Family Sues Bank For Alleged Loan Modification Snub

SAN FERNANDO (CBS) — A Pacoima family is fighting to save their home with a lawsuit filed by Neighborhood Legal services.

The Velasco family said despite making a loan modification agreement with JP Morgan Chase to save their home — which they’ve owned for over 12 years — the bank plans to auction off the property.

As KNX 1070’s John Brooks reports, the family is taking the bank to court to fight what they say are unjust mortgage lending practices.

“They are a graphic example of the bank’s systematic refusal to modify, and the banks are not complying with the Home Affordable Modification Program,” said lawyer Yvonne Jimenez.

Typically, banks take up to an average of about 300 days after sending a foreclosure notice before it can sell a home in an auction. During that time, most borrowers stop making mortgage payments.

However, the Velasco family said they remain current on their payments.

A class-action lawsuit that accuses Bank of America of reneging on promises to help borrowers modify their mortgage loans under the same federal program is already in the courts.

  • CAB

    Loan modifications are for homeowners who can no longer make their mortgage payments or the payments take up a high percentage of their take home income.

    I don’t care how poorly the banks are helping those in need, if you are MAKING YOUR PAYMENTS as stated in the article, they cannot take your home away from you. It’s that simple. Obviously all the facts were not presented here.

    • Prosper LawGroup

      The missing part of this article, as we have seen time and time again, is that the lender probably offered the borrower a loan modification, and although he was in complete compliance with that contract, the lenders is still foreclosing — the very thing the Loan Modification is supposed to halt. For all intents and purposes, it can be said that one hand of bank doesn’t know what the other one is doing. This is why litigation is often necessary.

    • A-Jay

      CAB, it’s really not always that cut and dry.

      Hey I’m not hear to preach, but it sounds like “you” may have been a little misinformed. Many banks to even process a loan mod try to put the buyer on some quickly thrown together trial period which is mostly an interest only type payment. Now the buyer, once they’ve been offered this trial mod, is required to continue paying it to even be considered (and that’s possibly why they thought they were current). And as you may not know, is simply 1 rep offers something and it’s next to impossible to actually speak to that same rep when you have questions. Now not every buyer may be as bright as you CAB.

  • Moe

    exactly what i thought Cab. why are they in foreclosure if they are up to date with mortgage payments? are they a red flag because of the modification application maybe?

  • Brad

    All it takes to start the forcloser process is to request a modification. B of A and Chase will start refusing to except all payments and forclose. They have been braking in to homes and cleaning them out and then claiming that they got the wrong address. Pull all of your money from these banks and let them go under ASAP.

  • Kenyan

    You still wanna sell to illegals? I hope they lose their home and get deported!

    • Anthony

      There’s the “illegals” comment, it never fails, every article, no matter what the subject is, there’s always someone who finds a way to blame “the illegals”. Why not sell to them? I thought they were taking all the jobs, so they should be able to make the payments right????

  • barry jones

    Seriously, Brad, where did you get your education? I know illegals educated at inner city LAUSD schools that have a better grasp of the English language than you. Learn the difference between break and brake; accept and except. While your at it, too, to and two; then and then; their, there and they’re. Once you do that, people might actually give your opinions a chance.

    • rufus

      Ok Barry: “While your at it” (your words) R do you know the difference between your and you’re?

  • TJ

    Ask your bank how many loans they HAVE modified. Nobody talks about the successful modifications and the homes saved. I assure you it’s in the hundreds of thousands. As always, the biggest complainers are the ones that make the headlines. There’s no news story in saving a family’s home apparently.

  • 60minmortgaemod

    Good addition. This is just the on the topic that I was looking for! Thx!

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