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Posted at 10:06 AM ET, 11/18/2010

Bank of America outlines radical foreclosure reform measures to Congress

By Ariana Eunjung Cha


(Photo Credit: Joshua Roberts/Bloomberg)

Bank of America on Thursday said it was committed to making significant changes in its foreclosure process and that it had completed 25,000 mortgage modifications for financially distressed homeowners in October. That's more than a 50 percent increase from the previous month.

Only 2,600 modifications were made through the federal government's Home Affordable Modification Program. The rest were made through the bank's own programs.

The figures show the speed and extent to which the bank -- the only one to halt foreclosure sales in all 50 states while it reevaluated its procedures -- is taking voluntary measures to fix its foreclosure problems.

The quick action comes as federal regulators and the 50 state attorneys general investigate the industry's practices and as Capitol Hill has increased scrutiny of foreclosures. The House Financial Services Committee is scheduled to hold the week's second hearing on the subject at 10 a.m. Thursday.

At the hearing, Rebecca Mairone, a default servicing executive with Bank of America Home Loans, is expected to outline a number key areas that the company pledges to reform.

"There are areas where we clearly must improve, and we are committed to making needed changes," she said in written remarks.

She said the bank is redesigning its modification process to offer a single point of contact, or a "case manager," for every eligible homeowner. More than 140,000 customers have already been assigned such a manager.

Mairone said the company has been talking with the state attorneys general "about how this approach can be expanded, and refined, to improve the customer experience and reduce borrower anxiety during the time they are being considered for modifications."

She also said the company would like to reform the "dual-track system" of foreclosing on a homeowner while loans are being modified to prevent foreclosure.

Bank of America is "looking for ways to change industry practice with respect to evaluation of borrowers for modifications after they have been referred to foreclosure to mitigate the very real concerns we have heard about that practice."

More on Thursday's hearing on foreclosures before the House Financial Services Committee subcommittee on housing:

Frank: Homeowners should not have 'false hopes' in foreclosure mess
Bachus, Waters: Why didn't regulators know of problems sooner?
CitiMortgage admits to foreclosure mistakes

By Ariana Eunjung Cha  | November 18, 2010; 10:06 AM ET
Categories:  Congress, Housing  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   StumbleUpon   Technorati   Google Buzz   Previous: CitiMortgage admits to foreclosure paperwork problems
Next: NY attorney general Cuomo sues Rattner, chief architect of auto bailouts


Reform by BofA? I'll believe it when I see it. I know of homeowners who have been through the wringer with no end in sight for their loan modification application, submitted over a year ago (and subsequently resubmitted twice more as their application and documents were "lost").

Two foreclosure attempts by BofA during that time (both after receiving written assurances from the Office of BofA's CEO that foreclosure would not occur) have been successfully stopped in their tracks, chiefly because BofA doesn't coordinate with their foreclosure attorneys.

To add insult to injury: the homeowners' second loan - also held by BofA - was already modified and they have been making payments on time for months under the modification. So what did they receive last month? A letter from BofA informing them that the loan was in default and being accelerated for non-payment!

BofA was bailed out to the tune of over $40 BILLION, and this is how they conduct themselves.

As far as I'm concerned "reform" is just a word BofA is throwing around to get Congress off its back.

Posted by: Anonymous | November 18, 2010 11:36 AM | Report abuse

After seeing how the banks implemented (or did not truly implement in good faith) the government's HAMP program to help distressed homeowners, I've become a very skeptical and cynical person when it comes to the banks' supposed reform plans. I tend to believe the blogger who wrote that these are just the lenders'/banks' ploy to get investigators/regulators off their backs. I will believe it when I see it. At this stage, it's all just public relations C.Y.A or B.S. to me.

Posted by: dasha22 | November 18, 2010 12:31 PM | Report abuse

We better hope they get their act together, for how goes the housing market so goes the economy. With foreclousers accounting for one third of all sales we need to get these homes back on the market and get the economy moving again!

Posted by: Anonymous | November 18, 2010 12:40 PM | Report abuse

Bank of America has put me through five modification qualifications as well as five full paperwork submissions. They keep saying that the documents did not get there, although they were returned to them via their pre-addressed FedEx Envelopes.

Last week, a woman in my town (who had also been put through this for months after her husband died) committed suicide because the bank drove her to it. They found her slumped over her mortgage papers with a bullet in her head. If any of you bankers are reading this, please hold that image in your brain and think long and hard about how it makes you feel. Much suffering and blood in on your hands; you jerks.

I hope that BOA and all of the other criminal operations are shut down. They all deserve to be in jail or on death row.

It is time to end this crap.

Posted by: rogertruth | November 18, 2010 12:49 PM | Report abuse

Rebecca Mairone of BOA is a laughingstock after her tepid response to the excellent Huff Post stories taking Bend Over America apart at the seams. Remarkable that she shows her face on the Hill. No shame.
Of course Bend Over wants to peddle its internal loan mods - they are a crazy quilt of padded charges, fees, penalties, interest, legal costs etc.
Banks that got stoned on fees in the boom are now free-basing on fees from defaulting borrowers - the same ones they fleeced the first time. It is criminal.
Dumbfounded that the many six-figure feds who were caught unawares in the meltdown were *still* asleep at the switch.
Thanks to crusading journalists, the heroes here. Mother Jones, Rolling Stone and Janice Martin @ the St. Pete Times in Florida are shining examples of modern-day patriots. Our gov. has been sold to banks, lock stock and barrel. Not so for the free press, bless their hard-working, justice-seeking hearts!

Posted by: FloridaChick | November 18, 2010 3:33 PM | Report abuse

The news media has STILL FAILED TO REPORT and DISCLOSE to the American public that CountryWide(B of A) was SANCTIONED by U.S. Bankruptcy Judge Thomas AGRESTI on October 5, 2010, for EVIDENCE FABRICATION and making false statements to the Court. The the hearing on imposition of sanctions for CountryWide's outside counsel is NEXT WEEK.

Even more significantly, Judge AGRESTI found that a CountryWide/B of A Asst. General Counsel MADE FALSE STATEMENTS UNDER OATH in a deposition during the investigation by the U.S. Trustee into the original misconduct.



Posted by: waroper | November 18, 2010 4:04 PM | Report abuse

How can BOA be trusted after all the crap they pulled on loan modifications?

Posted by: RANSOM11 | November 18, 2010 4:34 PM | Report abuse

And now CitiMortgage has fessed up to its foreclosure documentation debacle after months of stonewalling. Does any one of the pinheads working at these multi-billion dollar companies have a clue?

Come on Obama/Holder/Frank, is there a pair to be found among the three of you? When will you bring these leeches to justice?

Posted by: Anonymous | November 18, 2010 5:21 PM | Report abuse

Please go to and read about all the hell, I , as well as thousands of other people are going through with trying to get modified with Chase Home Finance. It is the same problem, requested information, sent information, modification, another request for the same information. Today, I find out they didnt pay my homeowners insurance that was supposed to be paid from my escrow account. I filed a complaint today with the PA attorney general office, I have spoken with PHFA, went through a supposed HEMAP loan that turned my fixed rate into a balloon mortgage! What the hell is going on here?

Posted by: Anonymous | November 18, 2010 7:09 PM | Report abuse

Gotta' love how BOA touts the number of modifications but not the number of *permanent* modifications. They're different.

In the Nov 7th HAMP report BOA/Countrywide reported 78,905 permanent mods and 159,010 "canceled" mods; that is, where they got people to cough up their last few remaining dollars then threw them out.

To compare and contrast GMAC had 31,932 permanent mods and 12,309 canceled mods (no; those figures aren't backwards). Some firms are worse: Litton (Goldman-Sachs) had 8,744 perm and 24,088 canceled mods but it's clear when BOA says they've started a modification it means virtually nothing.

Too big to fail really means too big not to fail.

Posted by: michael_olenick | November 18, 2010 8:03 PM | Report abuse

I was in the modification process with First Franklin Bank for the 4th time. BOA now services my mortgage effective 10/1/10. FFB said all of my mod paperwork would be transferred to BOA and they will give me an answer promptly. I called BOA on 10/1, and about a 100 times thereafter. On 11/8, I told them to start the process again because it does not look like FFB is going to send the paperwork. I asked how long will it take to get an answer and BOA response was in about 3 months!!!!! Can anybody believe this!!!!!!

In the meantime my balance keeps getting higher and higher, probably making it impossible to get a mod. I have tried to modify my loan almost 2 years now and I won't give up!!!!!!!

Is there anybody else who had a mortgage with FFB, now transferred to BOA experiencing the same problem??? Please let me know I can't be the only one. Thank you for your feed back.

Posted by: Anonymous | November 18, 2010 11:48 PM | Report abuse

I work for one of the major banks in the loan modifications. I can personally speak from experience that many of the accounts that I see declined, the borrower applied and while they may have been initially eligable, were later found not to be eligable due to a further analysis of the borrowers finances. One issue with MHA and the other govt mods is that once you enter into the trial period and are declined, you will no longer qualify for MHA ever again. That's another issue I see. That borrowers get a trial payment and still cant pay. As far as First Franklin goes, it takes up to 90 days for all paperwork to be sent over to us from 1st Franklin. They are dragging your feet, but you can fax any supporting mod docs you have from 1st Franklin to Bank of America. That will help out tremendously. I do wonder what people are willing to do to get out of debt. I talk to borrowers who cant pay their mortgage, but they can pay a lawyer to help them with a mod, they still have 2 high car payments, they still have cable tv, they are spending outrageous amounts of money on food monthly. What are people willing to do to save their homes.

Posted by: Anonymous | November 19, 2010 12:50 AM | Report abuse

Banks don’t foreclose when borrowers make their payments. Banks can’t make payments from escrow accounts that haven’t been financed. That’s what’s going on.

Maybe it’s better to ask why the responsible borrowers don’t get a break of some kind; they’ve been hurt, too ... but find a way to make their payments.

Posted by: meh4 | November 19, 2010 1:32 AM | Report abuse

meh4 said:

"Banks don’t foreclose when borrowers make their payments."

You better read the U.S. Bankruptcy Court decisions in In Re Hill and In Re Wilson. Because that is PRECISELY what the mortgage servicer did! They came into court with FALSE AFFIDAVITS in the Re Wilson. They alleged an outstanding balance in In Re Hill when there was NONE. In In Re Hill, the servicer then FABRICATED LETTERS which purported to PROVE that there was a balance due.

In In Re Hill, CountryWide/Bank of America DESTROYED Sharon Diane HILLS CREDIT with their FALSE allegations. Ms. HILL got her MORTGAGE DISCHARGED plus CASH. Outside counsel for CountryWide was sanctioned by the Court. Bank of America's Asst. General Counsel was found by the Court to have made false statements under oath in the ensuing investigation. His TRIAL IS NEXT WEEK.

I doubt that ANYONE in Congress heard ANYTHING about these outrages at their dog and pony show this week!

But, of course, the hearings were NOT about justice or about actually uncovering the problems or the cover-up. Instead, this was merely another SHOW so that Sen. DODD and his other corrupt buddies could PRETEND to be doing something about these ongoing criminal conspiracies.

Unfortunately for the banksters and the corrupt politicians, the Internet is the great leveller and ordinary citizens can now access information on a global basis and use it to PROVE the criminal actions of these institutions. ForeclosureGate did NOT arise because of some capable or competent regulation or oversight. To the contrary, it was exposed IN SPITE of the corruption and cover-ups of these regulatory entities!

The apologists who are asserting that these regulatory agencies or the state attorney generals are going to be investigating and acting fail to appreciate that the new revelations will continue to spill forth FASTER than the regulators and corrupt politicians can react! This is essential because the corrupt are mostly looking for new ways to sweep the entire sordid mess under the rug. But when you file upwards of 100,000 perjured affidvits and over 1 million forged assignments within the public records in over 10,000 counties, it is actually pretty difficult to orchestrate an effective cover-up! And when there are more than 1 million victims, there are a LOT more people who are angry and ready to take action than there are to effect the cover-up.

This scandal is only just getting under way! The Teapot Done scandal was just a trivial matter compared to this epic fraud. This is the greatest fraud in the history of capitalism or democracy!

Posted by: waroper | November 19, 2010 2:40 AM | Report abuse

Mortgage Rates have hit an all time low! For many, these rates will be the lowest we see in our lifetime. Rates change several times throughout the day, so to get an accurate quote search online for "123 Mortgage Refinance"

Posted by: Anonymous | November 19, 2010 4:53 AM | Report abuse

Acting United States Trustee for Region 3, Movant,


PUIDA, Respondents.

The bank believed, incorrectly, they had not received their payments, thus the foreclosure attempt. If you take the time to read the case, the sanctions were about the cover-up of their mistakes, not the foreclosure itself.

Posted by: meh4 | November 19, 2010 7:06 AM | Report abuse

There is a government agency investigating questionable practices by mortgage companies in the loan modification process. Specifically, they want to talk to people who were told by their mortgage company to intentionally miss a house payment in order to qualify to have their house payment lowered. Here's the story:

Posted by: Nicklas_R | November 19, 2010 9:05 AM | Report abuse

Posted by Nicklas above. I have seen this link and message a number of times. I called them but they are not a goverment agency and are not really taking information about banks telling customers to stop making payments. From the website, it looks like they are selling their services. Anyway, they weren't interested in just taking information.

Every time I have called US BANK for modification assistance, they tell me that I will have to make late payments or stop paying for a few months to get assistance. I can't sell my house as the loan is higher than the value. That leaves short sell or modification or foreclosure. It won't rent for what the payments are either partly because the property taxes in this town are incredibly high. There is no help for us and we are spending our sons education money to pay the balance of the mortgage.

Posted by: worktogether-takeaction-getinvolved-oneworld | November 19, 2010 1:52 PM | Report abuse

Bank of America stole our family's home via the Making Homes Affordable Program, stonewalling every time we called to check on the status of our "modification". The only thing Making Homes Affordable Program has done is steal our 7 years equity and put us on the street! They dual tracked us, robo signed us, raped us, and left my family to pick up the pieces. Get this, they forclosed on our home October 5th, sold our home to Fannie Mae (Government Bailed Out Company), and supposedly denied our modification all on the same day. Seems our government has found a new way to steal Americans money and leave their lives in ruin! How is it that they can steal from Americans and no one can stop them?

Posted by: Anonymous | November 19, 2010 3:31 PM | Report abuse

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