This is a weekly column by Sandusky attorney Dan McGookey, devoted to telling true stories of homeowners who have been victimized by a lending system which makes it profitable to foreclose. The names used have been changed for privacy purposes. This is Ida's tale.
Ida first approached us at McGookey Law Offices when she received a foreclosure complaint in June, 2011. As we do in all our cases, knowing that the foreclosing party is incentivized to foreclose because it is profitable to do so, we immediately entered a vigorous defense on Ida’s behalf in the action. That defense consisted of an answer challenging the bank’s (PNB) right to foreclose, and extensive and detailed discovery requests designed to force the foreclosing party to cough up information about the loan that it generally does not want to disclose.
After getting those requests to disclose information and upon review of Ida’s financial information, within months PNB chose to offer Ida a very favorable loan modification which lowered her interest rate, and her payments, drastically. Thrilled at the prospect of finally having her nightmare over, Ida made her first trial loan modification payment prior to its November 1, 2011, due date. However at the end of November, Ida, who herself had suffered from a long-term serious illness which required her to undergo kidney dialysis, learned that a lifelong friend who lived several hours away, had recently died.
Upon receiving that news, Ida immediately set out to attend the funeral services for her good friend. It was not until her return home several days into December, that Ida realized she forgot to send in her second trial plan payment, which was due on December 1. She immediately sent it in and figured everything was okay when she received a letter from PNB, thanking her for the payment. That belief was reinforced when Ida sent in her January, 2012 payment in on time, and that payment too was received and accepted without incident.
It was to her great shock then that Ida received a letter from PNB around mid-January returning her December and January payments, indicating that it was going to resume the foreclosure action. The reason? Ida was several days late with her December payment, due to the death of her friend. Thus it was painfully apparent that, rather than work with Ida on allowing her to succeed on her loan and stay in her home, PNB was searching for an excuse to foreclose, jumping on her innocent misstep in missing her December payment by just a few days. Presently, we have instructed Ida to send the two payments back to PNB, and contacted its attorneys apprising them of the situation and demanding that Ida be given the permanent loan modification she deserves. We are confident that our demand will be met.
Ida’s case is on example of hundreds that I’ve seen where the supposed “lender” would rather foreclose than work with the homeowner and actually have the loan paid in full. The reason for this is that the foreclosing party is not your lender at all, and has no financial stake in your loan. Worse still, that party will actually make money by foreclosing. In the world of securitized mortgage loans, unlike the world of criminal justice where crime doesn’t pay, foreclosure does.
Next week: the tale of Sandy, a foreclosed-upon homeowner whose transgression was her refusal to pay her flood insurance when she didn’t need it, a fact her bank finally admitted, albeit only after putting her through a year of torture and foreclosure.
Copyright 2012 Daniel L. McGookey