Wells Fargo Sued for Mortgage Fraud and Mortgage Discrimination

April 5, 2014 By

It appears that Wells Fargo is being sued on both coasts for mortgage fraud or discrimination.  In the first case, filed in New York, Wells Fargo, the nation’s largest home mortgage lender, is accused of ignoring terms of a multi billion dollar settlement that was meant to resolve foreclosure abuse. This particular case is being heard in the U.S. District Court, Southern District of New York.

The lawsuit claims that Wells Fargo violated the rules of an agreement between Wells Fargo and five other big lenders and 49 state attorneys general. Evidently, the bank is accused of not reporting defective home loans to the government.

The West Coast case was filed in December of this past year. The Los Angeles city attorney has sued Wells Fargo and Citigroup, claiming that both organizations participated in mortgage discrimination, which led to a rash of home foreclosures in minority areas during the housing bust.

The lawsuits note that “vulnerable, under-served borrowers” who had been denied due to years of unlawful redlining practices leapt at the opportunity to purchase a home when it was possible to obtain a sub-prime home loan, even if they couldn’t afford it.

Contact Shaffer & Gaier: Protecting Homeowner Rights

The law firm of Shaffer & Gaier protects the rights of those who are facing foreclosure or seeking mortgage modifications in New Jersey and Pennsylvania. To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Mortgage Discrimination, Mortgage Fraud, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , ,

MORGAN STANLEY AGREES TO PAY $1.25 BILLION FOR MORTGAGE SETTLEMENT

February 18, 2014 By

Morgan Stanley has now joined the ranks of JP Morgan Chase, Deutsche Bank, Bank of America and other big banks in agreeing to pay huge sums of money to the Federal Housing Finance Agency to resolve claims that it sold bad mortgage securities to Fannie Mae and Freddie Mac during the run-up to the housing market/mortgage crisis. Morgan Stanley recently agreed to pay $1.25 billion to the FHFA, which is the Federal conservator for Fannie Mae and Freddie Mac. The settlement resolved a lawsuit in which the Agency claimed that Morgan Stanley sold over $10.5 billion in mortgage-backed securities to Fannie and Freddie during the credit boom, while presenting a “false picture” of the riskiness of the loans. This is the same allegation that runs through all of these lawsuits against the big banks, but this lawsuit in particular involved securities issues between September 2005 and September 2007.

Many of the loans were originated by sub-prime lenders, like New Century and Indy Mac, and then bundled into bonds and sold to Fannie and Freddie. The lawsuit said that one group of these loans had default and delinquency rates as high as 70%. As was common in the industry, the big banks turned a blind eye to these default rates while continuing to serve as warehouse lending conduits to keep the train rolling on.

If the Morgan Stanley settlement becomes final, it will be the third-largest monetary payment by a Wall Street firm to settle an FHFA lawsuit. The largest was JP Morgan Chase at $4 billion, followed by Deutsche Bank at $1.2 billion. The FHFA still has some work to do, in that it still has approximately 12 other lawsuits filed against other financial institutions.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Lending, Mortgage Modification, Predatory Mortgage Practices Tagged With: , , , , , , , , ,

RELIEF FOR SOME HOMEOWNERS – BUT THEN A TAX BILL?

February 12, 2014 By

The big banks will be able to write-off the billions of dollars in debt relief they agreed to give to homeowners, but for the homeowners that received that help, the debt relief is treated as taxable income, which can result in large tax bills. There had been a tax exemption for mortgage debt forgiveness, but Congress let this expire on December 31, 2013. While Congress often allows tax breaks to expire, only to reinstate them later, the mortgage debt relief exemption has not yet occurred. This could partly be because there is a movement in Congress to broadly overhaul the entire tax code, and in an election year, this year was considered “small” relative to other tax matters that affect the nation as a whole.

The tax exemption helped homeowners who are underwater in their mortgage – that is, those who owe more on their mortgage than their home is worth (approximately 6.4 million households nationwide). Put in real terms, this means that if you owe $250,000 on your mortgage, and your bank lets you sell it by way of a short sale for $150,000, then the $100,000 difference is treated as taxable income. This would lead to an approximately $28,000 tax bill because of the typical tax laws in which if someone lends you money and then later says you do not have to pay it back, the IRS counts the amount forgiven as income (except in cases of bankruptcy or insolvency). Nationwide, approximately 100,000 people used the mortgage debt relief exemption in 2011. In 2013, however, that number will be much greater, simply because there were approximately 250,000 short sales, yielding an average debt reduction of approximately $37,000. A homeowner in the 25% tax bracket would then face an extra $9,250 tax bill.

What remains to be seen is if Congress recognizes the unfairness of giving the banks a welcome form of tax relief, while piling even more debt upon the innocent homeowner.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Abuses, Foreclosure Defense, Mortgage Debt Forgiveness, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , , , ,

Mortgage Modification Push Helps New Jersey Homeowners

December 18, 2013 By

Mortgage delinquencies are falling as home prices rise and the foreclosure pipeline is clearing. Many speculate that this is the result of the mortgage modification push by the Obama Administration.  The Obama Administration has used various programs like HARP, the Home Affordable Refinance Program, and HAMP, the Home Affordable Modification Program, to allow distressed borrowers to refinance or modify their mortgages into something more affordable.  These programs have been particularly effective in New Jersey, as under New Jersey law, a judge must approve foreclosures, and they often press the borrower and lender to find a way to keep the borrower in their home.  Full article.

Mortgage modification is a process where the terms of a mortgage are modified outside the original terms of the contract agreed to by the lender and borrower.  At Shaffer & Gaier, we aggressively protect the rights of property owners in Pennsylvania, New Jersey and Florida. Our lawyers bring more than 45 years of combined legal experience to every case we handle. While we recognize that your case is unique, our commitment remains the same — to use our skill, knowledge, experience and resources to help you get the best outcome possible in a timely and cost-effective manner.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , , ,

Seminar October 21st – What can be Done When you are Near or In Foreclosure

October 16, 2013 By

Don’t Lose Your Home – Seminar

Featuring Speaker Michael Gaier

foreclosure-seminar-image***SEMINAR HAS BEEN RESCHEDULED FOR OCTOBER 21, 2013***

Click HERE for additional information, including the number to call to sign up to attend (***SEMINAR WAS MOVED TO 10-21-13, same time & location***)!

Filed Under: Current Events, Foreclosure, Foreclosure Abuses, Foreclosure Defense, Speaking Engagements - Luncheons - Seminars Tagged With: , , , ,

Defending the Mortgage Foreclosure Action – Current Trends and Cases

September 6, 2013 By

Defending the Mortgage Foreclosure Action – Seminar and Luncheon

Featuring Speaker Michael Gaier

foreclosure-seminar-image

Click HERE for additional information, and to sign up to attend!

Filed Under: Current Events, Foreclosure, Foreclosure Defense, Mortgage Lending, Mortgage Modification, Speaking Engagements - Luncheons - Seminars Tagged With: , , , , ,
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