Monthly Archives: October 2014

Consumer Bureau Finds Homeowners Harmed by Loan Companies

The three-year-old U.S. consumer protection agency said it discovered that the largest mortgage servicers have been mishandling loan modifications and harming borrowers since new rules came into effect in January.

Consumer Financial Protection Bureau supervisors have made spot checks to examine the books and practices of bank and nonbank servicers, the agency said in a report yesterday, without naming the firms. Supervisors found “substantial delays” in modifying loans that resulted in “negative consequences,” such as higher mortgage payments and unjustified blemishes on borrowers’ credit reports, the report said.

“All borrowers should be treated fairly by loan servicers, and through our supervision program, we intend to hold them accountable,” Richard Cordray, the CFPB director, said in a statement.

Read on.

Screwing Our Vets Is an American Tradition

We have a long and proud history in this country of neglecting our veterans. It’s a tradition that goes back as far as the Civil War, if not longer. In the last few decades though, that we’ve allowed the behavior to not only continue, but to be ratcheted up a few notches from simple neglect to abuse and predatory behavior. It’s as if we’re saying, “Hell, they’ve been shot at, lived in the dirt, been taken prisoner, and tortured. They can take it.”

In February of this year, an effort to move forward with a $21 billion bill to enhance health care, education and job benefits for veterans, was blocked by the GOP; we’vecut food stamps, on which at least 900,000 military families rely; blocked a bill that was specifically supposed to create jobs for veterans; cut funding for the VA; sent them into battle with inadequate gear; and barely care for their health issues.

This week alone, there are glaring examples of how we treat our veterans. Steve Dibert over at MFI-Miami has a blog post up about how Deutsche Banks and Ocwen using forged notary stamps, duel tracking and other actions to take the home of a veteran dying of cancer. And then there’s angry lunatic and radio host Michael Savage who went on a disgusting rant, calling vets with PTSD “weak.” “narcissistic” and “losers.”

Nice way to treat the folks that have risked their lives for you to have the right and freedom to talk about and treat them that way, isn’t it?

Read on.

Saudi Property Mogul Sues Barclays for $10B

MANHATTAN (CN) – Barclays betrayed a client by settling an old lawsuit against Saudi Arabia for the first banking license granted to a Western institution in decades, Mideast real estate giant Jadawel International claims in court.
Owned by Jeddah-based billionaire Mohamed Bin Issa Al Jaber, Jadawel International and its corporate parent MBI International says the seeds to its complaint filed Tuesday in New York County Supreme Court were sown decades ago.
It began with two residential compounds Jadawel built in Saudia Arabia in the early 1990s “to house hundreds of employees of two United States defense contractors working in Saudi Arabia,” according to the complaint.
With Jadawel facing loan obligations related to its construction of the compounds, the developer created a financing vehicle to collect $1.4 billion in lease payments from the Saudi government in New York banks, according to the compliant.
Jadawel says Barclays took “a lead interest” in the transaction and ultimately headed the debt-financing transaction.
Barclays “aggressively solicited” Jadawel’s business with a $450 bridge loan and led a syndicate of banks in another $900 million loan, the developer says.

Read on.

How much offshore staff do the top mortgage servicers use?

For many companies in the U.S., both within the housing industry and outside of it, the practice of using offshore employees, commonly known as offshoring, has become more common in recent years.

While offshoring began with many non-customer-facing jobs, like data entry, the use of offshore employees has become increasingly popular for customer service departments and other customer-facing departments.

The reasons behind the increasing trend of offshoring are pretty simple. It’s simply cheaper to employ workers based in India, the Philippines, and other foreign countries than it is to employ workers in the U.S.

For many in the mortgage servicing business, offshoring has become the rule more than the exception. Several of the country’s largest mortgage servicers already have as much of a third of their mortgage servicing staff offshore.

In fact, one of the country’s largest mortgage servicers,Ocwen Financial (OCN), has a whopping 73% of its mortgage servicing staff offshore.

Read on.

Citigroup sets aside $600 million more to cover legal costs

(Reuters) – Citigroup Inc said it was setting aside an extra $600 million (374.83 million pounds) to cover legal expenses in the third quarter due to “rapidly evolving regulatory inquiries.”

The bank’s shares fell in extended trading after it revised down its third-quarter net income to $2.84 billion from the $3.44 billion it had reported on Oct. 14.

On a per-share basis, Citigroup adjusted its profit to 88 cents for the quarter. It had earlier reported a profit of $1.07 per share.

Like most banks, Citigroup does not disclose the size of its reserves for legal costs. Bernstein Research analysts estimated before Thursday’s announcement that Citigroup’s remaining reserves were about $2.5 billion at the end of September.

Read on.

Cuomo meddled with Hurricane Sandy investigation: report

Gov. Andrew Cuomo interfered with a commission tasked with looking into the post-Superstorm Sandy operations of  the Long Island Power Authority much in the same way as he did with a commission tasked to look into public corruption, according to a new investigative report from the New York Times.  The newspaper found that Cuomo’s office interfered with the commission’s investigation, tried to cover the real level of the administration’s involvement and had a preconceived idea of what the findings should be — the same behavior it displayed when dealing with the public corruption task force, which was looking into, among other things, the governor’s relationship with the real estate industry. During the months leading up to Sandy, the Cuomo administration didn’t help LIPA fill staff vacancies that the authority needed in the aftermath of the storm, the newspaper reported. One of those positions was an executive to oversee communications with customers who were without power following the storm. During Sandy’s immediate aftermath, all communications and news releases had to be sent through the governor’s office, delaying essential communication about when power would be restored. – See more at:

Mortgage servicer Ocwen targeted by complaints

A major U.S. mortgage servicing firm under investigation for issuing backdated letters to borrowers who sought loan modifications is also the subject of thousands of consumer complaints, government data shows.

Ocwen Financial (OCN) has been targeted by 13,520 complaints filed with the Consumer Financial Protection Bureau since December 2011 for problems involving loan servicing, foreclosures and related issues, according to the regulator’s data.

The complaint total ranked Ocwen third for mortgage-related grievances filed with the CFPB during the nearly three-year span. Only Bank of America (BAC), with 29,390 complaints, and Wells Fargo (WFC), with 17,574, had more, the data shows.

Ocwen’s complaint total topped those of two of its closest non-bank competitors in the mortgage servicing sector, Nationstar Mortgage (NSM) and Green Tree Servicing, a subsidiary of Walter Investment Management (WAC), according to the data.

Read on.