My family will be making our first modification payment on this newly offered modification program – “Multistate Home Affordable Modification Agreement” on June 1, 2011. With this program my family will be paying 2% interest for the first 5-years, the 6th year it will increase to 3%, in the 7th year it will increase to 4%, and then in the 8th year throughout the term of the loan the interest will be 4.875% interest. The Modification Agreement If you were refused by one of the Big Banks with regards to a modification because you were told that you didn’t make ...
My Favorite ChaseSux Sites: Chase Home Finance Sucks - a daily blog that focuses on Chase Home Finance, Modifications, Govt. Agencies and an overall emphasis on Chase Bank in general. Chase Sucks - an overall emphasis on Chase Bank with regards to Home Financing, Modificaitons & Credit Cards. Loan Safe - an overall emphasis on Bank Loans in general with a lot of individual loan and modification horror stories. This particular link focuses on Chase Bank. Loan Safe - another loan safe link that focuses on class action lawsuits. You Walk Away - Focuses on walking away from a bad Bank Loan and Strategic Default. Walking Away Paper ...
LAWSUITS ACROSS THIS COUNTRY A site that will send your complaint to a lawyer for review. Send Your Complaint to a Lawyer for Review Lawsuit – Urban Justice Center - JP MORGAN CHASE ILLEGALLY DENYING HOMEOWNERS FORECLOSURE RELIEF. NYC Homeowners Sue Chase for Unexplained Delays & Denials of Permanent Modifications under Federal Program, Including after Months of ‘Trial Payments’ URBAN JUSTICE CENTER SITECase Documents UJC_Chase press release_FINAL Final Chase Complaint Case20100504132936429 The following case information brought to you by Justia Lawsuit - A North Carolina case where the plaintiff, a family, is suing the defendant, Chase Home Finance LLC. FULL STORY The ...
The following article is brought to you by Danielle Douglas at WashingtonPost.Com
JPMorgan Chase and Citigroup have become the first U.S. banks fined for the alleged manipulation of benchmark interest rates that affect hundreds of billions of dollars in contracts around the world.
On Wednesday, the European Commission slapped six financial giants, including Deutsche Bank, Royal Bank of Scotland and JPMorgan, with a total of $2.3 billion in penalties for colluding to rig European and Japanese interest rates for profit. The commission is one of several regulators around the world that have been examining the manipulation of key interest rates such as the London interbank offered rate known as Libor.
In the United States, the Commodity Futures Trading Commission has already penalized four European banks — RBS, Barclays, UBS and Rabobank — for their role in the scheme, but the agency, along with the Justice Department, is still investigating domestic banks.
Each of the cases that have been settled so far revealed a corporate culture in which traders bragged about the schemes in e-mails and Internet chat rooms. Authorities say the latest cases illustrate more of the same brazen disregard for the law.
Between September 2005 and May 2008, traders at the banks worked together before submitting data for the calculation of Euribor as well as their trading and pricing strategies, according to the commission. Regulators learned of the full scope of their deception from traders at Barclays.
A similar scheme was afoot in Japan, where traders at the same banks allegedly worked together to manipulate rates to benefit their bottom line from 2007 to 2010.
“What is shocking about the LIBOR and EURIBOR scandals is not only the manipulation of benchmarks…but the collusion between banks who are supposed to be competing with each other,” said Joaquín Almunia, EU Competition Commissioner, in a statement.
For its part, JPMorgan has only settled allegations relating to the Japanese benchmark rate for $108 million. The bank, along with HSBC and Credit Agricole, maintains its innocence in the Euribor case.
In a statement, JPMorgan said, “The settlement makes no finding that JPMorgan Chase management had any knowledge or involvement in the conduct at issue, or that the traders’ actions had any impact on the firm’s LIBOR submissions or the published LIBOR rates.”
Citigroup, meanwhile, agreed to a $95 million fine for its participation in the Japanese scheme. It received full immunity for one of the violations by cooperating with authorities, avoiding an additional $74 million fine.
“We’re pleased to resolve this matter with the European Commission and to put this investigation behind us,” said Danielle Romero-Apsilos, a spokeswoman for the bank. “Citi continues to cooperate with other regulators in connection with investigations and inquiries related to various interbank offered rates and other benchmark rates.”
The two U.S.banks paid the lowest fines and had the fewest number of traders involved in the scheme.
Deutsche Bank, which is still under investigation by U.S. and British regulators, received the highest fine at $633 million. The bank’s chief executive Juergen Fitschen said, in a statement, the charges stem from “past practices of individuals which were in gross violation of Deutsche Bank’s values and beliefs.”
French banking giant Societe Generale was saddled with the second largest fine at $604 million. Bank officials maintain that its role was limited to one rogue trader who acted without management’s knowledge.
Swiss powerhouse UBS avoided a $3.3 billion fine, while Barclays dodged a $937 million fine for revealing the existence of the scheme.
Barclays was the first bank to ‘fess up to its role in rigging the rates in June 2012, when it agreed to pay $450 million to settle allegations. UBS followed its lead in December by reaching a $1.5 billion settlement with global authorities, which included the indictment of two of its traders and a guilty plea by its Japanese subsidiary.
The CFTC uncovered evidence of Barclays senior management and numerous traders in London, New York and Tokyo making false reports to improve the bank’s trading position dating to 2005. At the height of the recession, the bank submitted low figures to keep rates down and to deflect public scrutiny about its condition.
About a dozen financial institutions, including Barclays and JPMorgan, submit data to set the daily Libor rate. Until recently, that information was collected on behalf of the British Bankers’ Association by Thompson Reuters, which calculates the averages and devises the Libor rate.
In July, the association transferred the administration of the benchmark to NYSE Euronext to restore integrity to the system. Critics of the system, however, are skeptical about the transparency in how banks set their daily rates, questioning whether it leaves the process wide open to fraud.
The following article is brought to you by Chris Isidore at
U.S. banks might still be on the hook for more than $100 billion in additional fines and legal costs over bad mortgage loans sold during the financial crisis, according to a new estimate from credit rating agency Standard & Poor’s.
But despite that massive cost, which would dwarf the fines and costs they have faced to date, S&P believes the banks have the financial wherewithal to pay out those claims. It does not anticipate downgrading the credit ratings for the banks with the largest exposure.
The cost estimate for the legal expenses ranges from $55 billion to $105 billion, according to the note. But S&P admits it made the estimate using a “significant amount of simplifying assumptions,” and that the final cost could fall either below or above that range.
The note published Tuesday estimates that the major banks — Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo — together are already on the hook for more than $45 billion of payouts since 2009, and have incurred legal expenses of $50 billion.
(CHASEHOMEFINANCESUX RESPONSE: When Is The People; The Home Owner, The Investor, Or The Tax Payer, Who Were Actually Robbed, Going To See Any Justice!?!?! Or Is The Government & The Banks Just Going To Continue To Swap Money Among Themselves!?!?!)
The following article is brought to you by Kevin McCoy at USA Today, found at GreenBayPressGazette.Com
The admissions JPMorgan Chase agreed to under its record $13 billion settlement with the Department of Justice could represent a new legal liability in ongoing litigation faced by the nation’s largest bank.
According to the statement of facts, unidentified employees of the bank or its subsidiaries received information that some mortgage-backed securities they marketed and sold in 2005-2007 “did not comply with underwriting guidelines.” Yet the workers “did not disclose this to securitization investors.”
The statement focused on the practice of buying bundles of residential mortgages and packaging them into securities sold to investors – a procedure that Attorney General Eric Holder said “helped sow the seeds of the mortgage meltdown” that sparked the financial crisis in 2008.
For instance, JPMorgan didn’t alert investors that one employee wrote a letter “memorializing her concerns” that one package of mortgage loans was too risky to buy or bundle into securities sold to investors, the statement said.
An employee at Bear Stearns, the investment bank JPMorgan bought in 2008, similarly questioned packaging and selling mortgages bought from “poorly graded sellers” who sometimes sold loans that “experienced high rates of default.”
“The candor with which JPMorgan was forced to admit wrongdoing is unprecedented,” said Elizabeth Nowicki, a former Securities and Exchange Commission attorney who has served as an expert witness in securities lawsuits. Describing the statement as legally risky, Nowicki said “it would certainly give encouragement to plaintiff attorneys.”
In a regulatory filing last month, JPMorgan said the bank is defending itself and Bear Stearns against three purported class-action lawsuits involving allegations about their underwriting of mortgage-backed securities. “Motions to dismiss have largely been denied in these cases,” that filing said.
Among the lawsuits filed against JPMorgan and Bear Stearns is a New York federal court case in which the lead plaintiffs are the New Jersey Carpenters Health Fund and the Public Employees’ Retirement System of Mississippi. The suit, which seeks class-action status, alleges the banks “misrepresented the quality of the process purportedly used to originate the mortgage loans” securitized and sold to them. As a result, the investments “were far riskier than represented,” the lawsuit charged.
Attorneys at Cohen Milstein, the law firm that’s co-lead counsel in the case, are “carefully reviewing the statement of facts,” said media spokeswoman Pam Avery.
Jeffery Harte, an equity research principal who tracks the financial industry at Sandler O’Neill & Partners, raised the legal risk issue during a conference call.
JPMorgan CEO Jamie Dimon stressed that the bank did not “admit to a violation of law,” which would have posed an even greater risk for the outcome of other cases. Noting that each lawsuit is different, he said plaintiffs would have to surmount numerous legal hurdles to prevail in class-action cases.
“We’re prepared to negotiate if it makes sense and fight if it makes sense,” said Dimon. (CHASEHOMEFINANCESUX RESPONSE: Jamie Is Going To Do What Makes Sense To Him, Negotiate Or Fight. He’s Not Going To Do The Correct Thing, And Correct All of JPMorgan Chase Bank’s Criminal Actions. The Reason The Country Is In This Mess, Is Because The Government Allows Dimon & His Other Bank Exec Cohorts To Do Whatever They Want!?!? These Criminals Should Be IN JAIL!!!)
The following article is brought to you by BEN PROTESS AND JESSICA SILVER-GREENBERG at NYTimes.Com
They were some of the biggest losers in the 2008 financial crisis: Fannie Mae and Freddie Mac, federal taxpayers, state pension funds, credit unions and, of course, homeowners.
But their fortunes turned somewhat on Tuesday, when they ended up on the receiving end of JPMorgan Chase’s record $13 billion settlement. The deal, the largest payout a single company ever made in a government settlement, centered on the bank’s sale of troubled mortgage securities to investors in the run up to the crisis.
Of the $13 billion, the only fine in the case came from federal prosecutors in Sacramento, who extracted a $2 billion penalty. In case you missed their news conference, this was kind of a big deal, representing “the largest recovery ever in a case handled” by the office.
No, prosecutors cannot pocket the cash to purchase a life-size gold statue of Jamie Dimon. Instead, JPMorgan must wire the $2 billion to the Justice Department, which will then deposit the money into a fund at the United States Treasury.
The next chunk of cash, roughly $7 billion, will flow to a range of government authorities, some more obscure than others.
The biggest winner is the Federal Housing Finance Agency, which took control of Fannie Mae and Freddie Mac when the companies collapsed in 2008. JPMorgan agreed to make a “lump sum payment” of $4 billion “payable to Freddie Mac and Fannie Mae, divided between them,” according to the settlement agreement.
The National Credit Union Administration, the federal agency that regulates credit unions, said it would collect a $1.4 billion share of the $7 billion pie “for losses incurred by corporate credit unions as a result of the purchases of the faulty securities.” The payout will allow the agency “to greatly reduce the assessments that all credit unions have to pay.”
The Federal Deposit Insurance Corporation will collect $515 million, which it will distribute to the receiverships for six failed banks, including Colonial Bank, which was at the center of a huge fraud scheme.
State authorities also received a cut, albeit a smaller one, of the $7 billion sum. New York State’s attorney general, Eric T. Schneiderman, will use its $613 million to expand homeowner assistance programs. Lisa Madigan, the Illinois attorney general, will allocate her $101 million to state pension funds that suffered losses from soured mortgage securities, including the Illinois Teachers Retirement System. Attorneys general in California ($299 million), Massachusetts ($34 million) and Delaware ($20 million) also took home a share of the settlement.
That leaves $4 billion in the overall $13 billion deal. The Justice Department, which led negotiations with the bank, earmarked the final sum to help struggling homeowners in hard hit areas like Detroit. Half of that sum, or $2 billion, will go toward reducing the balance of mortgages and halting the collection of mortgage payments.
The remaining $2 billion in homeowner relief, according to the Justice Department, will focus on reducing interest rates on existing loans, offering new loans to low-income home buyers and demolishing abandoned homes to curb urban blight.
The total $13 billion payout might seem steep. Of course, it does not include the small fortune JPMorgan spent on the legal services of Sullivan & Cromwell and Debevoise & Plimpton.
AMOUNT WHERE THE MONEY GOES HOW IT WILL BE USED
$7 billion * State and federal agencies $4 billion for the Federal Housing Finance Agency goes to Fannie Mae and Freddie Mac. This deal was announced in October.
$1.4 billion for the National Credit Union Association to reduce assessments for credit unions.
$515 million for the Federal Deposit Insurance Corporation
$613 million to New York attorney general
$299 million to California attorney general
$101 million to Illinois attorny general for state pension funds.
$100 million to New York attorney general for expanding homeowner assistance programs.
$20 million to Delaware attorney general
$34 million to Massachusetts attorney general. The office has not decided how to spend the money.
$4 billion ** Consumer relief $2 billion credit for JPMorgan to reduce the balance of mortgages in foreclosure-racked areas like Detroit and certain neighborhoods in New York.
Up to $500 million credit for JPMorgan briefly halting the collection of mortgage payments.
Credit for JPMorgan to reduce interest rates on existing loans, offer new loans to low-income home buyers and keep those loans on its books.
Credit for JPMorgan to demolish abandoned homes and other efforts focused on curbing urban blight.
$2 billion Justice Department $2 billion fine goes to United States Treasury. Federal prosecutors in Sacramento led an inquiry into JPMorgan’s mortgage practices.
* JPMorgan says this part of the settlement is tax deductible, but that decision may rest with the I.R.S.
** JPMorgan will have to hire an independent monitor to oversee the distribution over four years.
Sources: Justice Department, states’ attorneys general
(CHASEHOMEFINANCESUX RESPONSE: As One Commenter Named John Defines This Article: “So the homeowners and investors who were among the first to suffer from the iniquities of shaky Wall Street bankers get…… bupkus! Very Fair, indeed!” We totally agree John, The Banks & The Government Just Passing Money Amongst Themselves, While Those That Were Abused & Wronged Get Nothing!?!?! Yes, It’s A Pathetic Country We Have Become!)
The following article is brought to you by Angelina Bouc at GuardianLV.Com
Earlier this year federal regulators were ready to prepare a list of enforcement consequences and fines against the largest bank, JP Morgan Chase. This stemmed from pending lawsuits by the Federal Housing Financial Agency – who accused JP Morgan of unlawful practices during the height of mortgage recession. From 2005 to the housing collapse in 2008, it was suggested JP Morgan packaged and sold mortgage loans to Fannie Mae and Freddie Mac that violated numerous federal securities laws. This of course is in correlation with Alt-A mortgages, a niche in the mortgage industry that stuttered to a a collapse in 2008, along with the sub-prime market. Yet, somehow JP Morgan has now avoided these investigations by settling with the Justice Department for $13 billion dollars.
The Domino Effect
In January of this year, several banks, including JP Morgan were named in a Independent Foreclosure Review Agreement. Due to deficiencies in mortgage processing and servicing, a fund was developed to pay back to homeowners for losses. The payments would be assigned to homeowners who entered into foreclosure between January 2009 until December 31, 2010. The payments were to be issued to the homeowners, but the settlement between over a dozen of the big banks and the Office of the Comptroller of the Currency and the Federal Reserve Board never made big news. Reportedly, homeowners had been contacted prior to the deadline of December 31, 2012. Payments averaged between $300 to $125,000 for over 4 million homeowners.
While JP Morgan settles with the Justice Department to avoid investigations for $13 billion, further yet are the many homeowners to continue to lose big. In 2008 alone, more than 850,000 families lost their homes, resulting in a spike of 226 percent of foreclosures from numbers in 2006. The foreclosure programs implemented failed to make a dent, while the numbers continued to spike into the millions of families walking away from their largest asset – raising the numbers of unemployment which still affect millions today.
The sub-prime market exploded in the mid to late 90′s, offering an opportunity to low-income, low credit scoring individuals to own property. The softened parameters included 100 percent financing of purchases and refinances for borrowers with credit scores as low 500. Sub-prime lenders monopolized the industry, drawing customers with promises of closing without an appraisal until funding of the loan and packaging the loan off to the secondary market.
The Alt-A market also exploded with loans, promising lower interest rates with Adjustable-Rate Mortgages (ARMS) that would keep a low payment for three, five or even 10-years. Thereafter, the rate could spike two percent every year with a max increase set at typically five or six percent. This process started catching up with homeowners who needed to refinance. Bloated appraisals started occurring in the mortgage industry to offset the costly ARM and negative amortization loans, resulting in one of the largest financial collapses in any one industry in 2008.
When foreclosure filings increased into troubling numbers, so did bankruptcies and unemployment rates- setting off a domino effect that continues today. Many low-income neighborhoods sit abandoned, houses boarded up as homeowners struggle to surface from the financial drowning experienced through the last several years. In 2009, the housing market in Michigan reached a pinnacle of drastic depression. The median home value fell to $7,000, allowing investors to come in and purchase the properties to invest another $20,000 into repairs and rent out the properties.
While JP Morgan is negotiating a deal with the United States to walk away from numerous lawsuits and investigations, this leaves no room for comfort for the millions of homeowners still struggling. Certainly, borrowers had the right to read disclosures and may had been aware of their payments- but felt it was their only chance to get a home and signed. In the sub-prime market, lenders like JP Morgan touted loans with requirements that included no income verification or bank statements for income verification. Lack of oversight, future analysis and uneducated consumers blossomed into a bubble that finally burst five years ago.
What is Next for JP Morgan?
The specific details of the settlement with the Justice Department are not fully disclosed at this time. Further yet, many are wondering the exact punishment when the bank will use consumer funds to pay the United States. Just a few short months ago, Attorney General Holder was adamant about the ongoing criminal investigation against JP Morgan. Until, JP Morgan bumped up the settlement amount to $13 billion which is to include $4 billion to the Federal Housing Finance Agency. The money is to offset allegations that JP Morgan mislead Fannie Mae and Freddie Mac with unlawful securities.
Once JP Morgan bumped their settlement to that amount, Holder backed off the investigations. Is this nothing more than child’s play of bribery? Many consumers feel that way. Speaking to former homeowner and customer of JP Morgan C. Neil, he expressed his distaste at the latest news,
I was 65 when I signed my mortgage with Chase. I was told in two years they would refinance the adjustable mortgage. That never happened, they avoided my calls and my rate increased and the following year increased again. I called for help and was given the runaround. I did receive a pithy $400 check as a sorry several years later. Yet, the feds get $13 billion? This is nothing more than a recycling corruption between the two biggest conspirators- the banks and the government.
(CHASEHOMEFINANCESUX RESPONSE: This Same Process Happened To Millions Of Us. But The Big Banks And The Government Continue To Just Screw Us, The American People!!!)
Millions may agree with Neil. For now, only time will disclose the specific details of the settlement, including how much of it is actually cash versus coupons or other discounts. Technically, it appears $4 billion will be paid in cash to the Federal Housing Finance Agency, but little else remains clear. The biggest settlement between the largest bank JP Morgan Chase and the Justice Department may be finalizing very soon for $13 billion. This might settle the criminal investigation but it may mean big trouble for CEO of JP Morgan Jamie Dimon, a fall guy is typically needed in matters of this magnitude. For now homeowners continue are aiming to regain their financial footing on a slope that hopefully will even out.