Bank of America (BoA) home loan customers are in shock after BoA sold the servicing rights of two million mortgages to Nationstar Mortgage. Normally whenever a bank sells their mortgages, that bank would continue to service the loans after they were sold. Not so in this case – Bank of America is stepping out of the picture and washing its hands completely from these dumped mortgage loans.
In March 2013, investors sued Nationstar with accusations Nationstar sold off home loans at ‘fire sale’ prices. That kind of news from the Nationstar front will not reassure these homeowners whose mortgages were dumped by BoA.
Speaking of ‘fire sales’, BoA sold these home loans worth $215 billion to Nationstar for $1.3 billion. BoA selling off home loans may be just the beginning. There is evidence other banking institutions will be selling off their older mortgage accounts as well.
Some of these dumped BoA homeowners had other benefits they will be losing. BoA had programs that gave perks to customers who had “multiple” accounts with BoA (i.e., savings, checking and consumer loans). What happens to those benefits and perks now that their mortgage is no longer with BoA? The answer – these customers will continue to receive those perks for a grace period of 12 months. After that, those perks, such as free checking will disappear.
Many of these BoA homeowners were in the middle of home modification loans and are wondering what happens to those modifications? Do they have to begin the process again of filling out loan modification forms, sending and resending documents to Nationstar?
Former BoA customers are now complaining Nationstar is making them start the loan modification process again – from the beginning and that Nationstar does not have any information on them regarding the modification they had, in the process of getting, or in a trial modification period.
Sifting through the more than 700 recent complaints filed against Nationstar, the complaints seem all too familiar; not corresponding with customers, not answering customers’ calls, not having a single-point contact, getting transferred repeatedly when they do call and getting different answers from each customer representative. Customers are also complaining when they finally do get through by phone, they spoke to someone in the Philippines who didn’t answer their questions, transferred them repeatedly until they were cut off. When and if a customer gets through to a representative, they are told “We are waiting to hear from corporate” and our “system has not been updated”.
Consumers are also complaining Nationstar was wrongfully not crediting or applying payments, increased their monthly payments with no explanation, denying solid short sale offers, wrongfully charging late fees, interest fees and property inspection fees.
Homeowners who were in the middle of selling their homes have entered a nightmare scenario. Title companies can’t get accurate payoff amounts, or are told it will take 5-7 business days and not being able to get through to Nationstar by telephone.
In the last few months, almost $500 billion in mortgages have been moved, with Nationstar doubling its servicing portfolio with just this one BoA transaction. Regulators are concerned over ‘lost customer information’ that has occurred through these transactions.
J.D. Power and Associates ranked Nationstar and Ocwen at the bottom of its mortgage servicer ratings last year.
Consumers should file complaints with the Consumer Financial Protection Bureau and their state’s Attorney General.
Keith A. Gantenbein, Jr. is a Colorado consumer advocate attorney, foreclosure defense and real estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes: foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles bankruptcies, mortgage negotiations, lender liability, real estate,civil litigation, debt defense, debt harassment, contracts and landlord/tenant. If you think you will be facing debt collection, foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.