Bank America reducing a customer’s credit score because of a letter trying to identify the actual owner of the customer’s mortgage is just the tip of the iceberg. Corporations are now our government. They have setup mutual structures that determine how the individual can operate in this corporate economy. If the individual “misbehaves” the corporate structure has metrics that ensure you cannot perform in the economy. A strong consumer protection agency with teeth can help mitigate this.
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Honey, I Shrunk The Credit Score Zach Carter – zach.carter@huffingtonpost.com
Arthur Delaney – arthur@huffingtonpost.comPosted: 01- 5-11 08:58 AM
Steven Marks knew he was wasting thousands of dollars every month paying the mortgage on a home he bought during the housing bubble that will never be worth that much again. Whilst he considered doing further research beforehand by looking at Reali and other experts, at the time the culture towards such decisions was very different from the one he found himself in now.
He was very interested in debt relief, like anyone who finds themself in debt, but he’d read plenty of horror stories about people having serious trouble modifying their mortgages due to bank confusion and misbehavior, so before he started looking for debt relief on his Reno, Nev. home, Marks sent a simple request to Bank of America: Could they tell him who owned his mortgage? And could they document it?
Marks didn’t get the type of response he was expecting. After initially declining to tell him who owned his loan, Bank of America provided a form letter with the name of the current investor a few weeks later. But they also appear to have lowered his credit score, the preeminent measure of creditworthiness that will principally determine his ability to obtain loans in the future. If only he’d known about the companies that repair bad credit, he could have taken back control by reversing the effects of their actions.
“I just asked to see my note, and they dinged my credit score. My insurance premiums have already gone up,” Marks told HuffPost. “I went to see a lawyer, we’re trying to figure out what my options are. After this, we’re thinking about some forced mediation. Why keep paying if my credit score gets battered anyway?”
Marks asked the bank for documentation through a “Where’s The Note?” website created by the Service Employees International Union and the African American grassroots-advocacy group Color of Change. Amid reports of widespread fraud in the foreclosure process, resulting in everything from illegal fees to improper evictions, the site’s stated purpose is to offer borrowers legal leverage to challenge bank wrongdoing.
“To protect myself and my family, I need to know who owns my mortgage,” the “Where’s The Note?” request template reads. “Furthermore, in light of the recent allegations of foreclosure fraud, I demand to see the original mortgage note proving ownership over my home loan. If you fail to produce a mortgage note proving that you have a right to collect my mortgage payments, I will be forced to consider all options available to me to ensure that my family and my home are protected.”
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Marks, whose situation was first described by finance blogger Barry Ritholtz, wasn’t used to financial instability. He said he’s never missed a payment on his home, or even sent one in late. Right before sending a letter to Bank of America, he’d checked his credit score — a near-perfect 780. He continued to pay on his mortgage after sending the request, only to find that his score had dropped 40 points to 740.
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“That is astonishing,” Ritholtz wrote.
A bank spokesman said it may have interpreted borrower language as a dispute, but would fix any problems created in its borrowers’ credit reports.
“Certain wording used in the letters brought to the bank’s attention may have been interpreted in some cases as raising a possible dispute. The bank is taking steps to clarify the handling of these requests, and when and if a dispute coding should be placed on the account,” the spokesman said. “In any case, once a possible dispute has been researched and the findings result in the removal of the dispute coding, it should no longer be reflected in the customer’s credit profile. Bank of America will review files that may have been impacted and make any necessary corrections in credit reporting.”
