We relate a tale today that we are quite sure will inspire wrath among many of our readers, for justifiable reasons.
The story concerns Laura Coleman Biggs, a retired nurse and widow from California.
In a nutshell, here’s what happened to Biggs.
Following her husband’s death in 2003, she began having problems making regular mortgage payments on the couple’s home. While just on the verge of a Bank of America subsidiary seizing the property in a foreclosure proceeding in 2013, Biggs was offered a modified loan to keep her in her house. That adjustment would have tacked on many thousands of dollars in fees and charges. Instead of executing the agreement, Biggs sought legal help.
And what she found out was stunning, namely this: Before he died, Biggs’ spouse had taken out a life insurance policy that included foreclosure protection. The policy provided that, upon his death, his widow would receive a mortgage-related payout of $100,000. When he did pass away in 2003, the couple owed about $120,000 on the home.
Laura Biggs was unaware of that policy, and neither the lender, its mortgage servicer or an insurance underwriting company from Miami ever deigned to tell her of its existence for more than a decade after her husband’s death.
What transpired, instead, was a continued demand for mortgage payments, coupled with the foreclosure-protection monthly insurance premium that should have stopped immediately upon the death of Biggs’ husband.
That collective bad faith resulted recently in Biggs filing a federal lawsuit against the above-cited parties.
One of her attorneys contends that the widow’s case is far from being a rarity.
“I think there are hundreds, or thousands, of Mrs. Biggses out there,” he says.
Source: Miami Herald, “As it moved to seize home, bank never told widow her loan was insured,” Kevin G. Hall (McClatchy Washington Bureau), April 16, 2015 (updated April 21, 2015)
