Thursday, January 7, 2010

Calling GMAC, POAs, and Bank of America Credit Cards

When I first entered into an agreement to buy a short sale home, I had no idea. No idea whatsoever. It's now about seven months later. The saga continues. Deepens. Twists. And I'm way to deep to stop now.

I can't tell you this story here, now, in narrative chronological form.

I will take one from the book of how to stay sane, and deal only with what's in front of me, now, today.

GMAC. They hold a $200,000 second lien, HELOC on The Property. GMAC handles short sales the way GM designed cars. There is a four to five business day wait for them to enter faxes into their system! Their loan modification department has odd business hours -- they don't open until 12 noon on some days! Today, Thursday, when they are supposed to open at 8 a.m., all I could get when I called was a recording listing these hours. This is insanity.

Bank of America Credit Cards. The Owner of the Property owed money ($62,000)to a credit card company called FIA, which was part of MBNA, which was bought by Bank of America. This is another lien that must be released in order for the deal to go through (one of many -- more about that in another post). When we started this ghastly business, FIA was being represented by a sleazy, monstrous debt collection company call Mann Bracken/Axiant. Google them. Complaints, law suits up the wazoo. We were negotiating with them. Then, one day, we call, and we're told -- guess what? Mann Bracken has declared bankruptcy. Hallelujah I tought to myself. Bank of America will be easier to deal with. After all, they are the ones who have agreed to the short sale on The Property. Why would they kill the deal?

WRONG. The Bank of America credit card operation has proven to be almost as bad as Mann Bracken. Talk to their representative and you hear not absolutely one trace of concern about causing an unnecessary foreclosure. Bank of America credit cards has absolutely no chance whatsoever of collecting a single dime on their lien, yet they seem to be quite willing to spitefully refuse to discharge the lien.

And, oh yes, Powers of Attorney. You need them to talk to people on the phone. Every company wants a different authorization or Power of Attorney. There is a new New York state statue for POAs. The NY State Dept. of Finance, however, has its own form....yikes!

Do I sound bitter? Am I a crackpot? I don't know at this point.

But it sure feels good to vent.


An Open Letter to Brian T. Moynihan, President, Bank of America

Brian T. Moynihan
Chief Executive Officer
Bank of America
100 N. Tryon Street.
Mail Code NC-1-007-18-01
Charlotte, NC 28255
January 7, 2010
Dear Mr. Moynihan:

I am writing to call your attention to a serious breakdown in the management oversight at Bank of America, a breakdown that involves one division of the company working against another.

This issue is detrimental to the interests of your shareholders -- and in addition, is a troubling example of how financial institutions can engage in socially irresponsible practices that promote home foreclosures. In this case, the foreclosure that is being forced will result in a
loss of revenue to the bank and to the underlying investor in the loan.

[gory details ommitted]

It is widely acknowledged that foreclosures promote neighborhood deterioration and further destroy home values. It is national policy to work to prevent foreclosure, and I'm sure it is the publicly stated position of the Bank of America that foreclosure should be averted if possible.

I hope you will help me resolve this matter in a way that will best serve both your shareholders and the public interest. I have filed authorizations from the homeowner and the credit card holder that give the bank permission to discussion this matter.

[gory details ommitted]

I have written to you in hope that your office can intervene constructively in the case. I would prefer to resolve this by working cooperatively with Bank of America, rather than to escalate
my grievance and bringing it to the attention of my congressmen, Senators, and regulatory officials at the Federal Reserve and Treasury Dept. I will not be willing to standby and experience a huge loss of my resources and to witness a shocking return to business as usual
and anti-consumer practices at an institution that has received a massive government bailout.


  1. My daugther and son in-law are going through the same thing with Bank of America. They are trying to purchase a short sale home in Orlando, Fl. It has been 7 or 8 months. They have had to renegotiate their contract about 5 times. They were to close finally on the 19th of this month. It took so long that the house had to be reappraised at a cost of $800 to my daughter but now the house is worth 10,000 less so now the bank wants to start all over again. This is just outrageous. My husband and I are going to close our accounts with Bank of American as well as my daughter, an Aunt and two of our friends. We are going to let our congressmen and senators know what is going on. My kids have great credit, savings , investments and my son inlaw has a good job. They are putting down a good chunk for the deposit and they still can't get into a house with the Bank of Amer. They are so disappointed. They will also loose the Federal Tax Credit. There are so many other couples going through the same problems. The bank would rather see the houses empty, vandalized and bring down the value of the rest of the neighborhood. I don't thing that this is a good way to run a bank. If they don't want to give morgages then don't waste peoples time and rob them of their dreams. This is also effecting the income of the realtors.

  2. I represent several sellers as well as buyers in todays Real Estate Market. The time and energy to do the right thing for any of our clients involves working with pencil pushers who have no clue even about the documents they have in front of them.
    The fact that most homeowners are so lost as to what to do about their finances as well as their home results in Attorneys making all of the money. The bank reps viewing files which are just about like reading greek, delay the process and complicate the entire short sale process to the point that sellers are getting savy. The new system is lets pay $1000 to an attorney who will keep the home in so much red tape, the actual losses to the bank rise an additional 40% over the next 12 months. This is in addition to the "to date" losses when the seller first contacts the bank. The stupidity and ignorance of those in command (who are making good money) will cost any bank a sizeable amount in over all losses per quarter.