WaMu Borrower Purposely Defaults, Gets Foreclosed On, Sues

This article has 32 comments:

•  
  lucky lenny

  Aug 06 06:48 AM
  These stories of nuisance lawsuits really bother me. It is we, the public, that ends up paying for these lawsuits. Mainly the costs to run the courts go up; then the businesses being sued have to raise their prices to cover the costs of the lawsuits. Just another reason to stop liberals, such as Barack Hussein Obama, who allow this nonsense to go on.
•  
  buyitcheap

  Aug 06 07:09 AM
  Your thought as to a mod being a "right" is spot on in this environment. It might almost be that the FHA and various housing agencies censure the servicer for not doing the modification in the first place. Does that open the door for on time payers to request a modification too? I'd like to make mine 40 years and 4.4% please. :-)
•  
  upside_down_
  fl

  Aug 06 09:13 AM
  I've had the pleasure of being current on an option arm mortgage and attempted to contact wamu to restructure. After 6 or 7 months of endless roadblocks with people who had no clue on their own products, and less of a clue on their own operation, I finally got a take it or leave it offer that basically amortized the existing balance over the balance of the term at twice the payment, so I turned it down. I qualified for a conventional product at the time, but this was a 'better fit'. To top it off, they have my mailing address but overnight the 'offer' to the property address...it's upside down in a market that's down at least 35%. When the reset comes, they can pick up the keys.
  
•  
  jjason

  Aug 06 09:46 AM
  Hey, Lucky Lenny...Don't blame Senator Obama.
  
  Do your homework. Check out what former Republican Senator Phil Gramm did when Bill Clinton was President. Go To:
  
  www.commerce.senate.go...
  
  And read Michael Greenberger's Report.
  
  Much of the current financial disaster has to do with DEREGULATION, Real estate speculators ( builders, investors and homebuyers ), POOR AND, PERHAPS, FRAUDULENT lending practices and a whole lot of stupid people.
  
  I am LUCKY JASON...I own my home free and clear, downsized 10 years ago and then retired.
  
  I live below my means, am comfortable, and live in a low cost, frugal community in NEPA.
  
  Also, help the economy recover NOW. Help lower the price of oil at:
  
  www.stopoilspeculation.../
  
•  
  deadbolt

  Aug 06 09:54 AM
  Lucky Lenny "Barack Hussein Obama" is not the current president. He is not the reason for this lawsuit. You're bringing your politics into this economic discussion, it's annoying.
  
  As for "upside_down_fl&q... ever think that you brought this on yourself? How about working some extra hours, picking up a second job, or asking for that promotion? Take some financial responsibility and don't drag the rest of our portfolios down with your delinquency.
•  
  John
  Pseudonym

  Aug 06 09:58 AM
  Since the Fed rate is 2%, I would like to restructure my loan to 2% for 50 years.
  
  Does anyone know where I can submit my request?
•  
  User 214700

  Aug 06 09:59 AM
  Let me understand.....All the delinquent borrowers get low interest so they can keep their home and the honest, mortgage payers will just have to pound salt with their high interest loans.
  
  Just another form of American justice...Reward the delinquent borrowers .......and screw the honest paying, upside down borrowers.
•  
  User 214700

  Aug 06 10:06 AM
  If all these borrowers got their loans with nothing down.....Why do they need saving from foreclosure? With nothing down all they have been doing is, effectively, paying rent. They lose nothing because they put nothing down.
•  
  jakw

  Aug 06 10:29 AM
  Amazing how the osama fans rise up in indignation - or - blame Bush neither of whom has anything to do with the problem the Boston screwups and a nuisance lawyer have hatched. Not so incidentally, the implied modification is the result of a Schumer, Scewlosie-and Reid plan generated by the democrat congress. Another example of pissing on forest fires started by dumkoffs in congress.
•  
  upside_down_
  fl

  Aug 06 10:37 AM
  If the conjecture from Dead, John, and user are somewhat directed my way, it's funny, nowhere did I say I was
  1) Delinquent
  2) Seeking below market interest.
  
  It's meant as a perspective on the industry/bank in relation to the Matt Stichnoth article.
  
  In a lot of cases, borrowers qualified for more conventional products but were 'guided' into these products. If borrowers were leveraging the low teaser rate/payment for a property they could not ultimately afford, shame on them, the banks and you for investing in businesses with sly underwriting guidelines.
  
  The point was borrowers were steered into sub-optimal products at that time for the benefit of the banks/brokers. If you are mis-informed about this, in retrospect, you need to do your research. Similarly, do you really know if the business is being well run. If you speak to someone in customer service who barely knows how to read from a script, do you think they are addressing the real issues? Years ago we invested based on business fundamentals, today a lot of investors do so based upon greed.
  
  Until the banks step up and come clean, it's going to be a long haul to recovery.
  
  Addressing the financial responsibility comment, perhaps directed in my 'pick up the keys' comment, as in all investments, sometimes we take the loss and walk away.
•  
  Recourse Bob

  Aug 06 11:58 AM
  Anyone who turns in the keys should be prohibited from obtaining another first mortgage for at least seven years. And first mortgages should all be with full recourse to the buyer/mortgagor and enforceable under federal law. These measures would put a stop to those who think they don't need to repay their home loan. Congress, do you hear me?
•  
  User 214700

  Aug 06 12:52 PM
  Upside down.....I don't blame you. The problem seems to be the Gov't basically gave the banking system so much cheap money they had to find ways to give it away so they gave $500,000 loans to people who had no down and no way to make payments. Also causing the housing bubble because instantly everyone became eligiable as a buyer instead of limiting buyers to those who had saved enough for a down payment.
•  
  Karen
  Consumer

  Aug 06 01:03 PM
  You boneheads. The lawsuit states they were late with ONE payment, knew they were in trouble, and asked for AND took WAMU's advice.
  
  BTY: I' delinquint on my WAMU credit card since 12/07, but WAMU still hasn't listed it on my credit bureaus. I still make payments (when I can scrape money together) but its no where near the minimum. Surely I'm not the only one whose delinquint, and are they holding off notifying the credit bureaus so they don't have to take the loss until they want to?
•  
  Kinabalu

  Aug 06 02:08 PM
  "borrowers were steered into sub-optimal products at that time for the benefit of the banks/brokers."
  
  Upside-down You seem to think this is a terrible indictment of WaMu. In fact, this is the way most companies are run unless they are not-for-profit. WaMu screwed up giving you the loan. you screwed up taking it. You should both bear the consequences. That is where it should end.
•  
  fishhead

  Aug 06 02:55 PM
  Its tough to say who is right and who is wrong w/o more info but my guess the greedy little banker made a risky loan to get "THEIR" share of the sub prime pie and when it performed as expected..the dumb borrowers are at fault. Then again maybe IF we let things slide enough we can get enough of a break for that new car....gee the wheels are spinning on both sides of the loan desk...There are borrowers who are that dumb but the banks should recognize them and simply not allow a bad/risky loan on their watch. Borrowers need to get their head out of their well you know and protect themselves..ask questions, plan, budget etc...get the help you need even if you have to ask 10000 times. If it looks to good it probably is.
•  
  MikeW

  Aug 06 03:55 PM
  Well, now we're seeing the trouble with expecting the Government to bail out irresponsible lenders xxxxborrowers, aren't we. Unintended consequence: people expect a "right" to loan modifications they think they need. They expect a government-enforced do-over for their mistakes. If Wall Street and Fannie and Freddie get them, why shouldn't they? IF I had a mortgage, I'd be tempted to not pay so that I could get an after-the-fact better deal.
  
  How about the Government gets out of housing finance and we give Capitalism a try? Might work, let's see, haven't tried it for 60 years...
•  
  Pony289

  Aug 07 09:03 AM
  Unless you or your child had some catastrophic illness why do you need a bailout? You SHOULD have done your homework before signing on the dotted line. It's the Internet Age... all the info in the entire world on every subject if you take the time to seek it. If you believe the mortgage broker (who wants to sell you a product) or the real estate agent (who wants their commission) and you seek no information or councelling before making the LARGEST purchase of your life... you deserve the CONSEQUENCES. I qualified for a $750k house... could have afforded it with an ARM... instead I bought a $350k house with 20% down, no PMI, with a 15yr fixed. I have 11 years to go and my mortgage will not rise. I did what I could best afford. DO your homework next time and BUY WHAT YOU CAN AFFORD! Whatever happened to PERSONAL RESPONSIBILITY in this country? WHINE I have a right to be greedy without consequences WHINE
•  
  GB Gentleman

  Aug 07 10:33 AM
  upside_down_fl - it's upside down in a market that's down at least 35%. When the reset comes, they can pick up the keys.
  
  ----------------------...
  
  And hence a bigger issue, the loss of personal integrity by those who are able to pay. You signed an agreement to pay a certain amount for the length of the loan...suck it up and pay.
•  
  change

  Aug 07 11:19 AM
  All homes should be nationalized and redistributed according to ability and need, regardless if the home has a mortgage or not. There are too many large homes and condos that should be occupied by families with children and not by childless couples. I would give priority to government employees who are staunch democrats first.
•  
  Pfloyd234

  Aug 07 11:29 AM
  Thats the stupidest thing I have ever heard CHANGE!!!! Take your Castro arse and move to France. Bon Voyage!!!
•  
  Pfloyd234

  Aug 07 11:30 AM
  Both parties can kiss it for all I care!!!
•  
  change

  Aug 07 11:43 AM
  :)
•  
  truthinvesti
  ng

  Aug 08 07:15 AM

  My Website
  I believe that a contract is acontract and You can see on myfreewebsite that iam certainly a capitalist. I just think that telling someone they are not"deliquent enough" is total BULL and goes against everything capitalism is supposed to stand for
•  
  Ihaveethics

  Aug 08 12:02 PM
  +1 with GB Gentleman. It amazes me how immature some of the people are. So your house is down, deal with it. Thats what happened when CA real estate melted down in 91-92. There are more and more stories of people who can afford to pay walking away because there houses are upside down. Don't you people have an integrity?
  
  I agree with Bob. A turn in the keys foreclosure should mean you are stuck being a renter for the next 7+ years. I don't want to subsidize the losses of people who are spoiled and immature.
•  
  Depressedall
  ready

  Aug 08 12:22 PM
  There is so much fraud today in the banking/lending/mortga... institutions that it would be VERY wise to "hire a lawyer" to read the "fine printed contract" to cover your A*** against "unscrupulous&quo... money/credit lenders! IF in court these people proved that they went to WaMu to reconsider their loan to make it affordable, I would say that they have a "legal right." The fact that THEY contacted WaMU "in good faith" to keep making payments but that they could, for the moment, not be able to pay the going rate demonstrates to the Courts that it was WaMu who violated the rights by not opting for lower payments! "Good Faith" and willingness to keep making payment is ALL that is needed in a court to prove the point for the consumers. I feel that WaMu and other credit organizations have gone too far and as the credit market tightens even more, there will be this vicious circle of "defaults" and "foreclosures&quo... UNTIL there will be the action upon the Justice System and Political laws and regulations to protect even the creditors against "unscrupulous and unfair credit practices" by the major credit lending institutions. The key word for litigation/rights is "Good Faith."
•  
  corp-emt

  Aug 08 01:29 PM
  I work in corporate restructuring....I am disturbed by the number of angry emails that for all intensive purposes blame the people for this type of "bail-out" as many of you so vehmently state. This happens all the time in corporations - big corporations. Corps go bankrupt, restructure debt or are loaned more money all the time because CEO's and Board of Directors made very poor decisions. They can because they simply have nothing to loose - the only repercussions are massive lay-offs, lower wages or the corporations simply dissappear (Enron). Nothing affects them personally. CEO's, Lawyers, and lawmakers all profit irregardless.... however, think about it, who really pays? The laws have been progressively changed to benefit corporations for the past 10 years. Where as consumer law has been squeezed and contorted. Before casting judgement on these people and their circumstances....look at the billions of dollars that we the tax payers have paid to bail out these corporations. We were much more solevant as a country when the laws benefited the people. You know, "government for the people and by the people"....Those who feel so angry need to look with clearer eyes, the Banks and Corporations and those making the decisions have no incentive to do business with us (the people) any differently - they make money either way....
•  
  User 240455

  Aug 08 03:50 PM

  My Website
  My name is chuck , I recently took out a loan for 500k on april 4th 2008 and once i reached 410 k the bank told me i wasnt within my guide lines to get anymore draws after 2 months . It was colatarallized with a 150k cd and all assets , they called the note due and is now shutting my company down and putting 12 people out of a job ,they would not accept a payment(only 100% of drawn monies) and got a restraining order from a judge without me even present (claiming I was hidding assets etc..) we were relocating a factory to a better market (Austin TX) this is why we got the loan in the first place ,and the President of the bank knew this !Of corse shes the white glove while a short fat MAN (VICE PRESIDENT ) is the weak iron fist , we do business in 7 countries and have always prided ourself on our credit ,IS THERE ANYONE OUT THERE THAT CAN HELP .
  
  Chuck ....
  Worldgranite@netzero.c...
•  
  Bman

  Aug 08 11:38 PM
  Did you read your loan documents Chuck?
•  
  dns

  Aug 09 01:13 PM
  I feel this is a criminal offense on the borrowers part. They obviously had a loan they could afford, and they signed contracts saying they would pay. They had other options, although they are starting ti dwindle away. They could have went somewhere else to refinance for a better rate, but they decided to puposely default. Where I come from, if you porposely write a bad check, it is a felony offense. I dont see much of a differnce between the two.
  As for all the poor people getting killed by their morgates, I dont see it. I hear about it, but I dont see it.
  One person that I know in forclosure owned her house free and clear. It was left to her by her father when he died along whith a hefty bank account. The woman blue the cash, than refinanced her house before the bouble burst. She blew all that money on junk. She was working two jobs, but makeing her bills, but she decided if she rented an apartment it would be cheaper than her nut, so thats what she did. She moved and walked away from the house. She was not in disstress. She just blew all the money, and found a cheaper way out.
  Another guy I know, also owned his house outright and decided to refinance. After that he lost his job due to a dirty urine test, and decided to take time off. He too blew all the money, it seems it is always party time, and their isnt a job out their good enough for him. He wont drive an hour to work, thats too far. Its crazy. These are the only people I know that are on the road to forclosure. One is their, and the other is close, but they both did it to themselves by living above their means. They need to take control of their finaces, not the banks, or the government. People like this should be hit up with felony charges, and have to pay restatution. I dont know anybody else in trouble so I cant speak about others in differnt situations. But people like this should be held accountable.
•  
  Bill WaMu
  Shareholder

  Aug 11 02:11 AM
  These people are crazy. Regular people like me own shares in these banks. The people have a mortgage on a piece of property, but it's gone down in value, so they want some free money, a better interest rate and other things for FREE.
  
  When you borrow money, you are supposed to pay it back.
  
  These people do not just get a free ride becuse they just want one. That is not fair. If there are real reasons to modify their particular loan on a case by case basis then that is fine.
  
  Otherwise we loaned you money, so pay it back. Don't be a deadbeat!
•  
  forwoodenboa
  ts

  Aug 12 06:11 PM
  It always amazes me how people will sell their integrity for a few thousand bucks. Granted, lots of hard working people who pride themselves on never being late on a payment can suddenly find themselves flat broke, especially if they live paycheck to paycheck as many of us do most of our lives.
  The ones who are taking advantage of the system, the 'me too's anytime they hear of a handout should be made to pay restitution plus 100% fine in addition, to help out some honest, productive family that really needs the help.
  I don't have enough fingers and toes to count all the people I've met who considered credit card bankruptcies a right - one girl my brother couldn't seem to shake ran up over $200K and never paid back a dime, and my ex chiropracter strongly suggested I default on the credit cards I used to fund much of a couple years of college not long ago (algebra really sucks in your late 40s if you never took it before!), but I was wearing a grin he'll never understand when I paid off the last one.
  He said that he and all his friends default, often twice, and they all had good jobs and weren't hurting for money.
  They considered it a right, he said, and so should I.
  I also had a right to never put another penny in his pocket, and never did, other than that visit's check.....you know he would have been the 1st one to come after me if I cancelled it!
•  
  SyM

  Aug 25 04:06 PM
  Some of your comments are just ignorant. We put 20% down when we purchased our home. We were quoted for a 30 yr fixed rate. They lied to us. Not until we were in the title office signing papers did we know they changed it to an ARM. We asked them to change it and were told they could not. Washington Mutual lied and we are now paying for it. We also requested WaMu to restructure our loan. We have been given such a run around, being told no such restructure exists. Two minutes later another WaMu employee said we did not qualify because we are not behind on our mortgage. Later, after numerous calls, we were offered a new loan, that would GROSSLY INCREASE the current mortgage payment. They said we would now need to pay PMI because we no longer have 20% equity in our home. Its the lenders GREED that created this mess. We lost not only our money, but now we may lose everything we have. Our loan is set to increase in Sept AGAIN. Not sure how long we can hang on.