Consumer complaint received 2022-01-07
Product: Mortgage — Conventional home mortgage
Issue: Struggling to pay mortgage — 
Company: U.S. BANCORP (OR)

To Whom It May Concern : I have been involved in a protracted legal battle with US Bancorp for almost ten years, over their mishandling of multiple attempts to foreclose on a particular property, described below, and I believe I have been treated unfairly in large part due to their incompetence and unwillingness to allow me to communicate with anyone in a position of authority. I will do my best to describe what I consider to be an abuse of corporate power. 

My mother died on XX/XX/XXXX, with an outstanding US Bank loan. She had purchased a condominium in XXXX, in her own name and that of a revocable trust. In XXXX, she transferred the title into a Personal Residence Trust. I became the successor trustee for the Personal Residence Trust on XX/XX/XXXX. 

When my mother transferred the title to the condominium into the Personal Residence Trust, she retained personal responsibility for the loan. The trust has no assets other than the condo, which was a liability at the time of her death. The amount owed on the loan at that time was around {$610000.00}. The condo was appraised at {$530000.00} as of XX/XX/XXXX although I was advised by multiple real estate agents that it would never sell for that much. 

I spent the next 15 months calling US Bank almost every day. I was told repeatedly that the bank was only authorized to talk to my mother, who was deceased. Until XX/XX/XXXX I continued to pay the mortgage although the trust had no financial responsibility to do so. I consulted various professionals and an attorney finally suggested that the bank might speak with me if I stopped paying the mortgage, which I did in XX/XX/XXXX. 

On XX/XX/XXXX, the bank accelerated the loan. On XX/XX/XXXX, I sent them a letter telling them that my mother was deceased, that no probate or administration of her estate was planned, and that her estate was without funds to pay off the loan. I included a death certificate. 

In XX/XX/XXXX, the bank finally agreed to talk to me. Per their request for details, I sent a letter enclosing another copy of the death certificate along with the trust agreement and the document appointing me as successor trustee. In this letter, I informed US Bank that several of my siblings and I might be interested in purchasing the property or taking on the loan if it could be modified to an amount commensurate with the current value of the property. We felt that this might be the fastest route to a resolution. 

In XX/XX/XXXX, I attended the first of several Foreclosure Avoidance Mediations. After consulting with experts, it had become even more clear that purchasing the property would be the easiest solution to the problem. I put together an offer that considered the value of the condo at that time, the projected costs for the bank to foreclose and subsequently deal with the condo until it could be sold, as well as the decreased value of selling a bank-owned property. At that time, the condo was in good condition as far as I knew. 

Despite the federal requirement that someone with decision-making authority be present at the mediation, no one was. The attorney representing US Bank thought my offer was reasonable and we agreed to meet again in a month after she presented it to her client. At the follow up meeting I was told that the bank did not have a mechanism for accepting an offer from me because I was not the borrower. I accepted that decision and left the meeting thinking that foreclosure would proceed easily. I asked the attorney if there was any way to speed things along and was told that the bank needed to go through the entire process, which would probably take between nine and twelve months. 

What followed was a series of long delays. US Bank first attempted to foreclose in late summer XXXX, erroneously naming me, in my personal capacity, on the lawsuit, forcing me to hire an attorney. I believe that error was corrected but the bank then failed to prosecute the case in a timely fashion and the court dismissed everyone except for me, in my capacity as trustee, because the initial error had required me to file a response. 

In XX/XX/XXXX toxic mold was discovered in the condo, related to construction defects that had been known to the HOA and the previous owner but never disclosed to my mother. I had been staying in the condo up to that point, so that I could afford to pay the HOA dues, but I was forced to move out due to the health hazard. 

The first foreclosure trial took place in XX/XX/XXXX. Before the trial, my attorney asked the bank to put the case in abatement because of the mold issues and because the case was not ready for trial as no proper party was named. He also asked if the bank would be willing to attend a global mediation with the HOA to resolve all the issues at once. The bank declined both requests and lost the case at trial. The Judge explained in her decision that the bank had not listed anyone who owed them money and that they needed to open probate. 

My attorney attempted to reach the US bank attorney who had been handling the case up to that point to work out the terms. She did not respond to multiple emails and phone calls. The court issued a supplemental judgement, awarding attorney fees and costs to me, on XX/XX/XXXX. Despite many requests for payment and filing a writ of execution, the bank did not pay in a timely fashion. 

The HOA refused to fix the exterior defects that were causing water intrusion and mold and I was forced to file a lawsuit against them. It took two years to reach a settlement. In XX/XX/XXXX, a refrigerator leak resulted in additional water damage to the kitchen and an adjacent closet. This was reported to US Bank, but they never followed up. I finally paid for remediation, which included demolition of the kitchen and closet, when I started to fear that the damage might otherwise become irreversible. With the outcome of the unit still under dispute, it has not been in my interest to pay for reconstruction and the unit remains uninhabitable. 

During remediation of the kitchen damage, the contractor noted other areas concerning for water intrusion and another mold inspection was performed. Contractors have also pointed out areas of exterior wet and dry rot while performing estimates. The bank, as well as the HOA, were made aware of these issues and chose to ignore them. 

Another Foreclosure Avoidance mediation hearing was under discussion starting in late XXXX. It was my understanding that the bank was required to attend and obtain a certificate but that I was not. However, I had never been able to talk to a bank representative and thought it might be my only opportunity. 

At the first meeting of this second foreclosure avoidance mediation, held in XX/XX/XXXX, a new bank attorney arrived with no history of the condo whatsoever. He had not been told that the bank had already lost one foreclosure lawsuit or anything about the current condition of the condo. I appeared with an attorney who pointed out that I was the only creditor in the room since I had no personal responsibility for my mothers loan, but at that time the bank owed me a substantial amount of money in attorney fees. 

Again, there was no US bank representative present at the mediation, despite federal requirements. I made an offer to purchase the loan for the current value of the condominium. It was decided that, because of the complexities of the case, negotiations should proceed outside of the mediation environment. I requested a follow up meeting because I was afraid it would otherwise drag on forever. One was scheduled for a couple of months later but US Bank kept requesting delays and it didnt take place until XX/XX/XXXX. 

As discussed in the mediation, I presented a formal offer to purchase the loan, considering that the housing market had changed but that the condo was no longer habitable. Although the terms had been discussed at the mediation, and the US Bank attorney felt they were reasonable, soon after the mediation US Bank appointed a different attorney for the interim. We never received a response and did not see the attorney who had been present at the XX/XX/XXXX hearing again until the follow up hearing in XX/XX/XXXX. He had been told nothing of what had gone on in the meantime, no bank representative with decision-making authority was present, and the meeting was a waste of time. 

During late XXXX and XXXX, we attempted to negotiate some type of settlement with the bank and asked them to participate in a private mediation. To each overture, the bank attorney simply said that hed pass the request on to his client and nothing more was heard. In response to my requests for payment of the supplemental judgement awarded in XX/XX/XXXX, this same attorney asked me, at least twice, to calculate the amount owing, with interest, as of a particular date. I sent him the information and received no response. On XX/XX/XXXX, the XXXX XXXX sheriffs office collected the judgement at a local US Bank branch and the funds were disbursed to me several months later. 

In XX/XX/XXXX, the bank filed a new lawsuit, seeking a declaration that it was entitled to foreclose on the note and deed of trust, and that it could proceed under a lost note. Again, they failed to name their sole borrower as a defendant. We pointed this out, but the bank moved for summary judgment anyway. We filed a cross motion and the action was dismissed on XX/XX/XXXX, for failure to name the real party in interest. I was awarded attorney fees and an enhanced prevailing party fee for having to defend the action. 

Two months later, more than eight years after my mothers death, and four years after the judge in their first failed foreclosure lawsuit told them in no uncertain terms that they needed to do it, the bank opened probate. The initial petition sought to appoint a professional fiduciary to serve as personal representative of the estate, even though my mothers will specified that one of her children should serve in that capacity. When this was pointed out to them, they filed an amended petition, but the accompanying order still listed the professional fiduciary as personal representative. I objected but before the hearing could be held, the court dismissed the second petition for other technical deficiencies, including, I believe, the wrong address for the court. A third petition was filed, and I was appointed personal representative on XX/XX/XXXX, eight months after the bank first filed for probate. 

In the meantime, the bank ignored our requests for payment of the judgement associated with the dismissal of the motion for summary judgement in XX/XX/XXXX, until they hired a new law firm in XX/XX/XXXX. I believe this was the banks seventh set of attorneys and the first ones who seem to have learned from the mistakes of their predecessors. However, although they have more effectively navigated the complex legal process, they have shown no willingness to consider the effect the previous error-filled years have had on the condition of and actual value of the condo when compared with the purported payoff amount. 

I completed all the requirements to become the personal representative by early XX/XX/XXXX, although no probate hearings were ever held. Instead, the bank sought to proceed by judicial foreclosure and filed a Rule 21 Motion to Strike which was heard on XX/XX/XXXX. The bank was allowed to proceed with foreclosure without resolving the probate issue although some other elements of their motion were denied. 

In XX/XX/XXXX the bank agreed to attend a private mediation, something Id been hoping to do for years. The attorneys were the only bank representatives present at the mediation, again no one with decision making authority appeared, and they did not seem to take the conference seriously. I felt that they acted disrespectfully toward the mediator, a retired judge, and generally seemed to mock the proceeding. When confronted with their blatant unwillingness to work towards negotiating a settlement, they responded with a statement implying that their presence was all the effort required from them. The mediator proposed a settlement which I accepted. He also requested that he be allowed to speak directly with someone at US Bank. That request was ignored and I heard nothing more about it. 

In XX/XX/XXXX, the bank filed a Motion for Summary Judgement which was heard on XX/XX/XXXX and granted in part. Because the court found that there were genuine questions of fact as to the amount owing on the loan and whether certain charges were reasonable, the case went to trial on XX/XX/XXXX. 

Prior to the trial, I made another good faith offer after the attorney stated that her client was willing to consider an offer from me. I sent the offer, along with a timeline of the history, through my attorney on XX/XX/XXXX at XXXX pm PST. The local attorney for US bank responded just over an hour later with a cryptic message citing the current pay off amount as a counteroffer. I was willing to negotiate my offer, but the timing of the response suggested that the attorney had not taken the time to seriously consider it. Since the banks headquarters are in the central time zone, they would have been closed at the time my offer was sent, confirming my long-term suspicion that my offers were not being presented to anyone at the bank. 

On XX/XX/XXXX, the court ruled that Because of plaintiffs repeated failures to properly file and pursue this foreclosure action, plaintiff shall not be entitled to claim interest on the periods between XX/XX/XXXX to XX/XX/XXXX, between XX/XX/XXXX to XX/XX/XXXX, and between XX/XX/XXXX to XX/XX/XXXX. The payoff amount on that day was {$980000.00}, almost {$360000.00} more than the principal balance of XXXX. He did not reduce the amount of other bank charges that occurred during that time, totaling around {$180000.00}, which were entirely related to the banks failure to properly prosecute the case. 

The judge ordered counsel for plaintiff to submit a form of judgment. The attorneys original calculation was approximately {$10000.00} off, in the banks favor. Recalculated correctly, the ruling knocked off around {$70000.00} leaving a payoff balance of over {$910000.00} for an uninhabitable condominium which was most recently appraised at {$63000.00}, on XX/XX/XXXX, due to multiple issues which have only worsened since that time. 

I commissioned the XXXX appraisal after an appraiser hired by the bank in XXXX stated that there were no defects associated with the unit even though he included photos of the torn-out kitchen, hallway, bedroom flooring, and breached sliding glass doors in his report. For my part, I made a point to hire an appraiser who had previously appraised the unit for US Bank in XXXX, assuming it was someone they trusted. Its important to note that the XXXX appraisal was performed while the bank was supposedly considering my offer at that time, although they never followed up on that. In fact, all these appraisals were performed based on the implication that the bank was willing to negotiate a deal with me. 

I have received estimates to repair the condominium that have ranged from around {$170000.00} up to {$520000.00} depending on the level of repairs. The cost of repairs, and the length of time it would take to accomplish them, have gone up considerably over the years especially in the past six months due to supply chain difficulties and shortages. According to real estate agents and comparing sales of other units in the condominium complex, the lower end repairs might result in a sales price of around {$850000.00}. The higher end repairs could conceivably result in a sales price of {$1.00} million. A neighbor, who had at one time expressed interest in purchasing the unit, recently stated that he would not pay more than {$500000.00} since repairs and updates would run into the hundreds of thousands. 

All of this is to say that, regardless of the recent court ruling, the bank will almost certainly not find a buyer at auction for anywhere near {$910000.00}, let alone over {$980000.00} which was their most recent counteroffer to me. Not only will they be selling an uninhabitable, bank owned property, with a history of mold, and disclosure requirements that they will have no knowledge about, US Bank will also have extensive holding costs and legal expenses in the interim. The HOA dues of $ XXXX and property taxes of $ XXXX could reduce their buyers pool by as much as 50 % since it will preclude half the potential buyers from obtaining conventional financing. The continued presence of toxic mold in the HVAC system from the incident in XXXX, a new mold problem under the existing kitchen sink ( despite the water being turned off at the main ) and the fact that most of the kitchen as well as the bedroom flooring had to be torn out due to yet another mold problem, will be further barriers to conventional financing. 

In addition, the unit has sole responsibility for a deck that it does not own but must maintain. The drainage on the deck is faulty and it is impossible to keep water from ponding. The HOA has refused to repair it in the past, even though it is a limited common element. There is a long history of water intrusion issues in the entire complex and there is currently wet rot and dry rot involving the exterior siding of this condo. The sliding glass doors are breached and need to be replaced. The HOA board is aware of these issues but have made no move to correct the defects that caused them. 

Although I have undertaken demolition and remediation to stem the most destructive mold damage, there are additional areas of potential concern, noted in the mold report attached to this complaint. A buyer faces the risk that these issues cant be solved unless the HOA first repairs common elements, something that has proven to be an uphill battle in the past. A new owner could undertake extensive repairs only to have the water intrusion continue because the association has not solved the underlying problems. The extent of the problems is unknown, and a rational buyer wouldnt buy the unit at all or would want compensation for not being able to live in it until repairs were negotiated and performed, or for potentially having to repair it twice. Alternatively, the bank could fight these battles with the HOA prior to selling the unit and further increase its own costs.

Yet according to their attorneys, US Bank has refused to entertain my most recent cash offer of {$64000.00}, which I was open to negotiate further, and they refused to respond to the mediators proposed resolution which would have had me pay the bank {$610000.00} in XX/XX/XXXX and saved them tens of thousands of dollars for the outstanding HOA lien, property taxes, and legal fees that they have subsequently paid. I cant help but feel that, either a suitable representative at the bank has never been consulted about this matter or that there is some form of discrimination occurring here. I find the fact that a bank, purportedly the ultimate authority in numerical accuracy, could not even calculate a simple mathematical formula to determine the amount of interest precluded by the judge in the most recent hearing, highly suspicious for the latter. Certainly, there are actuaries at the bank capable of not making a {$10000.00} mistake. That error seems more likely to have originated with an attorney who did not consult their client. 

I have never disputed that my mother took out a loan from US Bank and held a mortgage with them at the time of her death in XXXX. In fact, I diligently tried to give the condominium to the bank in the first two years after her death. They made it exceedingly hard for me to even reach them, let alone to negotiate whatever necessary transfer of title would have been required at that time. They never offered a cash for keys or deed in lieu option to me, possibilities that I didnt even know existed, and in fact denied that anything of that nature was possible when I asked their first attorney at the foreclosure avoidance mediation in XX/XX/XXXX if there could be a quick and simple resolution. I never learned those terms until the most recent bank attorney took over a little over a year ago by which time it no longer seemed simple or advantageous. 

For almost a decade, I have been trying to navigate a treacherous line between performing my fiduciary responsibility to an insolvent trust and my own priorities. Ive been stuck taking care of a condominium that I do not own and havent been able to live in or rent out since I became aware of the water intrusion and mold issues in XXXX. To make it livable, I would have had to pay for repairs out of my own pocket, not knowing if the bank would foreclose before I had an opportunity to recoup those expenditures. If I had known that it would take six more years for the bank to successfully foreclose, that investment would have been worth it. But I would never have predicted this outcome. If the bank had foreclosed quickly, they would have been the only beneficiary of any improvements I paid for. I asked one of their lawyers if the bank would be willing to reimburse me if that occurred and he never responded. 

As it is, I have had considerable out of pocket expenses stemming from my position as trustee of a trust that has no assets other than the condo. These include utilities, water damage and mold repair/remediation/demolition, multiple mold inspections and testing, appraisals, foreclosure avoidance and private mediation fees, legal expenses, plumbing repairs, condo insurance, contractor estimates, and probate expenses which turned out to be for naught. I have dealt with the occasional crisis and overall have spent close to {$100000.00} that has not been reimbursed. Its been stressful and costly and from my perspective has served to benefit no one except, perhaps, the bank who did not have to care for the place during the years when its value was markedly reduced by the financial crisis they contributed to causing. My sense is that US Bank has probably already made a profit from this propertys loss of value in the form of government bailouts, while that same loss of value was exceedingly costly for me and kept me from selling the condo. 

The bank has dragged their feet at every turn and refused to negotiate with me in good faith, all the while adding to what they claim to be owed at an exponential rate so that their payoff amount now borders on the ridiculous and bears no resemblance to the actual value of the property. I have done nothing to cause these delays, responding promptly and to the best of my ability to whatever they requested from me. If there was a situation in which I could have brought this to a close earlier, while still performing the duties of trustee, it was never clear to me, and the bank never brought such an offer to the table. Instead, they hired one set of attorneys after another, each apparently meant to correct the errors of previous counsel, only to have those mistakes repeated. They have wasted my time and the courts time, as well as their own. 

I have repeatedly been told that this probably all stemmed from negligence, that this property file inadvertently kept ending up at the bottom of a pile. My attorneys have always believed that the bank would eventually come to their senses and make a deal with me rather than continue to make the very choices that cost them more money. Isnt it the nature of a bank to put itself into the most profitable position? And yet, in this case, US Bank repeatedly chooses what appears to be the opposite and its difficult for me to believe there hasnt been some ulterior motive. Will they end up with the property and a big tax write off in addition to the bail out money they might have already received? Would it be fair of them to cost me a large amount of money, and ten years of my life, in order to do so? Or are they willing to lose money simply to discriminate against me for unknown reasons? None of it makes sense. 

I understand that this case has been fully litigated and that filing a complaint at this late date might be seen as sour grapes. I disagree. The fact that it was litigated for eight years was entirely due to bank errors and omissions and I believe that to be the most generous explanation. I wish that I had known about your agency 8 years ago, but its only recently been brought to my attention. I also recently discovered an email address for the CEO of US Bank and sent an email which elicited a response from the executive communications division on XX/XX/XXXX XXXX. I had been ready to submit this complaint at that time but held off in the hopes the bank would follow up with me. As of this date, they have not done so. 

In summary, my case with U.S. Bank has dragged on for nearly ten years and thru seven sets of bank attorneys. The condo has been severely damaged during the delays which has cost me a great deal of money. I have been sued personally by the bank, which was traumatic even though they lost, and have had a decade of legal expenses. During all this time the bank has never empowered anyone to negotiate a resolution or attempted in good faith to conclude a deal. 

I respectfully ask for your help. Since the court filings are public record, I am not attaching all of them to this complaint but will be happy to provide them if needed. Other relevant documents are attached. Please note that I have only included a few representative exchanges between myself and US Bancorp. If needed, I can supply copies of all communications between us. 


Thank you for your attention. 
Sincerely. 

*I have uploaded an unredacted copy of this narrative, which has superscripts to direct the reader to the appropriate document as the story unfolds, along with the supporting documents.