disaster.

  • http://anonsam.wordpress.com/ AnonymousSam

    Oh, FFS… yeah, that’ll be yet another reason for me to never move back to Michigan. I fled the state just before the governor passed his anti-democracy laws and it’s only gone down from there as far as I’m concerned.

    Well, I was happy to see the windmills when I visited last week, but then a cardinal opened his mouth…


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