Banks are on track to seize over one million homes this year. Nearly as many homes were seized last year and the year before. In coming months the number of bank seizures is expected to rise.
In this storm of repossessions, thousands of Americans have been wronged — it’s inevitable. And some of these stories are really horrible.
These foreclosure horror stories don’t mean much alone, but together they could possibly cause a more significant political reaction to foreclosure-gate than we’ve seen so far.
Let us know other horror stories you’ve heard.
Nancy Jacobini called 911 when she thought someone was breaking into her house. Actually, the 'robber' was a man sent from JPMorgan-- her bank-- to change the locks on her doors because Jacobini was three months late on her mortgage payments. Read the full story here.
Texas homeowner Michelle Binkley fell victim to two companies claiming to be able to help her save her home. She was four months behind on her mortgage when the bank foreclosed and sold her home. She was two weeks away from her foreclosure date and received a letter from a company stating if Binkley paid $1,400, they would help her. The help never came
In another act of desperation, Binkley paid another $800 to a different company that offered help. When that company said they couldn't help too, Binkley finally ended up going to HUD, which offers free assistance that Binkley never knew about. This story was last updated August 18, at which point Fannie Mae was investigating the Binkley's situation.
Dan Smith is a 33-year-old electrician living in Oakview, California. He devised a carefully thought out budget and decided he could pay $2,700 monthly payment on a home. He bought a home for his family and signed all the documents thinking everything was fine. Then the third month he received a mortgage bill for $3,600.
They thought it was a mistake and they called up their broker, who said 'Didn't I tell you that was a teaser rate?' Smith said if he had known the mortgage payment was going to be that much, he never would have bought the house. He lost his home and was left with 'huge debt and a horrible credit score.'
Construction worker Mark Jones had already paid off most of his $130,000 home in Levittown, Penn. Six years later, after his wife passed away and he was left with three kids to take care of, he refinanced his home with a 30-year mortgage to get money to pay the bills. But the terms of his mortgage were fraudulently bad, attorney Michael Gaier told The Philadelphia Inquierer.
His rate was set at 8.8%, with a scheduled increase in two years to 13% and rising. The bank promised to help him refinance in two years. But they didn't, and it turned out the bank was overreporting his stated income to push the mortgage payments higher and higher.
This is called the loan application bait-and-switch, says Gaier.
The previous owner of a foreclosed home in Brevard County, Fla. was found dead in the passenger seat of a car in the garage, according to WESH 2 news.
She had been reported missing months ago.
The new owner, who had just bought the home at a sheriff's sale, was looking around the property at night with a flashlight when he found the body.
After building equity for 20 years, Mary Lou from New Jersey took out a loan against her mortgage to hire a lawyer to prosecute medical malpractice that lead to her husband's death. She won the case, but received only a small settlement. Then she tried to refinance her mortgage again to get a lower rate. Bank of America refused.
For three years she tried to contact the bank and tell them that she couldn't pay 8.5% -- then 12.5% -- a month. But they wouldn't negotiate. In 2007, the bank foreclosed on her.
Since then she's been living in her house, uncertain about what happens next. Mary Lou has paid thousands of dollars to loss mitigation companies, which were supposed to negotiate her foreclosure. Every once in a while she receives a letter saying her house will be put on sheriff's sale at the end of the month, but the axe never drops. Anytime she contacts the bank, she can't find anyone with authority to talk about her case.
'I don't want to live like this anymore,' Mary Lou told us by phone. If the foreclosure never happens, then she has caught a lucky break. But if it does, she says she will be out on the street with nothing.
Florida resident Anna Ramirez came home last year to find her belongings strewn across her yard, after JPMorgan Chase held an auction on her home. Initially, the WSJ reported that the incident was due to a mistake in the clerk's office and a Chase spokesman was investigating the situation.
But the Journal later updated the story saying Ramirez had not paid her mortgage in some time, but court clerical errors led to her eviction. This complicated story proves just how inept our banks' reporting keeping processes are.
Paul Whitehead and Todd Phelps won a house for $137,000 during a foreclosure auction in Santa Monica, CA. But it turns out they actually bought 'a second mortgage from Wachovia on a house that still had an enormous, unpaid primary loan.' The auction company wouldn't give them their money back and the couple was at a loss until a New York Times reporter made some phone calls to Wells Fargo, who ultimately agreed to give them their money back.
A few weeks after newlyweds Mark and Brooke Barnum made their first mortgage payment on their new home, Wells Fargo Bank insisted it didn't receive the payment. Mark Barnum had used his Chase Bank online bill-pay account and printed the proof of payment sheet to show Wells Fargo. After some back and forth, neither bank knew where the money had gone. The Barnums began receiving phone calls from collection agents talking about late fees and foreclosing. Not until Mark called ABC 7 did the mess get cleared up. Chase had sent Mark's payment to the wrong company.
Annie Edwards's story is a nightmare. Her legally blind ex-husband was encouraged to take out a $102,000 mortgage on their house by their son and daughter-in-law. The couple forged Edwards' signature on a document that took away her home and left with the money. A few months later the bank served her foreclosure papers. The home was only worth $30-to-$40,000, Edwards said. So she questioned why a bank would loan out $100,000 on the house.
Charlie and Maria Cardoso paid for their future Florida retirement home with cash in 2005. The couple, who still lives in Massachusetts, had their home foreclosed on by Bank of America five years later this past February... but the bank had the wrong house.
The tenant renting the house from the Cardosos called the couple last July when three men showed up to clean out the house and change the locks. Charlie Cardoso talked to the Bank of America real estate agent who said he would tell the bank that they had the wrong house. But a month later a landscaper hired by Bank of America showed up to mow the lawn, causing the tenant to get worried and move before Christmas.
It gets worse. In January the bank put a lock box on the front door. When Charlie Cardoso drove down to Florida to to convince the bank they had the incorrect address on the foreclosure documents, he missed his son's homecoming from Iraq.
The couple had kept photos, clothes, tools and other items at the home. Everything had been removed and was presumably lost, they say.
The Cardosos have filed a suit against Bank of America for $500,000 and charging the company with defamation and libel.
When Captain Michael Clauer returned from Iraq last year, he found his home had been foreclosed on his $300,000 home. Over an $800 debt.
In this case it was an overzealous neighbours that pulled the trigger. Michael's wife had fallen into a depression while her husband was gone and she missed several bills from the Heritage Lakes Homeowners Association. In Texas homeowners associations can foreclose on homes without a court order.
Thankfully this story got picked up by the national media, and the homeowners association caved. Shows what a little outrage can do.