Nov 18 (EXAMINER) – New York Attorney General Eric Schneiderman threw down the gauntlet on Friday by warning Wells Fargo to reverse a new policy that temporarily suspends review of mortgage relief applications from New York homeowners, many of whom are still struggling to recover in the aftermath of Hurricane Sandy.
In a letter to John Stumpf the Wells Fargo CEO, Schneiderman wrote “A law firm representing your institution has issued a letter which states that Wells Fargo will unilaterally suspend “all Home Preservation reviews and decisions” in the wake of the Hurricane Sandy. Further it states that Wells Fargo will not respond to requests for mortgage relief until you receive further information from FEMA.” the letter further stated “I am certain that you are aware that… Wells Fargo is required to adhere to strict timelines… for a loan modification… Wells Fargo is required to make a decision within 30 days of receiving a completed application.” and “Wells Fargo’s decision to delay review will likely result in multiple violations of the National Mortgage Settlement.”
Brian McCaffrey a Queens foreclosure attorney was interviewed on Sun. Nov. 18, 2012, exclusively by the Examiner for this article and said that his firm would be making “a concerted effort to insure that the 5 banks who were covered by the National Mortgage Settlement were applying strict adherence with the Consent Decrees they entered into” with regards to his clients.
McCaffrey earned his law degree at St. Johns University in Queens, NY and operates his practice with a significant focus on foreclosure defense litigation and has become prominent in the foreclosure defense arena by achieving a number of victories for his clients with major decisions against lenders whose paperwork is inaccurate, incomplete, missing or fraudulent.
Here are a few of McCaffrey’s cases:
- US Bank v Combs
- HSBC v Begum
- ACT v Ullah
- HSBC v Rampersad
He explained “Under the National Mortgage Settlement banks agreed to new loan servicing standards, including a requirement to make decisions on loan modification requests within 30 days of receiving a completed application.” and “They also agreed not to move a file to foreclosure, or act in furtherance of foreclosure on files already in foreclosure…. it would be a travesty to see a lender like Wells Fargo using this disaster to ignore the settlement terms and delay homeowners assistance to the lenders own advantage.”
Attorney General Schneiderman issued this terse warning “my office will aggressively pursue any loan servicing company that uses this tragic event as an excuse to violate loss mitigation decision timelines.”
The National Mortgage Settlement was reached in Feb. of 2012 and the main criteria for eligibility under these rules are that the borrower had to be at least 60 days late on payments as of January 31, 2012. The settlement also offers assistance to homeowners who lost their homes in foreclosure to one of the 5 banks included.
If the loan meets the criteria these Court Orders are powerful and must be adhered to by the bank. Any deviation from the settlement would have serious legal consequences for the lenders and servicers.
The Court Ordered Consent Decrees include mandated time lines for loan modification approval (30 days), eligible loans (any loan delinquent more than 60 days as of Jan. 31, 2012, and substantial principal reductions for underwater homeowners.
The banks who are obligated to the terms of the settlement are:
- Bank of America
- JPMorgan Chase
- Wells Fargo
Below are links to the Court Ordered Consent Decrees for each of them.
- Ally/GMAC Consent Judgment
- Bank of America Consent Judgment
- Citi Consent Judgment
- JPMorgan Chase Consent Judgment
- Wells Fargo Consent Judgment
For more information on the National Mortgage Settlement: Click Here