Bad Breaks and Good Luck

by Doug Love

The big banks that got busted for bungling foreclosures paid billions for their bad business, through a settlement with the U.S. government. Eight-and-a-half billion dollars was paid to the feds, to be distributed to homeowners who were incorrectly foreclosed upon. Unknown is exactly who will receive the money, how much they will be given, and when they will get it.

There are people here in the North Valley who might be eligible- people who were in the process of a loan modification, for instance, who were told by the bank they were qualified for the modification, were days from closing the modification, and the bank abruptly foreclosed. It’s as if the left hand of the bank was holding a pen above the paperwork, ready to sign final documents, when the right hand appeared at lightning speed, seized the documents and fed them through a shredder, then slammed down the hammer of foreclosure. Bad break. No loan modification, no more home, time to pack it up and go.

After people packed it up and went, it was discovered the bank didn’t own some of the loans they foreclosed upon. Faulty and fraudulent paperwork stunk up the bank’s processing departments like rotten eggs. Too late though, the home has someone else living in it now.

Other people got the boot without being given proper notification, without correct paperwork, or disclosure of their rights. Mere technicalities one might say; but procedurally illegal nevertheless.

Amidst the foreclosure wreckage and the bad breaks, there are some good luck stories to be told.

One homeowner (who wishes to be unnamed) had a loan against his property of $375,000, and the house was worth around $225,000. The homeowner lost his job and quit making payments, and the bank began foreclosure proceedings. The homeowner packed, and prepared to hit the road.

Three days before the foreclosure was finalized, the bank confessed their paperwork on the loan was faulty, and they no longer claimed ownership of the loan at all. No one else did, either.

Eureka! The homeowner-who-wishes-to-be-unnamed now owns his home free and clear. He pulled the “Get-Out-of-Jail-Free” card; the “Bank-made-an-error-in-your-favor” card. Lucky break.

He also got his job back.