Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Carrie
SPS has made numerous mistakes on my loan since purchasing it in 2008. The most glaring was the amount of the principal, which suddenly went up by 22,000 from the amount owed the previous company.Since this almost exactly the amount of my second mortgage, I mistakenly assumed that they had also bought that loan as well. Not the case - I recently found out that the second has gone to a collection agency...What? I have been laid off several times over the past few years, and after tons of frustrations, lost docs, etc. finally got a HAMP mod on the loan with SPS in June of 2010. By August, I had this ridiculous letter from them saying that my escrow was in arrears, (it wasn't) and that my new payment would be $250 higher. I was really upset and sent them a letter, detailing what the escrow payments should be and why. A woman from the company called and told me that I was wrong, and that "the company had paid out a lot of money on my behalf", but refused to send me any documentation of that. By this time it was November, and the company sent me a letter saying that they considered the matter closed. In December I got another escrow statement, saying that they made a mistake, and the amount of the "new payment" was almost exactly what I had said it should be. Of course this payment would not start until Feb. of 2011. So, in effect, I had to overpay my mortgage for 6 months. I was sure that they would not issue a refund until the "escrow year" was up, and now that I have a new escrow statement, not only is there no refund, but again a supposed arrearage, that they have kindly provided a payment coupon for, or I can again pay higher mortgage payments. How can I get some of my money back from these theives?

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dan

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SPS has made numerous mistakes on my loan since purchasing it in 2008. 

 

It is unlikely that SPS actually purchased your loan.  More likely, SPS purchased the mortgage servicing rights to your loan.  The note is probably owned by an institutional trust.

 

*

 

Also, it is less likely that the matters you describe are actually "mistakes".  Rather, this is sounds like classic mortgage servicing fraud.

 

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The most glaring was the amount of the principal, which suddenly went up by 22,000 from the amount owed the previous company.  Since this almost exactly the amount of my second mortgage, I mistakenly assumed that they had also bought that loan as well.  Not the case - I recently found out that the second has gone to a collection agency...What?  I have been laid off several times over the past few years, and after tons of frustrations, lost docs, etc. finally got a HAMP mod on the loan with SPS in June of 2010.

 

Large and fraudulent amounts are occasionally added to borrowers' accounts.  The borrower is then threatened with foreclosure.  Eventually, the borrower is offered a modification, but usually only if the borrower agrees to confess that the fraudulent amounts are correct and to pay these fraudulent amounts in full.

 

Mortgage servicing fraud was a major source of revenue for Wall Street firms, several of which operated mortgage servicers.  Servicing fraud was one of the major dynamics driving the subprime frenzy.  The subprime bubble was a swindle in which the equity of American homeowners was stolen to enrich a handful of Wall Street tycoons.

 

When the housing market collapsed, Goldman Sachs and their Wall Street buddies engineered the election of President Obama to assure that none of the criminals was ever prosecuted.  But President Obama and his posse of crooked leftist politicians has its own agenda.  By pouring fuel on the fire of the foreclosure meltdown, all private homes can be seized by the banks.  The government will then seize the banks, completing the collectivization of housing and ending all private home ownership in the United States, a major objective of the Democratic Party in bringing about communism in our country.

 

For this reason, all national housing and banking policies under President Obama are actually designed to strip Americans of home ownership while pretending to do the opposite.  The Federal Reserve Bank will lend trillions of dollars to the too big to fail banks as long as they continue and accelerate foreclosures to bring about the end of private home ownership.

 

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By August, I had this ridiculous letter from them saying that my escrow was in arrears, (it wasn't) and that my new payment would be $250 higher.  I was really upset and sent them a letter, detailing what the escrow payments should be and why.  A woman from the company called and told me that I was wrong, and that "the company had paid out a lot of money on my behalf", but refused to send me any documentation of that. By this time it was November, and the company sent me a letter saying that they considered the matter closed. In December I got another escrow statement, saying that they made a mistake, and the amount of the "new payment" was almost exactly what I had said it should be. Of course this payment would not start until Feb. of 2011.  So, in effect, I had to overpay my mortgage for 6 months. I was sure that they would not issue a refund until the "escrow year" was up, and now that I have a new escrow statement, not only is there no refund, but again a supposed arrearage, that they have kindly provided a payment coupon for, or I can again pay higher mortgage payments.

 

Messing with your escrow amounts is not an accident either.  The servicer is trying to precipitate a default to justify foreclosing on your home.

 

You need to keep very meticulous records.  Calling the servicer is probably a bad idea.  They will make computer notes of all conversations, but these notes will include things that are erroneous at best and fraudulent.  The records of your phone conversations will be used against you in the ultimate foreclosure.

 

You are far better off communicating in writing, in very careful letters that contain minimal admissions, but which carefully document and memorialize the fraudulent servicing behavior.  You should probably send these letters via certified mail, so that you can prove that the letters were sent and received.

 

You can also file complaints with your state attorney general, the Federal Trade Commission and other supervisory and regulatory agencies, though these will probably do little good as President Obama's crooked friends are running the Federal regulatory agencies and will always help their Wall Street frineds rather than consumers, because this advances their ultimate objective of seizing everyone's home.

 

Some have suggested filing a small claims action against the servicer any time that it economically harms you by its fraudulent behavior.  This might actually be at least somewhat effective, since for the smaller servicing scams it might cost them more to defend than to simply adjust the bookkeeping to correct the "errors".  If you could get one or more court orders memorializing the incorrect accounting treatment or other misconduct, this could be very valuable if you are ever in a foreclosure suit. 

 

Generally, you do not want to be doing business with these people!  If your house is worth well in excess of the mortgage amount and you have substantial equity, you need to take care to protect your home as long as possible.  President Obama could still be defeated at the next election, before he destroys the country.

 

If you owe substantially more than the house is worth and have net negative equity, you need to realize that housing prices are declining again and are likely to continue decling for several years.  Falling housing prices are an important element of the plan to eliminate home ownership in America.  If your loan is already "under water", it is unlikely that you will ever be able to pay off the loan.  Especially with a servicer like SPS, you are in a tough position, because with negative equity, you probably cannot sell and SPS will continue to play with the accounting until they can accomplish a foreclosure and take your property.

 

If you are deeply under water, you might even want to consider a strategic default.  You need to think this through very carefully.  If you have many other assets and good income, this might be a bad idea.  If you have exemplary credit, this might be a bad idea.

 

But if SPS has already ruined your credit by making false disparaging credit reports, if you have minimal other assets, other excessive debts and especially if you live in a judicial foreclosure state, you might want to carefully study the posts here in this Forum and other documents at this site.  Especially read posts by Mr. Roper, Moose, Bill, John Lewis, Alina, George Burns, ka, and a few others.

 

You might discover that you can simply stop paying your mortgage, live in the property for several years before a foreclosure can be completed.  This may be the best way to recover the lost value taken by the servicer's fraud.

 

Hopefully, one or more of the above mentioned regulars can add some additional suggestions.

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George Burns
I hate to have to say this, but, you need a lawyer. In my experience it is cheaper to use a good experienced lawyer to correct the mistakes. The problem is finding one who charges a reasonable amount. I said amount NOT rate.

It seems to be exactly as dan points out. It is a deliberate effort by the servicers to create problems which lead to either paying money that you do not owe or facing foreclosure action. Both of these will cost more than a lawyer.

It might help if you state where you are. In South Florida $1,500 would more than cover the cost of a lawyer to straighten them out.

I really do advocate that you do not try to do it yourself. If you think about it, you should recall that each time you speak to them, you have to start the conversation all over again. The new person never has the details of your last conversations and the computer never shows any corrections or queries. It is always that you owe an unaccountable amount. I bet that they have promised many times to provide a statement of explanation. Have they ever lived up to any of the promises for clarification or explanation? I bet you have to answer, NO.

The only way that I have ever seen the average person get this situation corrected, is by using a lawyer to make demands and corrections. It is cheaper than having a fictious amount added ever so often to your balance which increases your monthly payment.

The lawyer used should also use the opportunity to set the stage for your foreclosure defense. So use a lawyer with proven foreclosure defense expertise. If you give your region someone should be able to give you some leads.
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t
It seems to me that whether to employ an attorney, as suggested by George, or to try at small claims court, as Dan proposes, probably depends upon the amount in dispute.

If the problem is a $22,000 misstatement of the purported balance, then you should probably get an attorney.

For disputed amounts in escrows of less that $2,000, involving an attorney will probably prove to be uneconomic.  Dan's suggested approach might be better for a bright, organized borrower with good presentation skills for an amount from $250 to $2,000, though the amounts may vary with jurisdictional limits on small claims amounts, as well as cost of filing fees.

For amounts in dispute of less than $250, even the filing fees and the time to bring a small claims action probably make this uneconomic.  Clearly noting the disputed amounts in written correspondence might make the most sense in this case, while waiting for amounts to elevate to justify one of the other approaches.

Doing nothing or simply talking on the phone to the servicer is usually the worst choice.
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