Q: What do you get when you have a $150,000 mortgage and a payoff of only $15,680 ? 

A: You get a 90% off sale at Saxon!

Payoff on July 25, 2009 is $150,031.37

Payoff on August 31, 2009 is a mere $15,680.62

And the borrower gets a full release of liability.

I currently have two loans with National City (now PNC) my 1st mortgage is $600k and the 2nd is $150k. 

I am technically in foreclosure with the first but working with the loan modification department on a workout package. 

My 2nd is due to charge off at the end of the month.  I have asked them repeatedly to work with me on a modification but they have only come back with a reduced payment for two years. 

I would like to stay in my home but given that I am down $300k don’t feel the 2nd is reasonable and am waiting on the first to determine what I should do next. 

Should I let them charge off the 2nd mortgage? 

Please advise?

Dewey (more…)

Las Vegas Sun – A Las Vegas real estate agent who landed a prominent role in a Time magazine cover story is being scrutinized by state licensing officials because of her comments, has left her employer and is lying low.

The story by Joel Stein in the Aug. 24 issue, “Less Vegas,” is a high-spirited and high-altitude view of the troubles facing Las Vegas, which he calls both “our most American city” and “an entire city of John Dillingers.”

In the story, Brooke Boemio — “a bouncy, sweet, recently remarried 31-year-old mom” — is cast as one of the Dillingers. She helps Stein break into a foreclosed home and brags about helping clients who are underwater on their mortgages buy a second house on the cheap and stop making payments on their first mortgages, pressuring the bank into selling the houses for a loss. Everybody’s doing it, she says in the story. In fact, she said, she did it herself.

Since the story appeared, Boemio and her employer have, in the words of Coldwell Banker Wardley Real Estate President Jeff Sommers, “parted ways.”

Sommers also said his company has conducted an internal investigation and has been unable to find any cases of Boemio engaging in the behavior described in the story. The buy-and-bail tactics described in the story, he said, are serious allegations and “really just in direct opposition to everything in our policies.”

In a further statement released online, Sommers said Boemio told him she had been misquoted and misrepresented by Time.

Boemio did not reply to the Sun’s telephone, text and e-mail messages.

When the story was published, it referenced a video on Time’s Web site titled “Breaking and Entering,” of Stein and Boemio entering an unoccupied home on the west side of town. Since then, the video has been removed from the Web site for what Time spokeswoman Betsy Burton described as “some sensitivity with various issues.”

A Metro Police spokeswoman said Stein’s description of his and Boemio’s entrance into the home appears to meet the definition of misdemeanor trespassing.

Boemio could face further trouble with the agency that licenses Nevada real estate agents.

The Real Estate Division of the Business and Industry Department is “aware of the article and is taking appropriate action,” spokeswoman Elisabeth Daniels wrote in an e-mail. Real estate agents are required to deal fairly with and disclose relevant information to all parties in a transaction and by statute must have “a good reputation for honesty, trustworthiness and integrity.”

Sue Naumann, president of the Greater Las Vegas Association of Realtors, released a statement Tuesday saying that although Boemio had applied for membership, she is not a member of the association. Officials with the organization said Boemio had not taken its ethics class.

Buy-and-bail real estate purchases may not be as common as it sounds in the Time story.

Darren Welsh, general counsel for Prudential Americana Group, said the practice was common earlier in the recession but is rare these days. Lenders, having been burned by buy-and-bail real estate purchases, are more cautious today and won’t sell a buyer a second home unless the buyer can afford both homes.

“They’re on to it,” Welsh said.

 

It’s not often that you see a reversal of summary judgment in foreclosure by way of appeals court.  And probably even less often to find one in my own backyard in the Tampa Bay area of Florida foreclosure.  So, without further ado, I post the following recent decision.

Terra Firma Holdings v. Fairwinds Credit Union (Case No. 2D08-3440, August 5, 2009)

Hello Paul.

I have a question about the impact bankrupcy has on credit scores. I had filed chapter 7 in 2007 with a discharge in 2008. I went today for an auto loan and was told that my credit looked good, no debt, and timely loan payments. He said that he would guess by looking at my credit report I would have high 600 score but instead I have a 558.

I know that it hasnt been that long since I filed but I have paid off 2 loans since then and have one now, with timely payments being made, which is secured. I have known numerous people who have filed bankrupcy and within months they were getting car loans and even buying a house.

When do your scores go up? Why does it seem that mine is so low while others must be higher, given the same circumstances. I just dont understand. Will anyone help me rebuild my credit or will I just have to wait it out?

Thanks.
Marisa (more…)

LA TIMES – Consumer advocates have long maintained that one of the more unfair practices in the business world is a provision in many service contracts preventing customers from joining class-action lawsuits and having to submit instead to binding arbitration to settle disputes.

Arbitration, critics say, typically favors businesses over consumers. And it’s not worth most people’s time to arbitrate nickel-and-dime issues that could be more practically dealt with in court.

So it was big news recently when Bank of America announced it would be the first major financial institution to no longer require that disgruntled credit card, banking and loan customers arbitrate any grievances.

Most media outlets characterized BofA’s move as good for consumers and bad for the bank’s lawyers, who now face a deluge of lawsuits.

Apparently it didn’t occur to any of them to ask whether scrapping the arbitration requirement also meant BofA was doing away with its prohibition on customers joining class-action lawsuits.

I did. And it hasn’t.

So although BofA’s decision means you no longer are forced into arbitration, you still can’t team up with other customers who have the same complaint and sue the bank.

You’ll have to fend for yourself, paying any legal expenses and dealing with any hassles. And that assumes you could even find a lawyer willing to take on a case involving what most would deem pocket change.

“Dropping the arbitration requirement is a useful step, but it’s only a half-step,” said Gail Hillebrand, a senior attorney with Consumers Union. “They still want the ability to ban customers from banding together.”

Class-action lawsuits are frequently abused by plaintiffs and attorneys whose only goal is to walk away with a share of some fat settlement.

But they’re also arguably the best tool many consumers have to address problems involving relatively small amounts of money. Individual lawsuits, even in Small Claims Court, can often cost more to resolve than the amount under dispute.

Betty Riess, a BofA spokeswoman, told me the bank still believed arbitration was a fair and efficient means of resolving disputes.

“But we have heard that some customers have not experienced the anticipated benefits of arbitration,” she said. “So we decided that it would be best for customers, and best for the bank, to discontinue the practice.”

Actually, most observers think BofA was responding to a decision last month by the National Arbitration Forum, the biggest provider of arbitration services, to stop handling credit card disputes.

The organization was sued by Minnesota’s attorney general for alleged fraud, deceptive trade practices and false advertising because it allegedly hid its financial ties to the very credit card companies whose disputes it was handling. The American Arbitration Assn. also said it would stop arbitrating consumer debt collection.

“Bank of America didn’t want to get sued too,” said Hillebrand, adding that other banks are expected to follow BofA’s lead in dropping arbitration provisions in their contracts.

When I asked BofA’s Riess whether the bank had scrapped its prohibition on customers joining class-action suits, it took several attempts before she could muster a straightforward response.

“We aren’t addressing the class-action waivers as part of this decision,” she finally said. “We will preserve the class-action waivers in our agreements.”

So what should customers do?

“We would hope that people would just deal with us directly,” Riess said.

Sure. Because if you can’t get a fair shake from your bank, who can you turn to?

A bill for a bill

Speaking of warm customer relations, our friends at T-Mobile are notifying wireless customers that if they want to receive a monthly bill in the mail, it could cost them almost $3.50.

That’s $1.50 a month for a mere summary of phone charges, and an additional $1.99 for a detailed account of all calls made and all charges.

That comes to $3.49 monthly or nearly $42 a year — just to receive your bill.

A T-Mobile spokeswoman said the fee was levied “after considering a number of factors, including rising costs for paper, printing and postage, as well as environmental impacts associated with printing paper bills.”

Neither Verizon Wireless nor AT&T Wireless hits customers with an additional charge for receiving bills by mail.

Let’s be clear: Saving trees is a good thing. And it’s good for businesses and their customers to be environmentally conscious. Paperless billing is terrific — as long as it’s something you want.

But those who, for whatever reason, are more comfortable with paper bills shouldn’t be punished for their preference.

Moreover, such fees disproportionately fall on senior citizens and lower-income people — those who may not have regular access to the Internet.

Sherman Oaks resident Margery Pope, 72, said she’s open to paperless billing. But she resents being strong-armed into the decision by T-Mobile.

“It shouldn’t cost me extra to see what I’m being billed for,” Pope said. “It’s their job to let me know what I’m paying for.”

Maybe she should think about suing the company. Oh, wait — T-Mobile’s contract requires that customers submit to binding arbitration.

Hi Paul,

If I short sell my house will it effect my current credit cards. I heard that if I short sale and get a negative mark on my credit report, my current credit card creditors can raise my interest rate and or decrease my line of credit.

Mary (more…)

Hi Paul,

My name is Alex, I came across your web page brokencredit.com in a search for (short sale leads) I have a team of dedicated and professional short sale mitigators, who’s life work has been completely and utterely committed to negotiating short sale (mortgages) with bank’s mitigating department.

These individuals have become so precise with their work and research that the short sale typically takes no more than 60-120 days (that’s open to close)!

With the down-spiralling economy the increase of foreclosure rates are at an all time high. We are looking to take part in doing all that we can to decrease that.

Many home owners don’t even know that they have an alternative to foreclosure, that is where we step in assisting them in the process of educating and going to bat for them with their mortgage holder and lenders, shorting the mortgage and relieving them of their dooming burden.

We take pride in knowing that families which are the heart of America can and will be saved one at a time just with a little effort.

Paul, if you can in any way assist us in this effort of saving these families of the dooming and overwhelming spoils of foreclosure, Please feel free to contact us.

Alex

St. Louis, Mo. – Attorney General Chris Koster today filed suit against two debt collection companies that are operating scams to collect debts from citizens who do not owe the money.

Koster filed law suits in St. Louis against Portfolio Recovery Associates, a public company based in Virginia, and Professional Debt Management located in Kansas City.

Koster said Portfolio buys old and bankruptcy-discharged debt, often from another bad debt buyer, and then tries to collect, sometimes through court action. He said the company often is attempting to collect on accounts that are already paid or have been discharged in bankruptcy; sometimes they try to collect from the wrong consumer or for the wrong amounts. He said the company has threatened to garnish consumers’ social security checks, which they have no authority to do, and has refused to provide consumers with proof that the debt is valid.

Koster said Professional Debt Management uses scare tactics, leaving messages on consumers’ phones that there is an emergency. He said that like Portfolio, they attempt to collect on accounts already paid or from the wrong party.

“The Attorney General’s office intends to take aggressive action to protect Missouri consumers,” Koster said. “I am asking the court to issue a permanent injunction prohibiting these companies from violating consumer protection laws and to order that they provide full restitution to the people they have harmed.”

Koster also is asking that the court impose monetary penalties and require the companies to pay all court costs.

Hello Paul -

Sometime ago, I was in a program to settle a debt. Later, I was contacted by Arrow Financial (a collection company). Yes, my account was sold. Arrow Financial requested that I pay more than what the other company had me pay monthly.

I couldn’t meet the payments they were requesting nor could I commit to any type of payment considering the current recession and cut back on my hours at work.

So yesterday, I received a call (at work) from some guy stating that he had a claim from Arrow Financial for $4K+. They are requesting to know if I will pay it or if they will need to file a “CIVIL SUIT” against me.

I was stunned and requested the phone number to call this guy back when I was off work. This sounds like some type of SCARE TACTIC. I may have written down a wrong phone #. When I called it, it was a some other type of service.

My question…can they do this? File a CIVIL SUIT against me?

At this point, I’m not sure what to do. Please help!

Char (more…)