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Friday, July 2, 2010

Bayview Man Claims Chase Bank Trashed His Loan Modification Agreement

Posted By on Fri, Jul 2, 2010 at 10:30 AM

Robert Davis was profiled on the radio as a success story -- a Bayview resident facing foreclosure who beat the odds and secured a home loan modification from Chase.

In March, it looked like his story had a happy ending: Chase approved him for a permanent loan modification that allowed him to keep his house. Davis says he even received a personal phone call from the bank congratulating him on his success. Then,

on June 1, Davis says he received a letter from Chase saying his modification was canceled -- because, the bank told him, he himself had

written to withdraw his request.


Davis, this made no sense. His path "hacking through the loan modification jungle"

was featured on KALW radio earlier this year. Davis (whose name was

changed to protect his privacy) has a steady job as a garbage

collector, but says he missed his mortgage payments in order to pay for

his mother-in-law's funeral. The missed payments put his much-loved

Bayview home into jeopardy.

After months of back-and-forth with Chase, Davis thought he had become one of the lucky ones. After his modification was approved he Fed-Exed his final approval documents

to Chase in April. He says he had even called the bank to personally

confirm the delivery, and was told that all of his documents were in

order. He had begun making his new loan payments.

Now, after months of paperwork and payments, Chase was telling him that he had canceled his own hard-won modification.


time he called the bank for an explanation, he received a different

answer, Davis says.  He was told that the Chase had never received his

confirmation paperwork, despite the Fed-Ex confirmation slip and the

phone call he made to ensure that his forms had arrived safely. He was

also told the letter was probably just a computer-generated fluke, and

that the issue should clear up in a few days.


Mack-Westrom, Davis' housing counselor at the non-profit San Francisco

Housing Development Corporation, called the situation "utterly amazing."


called Davis "a model borrower," a person who "crossed every t, dotted every i" throughout the loan modification process, and who had

proved he could keep up with his new loan payments.

On top of

that, Mack-Westrom said, Davis' case had received special attention

from a Chase representative after his story aired on the radio.

Now, even though Davis has meticulous documentation of his entire process, Chase is asking him to start again from scratch.  

"It's in the poorest of bad faith" on the part of the bank, Mack-Westrom said.

Gary Kishner, a spokesman for J.P. Morgan Chase, said he was looking into Davis' situation.


stories of the home loan modification process have become commonplace,

not only in Mack-Westrom's office, but across the country.

In order to secure a loan modification, homeowners have had to struggle

through a confusing process, with banks representatives frequently

losing paperwork, making mistakes, delaying decisions, giving

them contradictory advice, and even denying loans for bogus reasons.


the past months, JP Morgan Chase in particular has come under scrutiny

for denying loans to homeowners for reasons that the Treasury

Department had explicitly barred them from using, and for having the highest number of people stuck in "home loan limbo" with trial home loan modifications that stretch on month after month.  

Although the Treasury Department has set aside $39.9 billion to help homeowners avoid foreclosure -- including nearly $6 billion

to JP Morgan Chase subsidiaries alone -- only $190 million of that has

been spent as of May 2010, according to the watchdog organization ProPublica, which has been coordinating media reports on the struggling federal program. That's because only 20 percent of the estimated eligible homeowners have been approved for a permanent loan modification.

Photo   |   Sercasey

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