Palm Beach Post Staff Writer
Less than 3 percent of more than 4 million homeowners eligible for a free fraud review of their foreclosure have taken the government up on the offer, even though it could mean monetary compensation, a credit report fix or a loan modification.
Since November, mortgage servicers have sent out 4.3 million letters nationwide to homeowners whose foreclosure cases may contain flaws that, in extreme cases, could result in the return of the home. As of last week, just 121,725 people have responded.
The Office of the Comptroller of the Currency, which is overseeing the effort, has pushed back an originally scheduled April 30 application deadline to July 31, and is selecting files on its own for review.
But homeowner advocates and some attorneys say a lack of awareness as well as a distrust of the program may be hampering participation.
Struggling homeowners, already under a daily mail assault, may unwittingly toss the review offers, which advocates said are written in legalese more appropriate for attorneys than borrowers. Also, some lawyers recommend against applying for the review.
“For borrowers who have legal counsel, there’s no benefit in this,” said foreclosure defense attorney Michael Wasylik, whose firm has offices in Stuart and Dade City. “In my opinion, this is a mechanism for servicers to whitewash the widespread impropriety recently reported by the federal government.”
John O’Brien, Southern Essex Register of Deeds, Wants to Sue Over Mortgage Mess
John O’Brien is a national folk hero to anti-foreclosure activists. The Southern Essex Register of Deeds has garnered national attention by accusing big banks of acting like a “criminal enterprise.” After an audit revealed widespread flaws in banks’ handling of mortgage paperwork, O’Brien likened his Salem registry to a crime scene.
So when a New York law firm began soliciting local registries to join a class action lawsuit against an embattled mortgage clearinghouse, O’Brien should’ve been the first to sign on. He wasn’t. O’Brien was told he didn’t have the authority to join the effort. Deed registries in Norfolk, Bristol, and Plymouth counties are now pushing ahead with the case, while O’Brien is left standing on the sidelines.
O’Brien’s inability to sue over mortgage paperwork filed in his own registry highlights a quirk in Massachusetts state government. The state eliminated most of its county governments more than a decade ago, even as it retained some of the trappings of county government. District attorneys and sheriffs are still elected at the county level, for example, but they’re funded by the state. The consolidation of county governments also left the state’s 21 registries of deeds intact.
The registries remain elected offices, but most registers are now employees of Secretary of State Bill Galvin’s office. They don’t have the sort of leeway they once had under county government, and that includes ability to retain outside lawyers and initiate lawsuits on their own. It’s a constraint registers in Norfolk, Bristol and Plymouth counties aren’t working under.