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Man gets foreclosure notice for bank’s 80 cent typo

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Bank error leads to near loss of a home

Like millions of Americans, Tom Mudie was struggling to maintain his mortgage, so to avoid losing his home, he applied for and was approved for a mortgage modification through Bank of America that required timely payments for 90 days before it was made permanent. Mudie made his payments on time for the agreed upon amount, but according to the Tampa Bay Tribune, the bank entered his payment as $615.02 rather than the $615.82 he paid which threw him into default.

He was kicked out of the modification program, and when Mudie called to inquire, he was told to send a check for 80 cents which he immediately did. Bank of America cashed the check and Mudie assumed his account was back in order. The following month, Bank of America returned his 80 cents along with that month’s payment and a notice of his removal from the modification program. “Your loan is not eligible for the Fannie Mae modification program because you did not make all the required trial period plan payments by the end of the trial period.”

Mudie was in danger of foreclosure, but after extensive communication with the bank, a Bank of America spokeswoman says the error has been corrected and his modification has been approved.

Not the first time

This is not the first time that a Bank of America typo has caused a foreclosure nightmare. One memorable case is Shantell Curtis who sold her Utah house in August 2010, went to the closing, signed all documents, sold the property and cut ties with Bank of America who held the mortgage. Curtis’ accountant noticed that she somehow still owned the home, meanwhile, Bank of America threatened to foreclose on the family who couldn’t understand how they could foreclose on a house they no longer owned. To add insult to injury, Bank of America continues to report missed payments to the credit scoring agencies which has allegedly destroyed Curtis’ credit.

So how did this happen? Bank of America typed data in incorrectly and because of a $1 “coding error” as a Bank of America spokesperson called it, the title was never transferred, and they began the foreclosure process against Curtis. At the end of 2010, Curtis called Bank of America to find out what was going on, they instantly noticed the error and for nearly a year have told her that they would “process” it and send her a letter. Call after call, she still has not gotten the $1 error fixed, nor her credit score.

Bank of America later confirmed that it was a “coding error” that has been fixed, and they promised they would remove the false reports to the credit agencies within 90 days, but the Curtis family still had not been communicated with in any form, so all they have is an email to a reporter that title has been transferred and their credit will be repaired.

Also deplorable, we reported last fall that Bank of America was attempting to foreclose on a home that no longer existed and no monthly payments were missed, also due to a clerical error that they would not fix even after they acknowledged it was their error. Clerical issues have long plagued Bank of America and it doesn’t appear any efforts are being made to change this problem. A lack of human review of foreclosure notices plagues banks as the robo-signing debacle continues, and it appears no lessons have been learned.

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

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20 Comments

20 Comments

  1. April

    January 5, 2012 at 5:40 pm

    When BOA bought my home loan in the spring of 2010, they sent us the same letter instead of a letter saying they had bought our loan and where we should send our payment that had just become due. (We'd never been late, nor missed a payment.) I never received any information from anyone and it appeared to go away. I was repeatedly turned down for the the mortgage modification offer by BOA.

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Austin

Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?

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Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

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Housing News

Average age of houses on the rise, so is it now better or worse to buy new?

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.

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aging housing inventory

The average home age is higher than ever

(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.

With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.

Prices of new homes on the rise

Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.

Click here to continue reading this story…

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Housing News

Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?

The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.

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zillow move

Why Realtors are vulnerable to these rapid changes

(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.

Note: We’ll let you decide which company plays which role in the image above.

So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.

1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

…Click here to continue reading this story…

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