Source: http://mbway.blogspot.com/2011/02/
Timestamp: 2017-06-27 03:30:41
Document Index: 622577576

Matched Legal Cases: ['§ 342', '§ 83', '§ 342', '§ 342', '§ 342', '§ 226', '§ 83', '§ 342', '§ 352', 'in casu']

earth as it is in heaven: February 2011
Davidson County HOPE,
Homeowner's Bottom Line,
Orange County JUICE,
Foreclosure Fraud 5: Help for All Who Have Been Harmed
The relentlessness of the current foreclosure crisis can push one to despair. There is endless talk about solutions, but too many people get their hopes up only to see nothing change. Many striving for some way to keep their homes wait and wait until the time and opportunities run out and their homes are taken. There have been many stories of improper foreclosure proceedings through which people who had not missed any house payments found their homes sold at auction. They were told that since it was a legal sale, they could do nothing about it. Even more people, guided through a loan modification process and assured by a bank that the modification is forthcoming, have awoken one day to discover that their homes will be sold at auction anyway. This does not even take into account the foreclosures completed by banks and servicers who have not produced any proof of their right to foreclose on the home.
In the meantime, millions more homeowners are facing foreclosure in the coming year. A loan modification solution needs to be available soon so that these foreclosures will not continue to drive people from their homes and further undermine and harm the housing market. Yet fairness requires that those whose homes have been fraudulently foreclosed have recourse to recover their home and investment. A just solution must take all of this into account.
Problem: Because of entrenched problems and long-standing fraudulent practices, many families who should have received a loan modification have already been harmed, including the loss of their homes.
There are two basic categories of homeowners who have been harmed by servicers' malfeasance: (1) those who have lost their homes; and (2) those who are still in their homes, but have been denied a loan modification, pushed into default, or merely had improper fees tacked onto their account.Solution: • Remedies for Those Still in Process
For homeowners who have not yet lost their home in a foreclosure sale, servicers should institute a supervised, full review of every file marked in default. This review must include a review of the payment history, including the timing and application of payments and the validity of fees charged.Homeowners found not to be in default should be removed from foreclosure, corrections of credit reporting status must be provided to the credit bureaus, and accounts should be fully corrected.
All pending foreclosures should be halted while this review takes place, and dual track processing must be stopped on all loans so that the modification review can be completed.
Fees should be rolled back and limited to reasonable and necessary ones.
Recalculation of principal balances should be done to account for improperly assessed fees or overcharged interest. • Remedies for Those Whose Foreclosures Have Been Completed
The servicers should also be required to undertake a review of all completed foreclosures to identify any cases where the foreclosure was executed on the wrong home, where the homeowner was not in default, and where the foreclosure was completed without completing the loan modification review process, providing a written denial to the homeowner, or failing to offer a qualifying homeowner an appropriate modification.If the home has not yet been sold to bona fide third party, the servicer should offer to restore the mortgage, with a reduction of the principal balance to account for all assessed foreclosure fees, as well as any improper fees. If the homeowner cannot afford the current mortgage payments, they should be assessed properly for a loan modification under the procedures established above. Servicers must further provide corrected credit reporting to the credit bureaus to mitigate the negative credit reporting. A restitution fund should be established, funded by the servicers, to provide damages to this class of injured party. If the home has already been sold to a third party or if the homeowner no longer wishes to retain the home, the servicer should be required to refund to the homeowner all foreclosure fees assessed against the homeowner's account, plus the amount by which the valuation the servicer relied on exceeds the foreclosure sale price. Servicers must also take steps to repair the homeowner's credit in these situations. A restitution fund should be established, funded by the servicers, to provide damages to this class of injured
party. If the homeowner who was subject to a wrongful foreclosure cannot be located, the servicer should be required to deposit the money that would otherwise be paid to the homeowner into the fund for legal services and housing counselors.
The last post in this series will cover a few final concerns, including the criminality of foreclosure fraud.
Remarks presented to the Texas State Senate Committee on Business and CommerceFebruary 22, 2011
My name is Dr. Mike Broadway, and I am a Baptist minister and theological professor living in Salado. I am representing myself as a citizen. For the past year and a half I have been working with a wide range of church people, including pastors and seminary professors, to address economic injustices which have become increasingly acute in the wake of the mortgage security debacle and the burst housing bubble.Along with other leaders, I have met with the top credit and mortgage executives of Bank of America and Wells Fargo/Wachovia to address usury and justice issues. I have also joined leaders from around the nation to meet with Attorney General Tom Miller of Iowa to articulate our concerns for justice pertaining to a national investigation of foreclosure fraud perpetrated by major national and regional banks, of which he is the lead investigator. Only last week we sent a letter to all the state attorneys general, including Texas Attorney General Greg Abbott, to outline a path toward economic justice in housing.I give you this background because I want to emphasize that the struggle against usurious lending is not only a Texas struggle, but a nationwide struggle. In many states, legislators like you have worked diligently with citizen leaders to try to clean up the predatory lending practices that continue to spring up in our cities, towns, and neighborhoods. All of you can agree with me that lenders and borrowers need to operate in a system built on fairness. That is what the millennia of historical usury laws has been about. Under this assumption, for four thousand years financial institutions have been able to succeed and flourish under the careful regulation of interest rates to protect people from usury. Yet for some reason we now find ourselves, because of laws made in 1979, 1980, and 1987, operating with few legal protections from usury. Perhaps contemporary humans have overestimated our maturity in failing to listen to the wisdom of four millennia, which recommends strong usury laws.Of course, there have always been people who believe they should be able to charge as much as they want to lend money. In saner times, we knew what to call them: loan sharks. Nowadays, they pass as respectable business operators. When a legislature musters enough moral courage to try to prevent the worst forms of usury, these predators search the fine print and locate every loophole in the letter of the law. Exploiting these loopholes, they find new and creative ways to abuse borrowers and scoff at the spirit of the law. The latest way is to pretend that interest is not interest by calling it a fee. The current abuse of payday lending and car title lending is an egregious example of this bald-faced lie.If I borrow money from you, and you charge me for borrowing that money, then that is interest. The ancient text of Deuteronomy makes it very clear that usury is usury, whether you collect a fee up front, you charge it along the way, or you claim it at the end. The heart of the legal tradition’s bias against usury is that it is wrong to victimize the poor and weaker members of the community by creating lending practices which prey upon their weakness. Payday lenders may claim that closing this loophole will make it impossible to do business. It will make it impossible to do business the way they do it. But from my observations around the country, let me say that it will not make it impossible to operate a fair lending business among people of low and moderate income. Numerous workable business models exist, from non-profits like Grace Period of Pittsburgh, PA, to microlending banks, to community banks and credit unions. These businesses can make fair, non-usurious loans to fill the need of people who patronize payday lenders.One of the shameful practices of the recent past in our nation was known as sharecropping. Theoretically, it was a way for people to apply their labor to improve themselves and benefit the landowner, whose land they farmed, at the same time. In reality, it was often a trap to keep people in debt to the landowner, living as debt slaves, perpetually indebted. The biblical tradition opposing usury has at its core the assumption that no society can be just if it creates and maintains a permanent debtor class. There must be a way out of debt. Payday lending as we have it now is debt sharecropping . . . debt sharecropping. Its business plan is perpetual indebtedness of its borrowers. Please close this loophole and help our state take another step toward economic justice in consumer credit.
Bishop Joe Vazquez,
Chad Chaddick,
Freddy Haynes,
Thanks to my infinitely lovable brother-in-law Jim Lowder for the gift of a Capresso coffee grinder. I had burned out and fixed and burned out again my coffee grinder almost a year ago, so I was back to depending on getting my coffee ground before I brought it home. I was a bit perturbed by reading opinions and reviews of coffee grinders and had given up on getting one. Jim has had long experience grinding his beans for coffee, and he had the kindness to solve my dilemma with a Christmas gift. I've used up my ground coffee stocks, so I started a couple of weeks ago grinding beans with a bag of Larry's Beans Holiday Blend. One way I know the coffee is really good (which means really strong) is that no one else in the house can stand it.
Thanks, Jim, for just the right gift.
It's a Nationwide Fight Against Predatory Payday Lending
For numerous years, a fight has been going on from state to state and on a national level to curb and stop usurious payday lending. This loan-sharking business exists by finding the cracks in the laws. They hire sophisticated lawyers to find the legal loopholes, and slick PR firms to explain why they fill a need in the credit market. They prey on desperate people and pretend to be a friend of the people who need credit. The real nature of their business, however, is to be debt sharecroppers. They gain an interest and claim on a person's future income in perpetuity. It is a business designed to entrap borrowers so that they can never get out of debt.
I'll get a chance to speak about this predatory business at a public hearing on Tuesday, February 22, at the Texas Senate Committee on Business and Commerce. I am impressed with the work of Texas Faith for Fair Lending, at whose invitation I will be speaking. Some of these folks are the ones I used to work with as a wet-behind-the-ears seminary graduate in the mid-1980s. In those days, these organizations were working to protect and provide for children in poverty and trying to hold off the tsunami of state-sponsored victimization through gambling businesses. Suzii Paynter of the Texas Baptists Christian Life Commission will be part of the fight, and I am proud to get to work with such a distinguished drum major for justice. The quoted material below comes from the Texas Faith for Fair Lending web site. You can read the original at this link.
Payday Lenders and Car Title Lenders Evade Existing Texas Lending Laws
Although Texas lending laws provide generous regulatory and fee structures, payday lenders and car title lenders sidestep these provisions by posing as credit services organizations (CSOs), giving them an unfair advantage in the lending landscape. As CSOs, payday and car title lenders operate outside of the bounds of the rules set for all other consumer lenders in the state and exploit a state law designed to protect consumers from seeking credit repair help. Both payday and auto title lenders could operate under Ch. 342. For the smaller loans, auto title lenders could use the rate computations under 342F (or 342E). For larger loans, they could operate under 342E.i
Below is a comparison of Texas's existing lending law which payday and car title lenders evade, and a snapshot of their abusive practices permitted by the CSO loophole.
It's Time to Level the Playing Field. The state's CSO statute was designed to protect consumers from abuse when seeking credit repair help, not as a vehicle for loans that result in long term indebtedness. After more than 5 years of permitting this evasion of state law to continue, it is time for legislators to close this loophole, and ensure that these lenders operate under the Texas lending laws in place for all other consumer lenders. It's time to close the loophole.__________________i The maximum loan under subchapter F is $1,240. Under subchapter E, loans of up to $15,000 may be made.
ii Under existing Texas lending laws, finance charges for payday loans are set by the Texas Office of Consumer Credit Commissioner (OCCC). Texas OCCC's authority to set these rates comes from TFC § 342.007, which allows the finance commission to establish rules for payday loans, and in TAC § 83.604(c) which incorporates the fees by reference. For current Texas OCCC rates, see http://www.occc.state.tx.us/pages/int_rates/Index.html and click on the link for “Deferred Presentment Transaction Rate Charts.” However, instead of complying with this law intended for them, payday lenders operate as CSOs, for whom there is no limit on finance charges, and rates reach upward of 500% APR (and higher) fur a loan that typically has a 14-day term.
iii Under existing Texas lending laws, car title loans can carry finance charges consisting of a $10 set fee, plus $4 per $100 a month installment charge. Car title loan finance charges are authorized under TFC § 342.253, which incorporates the fees permitted by TFC § 342.252 (3). In addition to these finance charges, under existing Texas lending law, TFC § 342.502 (b) (5) expressly permits a “fee for recording a lien on or transferring certificate of title to a motor vehicle offered as a security for a loan.” (The recording fee is not included in APR calculations because they are excludable from inclusion in the finance charge under the federal Truth in Lending, Act, Reg. Z § 226(e) (l).) However, instead of complying with these state lending laws intended for them, car title lenders operate as CSOs, for whom there is no limit on finance charges, and rates reach upwards 300% APR fur a loan that typically has a 30-day term.
iv Regardless if the cost is classified as "interest” or “fees” under state law, the cost to the borrower is the same. The federal Truth in Lending Act requires that both interest and fees be combined and disclosed to borrowers as an Annual Percentage Rate (APR). Federal law requires the cost of the all credit to be disclosed in terms APR, regardless of whether the loan is for two weeks or two years.
v Existing Texas laws expressly permit payday loans to use a borrower's post-dated check as collateral for the loan, and expressly permits car title loans to use a borrower’s title to her car as collateral. For payday loans, see TAC § 83.604 (b) (“The check given in the [payday loan] transaction may serve as security for the payment of the loan.”). For car title loans, car title as security is not expressly prohibited under TFC § 342.503 and is stated as a permitted practice for authorized fees in TFC § 352.502 (b) (5). However, even though the CSO statute does not expressly allow any of these collaterals, these payday and car title lenders operating as CSOs use checks and car titles as collateral respectively, as well as electronic access to a borrower’s debit account and a letter of credit issued by the CSO.
vi Under existing Texas lending law, payday lenders and car title lenders, just like all other consumer lenders and brokers, are subject to oversight by the Texas OCCC. Although CSOs are subject to private litigation and oversight of the Attorney General, these provisions have proven insufficient to protect consumers against abusive high cost lending. CSOs are the only entities engaged in consumer lending transactions that escape oversight and compliance requirements of the OCCC.I'll let you know how it goes. This will be a first for me. Posted by
Mandatory and Standard Loan Modification ReviewForeclosures should not be initiated until the servicer does a complete review of a borrower's file. If the borrower is already in foreclosure when he or she requests a review, the foreclosure process (and not just the final sale) must be suspended until the review is completed.a. This review must include the complete payment history; the contact log; and any other relevant information to determine whether the borrower is actually in arrears.b. This review must include a determination that all loss mitigation requirements (as set out by HAMP, investors, FHA, GSE's, etc.) have been met, and the servicer must disclose to the customer all inputs and calculations done to establish qualification for a loan modification (see NPV transparency above).c. Servicers must develop a protocol for evaluating Pooling and Servicing Agreements for investor restrictions and must seek a waiver if necessary.
Written Confirmation of Review to BorrowerIf a borrower is not offered a loan modification, the servicer must provide a sworn affidavit to the borrower, disclosing the reasons for denial, including a. any calculations done to determine loan modification eligibility; andb. if the denial is due to investor-imposed restrictions, the specific language in the PSA prohibiting the modification, instructions on how the borrower can view the full PSA, and a written log of the servicer's efforts to obtain a waiver of this restriction.
Borrower Appeals ProcessThe denial letter must provide the borrower with an opportunity to appeal this determination to a neutral party. Foreclosure can only be resumed after written denial has been provided and time for an appeal has passed. If an appeal is pending, no foreclosure can be resumed.
No Legal Foreclosure Without Proof of Due DiligenceServicers should be required to file a certification of loan modification procedures as a precondition to a foreclosure sale. In the case of a non-judicial foreclosure, the government official responsible for recording deeds and other transfers of property in the jurisdiction in which the property is located shall not permit the recordation of a deed transferring title after a foreclosure without certifying that the party conducting the sale has demonstrated that the requirements of this section have been met. A sale of property in violation of this subsection is void.
Consistent Communication with Consistent StaffUpon contacting the servicer, the borrower must be assigned a case manager that will remain with that borrower throughout their loss mitigation experience. This case manager will have decision-making authority and access to the highest levels of management in the company. It is permissible for additional line staff to assist the case manager, as long as the case manager is always accessible to the borrower. If a servicer is temporarily incapable of providing this adequate staffing level, the servicer must refer to a licensed special servicer until adequate staffing levels are reached.
The next post will deal with the imbalance of power that leads banks to multiply additional fees and get by with ignoring the law. Posted by
I worshiped at Ecclesia on Taft St. in Houston today. It has some of the expected features of emergent-type congregations: a repurposed building, a coffee shop and coffee drinking in the service, people worshiping in casual clothes, a worship band and large-screens for lyrics and video, a slight techie feel combined with functional furnishings, a sense that the setting is an impermanent stop on a longer journey, an ambivalent relationship with popular culture, one foot in the ancient Christian tradition, a fair share of small beards and goatees, and conversational worship leadership and preaching.
Finally, I should remark that although it is clearly a young adult dominated congregation, they are not merely detached and carefree. I could go into a number of ways in which they show signs of taking their place in the struggles of human existence, but I will focus on only one thing here. This sermon followed a day in which one of the young women of the congregation had been buried. Without telling us a lot of details, it was clear that she had been facing a life-threatening disease and that her expected time to continue fighting the condition had been cut dramatically short. Under these conditions, Bro. Seay offered a hopeful reflection on heaven, in which those who have gone before us are watching and pulling for us in the struggles we face. Heaven is not the same as our lives here, nor is it a locus of complete wish fulfillment. It will take some adjusting to the differences, he said, but it will be better than we can imagine. That is a pretty good riff on the biblical language, as I see it. Dad knows good preaching when he hears it, and I think he would be passing on some things he heard if he had been there today. Thanks to Curtis Freeman for telling me about these folks.
Rev. Noel Castellanos, the executive of the Christian Community Development Association, recently sent a note that I thought worth sharing here. In our time of economic crisis, we may be inclined to turn selfward, whether as families, individuals, or churches. We see so many challenges and fear we cannot do anything but survive. But turning in on ourselves is the opposite of what to do in this crisis. We have to continue to realize that God's calling to us, all the way back to the calling of Abraham, is a calling to be a blessing to others. God blesses us, that we may bless others. The incarnation reveals the superabundant love of God, shared among the three persons of the Trinity, turning outward toward blessing all humanity. As followers of Jesus, we get to join him in that incarnational work. Thanks, Noel, for the words here.
This past Sunday during my church's prayer time, a long-time member stood up to give a testimony before his church family that after two hard, long years, he had finally found a new job. Not just a job, but the perfect job, provided by God. This encouraging testimony came after "Coach" Wayne Gordon's Biblical teaching from the book of Job, which reminded us that bad things often happen to good people.
I am reminded that our core ministry is to live with and among men and women who know this lesson all too well. Violence, unemployment, kids struggling in bad schools, and overall difficult lives are not the exception, but the norm in our most of our neighborhoods, even for those who love God are serving Him diligently.
While sitting in a White House briefing tasked with developing the new Consumer Financial Protection Bureau, I caught myself reflecting on my friend's two-year struggle to find a job. It struck me that families are vulnerable to making bad financial decisions and falling victim to fraud when faced with these kinds of employment challenges. With so many of our families struggling, it is easy to feel overwhelmed!
As we approach Lent, let us take the time to re-examine our commitment to follow the God who left the comfort of heaven to enter the hurt and pain of our sin-filled world. Moreover, let us root our lives and our neighborhood work in a deep, daily walk with Christ. Let us be empowered to be agents of hope and justice wherever we see someone’s God-given dignity compromised.Some leaders from the MetroIAF were at this meeting with Noel, Jim Wallis, and others. Our national organizing work on the economy is one part of the bigger picture. But Noel reminds us that nothing short of blending our lives into the lives of the world will move us toward the calling to let God's will be done on earth as it is in heaven.
MetroIAF,
As part of the work on resetting the economy, North Carolina United Power and the IAF-SE have been pressing for banks to obey the law in dealing with loans to military personnel. The law, revised in the past decade, says that when soldiers are on active duty, all of their loans must be capped at 6%, and any existing interest above that level must be forgiven. Moreover, when they are on active duty and three months beyond, a bank cannot start foreclosure proceedings or other debt recovery strong-arm tactics. We took up this cause because we were hearing many stories about how banks were not following these laws. And that does not even take into account all of the predatory lenders, loan sharks, and such who open for business just outside the gates of military bases.
We made good progress in these negotiations with big banks and with NC government officials. Bank of America was especially responsive, offering unilaterally to extend the grace period law demands from three months to nine months. By doing so, they give room for the new shape of military deployment which relies heavily on National Guard and Reserves and which has led to numerous sequential tours of duty. The law did not anticipate this change, and it has hurt many military personnel whose cases have not been handled correctly.
In case anyone wondered whether this is a real problem, a recent news article points out that at least one major bank, has admitted to breaking the law in dealing with military families. J.P. Morgan Chase was foreclosing on military families while they were bearing the weight of active deployment. The article names only a few cases. I suspect that a committed investigative reporter would find many, many more at all major banks, in regional and local banks, and an explosion of cases among payday lenders, car title lenders, and other criminally conceived businesses trying to fly under the radar.
Let me again acknowledge Bank of America for its promises to improve services and go beyond the letter of the law in working with military families. We have had some hopeful conversations with Wachovia-Wells Fargo who has had experience operating a specialized military bank out of San Antonio, TX, but they have not made any commitments in response to our requests. Obviously, J.P. Morgan Chase has had to come clean on a few cases. I hope some other groups working toward economic justice will raise these questions locally to stop the sucker punching on these families who already face stress and problems beyond what anyone should have to face.