Housing advocates allege foreclosure practices are unfair

Housing advocates rallied outside the State Capitol Monday in an effort to draw the attention of local and state lawmakers to their claims that some banks are using fraudulent and predatory practices to foreclose on homes.

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RALEIGH, N.C. — Homeowners' rights advocates held a rally at the state capitol today to protest what they say are unfair, predatory, and even illegal practices by banks foreclosing on home mortgages.

Kimberly Richardson spoke at the rally. She’s been trying to get her mortgage modified since she lost her job in 2008. She found a subsequent job, but it pays only half her old salary. 

After three years and many dozens of phone calls, all she has to show for her efforts is a suitcase full of paperwork.

"And then they send you more paperwork on top of what paperwork you’ve already sent," she told WRAL. "Then, if it’s not processed in 30 days, you have to send the same paperwork, if not more paperwork."  

Richardson was told her house would be sold last Monday. But Wells Fargo won’t return her calls. She doesn’t know when or if she and her family will be homeless. She says she's getting the runaround. 

"That’s essentially what it is – pushing papers. And they’re running around in circles, trying to figure out how to get you out of your home," she said, close to tears. 

Monday’s rally was timed to coincide with state Supreme Court arguments in the case of Dobson v Wells Fargo. The bank is asking the courts to allow it to foreclose on the home of Linda Dobson, even though it can’t produce the original loan paperwork that shows it owns the property. The bank says a photocopy and sworn affadavits are enough to make its case. Rally organizer Michael de los Santos with the Community Reinvestment Association of NC disagrees. 

"They’re not above the law," de los Santos said. "I can’t walk into your house and say 'This is my house, I’m taking it,' if I can’t show I have some sort of ownership in it. Banks shouldn’t be able to do the same thing."

De los Santos says big banks aren’t living up to the promises they made when they took bailout money from the federal government in 2008 and 2009. Nationwide, foreclosures are on the rise, while loan modifications are dwindling.

The protestors planned to deliver petitions for stronger legal oversight of the mortgage industry to Attorney General Roy Cooper. Instead, Cooper came to the rally to pick them up.

"Your voices are being heard," Cooper told the three dozen or so people in the audience. "Financial fraud has been committed on our legal system, and it needs to be made right." 

Cooper is part of a multi-state case against the big five banks, along with the US Department of Justice, the Treasury Department, and the Federal Trade Commission. They’re seeking a settlement for compensation for victims of predatory mortgages, and better nationwide servicing standards for foreclosures.

It may not come in time to help Kimberly Richardson.

"At least give us a chance," Richardson pleaded. "If I’m sending you the paperwork, then there should be a modification somewhere. I’m still working, I’ve still kept a job. It shouldn't take three years."

WRAL contacted Wells Fargo shortly after noon today, seeking details about Richardson's case.

Late this afternoon, Richardson called us to say Wells Fargo contacted her this afternoon. She was told the sale of her home has been delayed by 60 days while the bank tries again to work out a modification. 

"Foreclosure is always an option of last resort," said Wells Fargo spokesman Jason Menke. 

"We have postponed the foreclosure sale on Ms. Richardson's home a number of times in order to allow her time to provide the documentation we need to determine her eligibility for payment assistance," Menke said in a written statement.  "Our hope is to be able to come to a resolution soon, and we continue to work with Ms. Richardson to find a way for her to avoid foreclosure."

In 2010, there were 66,287 foreclosure filings in North Carolina, according to the North Carolina Administrative Office of the Courts.


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