The moral to the story below is if you are put into a “loan modification” your regular payments will not be applied, late fees will occur, your credit will be ruined because you are reported as NOT making your payments when in a modification, and once you sent in your trail payments, they deny you and foreclose.

The part that gets me the most is all those trial payments, even if you made 10 or more of them, are gone, not credited to your account.

From what I have seen, this happens in every single case…

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Bank Of America’s Christmas present: Foreclose Even Though Not A Payment Missed

By George Gombossy

In one of the more bizarre foreclosure cases, Bank of America is threatening to throw a West Hartford family out of their home even though the couple never missed a mortgage payment.

The largest bank in the United States earlier this month notified Shock Baitch and his wife Lisa (Friedman) Baitch that foreclosure action will start today – Christmas eve – unless the couple agrees to put their home up for a forced sale.


Because another unit of Bank of America erroneously reported to credit agencies that the family was seeking a loan modification, ruining their credit rating and as the result putting their mortgage into default.

All this is happening even though the bank – after admitting it erred and sent a letter of apology in September – handed this case to a special unit at Bank of America that is charged with dealing with severe customer issues. It promised  to notify the credit reporting agencies that the couple were not deadbeats, but were good credit risks.

“I have never seen a case like this,” said Manchester attorney Wendell Davis, whose office handles many foreclosures.

Before taking the case, Davis said he thoroughly checked Baitch’s records and found that all his and his wife’s allegations were accurate.

“They have never even been late on a mortgage payment,” said Davis this morning in an interview.

Davis, a member of the Ct Bar Association’s foreclosure committee, said he is preparing a lawsuit to protect his clients because it’s the only way to hold Bank Of America accountable for its actions.

Bank of America representatives have yet to respond to the last issue. As soon as they do I will update my column in (In full disclosure I own several hundred shares of BofA stock).

I have forwarded the documents in this case to Attorney General Richard Blumenthal’s office.

I guess what they are doing to his couple is not as bad as what Bank of America did in Florida where it seized a house which a Massachusetts couple had paid cash for. The bank removed belongings and changed the locks on the doors, according to a lawsuit the couple have filed in federal court.

Baitch’s story began about a year ago when he and his wife wanted to refinance their home in order to pay for improvements and to consolidate their debts. Baitch is a firefighter.

They spoke to a BofA loan specialist and asked for the cheapest refinance option. The loan specialist tentatively put them into the “Making Home Affordable program,” which unbeknownst to the couple would signal to the credit world that they were in financial straits.

When the couple received a package of papers to sign, they decided to go with a conventional mortgage because they did not want to have to add escrow costs and home insurance to their mortgage payments, not because they were aware of the ramifications on the loan program.

But it was too late. Shortly after that, in April, Baitch’s wife (whose name is on the mortgage) received a letter from BofA telling her that the credit limit on one of her credit cards was reduced to $18,800 from $30,000. The two weren’t worried because they had plenty of credit available on other credit cards. Baitch said he just figured that the bank was tightening everyone’s credit.

It was only after his wife started receiving notifications from other creditors that several of her other accounts were being closed that the couple discovered what had happened.

Their bank, Bank of America, had reported to credit bureaus that they were in a loan modification program. That was a red flag to many creditors, which either cut their lines of credit or placed their debts in the highest interest rate category – the Universal Default rate.

Baitch met several times with Bank of America managers who promised to correct the erroneous credit report, but were told it was too late to refinance her mortgage because their credit scores had been damaged.

“I begged them that they can’t do that in this case since they destroyed our credit scores,” Baitch told me. “Although they admitted to making the mistake, I was told they cannot change the underwriting rules. So, in a nutshell, the other creditors will not reinstate the old credit limits because they use the current credit reports, BofA will not help because they use the current credit reports, and my monthly minimum payments have more than doubled because of the Universal Default rate.”

Check out the rest here…