Mortgage Settlement Banks Getting Away with 'Dual-Tracking' Foreclosures

Mortgage Settlement Banks Getting Away with 'Dual-Tracking' Foreclosures The practice known as ‘dual tracking’ — when a lender moves ahead with foreclosure as it negotiates a loan modification with the same homeowner – persists among the big banks under the National Mortgage Settlement.
How is this possible when dual tracking is one of the abuses supposedly addressed by new mortgage servicing standards?
The Palm Beach Post reports that loopholes found in the complicated rules pertaining to dual tracking amount to mere restrictions — not an outright prohibition of the double-dealing practice.
Dual-tracking rules are mentioned in more than four pages of mortgage settlement documents, covering time tables for putting foreclosures on hold, appeals processes, trial payment periods and expedited review requirements.
The Post reports that there are different rules depending on when the modification is requested and whether the application is considered finalized.
“The banks know they can find loopholes in this type of detailed language,” West Palm Beach foreclosure defense attorney Paul Krasker told the Post. “I assume the banks would not commit to a simple ‘no dual-tracking’ provision and insisted on carving out exceptions.”
Lenders are ruling applications incomplete for minor reasons, such as checking the wrong box on a tax return transcript request, Krasker said. An incomplete mortgage modification application is one of the loopholes for proceeding with foreclosures.
“The banks are relying on borrowers to not be able to complete the applications and then the banks notify the borrowers to resubmit after the time deadline passes,” he said.
Recently, Florida Attorney General Pam Bondi strongly criticized Bank of America and Wells Fargo for possible violations of the 2012 settlement. Those concerns include dual tracking.
The five banks party to the settlement are Bank of America, Citi, JPMorgan Chase, Wells Fargo and Ally/GMAC.

2 thoughts on “Mortgage Settlement Banks Getting Away with 'Dual-Tracking' Foreclosures

  • June 18, 2013 at 9:25 am

    You also left out how their doing this by the hedge funds they support and supply income to, as well. All the while you think , it is in a work out its being sold to private hedge funds they fund and remain on as trustees. Like Chase, Deutsche Bank, and US BANK, Wells Fargo and Citi, and no worries about lost paperwork they just have Orion Financial group ( the next docx and LPS) making them for them. Why isn’t this being investigated? Are we waiting for yet another 2008 disaster to hit before we do?

  • June 18, 2013 at 9:39 pm

    the eternal loophole. we should be so lucky they put their necks through it !! Dual tracking is how they foreclosed on me. First two weeks of December we went back and forth about the two months i was behind. Papers are in the mail, papers weren’t done correctly so we will send to you again, we are so sorry for the delay AND THEN final paper work gets to me and it shows they SOLD MY HOUSE on November 4th and I get to move out Christmas week. I received absolutely nothing – couldn’t even get copies from their attorneys. They kept my $80 equity – they sold my house for $140K and wow – National Mortgage sent me a check for $1,484. I hope they all get the dual track to hell .

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