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Major banks wrongfully foreclosed on hundreds of service members

On Behalf of | Mar 8, 2013 | Foreclosures

Florida is home to scores of thousands of active-duty and reservist military members across all branches of the Armed Forces.

Based on recent revelations uncovered by federal regulators via a mandated investigation and report from a number of major lending banks, many of those service members – along with their peers from across the country – have the right to be both shocked and angry by the unethical and flatly illegal practices of those lending institutions.

The public has been long aware that banks such as Citigroup, JPMorgan Chase and Wells Fargo engaged in acts of mortgage fraud that centrally contributed to the massive housing market collapse of recent years. What the newly emerging documents shockingly reveal is the sheer extent of wrongful foreclosure activity engaged in by those banks.

As a result of the disclosures, it can readily be seen that many more military members than originally envisioned suffered through wrongful foreclosure and eviction. Moreover, unlawful bank conduct forced many of them to consider or file for bankruptcy.

As part of the multibillion-dollar settlement that the banks executed with the federal government, the former were required to conduct a wide-scale review of their past mortgage practices, focusing particularly on military members.

The results showed that earlier estimates of wrongdoing – especially evicting service members who were timely on their payments or failing to honor agreements to renegotiate mortgage payments – were greatly understated.

The new analysis indicates that the country’s largest banks acted so egregiously, says the manager of one advocacy group, that, “Our initial reaction was stunned disbelief.”

In fact, the numbers reveal that the banks unlawfully foreclosed on more than 700 service members and seized the properties of dozens more who were not tardy on payments.

The new revelations could spur a number of groups that are opposed to what they view as the government’s soft treatment of spurious bank activity to make increasingly strident demands for tougher sanctions.

Source: New York Times, “Banks find more wrongful foreclosures among military members,” Jessica Silver-Greenberg and Ben Protess, Mar. 3, 2013


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