The following article is brought to you by Brent Hunsberger at OregonLive.Com
Two weeks ago, a jury in Hillsboro found that JPMorgan Chase broke state law when it foreclosed on a Washington County adult foster home. The jury believed Chase had promised the homeowners a modification, told them to stop making payments, then foreclosed on them anyway.
The events in that case started more than four years ago. The housing market has since recovered. Big banks have paid billions to settle foreclosure fraud allegations nationwide. Chase has reported $75 billion in profits since 2008, more each year.
Surely those problems are behind it.
Not according to Jill Africa-Barnes.
In May, Africa-Barnes found herself threatened with foreclosure by Chase after it bought her newly modified loan from another servicer. She’s now considered behind on her mortgage because she asked for help and followed their instructions.
Other homeowners continue to face similar loan-servicing mistakes and delays, advocates and experts say, despite the 18-month-old mortgage settlement.
“The complaints are continuing to come in,” Jeff Manning, spokesman for the Oregon Department of Justice, said last week.
In this instance, Chase faces a woman who’s survived much worse. To her the Fortune 500 company’s mistake, a risk to her livelihood, is “a minor inconvenience.”
Africa-Barnes had just sold her home in 2007 when her husband, Steve, called her from his truck-driving job. He couldn’t control his arm. It was flailing.
He died six months later of a glioblastoma multiforme, an inoperable cancer that rapidly overtook his brain.
Africa-Barnes watched her husband of 10 years become pumpkin-faced and paralyzed before he died. She fed and diapered him, took him to chemo and radiation, kept track of his meds. Just 5 feet 6, she shouldered his 250-pound frame from wheelchair to car, once fracturing her foot in the process.
She also saw her 8-year-old son fall deep into depression, a demon he still struggled with this summer.
Steve Barnes’ death at age 57 brought the end of health insurance, a comfortable income, normalcy. “He was my best friend,” she said.
She filed for bankruptcy in 2009 after Bank of America raised the interest rate to 29.9 percent on the $40,000 line of credit she used to finish a remodeling job that a contractor refused to complete.
Yet even through bankruptcy, Africa-Barnes managed to hold onto that home she bought in Banks, where her husband spent his final weeks.
“He wanted to buy a house because he wanted to know we had a place where my son and I would be OK,” she said.
Now she’s a runaway train ride away from losing it. All she did is the same thing Americans have been doing for four years now, with encouragement from the Obama administration: She asked her lender to reduce her monthly payments.
Loan is sold
Nine months ago, MetLife Home Loans gave Africa-Barnes a trial mortgage modification under the federal Home Affordable Modification Program. She made her first reduced payment in January.
Without warning, MetLife sold the loan to Chase. Her “inconveniences” began.
After two more payments, she said, Chase customer assistance specialist Nathan Roggow called. Make no more payments, she recalls him saying, until she receives modification documents from Chase.(CHASEHOMEFINANCESUX RESPONSE: The Big Banks Are Still Lying, Stealing & Robbing From The People, And The Government Continues To Do Nothing!)
To this day she has yet to receive them. Instead, on May 13, she found an “Acceleration Warning (Notice of Intent to Foreclose)” in her mailbox. The letter said she was in default because she’d failed to make her April payment.
Eventually, she reached Roggow. A glitch prevented modification documents from being sent out, she recalls him saying. It happened to others too. But, technically, she was now in default because she had failed to sign a modification.
Should she continue paying, she asked.
I’m not telling you to make the payment, she recalls Roggow saying, and I’m not telling you to not make the payment.
She continued making them.
Last month Roggow told her she needed to start the modification all over, she said, a process she initiated more than a year ago with MetLife.
“I’m not quite sure why this was all my fault,” Africa-Barnes says. “It’s almost like they’re doing this on purpose.”
Chase could be violating terms of the National Mortgage Settlement. The 2012 consent judgment requires the nation’s five largest servicers to honor pending trial loan modifications when they acquire a loan, said Lake Oswego attorney Kelly Harpster, author of the HouseKeeping Report blog. But with little meaningful oversight by federal regulators, borrowers must resort to complaining to the Oregon Department of Justice or the U.S. Consumer Financial Protection Bureau, or file a lawsuit, she said.
I contacted Chase on Africa-Barnes’ behalf and received an emailed statement: “Ms. Africa’s loan has never been referred to foreclosure. We have recently notified her that a new application package is not needed, and are actively working with her to bring closure to this matter.”
Of Chase, Africa-Barnes said: “Everybody is profoundly exceptional at doing one thing, and that’s saying, ‘I’m sorry.’”
I’ve been writing about these problems for four years, ever since Howard Spindel called me, flabbergasted. CitiMortgage had pestered him to modify his loan, then reported him delinquent to credit agencies when he did.
The problems haven’t stopped. Big bank loan servicers are still making basic mistakes that threaten to drive people out of their homes. It’s why Oregon’s revised Foreclosure Avoidance Program, which officially relaunches Sunday, is still crucial to homeowners and the economy alike.
These are the same banks that received infusions of cash from U.S. coffers. They were too big to fail, we were told.
Only they keep failing their customers. Again and again. Botching details that stress everyday Americans.
“These are huge organizations that are having record profits,” said Carlos Garcia, homeownership support program manager at Hacienda CDC in Portland. “I would think they would have put better systems in place.”
Africa-Barnes has not failed. She is seeking renewal.
With the help of scholarships, her husband’s Teamsters pension and her and her son’s Social Security death benefit, she’s now one year from a degree in social sciences from Portland State University.
In May she won a Ford Opportunity Scholarship from the Ford Foundation that will cover nearly all of her $26,000 tuition and expenses. She also was named a PSU Ronald E. McNair Scholar, which helps students pursue doctorates.
She hopes to one day use an advanced degree in counseling to help kids from disrupted homes cope with losing a parent. It’s something she understands well.
Chase’s glitch? That she does not understand.
“You couldn’t get loan documents out because you didn’t have enough people working there? Or because you’ve got CEOs making too much? This is what you do. You get loan documents out.”