Tester grills top Wall Street bankers with ‘nightmare’ foreclosure stories from Montanans
Senator demands answers on improper foreclosures, cases of Montanans told to not pay mortgages
(WASHINGTON, D.C.) – Senator Jon Tester today grilled some of Wall Street’s top bankers on questionable foreclosure practices, demanding that they answer to firsthand accounts from Montanans of improper and potentially fraudulent foreclosure activities.
During a Senate hearing focused on allegations of big Wall Street banks improperly foreclosing on homes, Tester demanded bank executives answer for the case of Jim Ahern from Helena, Mont. Ahern was never late with, and never missed a mortgage payment, when he received a letter telling him he was in foreclosure, along with a foreclosure notice that ran in his local newspaper.
Ahern was forced to fight the foreclosure for more than year, despite providing proof of a loan modification approved by Bank of America representatives. Ahern also received his foreclosure notice during Bank of America’s self-imposed “pause” in foreclosures.
Tester, the only Senate Democrat to vote against both bailouts of Wall Street and the U.S. auto industry, also demanded answers in the case of a Whitehall, Mont., resident who was told by a Bank of America representative to not make any mortgage payments while applying for a loan modification, and that doing so would results in a rejected application. Ultimately, Bank of America rejected the application anyway. As a result of the missing payments, the resident was slammed with interest, penalties and badly damaged credit.
“We’ve got a state of 950,000 people and I’ve got staff members that are spending a ton of time on this issue,” Tester told the executives. “I think it’s more than an isolated case. These folks never missed a payment and they’re getting hammered. Can you tell me how a servicer would tell a homeowner not to pay their mortgage?”
“It strikes me that some of the biggest servicers have been a little bit glib about the potential magnitude of these risks,” Tester added. “Heads have got to roll, because we’re not going to be bailing anybody out.”
Barbara J. Desoer, President of Bank of America Home Loans admitted that these cases represent serious mistakes on the part of the banks, and agreed that homeowners should never be told to not pay their mortgage payments. She pledged to strengthen efforts to hold their employees accountable.
Both Montanans mentioned are currently being assisted by Tester and his staff in resolving their respective cases. Tester is also forwarding information he has gathered from Montana foreclosure counseling agencies about the servicing and foreclosure processing experiences of Montanans to two ongoing investigations: the federal foreclosure investigation being led by the Treasury Department and the investigation underway by the attorneys general of all 50 states—including Montana Attorney General Steve Bullock.
A video of Tester’s questions to the banking executives is available HERE. Tester’s letters to the investigations are available HERE and HERE.