Complaints About Citi Bank Mortgage Denying Permanent Loan Modifications

We have been receiving complaints to our office about Citi Bank Mortgage's delay in processing loan modification requests and then denying permanent loan modifications after borrowers have complied with all payments under a temporary loan modification agreement.  These complaints are similar to the complaints we have been hearing about Bank of America and Wells Fargo.

In the Citi complaints we have heard and are investigating, the borrowers signed temporary loan modification agreements.  They made the three temporary loan modification payments on time, but Citi did not provide them with a permanent loan modification.  In one instance, the borrower continued to pay the temporary loan modification payment for four more months. 

One of the troubling aspects to these complaints is that neither borrower received a written denial of their loan modification stating a reason why Citi failed to make their temporary loan modification agreement permanent. Calls to Citi were fielded by a series of customer service representatives who gave differing answers to the borrower's question of why the loan modification had not been made permanent.

Lenders and servicers are not listening to borrower complaints.  The homeowners we talk to every day tell the same story of being placed on hold for literally hours only to be passed from one bank representative to another with a different answer coming from each representative.  Complaints that do get escalated fair little better.

Borrowers need to resort to filing individual and class action lawsuits in federal court to put these important issues before federal judges.  Can lenders and servicers violate HAMP guidelines with impunity?  Can investor guidelines trump the HAMP loan modification guidelines?  Is it a violation of state consumer protection statutes for a lender to fail to comply with federal loan modification guidelines?  These questions need to be answered by the courts.

For us, the answer is simple:  the banks were bailed out with taxpayer dollars and should be complying with the HAMP guidelines. 

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