Tuesday, January 8, 2013

BOA mortgage loan modification offers - errors & mistakes abound

BOA Mortgage Loan Modification Offers - Errors & Mistakes Abound

As an attorney who represents mortgage loan borrowers and homeowners, I see more than my share of mistake-filled Bank of America mortgage loan modification offers. I just reviewed another modification offer from BOA, made to new clients of mine. Almost every modification offer I've ever reviewed has significant errors in it, especially BOA's. My goodness, one would think that they would hire a good lawyer to draft these document templates, right? Here are some of the errors / problems in this most recent one: 

A) Dated Dec. 17, allegedly sent via overnight mail on or about Dec. 17, but did not arrive until the end of December, just a few days before the (arguable, see below) January 1 deadline.

 B) Page 2 says "Using the pre-addressed, pre-paid FedEx envelope and the address label provided, return all properly signed and notarized documents and first payment on later than January 1, 2013." (emphasis added). Presumably, this was supposed to say everything is due "NO later than January 1, 2013"  . . . however, as it reads, it is poor English for "everything is due after January 1!" Heck, given that the BOA "single point of contact" (SPOC) who called me yesterday barely spoke English and mangled every 4th word, perhaps he wrote this agreement, and Bank of America  meant to say it's all due after January 1?

C) Page 3 specifically lists the first payment as due on February 1, 2013; another part of page 3 implies that February 1, 2013 is the first due date; but then page 3 specifically states "We look forward to receiving all required documents and your first payment PRIOR to the document return deadline of January 1, 2013." (emphases added)  

As an aside, don't we all wish Bank of America had the foresight to not make thousands of modifications offer responses due on  January 1, 2013, a national holiday date on which BOA isn't even open?  

D) This offer mentions a balloon payment (matures in 25 years, but payments amortized as if it were a 40 year loan) but doesn't state what that payment would be, or even estimate it, despite the fact that such an amount is obviously a material condition to the modification (and very important for the borrowers to know; if this was a loan origination, failure to state the same would presumably be a violation of federal law) and despite the fact that the amount should be ascertainable as this is a fixed rate loan.

 E) This offer, the format for which is different than any I've seen in the past, doesn't state whether it is private/internal, pursuant to the National Mortgage Settlement (NMS) / DOJ Settlement, or made under the Home Affordable Modification Program (HAMP).

 Keystone Cops, comedy of errors, etc. These borrowers had to make a Hobson's Choice (accept a confusing and unclear offer and pay thousands of dollars or risk losing the chance at mortgage relief) and/or pay someone like me to try to push BOA to clean up this mess, all the while trying to stave off foreclosure and hoping BOA will agree to correct the problems.

Hey, Bank of America - it doesn't have to be this difficult! Yes, some of the challenges you face are truly complex, but, heck, are you telling me one of your $500.00 an hour lawyers couldn't have drafted up a basic document that makes sense?! You need to do better.

McGrath & Spielberger, PLLC provides assistance to those involved in mortgage disputes, including borrowers in need of mortgage relief services such as mortgage loan modification, foreclosure negotiation, and deed-in-lieu or other negotiated settlement resolutions.