Citi using Taxpayer Bailout Funds to deny Loan Mods and Foreclose on Cooperating Homeowners

By
Real Estate Agent with California Coast & Country Homes, Inc. CalBRE Broker #00983670

Yes, you read that right!  Unbelievable but true.  I am out in the field talking to homeowners every day.  Here is a TRUE story of California home owners who are fighting back and winning against these greedy giant corporate banks.  It's shocking to know that OUR taxpayer bailout money is being used to support such bad business practices by lenders like Citibank.  This homeowner's story has developed over the past year.

The Homeowners refinanced their house in the Spring of 2004, with a 6% ARM fixed for 2 years.  No problem, they would refinance into a better loan at the end of 2 years.  Unfortunately by that time, the market had changed and they couldn't refinance out of that ARM loan.

1. Due to the interest rate on the ARM loan increasing to approximately 11%, the homeowners' payments jumped from $1,800 to about $3,600 per month (not including taxes and insurance).  Note that these interest rates are being charged to the homeowner at a time when the federal rates were the LOWEST ever (4 to 5%).  Citi was currently servicing their loan, which had been transferred several times after their initial loan.

2. After getting behind in payments, the Homeowners first tried to negotiate with their lender Citi.  Citi demanded large payments to get caught up.  The Homeowner asked Citi if they could do a Loan Modification because they wanted the interest rate lowered.  Citi stated that they do not do Loan Modifications.  (Citi's computer called them automatically 2-3 times per day from Citi's collections dept.  The homeowners had to submit a "cease & desist" letter asking NOT to be called from Citi, in order to stop the harrassing phone calls.)

3. The Homeowner was unable to make the payments and contacted the HOPE government agency for help.  Citi ignored the HOPE program's request and refused to contact the Homeowner.  

4. The Homeowner's attorney then wrote 2 separate letters to Citi, with no answers or results from Citi.  The homeowners continued to contact Citi.  They got the "run-around" of being transferred from department to department, with no answers, no rep assigned to their case, and no one to return their phone calls.

5. The Homeowners heard that Citi was now offering Loan Modifications.  The Homeowners then submitted their financial form to Citi, requesting a Loan Modification.  The Homeowners contacted Citi every week with no answer or reply.  Finally, they got a letter denying their Loan Modification request.  Citi said it was denied because the file was incomplete because an additional paper was needed.  The Homeowners were never notified that additional paperwork was needed.  Citi said they could not contact the Homeowner because the Homeowner had asked Citi to "cease & desist" making collection calls (they were harassing the Homeowners by having the collection dept. computer calling them twice per day).  The Homeowners then pointed out that they had sent Citi a fax authorizing to be contacted on their cell phone regarding the Loan Modification.  The Homeowners asked Citi why they didn't simply send them a letter requesting the additional paperwork.  Then Citi stated that the Loan Modification application had been deleted from their system, and if the Homeowners wanted a Loan Mod, they would have to reapply and start the process all over again.  Citi stated that their Loan Modification process was a 4-6 week process.  The Homeowners pointed out that Citi had set the Foreclosure sale date only a few weeks away, and asked if Citi could postpone the sale date.  They said they could not.

6. The Homeowner then hired a Loan Modification company.  Unfortunately, after many attempts of dealing with Citi's senior management, the Loan Modification company was not able to obtain a loan modification because Citi refused to cooperate with them also.  First, Citi said that the Homeowner didn't have enough income to qualify for the Loan Modification program.  Then Citi said that the Homeowner had too much income to qualify!  (Fortunately, this company offers a money-back guarantee if they can't perform.)

7. Next the Homeowner hired a legal services program to file a fraud lawsuit against Citi.  After a couple of weeks, the program's lawyers could not get it filed in time because of their backlog of so many cases.   (This company called the Homeowners and told them the attorneys weren't going to be able to get their lawsuit filed before the foreclosure date.  And yes, they sent the Homeowners' money back to them the next day).  They received a Notice of Trustee's Sale (Foreclosure sale) from Citi.  The sale date was set for January 30th.

8. The Homeowners next hired Home Defense Group to file a lawsuit against Citi.  With less than 2 weeks before the Foreclosure sale date, Home Defense Group filed a very strong lawsuit against Citi.  Reading from a court-certified copy, the first page says:

COMPLAINT FOR:

1. DECLARATORY RELIEF
2. VOID, CANCEL, AND SET ASIDE:
    (a) NOTICE OF TRUSTEE'S SALE UNDER DEED OF TRUST;
    (b) NOTICE OF DEFAULT AND ELECTION TO SELL UNDER DEED OF TRUST
3. CANCELLATION OF INSTRUMENTS
4. QUIET TITLE TO REAL PROPERTY
5. ACCOUNTING
6. INJUNCTIVE RELIEF
   (a) Temporary Restraining Order
   (b) Preliminary Injunction
7. DAMAGES:
   (a) General
   (b) Compensatory
   (c) Bad Faith Foreclosure
   (d) Violation of Statute(s)

9. After receiving this lawsuit, Citi postponed the Notice of Trustee's Sale (Foreclosure sale).  Citi did not notify the Homeowners or the law firm.  This information was discovered when searching the foreclosure public records.  The Sale date postponement was postponed from January 30th to March 2nd.

10. Meanwhile, Home Defense Group will continue to work on behalf of this Homeowner until the case can be successfully concluded.

PLEASE NOTE that there is NO guarantee that ANY particular program or lawsuit will be successful on your behalf.  I have heard a rumor that some lawyers, although they had filed valid cases, were not having the success they sought.  I heard it was because some corrupt judges were siding with the huge corporate lenders, who are paying millions of dollars to try to get these lawsuits thrown out.  These huge corporate lenders are afraid that losing a fraud lawsuit will set a precedent, opening the floodgates to thousands of other Homeowners who will sue on the same grounds, and the lenders will do everything possible to stop these type of lawsuits. 

Although I hope and pray that these cases get heard fairly on behalf of homeowners, I can't deny that corruption, favoritism, and unfairness exist in every society.  Our American justice system is not perfect, and life is not always fair.  However, I feel that homeowners have a GOOD SHOT at getting some POWER back in their hands with these experienced attorneys who are willing to put their careers on the line to FIGHT back for American citizens.  God bless them!!!

If you question the legitimacy of this tactic, consider this:  Your lender may have sold your promissory Note and they may not own your Note -- which may mean that they do NOT have the right to foreclose, and maybe even don't have the right to collect your mortgage payment.  Smart attorneys are working with home owners to make the lender PRODUCE a valid note.  Here's Lou Dobbs from CNN.

According to Ohio congresswoman Marcy Kaptur as interviewed on LouDobbs.com on CNN.com, if your lender tries to foreclose on you, hire an attorney and fight back!  Stay in your house, do NOT move out.

In this CNN clip called "Fight Foreclosures: Be a Squatter!", check out the video here:

http://www.cnn.com/video/#/video/us/2009/01/30/griffin.mortgage.squatting.cnn

Please reference my previous blog, "Bank Foreclosing?  Don't Move Out, Stay in your Home" at http://activerain.com/blogsview/911789/Bank-Foreclosing-Dont-Move-Out-Stay-in-your-Home

Can Home Defense Group's program work for you or your homeowners?  Contact us today to find out if your loan qualifies and you can put their powerful program to work for you.

Join my new AR group and post your blog at http://activerain.com/groups/virtualoffice

Regina P. Brown
Broker, Realtor®, e-Pro
Author of eBook "Stop Foreclosure Fast: Solutions to Save your House"

Text copyright © 2009 R.P. Brown, All Rights Reserved

Posted by

Regina P. Brown
Broker, Realtor®, e-Pro
California DRE # 00983670
Join & post to my NEW ActiveRain group at http://activerain.com/groups/virtualoffice

www.CalCoastCountry.com

   

RealtyPro Academy online training courses for real estate agents

             

Text copyright © 2011 R.P. Brown, All Rights Reserved

Page copy protected against web site content infringement by Copyscape  

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Re-Blogged 7 times:

Re-Blogged By Re-Blogged At
  1. Roland Woodworth 02/07/2009 06:49 AM
  2. Missy Caulk 02/07/2009 11:44 PM
  3. Thom Abbott 02/08/2009 12:31 AM
  4. Kent Simpson 02/08/2009 06:08 AM
  5. Dawn Maloney 02/08/2009 08:56 AM
  6. Ginger Sala 02/08/2009 02:54 PM
  7. Rebecca Gaujot 02/09/2009 01:59 PM
Topic:
Lending / Financial
Location:
California San Diego County Encinitas
Groups:
Realtors®
Short Sale REALTORS®
Short Sales Pre Foreclosures Bankruptcy and More!
FREEDOM Office: Professionals Working from Home
Short Sale and Loan Modification Nightmares
Tags:
home owners
foreclosure
california
save your house
fight foreclosures
citibank foreclosing
taxpayer bailout money funds
stop reo

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Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Wow, I checked the comments after church today, and there's over 50!  This is a very hot topic right now.  I'm glad to see everyone's discussions and input, whether or not I agree, I think I can learn a little bit from everyone.  Thanks for stopping by and commenting.

Realtors:  God bless you for giving so much of your time and energy to help home owners, whether or not they are your clients.  You deserve recognition and applause for taking the time to help others, even though you aren't compensated for your efforts.

Feb 08, 2009 08:22 AM #52
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Mark Organek wrote an interesting post about AHMSI (American Home Mortgage Service) and there was a very long (but eye-opening) comment there today:

http://activerain.com/blogsview/883957/AHMSI-really-doesnt-care-do-they

Check it out!

Feb 08, 2009 08:30 AM #53
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Thom & Ray Team:  Thanks for the suggestion.  I joined the following groups, and added this blog post to these groups:

Short Sale and Loan Modification Nightmares
Short Sale REALTORS®
Short Sales Pre Foreclosures Bankruptcy and More!

Feb 08, 2009 08:45 AM #54
Rainer
5,051
Testing Test
loan - Tustin, CA

Well, Citi is getting their just rewards then.  Have you seen their stock?  Instant Karma baby.

Feb 08, 2009 11:44 AM #55
Rainmaker
1,859,194
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Regina - I have wondered if some of these banks aren't dragging their feet on loan mods, because they want the toxic assets to remain on their books, while hoping to be awarded a second dip of the bailout funds, which will likely be announced later this coming week?

Feb 08, 2009 11:52 AM #56
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Mark, Myrl, YES you are both right, I think there is MORE going on than just homeowners doing loan mods.  I heard that some banks preferred foreclosures because they could receive federal gov't money for their losses, and that is now their operating cash.  Not sure if this is true, I don't know enough about their operations. 

But there is a lot more going on behind the scenes than we know!  Personally, I don't think any of these giant lenders/banks are operating profitably and they will all be out of business in the next 2 years.  My theory is that they are just amassing as much cash as possible to pay their CEOs and upper management as much as possible, before the inevitable collapse. 

But I would really like to hear from others who have an "inside scoop" to what their M.O. is.  Anyone?

Feb 08, 2009 12:28 PM #57
Rainmaker
241,100
Brien Berard
Remax Professionals Laurel MD - Laurel, MD
Maryland Real Estate Agents - Laurel Real Estate

This was tough to read.  I am the selling agent on four pending short sales.  Yikes!

Feb 09, 2009 02:04 AM #58
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Brien, you are doing a great job for your clients.  And for the lenders, whether or not they appreciate it.  Keep perservering, you will get them all closed.  Good job with all your hard work.

Feb 09, 2009 04:17 AM #59
Ambassador
1,130,525
Craig Rutman
Helping people in transition - Cary, NC
Raleigh, Cary, Apex area Realtor

What a shame that these people had to go through all of this just to modify a loan with a ridiculous rate...especially in light of the lower rates that are available now...and the fact that Citi and other lending institutions were given huge sums of money from the common taxpayer to bail them out of the mess they created.

Feb 10, 2009 05:39 AM #60
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Craig, our financial industry is not only a shame and but a disgrace to our hard-working forefathers who believed in hard work, self-sufficiency, and financial independence.  Our great-grandparents would roll over in their graves if they saw what a mess we've made out of our resources!

Feb 10, 2009 06:17 AM #61
Rainmaker
1,859,194
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Regina - If you think Citibank doesn't handle loan modifications well, consider how they handle credit cards.  The following dialog popped up in my inbox this morning.  I'm assuming it's a ruse, but in a world where life is increasingly imitating art, who knows:

Be sure and cancel your credit cards before you die. Customer service being what it is today.

A lady died this past January, and Citibank billed her for February and March for their annual service charges on her credit card, and added late fees and interest on the monthly charge. The balance had been $0.00 when she died, but now somewhere around $60..00. A family member placed a call to Citibank.  The person who answered was, obviously, from (probably in) India .

Here is the exchange :

Family Member: 'I am calling to tell you she died back in January.'

Citibank: 'The account was never closed and the late fees and charges still apply.'

Family Member: 'Maybe, you should turn it over to collections.'

Citibank: 'Since it is two months past due, it already has been.'

Family Member: So, what will they do when they find out she is dead?'

Citibank: 'Either report her account to frauds division or report her to the credit bureau, maybe both!'

Family Member: 'Do you think God will be mad at her?'

Citibank: 'Excuse me?'

Family Member: 'Did you just get what I was telling you - the part about her being dead?'

Citibank: 'Sir, you'll have to speak to my supervisor.'

Supervisor gets on the phone:

Family Member:'I'm calling to tell you, she died back in January with a $0 b alance.'

Citibank: 'The account was never closed and late fees and charges still apply.'

Family Member: 'You mean you want to collect from her estate?'

Citibank: (Stammer) 'Are you her lawyer?'

Family Member: 'No, I'm her great nephew.' (Lawyer info was given)

Citibank: 'Could you fax us a certificate of death?'

Family Member: ' Sure.' (Fax number was given )

After they get the fax :

Citibank: 'Our system just isn't setup for death. I don't know what more I can do to help.'

Family Member: 'Well, if you figure it out, great! If not, you could just keep billing her. She won't care.'

Citibank: 'Well, the late fees and charges will still apply.'

(What is wrong with these people?!?)

Family Member: 'Would you like her new billing address?'

Citibank: 'That might help...'

Family Member: ' Odessa Memorial Cemetery , Highway 129, Plot Number 69.'

Citibank: 'Sir, that's a cemetery!'

Family Member: 'And what do you do with dead people on your planet???'

(Priceless!!)

Feb 10, 2009 06:49 AM #62
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Myrl, you gotta love it!!!  Hilarious.  Probably true, I wouldn't doubt it.

Feb 10, 2009 07:19 AM #63
Rainmaker
171,909
Debra Kukulski, Broker Associate
RE/MAX Unlimited Northwest - Cary, IL
SFR,CDPE;GRI;ABR;e-PRO Realtor, Northern IL

Myrl, that story IS priceless!

Feb 15, 2009 11:32 PM #64
Rainer
2,179
Jack Burns
Real Estate Now - Bellevue, WA

Check out www.ShortSaleNation.ORG. It's a FREE online short sale, self service tool for agents and their clients. You don't need to interact with anyone and you are in total control of your short sale.

Mar 13, 2009 06:01 AM #65
Anonymous
Steve

This is an actual email from a lender who is doing a "workout" loan modification for a borrow who has an 8.1% fixed rate loan and has missed a payment.  Even though the borrower now has the funds to come current, his lender refuses to accept any payments from the borrower and the borrower has just recived a Foreclosure Notice in the mail.  Bear in mind that the only reason anyone would get a Sub-prime loan is because their credit rating would not qualify them for a better loan.


"First of all once you are referred to foreclosure your loan is turned over to that attorney's office. Our company has no control over those letters. Per the note you signed at your closing you have given us permission to proceed with foreclosure if you stop making your payments.

 With regards to the plan the "Fed" is offering that is the HMP that our company will try to qualify you for if at all possible. Just as an FYI the criteria and documentation that the "Feds" are requiring through FNMA to approve an HMP is very thorough. Be prepared to submit additional information and they will scrutinize your credit before they will reduce any interest rates or defer any loan balances.

President Obama portrayed this plan as a very simple process and the fact is that this is a government run program and they will  dictate  to Fannie Mae what the guidelines will be. We are still awaiting training on this program that is still weeks away from being ready.

I hope you will qualify and that you will receive what you believe is due to you however if you have poor credit and extreme debit that will most definitely affect whether you will qualify or not.

I wish you the best of luck and again please be patient and let us do our jobs.

Thanks"

Mar 28, 2009 10:11 AM #66
Rainer
9,147
Peter Collins
Loan Modification Network - Phoenix, AZ

Can you believe the temerity of these people? Citi, countrywide, indymac all speak with forked toungues when it comes to loan modification.  I saved my home with an attorney performed loan modification from www.us-loan-modification.com

 

May 11, 2009 05:45 AM #67
Anonymous
George

 

I am sure a lot of you are familiar with the beat up leads that your sales people work to the bone to close. If you are tired of this and want to help your business retain sales people, close leads at a higher ratio. then check out Loan Modification Leads or call SpotLight Media at 1800-371-1112. Our Leads come via live transfer from calls we get off our national televised commercial. check out our commercial at TV Loan Modification Leads

May 29, 2009 03:22 AM #68
Anonymous
Anonymous

Loan mods will bring just more foreclosures to us

http://homesinsale.com 

Jul 05, 2009 03:59 PM #69
Rainmaker
523,715
Regina P. Brown
California Coast & Country Homes, Inc. - San Luis Obispo, CA
e-Pro Realtor

Steve, was that letter a joke?  I hope so, it sounds crazy.

George & Peter, I do not recommend Loan Mods to anyone, they are a waste of time unless the mortgage company will reduce the payments significantly OR reduce the principal balance.  Most of the big corporate lenders will NOT.

Jul 09, 2009 03:58 PM #70
Rainmaker
171,909
Debra Kukulski, Broker Associate
RE/MAX Unlimited Northwest - Cary, IL
SFR,CDPE;GRI;ABR;e-PRO Realtor, Northern IL

I also have not yet heard of anyone doing a successful loan modification.

Jul 17, 2009 01:44 AM #71
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