Arizona & Nevada Sue Bank of America Over Loan Mod Conduct

Bank of America was sued by attorneys general in Arizona and Nevada yesterday over allegations that BoA misled and deceived homeowners seeking to modify their home loans. Arizona's Attorney General Terry Goddard said that Bank of America violated Arizona's consumer fraud law by misleading consumers who tried to reduce their monthly mortgage payments, according to a report by Arizona's KVOA.com. 

The basis of Goddard's lawsuit on behalf of Arizona homeowners is that Bank of America repeatedly reassured them that their loans were being modified while collecting temporarily modified loan payments. Instead, many of those homeowners lost their homes anyway. According to a statement to the Associated Press, Goddard said that those consumers were deceived into making mortgage payments when there was no hope of saving their homes.

Nevada's Attorney General, Catherine Cortez Masto told the AP that her state's lawsuit was a last resort to try to get Bank of America to change its ways. It was filed after discussions with BoA management that led to assurances about changing its loan modification conduct, but little more. "Clearly there is a disconnect between what Bank of America tells me at the management level and what's happening on the front line," Masto told the AP. 

Arizona's Attorney General has been an outspoken critic of the loan modification conduct of many of the nation's largest banks and mortgage servicers. (See related story). Goddard's office had been deluged with consumer complaints and launched an investigation over a year ago. Settlement talks with BoA that began in April, finally broke down on Thursday.
 
Phillips & Garcia, which has been investigating and representing homeowners who have been victims of wrongful foreclosure lock outs by banks, have also heard from hundreds of consumers frustrated with what they describe as misleading conduct by Bank of America and other national mortgage servicers. "This month alone, we've had contacts from probably more than 25 consumers about loan modification problems," says wrongful lockout attorney, Andrew Garcia. "Their stories are all the same - they've been approved for a temporary modification payment plan, they've made all the payments on time, they've sent in all the documents as requested, months and months go by with assurances that their application is being reviewed. In the end, they are told that they've been denied and are losing their house in days," says Garcia.
 
Garcia is glad to see that state attorneys general are finally jumping into the fray against these large banks and servicers. "Our advice to consumers who have these problems with their modifications has been to contact their state attorney general's office, their federal senator's office and to file a complaint online with the federal Office of the Comptroller of the Currency," Garcia said.  "These officials need to know what is really happening to their constituents and their offices are intended to help all of us as consumers." 
 
Phillips & Garcia is dedicated to helping victims of wrongful foreclosure lock outs and trashouts enforce their legal rights.  If you've been a victim of such conduct, get your FREE book and learn your rights, or contact our offices for a free case evaluation.