Texas Mortgage Debt Relief Case Ends in Lawsuit Against Bank of America
A Texas woman who sought mortgage debt relief from Bank of America has sued the bank after it approved her request for a loan modification for her Austin home but then rescinded the approval and eventually began foreclosure proceedings against her.
The lawsuit by Maria Gonzales alleges that the bank wrongly invalidated the loan modification agreement it had approved for Gonzales, and fraudulently sought to foreclose on her home, because the agreement wasnâ€™t signed by her husband, Albert Gonzalez. However, Albert Gonzalez died of a heart attack in 2007, three years before Gonzales sought the loan modification. In fact, it was Albert Gonzalesâ€™ death that led to the request for mortgage debt relief in the first place.
According to the lawsuit, Gonzales and her husband bought their home in August 2006 with an adjustable rate mortgage from Countrywide Financial Corp., the former $500 billion home loan giant that eventually collapsed into bankruptcy. Countrywide Financial was bought by Bank of America in 2008 and cost the bank $108 million to settle federal charges that Countrywide Financial overcharged customers who were struggling to keep their homes.
Bank of America became the servicer of Gonzalesâ€™ loan when it bought Countrywide Financial. When Gonzales fell behind on her mortgage payments in 2010, she sought a loan modification from the bank, which was approved in January. In June, Bank of America notified Gonzales that the loan modification had been canceled because it had not be signed by her husband, who was listed as co-borrower on the original loan.
According to the lawsuit, the bank notified Gonzales of its decision to cancel the loan modification after she had sent the company a copy of her husbandâ€™s death certificate.
Bank of America then notified Gonzales of its intention to list her home for foreclosure auction (â€śAustin Woman Sues Bank of America Over Foreclosure Procedures,â€ť The Austin-American Statesman, Dec. 1, 2011).
Visiting District Court Judge Gus Strauss granted an injunction preventing Bank of America from proceeding with the foreclosure process against Gonzalez until Dec. 15, when another hearing on the case was scheduled.
Gonzalesâ€™ lawsuit against Bank of America was filed on the same day that a Massachusetts lawsuit was filed accusing five of the nationâ€™s largest banks, including Bank of America, of deceptive and fraudulent foreclosure practices.
Popularity: 1% [?]
- Mortgage Debt Relief Struggles Continue at Bank of America
- Credit Card Debt Collection Lawsuit Ends in $1.26 Million Award for Plaintiff
- Final Guilty Plea Ends FTC Lawsuit Against Fraudulent Consumer Credit Counseling Companies
- Missouri Attorney General Sues Texas Debt Relief Company
- $52 Million Bank Settlement Offers Debt Relief for Some Mass. Homeowners