This is one instance in which the industry practice of tricking borrowers into foreclosure becomes crystal clear. The case is also instructive on the terms of so-called “modifications.” The goal in all instances is to use every means at their disposal to trick the borrower into waiving rights and falling into the abyss of foreclosure without any appropriate disclosures.
these self-proclaimed “servicers” are not acting on behalf of any real creditor whose money was converted to a fraudulent scheme; instead they are creating a void by not revealing the creditor and then stepping into that void declaring themselves to be creditors or to be entitled to being treated like creditors.
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“We are not in the modification business. we are in the foreclosure business.” So said the manager of the “loss mitigation” department of Bank of America in Massachusetts a few years back, already reported on this blog.
So it should come as no surprise that Citi granted “deferments” that accrued until the deferment period was over rather than tacking it on to the end of an obligation (that they had interest in anyway).
Citi SAID they would extend the “payback” period (term of the loan) but they didn’t, leaving the people who received deferments in the untenable position of suddenly coming up with a whopping sum of money that they thought was due at the end of their loan — not at the end of the deferment period. So the whole reason for offering the deferments was (1) to get the “borrowers” to waive their rights and (2) to be assured that the foreclosure would happen without defenses being raised.
As always we are talking about the new normal — where super banks don’t look for workouts that will improve their chances of getting paid on a loan. Instead they are looking for way to diminish the payback, depress market values and score big on foreclosures that put a presumptive cap on their illicit activities preceding the foreclosures.
The banks made their money long before the foreclosure and don’t care what actually happens to the property — except that they welcome the false “recovery” of “servicer advances” in which they paid investors from a dynamic dark pool consisting entirely of investor money.
In other words these self-proclaimed “servicers” are not acting on behalf of any real creditor whose money was converted to a fraudulent scheme; instead they are creating a void by not revealing the creditor and then stepping into that void declaring themselves to be creditors or to be entitled to being treated like creditors.
- For borrowers who received a Special Deferment (and therefore did not prepay any interest), the interest accruing during the Deferment period became due immediately upon a borrower’s next scheduled payment, rather than at the end of the borrower’s loan term.
- Respondent sent borrowers who applied for Deferments in certain states an authorization form informing them that “the repayment term of the loan will be extended.” Respondent sent all borrowers who it approved for a Deferment a confirmation letter with similar disclosures.
2017-CFPB-0004 Document 1 Filed 01/23/2017 Page 8 of 31
- In its communications to borrowers, Respondent disclosed that “interest will continue to accrue” during the Deferment period, but Respondent did not disclose the amount of interest that would accrue during the Deferment period, when that interest would be due, or how a borrower’s next payment would be applied in relation to that accrued interest. Respondent also failed to disclose that a Special Deferment would significantly reduce the amount of principal reduction borrowers would achieve once they resumed making loan payments, resulting in borrowers paying more interest over the life of the loan. [e.s.]
Filed under: foreclosure | Tagged: “servicer” under 12 C.F.R. § 1024.2(b), CFPB, CitiFinancial, CitiFinancial Company, CitiFinancial Credit Company, CitiFinancial Services, CitiFinancial Servicing, Citigroup Inc, Credit reporting, Deferment, Furnisher |