Several big banks have negotiated large settlements with the Department of Justice for their role in the housing bubble and subsequent economic collapse.
While the historic settlements sound promising on the surface, a study by Denbeaux & Denbeaux law firm exposes why struggling homeowners shouldn’t hold their breath waiting for relief.
The report, “Mortgage Fraud” finds that:
New Jersey homeowners subject to the first Agreement made by the Attorneys General were not apprised or made aware by Wells Fargo that they already had the protections and the right to the promised modifications that were contained in the California Class Action Settlement. Instead, these homeowners were sent the “new” settlement agreement which contained promises and protections they already had (not explained) and a check in the amount of $178.04 in exchange for all their rights and defenses.
The report also claims that Wells Fargo has perpetrated a seemingly endless cycle of misleading, deceptive and exploitative practices in response to its misleading, deceptive and exploitative practices. Not only did Wells Fargo and its predecessors:
- issue the predatory and misleading loans;
- settle with multiple States’ Attorneys’ General without requiring homeowners to waive any rights to entice the Attorneys’ General to drop their actions;
- subsequently enter into the California Class Action Agreement which offered no further modification benefits to the class members but violated the original agreements by enforcing a waiver of all legal rights by class members;
- move aggressively forward with foreclosures and insist that class members could not defend against these suits because any right to defend their homes had been waived; but now Wells Fargo has been found to have:
- violated the California Class Action Agreement