By: Steve Lash
Welcome to the first Monday of 2013, the day college football will crown a national champion. But before Alabama v. Notre Dame, here are a few news items to get your week started.
– Bank of America reaches $10 billion settlement over troubled mortgages.
– A former gang member now helps San Francisco prosecutors decide whom to lock up.
– Is this Minnesotan blowing the whistle or violating patients’ rights?
– Will China close its labor camps?
By: Danny Jacobs
Caroline Farrell did not meet David Gaudin while in Mississippi earlier this month with the Maryland Law Katrina Project. But when a foreclosure attorney from the Mississippi Center for Justice shared with her Gaudin’s story, Farrell knew she needed to help a stranger.
Gaudin has terminal cancer; doctors give him less than six months to live. His illness forced him to stop working, and he subsequently fell behind on his mortgage. Wells Fargo, Gaudin’s bank, threatened to foreclose on his home. Gaudin and his foreclosure lawyer rejected the bank’s proposed loan modification late last year – three months’ forbearance followed by a large, balloon payment.
The bank now wants to move forward with foreclosure proceedings against Gaudin after rejecting his request for a loan modification because of an outstanding balance of $650 on his account.
“This is so heartbreaking,” Farrell said. “It seems so egregious that the bank can’t be flexible.”
That the sticking point was a couple hundred dollars also bothered Farrell, a 3L and president of the Katrina Project.
“I said, ‘We could raise this in an hour,’” she said.
She’ll have three hours to do it Friday night beginning at 9 p.m. at Quigley’s Half-Irish Pub near the law school. All proceeds from the $10 admission fee will go toward erasing Gaudin’s outstanding account balance. Farrell and her classmates have been spreading the word through listservs and Facebook, and Farrell is confident the event will raise more than enough money for Gaudin.
(Farrell said donations can also be made online by writing “The campaign to save David’s house” in the comments section.)
As for the beneficiary, Farrell said Gaudin cried upon learning what the Maryland students were doing for him. He’s now in regular contact with Farrell, a stranger no more.
By: Ben Mook
The Federal Deposit Insurance Corp. on Wednesday released an online toolkit aimed at arming borrowers, banks and others with information to prevent unnecessary foreclosures as well as foreclosure rescue scams.
The kit includes:
- Is Foreclosure Knocking at Your Door? brochure (available online and in print), which encourages consumers facing financing difficulties to contact their servicer, apply for a loan modification, and talk to a counselor.
- Beware of Foreclosure Rescue Scams brochure (available online and in print), which provides information on common scams, tips for detecting fraudulent deals, and resources for reporting criminal activity.
- Spring 2009 edition of FDIC Consumer News, which features advice for consumers on avoiding foreclosure rescue and loan modification schemes.
The tool kit and other helpful resources are available on the FDIC’s foreclosure prevention Web page at www.fdic.gov/foreclosureprevention.
By: Danny Jacobs
Normally, I wouldn’t pass along something that is possibly apocryphal, but today I found it apropos.
I closed on a mortgage refinancing this morning. The process was relatively painless, just lots of paperwork to sign and initial. Part of the closing costs includes title charges. My building is only five years old and I’m only the second owner of my condo, so the title abstract, I would assume, is brief and easy to locate.
So I laughed when I found in my inbox an e-mail about a New Orleans lawyer trying to secure a Federal Housing Loan for a client. The lawyer was told the loan would be granted if he could provide the title to a property being offered as collateral. The challenge? The title dated back to 1803.
It took the lawyer three months to track down the title, after which he sent it to the FHA. The agency responded in part:
While we compliment the able manner in which you have prepared and presented the application, we must point out that you have only cleared title to the proposed collateral property back to 1803. Before final approval can be accorded, it will be necessary to clear the title back to its origin.
The lawyer then wrote back a letter that began:
I note that you wish to have title extended further than the 194 years covered by the present application. I was unaware that any educated person in this country particularly those working in the property area, would not know that Louisiana was purchased, by the U.S., from France in 1803, the year of origin identified in our application.
You can see the lawyer’s entire response here. The loan was ultimately approved.