This morning, the New York Times reported that Bank of America agreed to pay “more than $10 billion to Fannie Mae to settle claims over troubled mortgages that soured during the financial crash.” Most of these “troubled mortgages” were loans issued by Countrywide Financial, a subsidiary of B of A that the bank acquired for $4.5 billion during the financial crisis.
To many of us, this isn’t news. By 2012 Bank of America had already spent hundreds of millions of dollars settling charges against Countrywide for wrongful and illegal practices. The accusations, which mounted piecemeal through charges brought by the Department of Justice, the US Department of Housing and Urban Development, the Federal Housing Finance Agency, the SEC, and the States Attorneys General, are almost too outrageous to list: selling mortgages to borrowers it knew were unqualified for the loans; defrauding the government by underwriting tens of thousands of government-issued mortgages based on inflated appraisals; steering 200,000 qualified African-American and Latino borrowers into expensive and burdensome subprime loans while similarly qualified white borrowers were sold less expensive loans; initiating foreclosure proceedings against active duty servicemen without doing necessary military status checks; lying to investors about the toxic quality of subprime loans in the firm’s portfolio; overcharging homeowners facing foreclosure with hidden fees. Not to mention the everyday, run-of-the-mill deception we’ve come to expect from big banks over the past decade: lying in response to consumer complaints, failing to file paperwork and payments on time, charging improper fees—things that have cost people their homes, and more.
With facts like these in plain sight, $10 billion from Bank of America doesn’t quite feel like hush money. The sum alone says a lot. Still, no dollar figure can come close to adequately representing the human cost of all the lies, cut corners, and broken promises. Nor can it, more modestly, show what it felt like to experience these things from the other side.
For this reason, we’ve excerpted the following letters from The Trouble Is the Banks: Letters to Wall Street, the latest small book from n+1. Written by people who were directly affected by Bank of America and Countrywide’s reckless decisions and addressed to Bank of America executives and directors, these letters offer human testament to an inhuman sum.
Didn’t Get Loan Mod Due to Incorrect Phone Number on Application
To: Charles H. Noski, Bank of America
My name is Matt. You don’t know me but I’m a Bank of America customer. A few years ago my Countrywide Mortgage was bought by Bank of America, and we’ve been together ever since. Currently, my home is underwater by about $150,000 and I’ve also been hit by hard times. I’m working two jobs to keep my home, but over the last two years I’ve tried (unsuccessfully) to do a loan modification. Three times I’ve tried to do that.
I won’t go into all the details, but the last time I tried to get a loan mod I was turned down because I had put down my home phone number instead of my cell phone number. Since I’m never home, due to working sixty-five hours a week, I didn’t get the messages that were left on my home phone answering machine. That’s the reason I was denied a loan mod by Bank of America.
But every time I call and talk to someone I get a different story. I can talk to Rep. A for a few minutes, call back in thirty minutes and talk to Rep. B about the same issue and get a different answer. The left hand doesn’t know what the right hand is doing. In the meantime, I’m slowly drowning in debt.
Then I found out that in 2009, Bank of America paid $0 in Federal Income Tax. It was pretty much the same for 2010 too, as I understand it. But you got almost $1 billion from taxpayers in the bailout. What did I get? Nothing. If I went out and tried to make money and didn’t, why should the government pay me for my losses?
Does that make any sense to you, Charles? I don’t understand how a company that doesn’t carry its fair share by using legal loopholes created by your lapdogs (Worst Congress Ever!) to dodge paying its taxes is able to get a bailout. Yet I try to get a loan mod (because I love my home and want to stay in my home) like many other hardworking, honest, good American citizens, by earning money and paying taxes. The bailout helped you, it paid you and others at Bank of America bonuses and your salary — but I’m denied a break because I put down the wrong phone number on the application.
Perhaps someone there can explain this to me, because I just don’t get it. I’d really appreciate it if someone would take a couple of minutes to explain this to me.
Spring Valley, CA 91978
Bad Faith Foreclosures
Bank Of America assured a friend that they were working to modify his loan while they were actually moving to foreclose; he was saved only by the intervention of a US senator. Our banks act like a corporate mafia worthy of a RICO indictment.
Greetings from Detroit!
To: Christine P. Katziff, Bank of America
I would like to personally invite you to Detroit! Have you ever been here? It’s a lovely town — of course, we have a B of A on every corner! Why, many of my friends have done business with your good friends over at Countrywide Insurance! I know, it’s a small world! So, you’d be more than welcome to take a tour of our beautiful town and its lovely neighborhoods.
Oh, what’s that you say? You’ve heard Detroit is actually not a very nice place? You’ve heard that many of the homes in Detroit are foreclosed on at higher rates than in other American cities? Well, I guess you’re right about that. After all, most people who live in Detroit are African American, and Bank of America surely knows that African Americans are losing their homes faster than white people (though there are plenty of white people losing their homes, too — so obviously you don’t discriminate too much!).1 Anyway, Detroit used to be a really nice place to live. And lots of people would like to buy homes in Detroit and fix them up and make them pretty again, but Bank of America and Countrywide probably wouldn’t stand to make too much money if houses sold cheaply and mortgages were fair and banks were more flexible when the unemployment rate in America is around 9% (here in Detroit, it’s more like 14%—that’s really high, in case you didn’t know).
So, Christine! Come visit us here in Mo-Town! Why, we’d be happy to show you what it’s like to lose your home even in one of the most sparsely populated cities with tremendous issues around blight, abandoned homes, and deteriorating housing stock. I mean, really! You might get a kick out of it! Or you might decide to make a conscious, ethical decision to advocate for the 99%—the ones that make your world go ’round.
Love and Hugs from Motor City!
Detroit, MI 48238
When I refinanced my mortgage in 2006 with Countrywide, I did so to get my payment down. The guy I spoke with sold me on taking out some of the equity on my house to get my kitchen floors redone and do some repairs on the subflooring that I otherwise couldn’t afford. What I didn’t know was that he was going to inflate the property assessment of my home, lie and say that my father also lived at my house so the loan would be approved, and put me in a Pay Option ARM that caused over $10,000 in negative amortization. I was told to pay the minimum payment because that was the interest-only payment, but it wasn’t. Now my house is upside down and I am struggling each month to keep afloat. I can’t join any of the modification programs that Bank of America (who now services my loan) offers because I haven’t fallen behind on my payments, and I refuse to fall behind on my payments because I am trying to maintain a good credit score. If this refinance had not been approved and I had not been misled about the mortgage I was being put into, I would not be in the mess I am in now.
This isn’t the last you will hear from me. I am meeting with the state’s attorney this week about this.
Great Mills, MD 20636
Greetings from a Soon-to-Be Ex-B of A Customer
To: Ron D. Sturzenegger, Bank of America
My name is Elizabeth Lang. I am a B of A customer in Westlake Village, CA. I have been a customer for a very long time, and not only are my personal bank accounts and my mortgage with Bank of America, my small business banking and credit line are with B of A, too.
Several months ago, I noted that Bank of America had started withdrawing approximately $90 per month from my bank account. I had never approved any such automatic withdrawal, so I called your customer service line and learned from a fairly unfriendly customer service representative that it was for “homeowners insurance.”
The rep claimed that I had failed to prove I had homeowners insurance, so B of A had started taking the money from my account — without telling me.
Here’s the rub. I have had the same homeowners insurance policy since I purchased my home. The last time I checked, randomly taking money from my account constitutes theft. So my next step was to head to my branch of B of A to speak to someone in person.
Upon arriving at my bank branch and requesting to speak to a manager, I was told, “you are not allowed to speak to a manager.” Flabbergasting. My own bank is stealing my money and I’m “not allowed” to speak to a bank manager in person? While I did (after hours of talking with rude, unhelpful customer service reps) manage to get my money refunded, I am still disgusted.
Cut to three weeks ago when I went to my bank to deposit some checks. The line for the ATM was too long — so I opted to go inside to the completely empty bank where tellers stood around doing nothing. Upon completing my transaction, the teller said, “You have a large balance, you should consider opening a money market account that would earn interest for you.” My response? Wondering how my opening a money market account would benefit B of A — because you certainly aren’t trying to do me any favors or earn me interest.
That’s when I realized . . . I don’t trust you. You stole from me in the past. You push us all on the ATMs then charge us to use them. Your customer service consists of surly, churlish and unhelpful people.
In short, I’m leaving and taking my “large balance” and my good credit rating and I’m going to a local credit union where I suspect I won’t be treated like chattel.
I’m sending this email to you and a number of your colleagues. I challenge just one B of A executive to respond to me personally and tell me why I should stay at your institution.
Westlake Village, CA 91362
Dear Bank of America and affiliates,
Since my mortgage was bought by good old B of A I am required to carry flood insurance for over twice what my property is worth. If I can’t get my own, B of A will purchase it for me, for about twice what I have to pay my current insurance company. Last year it took me three months to get the money together and B of A charged me $600 for retroactive coverage plus interest. I am 68 years old and retired. My property is now appraised at less than what I owe on it. I am barely hanging on and B of A is apparently eager to see me go down.
By the way, they would not refinance my property because it is not a “conventional structure” but they want me to carry flood insurance of over $200,000. Who is getting rich off of this and how do they get away with it? There has not even been a claim for flood damage since the home was built in the ’70s. If I go under I plan to move to the B of A parking lot in town with my four dogs and three cats.
Meadow Valley, CA 95956