Chicago Family Refuses to Leave Home After Foreclosure Fraud

Silva Tellez remembers holding the phone in her hand and dialing the number that came on the letter about her mortgage. It rang and rang, she says, but finally a machine picked up.

“It said, ‘Your loan modification is denied,'” she says. “That was it.”

Tellez was shocked. She and her husband, Alvaro, hadn’t missed a payment since their loan modification was granted. What they hadn’t realized was that the bank had already started the foreclosure process.

Today, the Tellez family is standing up, with help from the Chicago Anti-Eviction Campaign, and saying they won’t go, even if the sheriff comes to evict them, because they were victims of the sub-prime loan craze and foreclosure fraud.

Foreclosure fraud has been in the news a lot lately. It’s not just the so-called “robo-signers” either. Propublica’s Marian Wang detailed the various ways banks are swindling homeowners, including foreclosing on people who aren’t even behind on their mortgage. One of those ways is the dual-track foreclosure and loan modification process, which the Tellez family says they are dealing with.

Banks aren’t supposed to foreclose on homeowners until they’ve exhausted all available loss mitigation options. But foreclosures and loan modifications being processed simultaneously by different divisions within the bank can cause many struggling homeowners awaiting approval for a loan modification to be foreclosed on first.

Silva says when her loan was sold from Fremont Investment and Loan to Litton Loan, she was told she could continue the modification with the new company. But twice, when she tried to send in the paperwork and then the payment a week later, she was told that the check got there before the paperwork and thus couldn’t be processed. The third time, she was told the modification went through and continued making the lower monthly payments.

So when the Tellez received the answering machine message that their modification had been denied and that Litton Loan had auctioned their house, bought for $405,000 in 2006, to HSBC for a mere $10,000, they were shaken.

“I was thinking we had lost our house,” Silva says. “I thought it was over.”

But then she met someone from the Chicago Anti-Eviction Campaign. “They told me it wasn’t over,” she says. “That I could keep fighting. So I am.”

Read more: http://www.chicagonow.com/blogs/chicago-muckrakers/2010/12/chicago-family-refuses-to-leave-home-after-foreclosure-fraud.html#ixzz173Oan4uL

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4closureFraud.org