States Eye Settlement In Mortgage Fraud Litigation

Our San Francisco mortgage fraud lawyer represents individuals and small businesses harmed by financial fraud and mortgage abuses. As a financial fraud law firm, we are prepared to help consumers fight the big banks and financial institutions.

We have closely followed the national mortgage fraud cases, including those at the state level. This week, both California and New York agreed to enter into settlements for the state claims with mortgage lenders. The San Francisco Chronicle reports that several major banks including Bank of America, Wells Fargo, JP Morgan Chase, and Citibank have agreed to the proposed $37 billion settlements. The issues in the dispute include improperly lowering home mortgage principles, refinancing, “robo-signing,” failure to verify documents, and other decisions related to personal mortgages. There are ongoing negotiations regarding liability releases and other states may join the settlement in the coming days. Under the proposed settlement, California would receive $430 million. The providers would also be required to reduce loan amounts for over one million households nationwide. If enacted, the deal would be the largest single-industry settlement since a 1998 multistate tobacco agreement.

According to the Chronicle, more than two million California are underwater on their mortgages. Individuals need to be aware that California mortgage fraud can be the subject of personal civil lawsuits in addition to the state actions. The Federal Bureau of Investigations has a dedicated web site that can help consumers understand this complex legal arena. The FBI notes that mortgage fraud resulted from unsound underwriting processes and weak loan approval standards that result in mortgages being improperly extended. Mortgage fraud can take many forms including fake loan applications, fraudulent supporting paperwork, inflated appraisals, kickbacks, straw buyers, and false or stolen identities. The FBI compares mortgage fraud to a bank robbery that goes undetected. The FBI notes that over 2,700 claims were brought through the year 2009. The cases resulted in 494 criminal convictions, $2.5 billion in restitution, $58.4 million in fines, and $7.5 million in recoveries.

Individuals considering a mortgage or a renegotiation should carefully research their providers and be suspicious of promises that seem to good to be true. All mortgage promises should be made in writing and contain detailed information about the lending institution. The California Attorney General and Better Business Bureau can provide useful background information on mortgage-related companies. Borrowers should also make sure all documentation is complete and should never sign documents with blank lines.

Those who are already in a mortgage that they suspect may be fraudulent should reach out to skilled legal counsel such as the team at The Brod Law Firm. You may have a claim against the bank or lender for financial fraud or a malpractice claim against the attorneys involved in closing your loans. Do not let the wrongdoers win – seek the justice you deserve and the compensation you need. Civil lawsuits can exist alongside the criminal charges and a civil case can help you recover from the financial damage of a fraudulent mortgage. Our San Francisco financial fraud lawyer is available for a free consultation to discuss your unique case and your legal rights
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