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Borrowers sue over apparent loan mod mishaps
Legal Business |
2011/07/05 09:24
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It seemed Maria Campusano's financial problems were behind her when the mortgage on her Victorian home in a Massachusetts mill town was chopped by hundreds of dollars a month.
She soon learned that her troubles had just begun.
Weeks after making her first payment under the new rate, the school district staffer began receiving past-due notices, documents showing wildly inaccurate loan balances and letters threatening foreclosure. She now fears she'll lose her home.
"How can they take away what I have worked so hard for?" Campusano said.
Campusano is one of two named plaintiffs in a proposed class-action lawsuit alleging breach of contract by Bank of America NA and subsidiary BAC Home Loans Servicing LP.
The suit, which was filed in Los Angeles federal court because BAC is located in nearby Calabasas, is among a growing number of legal complaints accusing banks of disregarding what should be binding agreements to reduce the monthly mortgage payments of troubled borrowers.
The suits involve permanent modifications through the U.S. Treasury-administered Home Affordable Modification Program, which offers incentives to loan servicers who extend modifications, as well as so-called proprietary modifications, which banks offer independently of the government guidelines.
They represent a new wave of complaints against banks that have already weathered years of criticism for their reluctance to modify loans and for foreclosing on borrowers after offering them trial modifications. |
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BofA Near $8.5B Deal to Settle Big Investors' Claims
Legal Business |
2011/06/28 22:17
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Bank of America Corp. is close to finalizing a deal to pay $8.5 billion to settle claims by a group of investors that the bank sold them poor-quality mortgage-backed securities that went sour when the housing market tanked, according to a person familiar with the settlement talks.
The Charlotte, North Carolina, bank was continuing talks late Tuesday with the group, which includes the Federal Reserve Bank of New York, Pimco Investment Management, the world's largest bondholder, and Blackrock Financial Management. It is expected to announce an agreement as early as Wednesday, the person said on condition of anonymity because the matter was still developing.
The deal comes eight months after the group fired off a letter to Bank of America demanding that it repurchase $47 billion in mortgages that its Countrywide unit sold to them in the form of bonds. The investors have argued that Countrywide's practice of modifying loans found to have faulty paperwork or those written outside of normal underwriting standards breached signed agreements with the investors. By continuing to service bad loans rather than speeding up foreclosures, the group has claimed that Countrywide ran up servicing fees, enriching itself at the expense of investors. The New York Fed is involved because it took over assets held by American International Group Inc., which faltered under the weight of bad home loans that it insured.
Bank of America, which paid $4 billion for Countrywide in 2008, has dismissed suggestions that its handling of loan modifications and other efforts to prevent foreclosure have violated the terms of the mortgage-backed securities that the investors hold. In November, CEO Brian Moynihan said he was in day-to-day "hand-to-hand combat" with investors' demands. |
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Toyota class action suit to start with Utah case
Legal Business |
2011/06/24 22:19
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The first lawsuit to go to trial in a massive class action against Toyota Motor Corp. over acceleration problems that led the company to recall 14 million cars will involve a crash that killed two people in western Utah, a federal judge said Friday.
U.S. District Judge James Selna told attorneys the case of 38-year-old Charlene Jones Lloyd and 66-year-old Paul Van Alfen, whose Toyota Camry slammed into a wall in Utah in 2010, is scheduled to go to trial in February 2013.
The case - Van Alfen v. Toyota Motor Sales, U.S.A., Inc. - will be the first of several bellwether lawsuits, intended to determine how the rest of the litigation will proceed.
Selna wrote in a tentative order that he hoped the selection would "markedly advance these proceedings."
"The Court believes that selection of a personal injury/wrongful death case is most likely the type of case to meet that goal," Selna said.
Toyota said it welcomes the Utah case as the first suit to reach court.
"We are pleased that the initial bellwether will address plaintiffs' central allegation of an unnamed, unproven defect in Toyota vehicles, as every claim in the multi-district litigation rests upon this pivotal technical issue," the company said in a statement.
Toyota has previously argued the plaintiffs have been unable to prove that a design defect in its electronic throttle control system is responsible for vehicles surging unexpectedly. It has instead blamed driver error, faulty floor mats and sticky accelerator pedals. |
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Casino owner cited in complaint against Ala. judge
Legal Business |
2011/06/24 22:19
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A casino owner accused of buying votes in Alabama for pro-gambling legislation is cited in a judicial complaint against a former state judge, who's accused of letting a gambling lobbyist bankroll her re-election campaign while she was handling a custody dispute involving the casino owner's grandchildren.
An attorney for VictoryLand casino owner Milton McGregor said Tuesday that he did nothing wrong and the complaint filed against former District Judge Patricia Warner of Montgomery is based on errors.
"It's reckless and somebody is going to have to answer for that," defense attorney Joe Espy said Tuesday outside the federal courthouse.
The 72-year-old McGregor is in the third week of a trial where he and eight others are accused of buying and selling legislators' votes for pro-gambling legislation with campaign contributions. The legislation was designed to keep McGregor's now-closed VictoryLand casino in Shorter operating.
Late Monday afternoon, the state's Judicial Inquiry Commission filed a complaint against Warner, a Democrat who resigned unexpectedly last week less than six months into her second term. The 74-count complaint accuses Warner of judicial misconduct in several cases, including the one involving an effort by McGregor's former son-in-law to regain visitation rights with McGregor's grandchildren.
The complaint will be heard by the Alabama Court of Judiciary, which can sanction her if it finds her guilty of misconduct and impose financial penalties. A spokesman for the state pension system said Warner qualifies for state retirement benefits. The amount was not immediately available. |
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Mont. Supreme Court rules against Paws Up
Legal Business |
2011/06/20 00:10
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The Montana Supreme Court has reversed a lower court and ruled that a Montana construction company can either collect a debt or foreclose on a high-end guest ranch involved in a decade-long financial fight. The Independent Record reports that the high court on Tuesday ruled that the owner of Paws Up used a "shell" corporation to try to avoid paying Helena-based Dick Anderson Construction. Paws Up is owned by Monroe Property Co., which is controlled by David Lipson, the former CEO of the haircut chain Supercuts. In 2001 Anderson filed a lawsuit seeking to collect the final $800,000 on the $10 million project. Arbitrators awarded Anderson about $1.4 million in 2005 in damages, interest and attorney's fees. |
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