Sunday, May 19, 2013

More Homeowner Horror Stories To Come As Banksters Begin Unloading Servicing Rights; Trouble Expected As Buying & Selling Servicers Begin Fumbling Handoffs

In Charlotte, North Carolina, the News & Observer reports:

  • Millions of homeowners around the country have received an unexpected message from their banks: Goodbye.

    After years of collecting mortgage payments from as many people as they could, big U.S. banks such as Bank of America and Wells Fargo are scaling back. As servicing mortgages grows less lucrative, they’re selling the rights to do so in deals measured by the billions.

    The buyers are specialty companies much less known to the public. And as the massive transfers take place, regulators have signaled they are concerned about a small but growing fraction of homeowners who report falling through the cracks.

    Some have found their online accounts unavailable. Others have reported delays in receiving account numbers. The details of some promised loan modifications haven’t been carried through with the new servicer.

    In Charlotte, one man said his short sale, arranged with Bank of America, wasn’t honored after the mortgage was transferred. The home is now in foreclosure.

    Tales like these have led the Consumer Financial Protection Bureau and Conference of State Bank Supervisors to warn the industry they’ll be paying close attention to how the handoffs work.

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