How Chase Ruined Lives of People Who Paid Off Their Mortgages - NakedCapitalism

[WillyT]

How Chase Ruined Lives of People Who Paid Off Their Mortgages
Yves Smith - NakedCapitalism
FRIDAY, AUGUST 26, 2011

<snip>

Matt Taibbi, in giving a well deserved thrashing to the banking industry’s Tokyo Rose, aka New York Fed director Kathryn Wylde, said:

Stealing is pretty much the worst thing that a bank can do — and these banks just finished the longest and most orgiastic campaign of stealing in the history of money.

Once you read the allegations in the cases included in this post, I strongly suspect you will agree that the “ruining lives” in the headline is not an exaggeration. And as important, these two cases, with very similar fact sets, also suggest that these abuses are not mere “mistakes”. These are clearly well established practices that Chase can’t be bothered to clean up, since cleaning them up costs money and letting them continue is more profitable.

Both cases took place in Alabama. In both cases, the borrowers had made every mortgage payment on time. One was a couple with three children, the Barnetts. The second is a widow, Besty Barlow, but her husband was still alive when this ugly saga started.

In both cases, the house burned down, The borrowers both had homeowners’ insurance. In the case of the Barnetts, they promptly notified Chase, their servicer, and made one mortgage payment post the fire. Both the homeowners and the insurer, State Farm, called Chase to get a ten day payoff amount. They were told not to make the next payment, since it would be included in the payoff amount. State Farm sent as check as instructed, asked that the mortgage be paid off, and Chase cashed the check.

But Chase did not pay off the mortgage. It put the funds in a suspense account The Barnetts found out the mortgage had not been paid off on their own, and called Chase to get the matter corrected. Chase then proceeded to harass the Barnetts for payment, calling at home and at work. Chase then ‘fessed up that they had the money, and asked the wife, April, to send a fax instructing them to make the payoff. They didn’t, called to pressure her again, and claimed they never got the fax. April repeated the process as instructed a second time (to a different number).

Chase continued to call demanding payment and then sent a letter stating that Fannie had refused the payoff due to “past due” amounts. Chase wanted an additional $8000, which consisted of fees that were not warranted and were due solely to the failure to pay off the mortgage with the money they had.

<snip>

More: http://www.nakedcapitalism.com/2011/08/how-chase-ruined-lives-of-people-who-paid-off-their-mortgages.html

:mad:

:nuke:

:kick:

[plumbob]

1. This is why I support a carefully administered death penalty for a very

limited number of crimes. In this case, the CEO of Chase should be executed for killing a baby and a husband.

We need badly to strip away the personal liability shield that corporations afford individuals. Actions should have consequences. I can assure you that just one execution for corporate actions leading to death would make companies sit up a lot straighter.

I'm just thankful that I made a decision in 1978 to have nothing to do with any bank or other financial institutions. Best decision I ever made, and I don't even know how much money it's saved me.

[tcaudilllg]

16. I agree: the death penalty is a fitting punishment for the leaders of Chase.

[Fuddnik]

36. + a brazillion

I'll pull the switch.

[scentopine]

47. Corporations are people. CEOs and corporations should be put to death for these crimes. -nt

[plumbob]

50. Yep. I wanted to be sure the same people didn't come back with a new

corp. You're right - both must go.

[Ilsa]

53. On a realistic note, corporate charters should be revokable for these crimes.

There is no reason for corporations to have the right to immortality when it is proven that they act against the best interests of the citizens and customers they purport to service.

If I recall a Thom Hartmann program correctly, corporate charters had to be periodically renewed several centuries ago. They had to re-prove that their existence was in the best interests of the community.

Of course now, this sort of thing, expiring charters, would be abused by powerful politicians to keep their buddies in commerce and to remove their competition.

[JDPriestly]

57. Stripping away or more severely limiting the corporate shield.

That's what is needed. This is a state-by-state matter, and Delaware, Biden's state is key.

So start a movement at the state level to change laws concerning incorporation.

Yes, states with liberal laws draw lots of business, but they also draw a certain amount of criminal behavior. Corporations should have limited liability to a certain extent, but not to protect them in cases such as these. Problem is this is most likely behavior that is justified within the corporation's policies. So the corporation should be liable if its policies result in unfair consequences.

I have seen a similar situation arise with regard to a contract for an equipment lease.

[dotymed]

60. The corporations are "persons" under the "law."

Yet they have absolutely no criminal laws that the "individuals" are liable for. If a sociopath was listing his/her dream scenario, this would be it.

Our government (and most others) are "Criminal Enterprises." Watch the Max Kaiser interview with the former Secretary of Housing under Bush Sr. She is a (R) but she tells the truth. We must respond , it's never too late.

[nashville_brook]

2. will justice ever come for these people?

[fasttense]

25. You will understand if you watch the Catherine Austin Fitts interview on

the front page of DU. She explains that the banking system is a total fraud and why. Highly recommended.

[Hestia]

42. She is also the one who warned in 2004 that this mortgage debacle would

happen. It is/was due to mob elements being allowed to get into mortgage banking. Looks like they are definitely still there.

[dotymed]

61. That is an "eye opener" from a (R) Secretary of Housing

under Bush, Sr.. Because this lady tried (well she did) to tell the truth, she was POISONED, ran off the road, her pets were killed, etc. Like I said she was a repub high office holder whose life was in danger for telling the truth about the Financiers. She said that a bank owned by Buffet, laundered billion$ from Mexican drug and weapons cartels. The punishment was 2%. Would you illegally make billions of dollars if you knew that your "punishment" was to pay 2% of it back to the government? Absurd..

[Occulus]

41. Not as long as Obama is in the WH and Holder is AG.

We're looking forward now, remember?

:evilfrown:

[scentopine]

48. Holder is the Public Defender for Large Corporations. But a cancer victim smoking a joint or...

a peace activist? Watch out. He's Elliot Fucking Ness.

[saras]

3. The individual workers involved ALL NEED TO BE JAILED.

Being ordered by an employer is NOT SUFFICIENT EXCUSE.

I don't think America has ANY HOPE AT ALL until a sufficient number of Americans are willing to walk away from corporate crime and refuse to participate, EVEN WHEN IT COSTS THEM THEIR JOBS.

Until then, those people are all choosing, in by far the most powerful choice they have (easily outweighing voting by hundreds of times), to support the corporations doing these things.

If someone screws me out of MY house in order to keep their job, I see no reason to allow them to continue to keep their job. I mean, I'm homeless now, right? I've got nothing better to do with the rest of my life than to keep them from making others homeless.

[Fuddnik]

35. Tell me about it. I went through the same shit with them!

See post below.

They made me a raging lunatic about 6 months. I wound up in the hospital for four days. Stress. I can't say for sure that they caused it, but it had never happened before or since.

[dkf]

4. That is bad.

[lonestarnot]

5. Some richie lib needs to give them a bailout by investing heavily and take them over then divest.

Flatten their asses.

[Kurmudgeon]

6. So very sad and sickening. How Chase executives escape punishment I don't understand....

[russspeakeasy]

29. ...because we are told on a near daily basis to look forward..

:evilfrown: which I think is code for "damn, I hope they don't look at what we did".

[salin]

7. Someone must have earned a big bonus for coming up with this new "money stream" for Chase.

:puke:

[HCE SuiGeneris]

8. Thanks Willy, for providing another eye-opening example of the incredibly corrupt practices

that are the norm for abusive bankster corporations.

K&R

[WillyT]

10. You Are Quite Welcome !!!

:hi:

[Aerows]

9. This is horrible

And another shining example of what our banking system has turned into - a den of thieves.

[Starry Messenger]

11. k&r

[Jefferson23]

12. Scum of the earth.

From Thomas Jefferson, 1802, in a letter to then Secretary of the Treasury, Albert Gallatin:

"If the American people ever allow private banks
to control the issue of their money,
first by inflation and then by deflation,
the banks and corporations that will
grow up around them (around the banks),
will deprive the people of their property
until their children will wake up homeless
on the continent their fathers conquered."

[WillyT]

14. + 1,000,000,000... What You And TJ Said !!!

Most excellent quote !!!

:bounce:

:hi:

[Enthusiast]

23. Yeah but, Thomas Jefferson

was a damn liberal. Can't listen to those guys.

[bluesmail]

13. Kick. Heck Double Kick. Chase. BOA, Goldman Sachs and all the rest of those

scumbags. I wish I knew they were going to get karma someday, but...I just don't know for sure.:thumbsdown:

[BreweryYardRat]

15. We need executions for this.

Trace the orders up the chain until we find who originally issued them and/or made this standard practice. Then hang that person or persons.

[Vinca]

17. And these are the crooks the administration wants a great big, giant settlement for?

[Enthusiast]

24. They are the very ones.

And the Administration is going to get that settlement. And no one will be prosecuted.

[scentopine]

54. BP can blow up an oil rig, kill a bunch of people, spill 200 million gls of oil, for small price

of $5 billion in settlement claims. Although there was a $20 billion dollar "set aside", Obama put BP in charge of managing the oil spill. This means self adjudication and immunity for any crime. Meanwhile, BP is refusing to pay out rest of damage claims. They are allowed to do under settlement because the government agreed to not interfere in BP's private corporate affairs.

BP's idea of clean-up means running commercials bout how shrimp tastes better on a diet of crude oil mixed with dispersant.

BP executives are laughing their asses off at the people on Gulf Coast, just like Wall Street banker and insurance CEOs are laughing their asses off at the rest of us.

[mdavies013]

18. You need to look forward...not back. Just think of the losses a bank would have

if they had to operate under the rule of law. They would be so big the bank could fail and then we would need another bailout. It's far better for them to steal from families. Keep looking forward and you never have to feel upset.

[Hugabear]

19. This is another reason why we need to nationalize the banking industry

Remove the profit incentive from banking.

[hobbit709]

20. It's not just Chase.

All of them try some shenanigans at payoff time. I paid off Donna's mortgage 5 years early and had a go-round with the mortgage company. At one point, they had cashed the final check and on-line it showed zero balance. Then the next day it showed a $2900 balance. The rescinded the last two payments all of a sudden. Of course they didn't send the money back to me. I called them and they tried to give me what I call standard answer 35B.
I asked for the supervisor and then to transfer me to their legal department. At that point I told them the name and phone number of my attorney and said that if they didn't immediately credit the payments and send me the paid-off notice that ALL further communications from them were to go through my attorney. An hour later when I checked online, it was marked Paid In Full and 4 days later I got all the papers showing that the mortgage was paid off. At which point I went down to the County Clerk's office and filed it with them. If any of them want to try something now it will cost them big time-I know LOTS of activist lawyers, and some of them owe me some big favors.

[w0nderer]

21. k&r n/t

[Enthusiast]

22. Don't worry!

Obama will see to it that those families have justice!

[russspeakeasy]

30. It will happen on the same day that bush and cheney go to jail

:evilfrown: for war crimes...
Is Eric Holder still on the job, or has he retired and just not told anybody ?

[marmar]

26. Unbelievable.....Well, not really. These zombie banks kill.......

This Max Keiser report segment is interesting companion viewing: http://www.youtube.com/watch?v=zr2an1guAZ8&feature=related

[Fuddnik]

27. Oh Jesus Christ! I went through the same fucking thing with them!

I moved to Florida 9 years ago. I couldn't sell my house in Cleveland, so I rented it out for a couple of years. When it was vacant, I went back and prepared it for sale. New paint, carpet, etc.

After it was on the market for 6 months or so, I called the real estate agent and told her I wasn't going to renew the listing. She went over to remove her lockbox, and called me on a Sat. morning in August, and said "there's water everywhere". I flew up the next day, and found a toilet supply line in the upstairs bathreeom had broken and had been running for about 6 days. A friend across the street had kept an eye on the place, in return for letting them keep their jet-ski in my garage.

When I got there, the hardwood floors, covered by carpet looked like the Rocky Mountains. And mold everywhere. State Farm decided to dick me around for a while, so I told them "Look assholes, I'm hiring a Public Adjuster, and going back to Florida tomorrow. Deal with him".

We settled the water damage claim at just under $70,000. I deposited the check with Chase in an escrow account for the house.

This entire time, I'm paying two mortgages, and almost bankrupt. I had a couple of buyers interested in buying the place "as is" and I was going to use the insurance money to complete the sale.

It took me six solid fucking months to get Chase to release the insurance funds to apply to the sale. They would not give me a payoff. Between me, and an angel from the title company we finally got hold of a Vice-President at Chase who walked the entire deal through their asshole system. It cot me about $10,000 dollars, but I finally got rid of the place.

Now, I just have to deal with complete assholes at Well Fargo, who keep trying to add "force-placed" homeowners on my over-insured house in Florida, because they claim I don't have enough coverage.

I'm ready to walk away, and tell them to "fuck off". The mortgage is underwater anyway.

[NNN0LHI]

28. Why would someone notify the mortgage holder the house burned down?

The mortgage holder doesn't have anything to do with that do they?

I would call my insurance company and report the loss and have them pay to fix or rebuild it. I would feel no need to call my mortgage holder.

Never heard of receiving a "payoff amount", as if it were a total loss like a car after a house burns down.

Does anyone understand what is going on here?

Don

[Fuddnik]

31. Because it's required.

The mortgage holder will be named as "Party in Interest" and their name will also be on the check. You can't cash it without them signing off on it.

I used to be in the fire damage restoration business. We would have the homeowner sign a "Party in Interest" agreement to do the work. The insurance company would cut the check(s) sometimes in phases, with three names on them. The Homeowners, the mortgage company, and us. The reasons for a three phase draw, was so that the mortgage company could make sure their collateral was protected. First phase: Tear out, Second phase, structural repair, Third phase, decorating.

[NNN0LHI]

33. I wouldn't have thought I would even get a check if my house burned down

I never had one burn down but I always thought any checks would be written out to the contractor doing the work.

I know when I had a roof replaced after some storm damage years ago there was no check written out to me in my name or the mortgage holder. Check was written out(minus my deductible) to the contractor who replaced the roof. The mortgage holder never got involved.

Maybe things have changed over the years?

Don

[Fuddnik]

34. It's been that way for 30 years that I know of.

We used to get a lot of what we called "small claims" straight from the insurance company. Usually broken pipe water damage or roofing, and the check would be sent to us, but the homeowner had to sign it, and also the bank, before we could deposit it.

[TwilightGardener]

37. I had to make an insurance claim when a tree fell on my house--

never occurred to me to contact the bank, and I don't think the insurance co. did, either. But that was a repair. Now, if the house is a total loss, I would think the bank would have to know, because it held the deed to something that didn't exist anymore.

[NNN0LHI]

38. The deed isn't just for the house. Its for the land it is sitting on too

And the land doesn't burn down. It certainly does still exist. So it can't be considered a total loss. Can it be?

Don

[TwilightGardener]

39. I don't know. But imagine if the homeowner simply stopped paying

the mortgage, walked away from the smoldering ruins of a house. The bank is going to be mighty surprised when it goes to foreclose and there's no habitable structure there.

[NNN0LHI]

40. If the homeowner simply stopped paying we are talking about something completely different here

Is that what occurred in these cases?

Don

[TwilightGardener]

43. No--but you were questioning the necessity of involving the bank at all in the claim,

so I'm saying the bank would have an interest in a structure it owned that was totally destroyed and would have to be rebuilt.

[NNN0LHI]

44. Why would the homeowners think the insurance company would be making their mortgage payment?

That is the part that baffles me?

Does that make any sense? If my house burned down and I was waiting for it to be repaired I certainly wouldn't stop making the mortgage payment on it.

Don

[Fuddnik]

45. They don't.

It's the homeowners responsibility to make the payments. The insurance company will pay for "loss of use", hotels, rentals, food, etc.

But, when the check is cut for the damages, the banks name will be on it as a co-owner.

[burrfoot]

46. I think that

it's wasn't that they thought the insurance company would be making their mortgage payments; it was that their insurance companies had accepted it as a total loss, requested a payoff amount, and then actually paid it- so for several months after they loan was paid in full, the bank was claiming monthly payments were due because they'd (the bank) put the money into some kind of holding account rather than crediting it to (and therefore fulfilling the terms of and closing) the loan.


:shrug:

[NNN0LHI]

49. Might have been the "total" payment for the loss of their house

But as I posted above I have never heard of anyone having their house and the property it is sitting on considered a "total loss" like a car is totaled out after a fire. Because the land it is sitting on doesn't burn down. And the land may be worth more than the house was? The insurance company would just pay to rebuild the house. The amount for that would be considered the "total" payment for the loss of their house that was sitting on their land. I have never heard of an insurance company paying for the land too.

Don

[Fuddnik]

51. In my case, with these motherfuckers.

They had the insurance funds in their escrow account for over a year, and I had made every single payment on time, usually early, during that time frame.

If I had it to do over again, and there wasn't another innocent party, the buyer involved, who had sunk money into it, I would tell them to blow it out their ass.

And to your post above, no you don't insure the land, just the structures on the property. If it's a "total loss", and the leins are satisfied, you still own the land.

[NNN0LHI]

55. So what happened in the article?

Was it a case of someone not understanding the difference between "total loss", and "total amount paid for their loss?"

Can you tell from reading it?

Don

[Fuddnik]

32. After reading this article, now my wife knows why I was walking around like a lunatic.

For about 6 months.

And the poor guy who was buying the house, had already stuck money into it, so he could get financing.

Chase can really get you to want to commit murder.

[Fuddnik]

52. Here's the Taibbi article.

http://www.rollingstone.com/politics/blogs/taibblog/obama-goes-all-out-for-dirty-banker-deal-20110824

One wonders how long he can keep siding with Wall Street against the citizens, and be re-elected. I, for one will NOT vote for him again. I'll write in Nikita Kruschev first.

[white_wolf]

56. They're people now, right?

I firmly support capital punishment for corporations.

[colsohlibgal]

58. I Dumped Chase A Few Years Ago

I walked in one day, told them to close all my accounts, then took all my money to a local credit union....like so many others lately.

If you have checking/savings there, or in any big bank, clean out your cash and put your money in a place where you are part owner, a shareholder. Hit the capitalists where they hurt.

This is increasingly us versus them, the people against the rich oligarchy.

[Fuddnik]

59. I did the same with Wells Fargo.

Went to a CU.