We may have to sue the bank to get their attention!

Its a tough economic time out there, the home owners are being crushed by unaffordable debt, the cost of living is skyrocketing, jobs are being eliminated, credit is very difficult to obtain, our homes are worth less and less every day as we see our equity dissolve and our debt remains the same. There are few buyers for our homes and even if we find one, the offer price is typically lower then the mortgage payoff, thus we believe we are stuck with no way out.

We have many difficult issues that need attention and focus to be resolved.

One reality is however banks have been deemed by our courts to have a fiduciary responsibility to its borrowers and customers, which requires a higher standard of care then ordinary business relationships. This is because the law says that when handling peoples money their is a trust relationship and therefor the banks are held to the higher standard of care, as well they should be.

When the banks start kicking the borrowers under the bus and running them over the borrowers must understand that the banks can do what they are legally allowed to do, foreclose for example, but their standard of care remains high and must be maintained at all times, even in foreclosure when dealing with its customers.

So here we are with a short sale for a client, a sale that has the buyer buying at fair market value, although less then the mortgage amount. Such a situation is being accepted all over the market place as banks are willing to negotiate and accept less then the mortgage in many instances if the purchase price is equivalent or approximates appraised fair market value.

We have just such a situation, and we have been calling the bank for a month to get this matter reviewed and accepted. The bank has told us “they are too busy to get to it quickly, sorry. You must wait to get someone to talk with.”

Ok, how long,we asked, “…months!” they say!!!! “Many months”. “But we may loose our buyer if we have to wait months to have this reviewed”, we exclaimed. “To bad, that’s the way it is, we are too busy to handle the work load”.

“But we will suffer damages!” we exclaim, “Too bad” they rebuff.

No, bank, its not to bad for us, its to bad for you, as you have a fiduciary responsibility to deal with us in good faith and with due diligence and within a reasonable amount of time, as that is your fiduciary responsibility.

The bank remains silent.

Thus we had no choice, we had our lawyers draft a lender liability suit for the damages our client will incur as the buyer is about to walk away. We chose to send the suit, not yet filed, to the bank with a letter explaining that if they did not address our issues within 48 hours we will file the suit in Federal District Court and sue for the damages. We still understand and believe that a business resolution is far better then a legal battle, but we have little choice here. Wow, a law suit just to get them to review our file and request for a short sale.

My bet is that this will get their attention and bring them to the table. I further bet this will also result in their accepting a short sale and supporting our efforts to resolve our clients problem, as we are acting within the current standards of the bank.

We shall see, I shall report what happens in two days.

That’s hardball…but what choice did we have, the bank is negligently violating our clients rights and causing them damages. It is a breach of their fiduciary responsibility, they deserve a lender liability suit.

HERE IT IS TWO DAYS LATER AND NO RESPONSE, WE CALLED THE BANK AGAIN, AND THEY STILL HAD NO IDEA ABOUT ANYTHING, AND WE WERE NO FURTHER ALONG NOR CLOSER TO BEING SERVICED. THERE IS SIMPLY NO ONE HOME. WE WILL PROBABLY HAVE TO FILE THE SUIT TO GET A RESPONSE AND SEE WHAT HAPPENS. ONCE FILED ITS A DIFFERENT BALLGAME.

I will keep you posted.

Ok, small signs of life, a clerk acknowledged receipt of the suit and letter explaining our position and she promised to email a memo to a Loss Mitigation manager to determine what they will do…I GUESS THIS IS PROGRESS. Meanwhile we are about to lose our buyer and real damages will occur.

Wonder how this will be compensated for.

Its working, we expect to have a Loss Mitigation councilor assigned very shortly, we have penetrated the wall, we are almost on the playing field. We did not have to file the suit, but we did have to show and threaten with counsel…just to talk…amazing, but it is what it is.

We will soon see how it progresses.

Wrong, we may have advanced our position to the gate keeper but we have not been assigned a workout officer or an early loss mitigation councilor as they are called here, and we were told again there are thousands of files ahead of us and it will take months to get an officer to talk with us.

We are now contemplating having our lawyer filing the suit and forcing their hand. We have already lost our best and highest sale so our damages are real, we have another potential buyer for a lower price and all we need is someone to talk with who can ok a sale. I doubt this will happen without a lawsuit to compel their noticing us….what ever happened to fiduciary responsibility?

Call me if your having similar difficulties getting the bank to even talk to you, maybe I can help. Doesn’t look like we are experiencing much luck, but we will get to the bottom of this in due time, one way or anther.

Call for help 413-549-2966 Norm will arrange a no obligation teleconfeence.