Trapped in Bank of America Hell

Are you one of the lucky ones? Have a good job, live in a nice neighborhood, enjoy your cozy home? Think foreclosure only impacts the reckless or the unemployed?

Think again.

George Mahoney worked and saved and built his cozy colonial-style home in Lynnfield, Massachusetts in 1981. There, he and his wife raised three lovely daughters. For many years, the Mahoneys paid down their relatively small mortgage with their local bank -- a division of Bank of America (BofA). In 2007, they took out a second mortgage to help a daughter start a small business. Two wage earners, a great credit record -- the loan was a breeze. That was when the trouble began.

About a year after getting the second mortgage, BofA started notifying George that his payments were late. Soon they jacked his credit card interest rates from seven percent to twenty-eight percent. Next, they ruined his credit record. His Sears card dropped from a $10,000 limit to a $500 dollar limit. Then one day in the fall of 2009, BofA initiated foreclosure on the house he had built and owned for 28 years.

The only problem? The Mahoneys had never missed a single payment on either their first or second mortgage.

Initially, George thought the problem would be easy to fix. He went down to his local branch to get help, but the local employees were rebuffed by corporate headquarters. So he started getting a receipt for each mortgage payment and faxing it to BofA headquarters. He also started the first of thousands of calls. Usually, BofA staff would readily concede that he was right. But even if they initiated a "fix" it never lasted more than 90 days, when the saga would start over again. In the last few years, he has received foreclosure notices twice – most recently in October 2010.

"Banks shouldn't be allowed to ruin people's lives this way. My stress level for the past year and a half has been a 10 and my wife is a wreck," George explained. His wife Marianne confirms the toll the trial has taken on the family. "The whole thing is a nightmare. The stress we live under is unbearable and it's embarrassing too. No one can help us, no one can do anything and it's ruined our credit. I have always been proud to have perfect credit," she adds, the strain evident in her voice.

After receiving a foreclosure notice in October, hiring a lawyer to send urgent letters to BofA and even after repeated talks with top-level staff in the office of BofA President and CEO, Brian Moynihan, the Mahoneys are still in jeopardy.

Bank of America Fraudclosure Central?

Recently released data from the Federal Reserve shows that BofA received almost one trillion dollars ($931 billion) in taxpayer assistance during the financial crisis. The Fed has also been investigating snowballing allegations of fraud in the foreclosure process, allegations that include false notarizations, false affidavits, accounting fraud, abusive fees, false practice of the law and more. Fed Board Governor Daniel Tarullo told Congress that the problems identified "raise significant reputation and legal risk for the major mortgage servicers… requiring immediate remedial action." But will it come in time to aid the Mahoneys?

The Mahoney's experience indicts what appears to be a criminally sloppy record keeping system at BofA. Payments are misapplied constantly and the default position is abusive foreclosure. The bank reports some 1.3 million customers behind on their payments, but can regulators trust any data coming out of BofA? How many of these people are trapped in the same hell as the Mahoneys?

In a lengthy interview with the New York Times this weekend, Brian Moynihan reviews his first year as BofA chief. "I feel proud of what we have done," he said. "You never want to have a customer feel that something isn't right." But given BofA's track record, Moynihan's cheerful "there is not a better job in the world!" tenor strikes a surreal note.

Help May Be on the Way

On Tuesday, Iowa Attorney General Tom Miller, leader of the 50-state task force on mortgage fraud, met with more than 100 people from 15 states. In the crowd were representatives from community, faith, and labor organizations, foreclosure victims and struggling homeowners from across the country.

Led by the feisty folks at PICO National Network, National People's Action and Iowa Citizens for Community Improvement, the participants presented Miller with hundreds of case files documenting foreclosure fraud, abuse and plain malfeasance.

The group burst into a spontaneous round of applause when Miller said in no uncertain terms: "we will put people in jail." Miller also said he supports a settlement with the big banks that requires significant principle reductions, loan modifications, and compensation for victims -- key demands of the community groups.

As the holiday's approach, too many Americans will be losing their homes because of hard times. An untold number will be losing their home due to the fraudulent behavior and stark indifference of the nation's largest bailout-out banks. Let's hope the Mahoneys are not among them.

Mary Bottari

Mary Bottari is a reporter for the Center for Media and Democracy (CMD). She helped launch CMD's award-winning ALEC Exposed investigation and is a two-time recipient of the Sidney Prize for public interest journalism from the Sidney Hillman Foundation.


i would like us all to please take whatever time is necessary right this instant to see our immediate future. this is america. the tea party is not completely wrong when they complain that government doesn't work. liberals aren't completely wrong when they complain that gotcha capitalism will ruin 90 to 98 per cent of us if we allow it to. arbitrary complications and missteps are more the rule than the exception with very few people, however well-meaning, able to contort a just and proper response out of whatever misguided, mismanaged 'system' they are trying to simply survive within. you probably work in one of these places. your boss is easily frustrated by simple questions mostly because there is no reasonable answer. you know that, with the lone exception of taking home a paycheck, too often what you are doing is only to serve your own survival. not real survival. economic survival. yes, virginia, there is a difference. and most recently we no longer have any excuse to expect anything but worse since our parentless children rank twentyfifth in the world in just about everything but free associating their pointlessness on the social networks. we, that is, each and every american, individually, jointly and severally have absolutely nothing more important to do this very instant than to stop whatever you are doing, understand that the plight which the subjects of this story are suffering today is most certainly your plight tommorrow (perhaps literally) and decide if what you are doing is more important than calling an immediate time out. for ninety, or so, per cent of us it is absolutely not.

Yes, Virginia, corporations can be bureaucracies. That doesn't make it right but what I'm saying is that the machinery is running but nobody in charge is home. My wife and I have the same but different problem. Someone has been using her name and our address successfully for years. THANK GOD SHE DOESN'T HAVE THE SSN. But that doesn't stop credit agencies from failing to verify. The National Student Loan collections department has been particularly egregious about this. They call a few times every few years for money. They make it easy for a loaner to go to their web site and "change" their address. How hard would it be to add a database field for troublemakers so they could be watched and tracked with their own SSN? But naw. Waste time messing with some uninvolved strangers instead. Repeat. Waste time. Repeat. I even contacted my Senator but their guy told his aide that he "couldn't understand what I was referring to."

Thank you for this information. I used the account of the BOA but I have not used this one anymore. Baju Muslim.

Banks have handled U.S. foreclosures with what can candidly be called complete incompetence and potentially illegal methods. Many individuals have been promised <a title="Fake foreclosures: Another banking wreck" href=""> loan modifications</a>, only to face foreclosure after months of stonewalling from the bank. Fake house foreclosures are yet another wrench in the machine. In this case, honest individuals who are paid up discover themselves singled out for a good, old-fashioned home ransacking and lock-changing.

My husband and I are still in a loan modification with JP Morgan Chase and as far as I see nothing has changed. They question our earnings every month and still they have done nothing. How long does it take and what is it they are exactly looking for. Modify our loan already!!!

I am pretty sure that still there are situation like this. What will happen next specially a crisis is occurring?

It's the INVESTORS in the FRAUD who do include the BANKS which is CRIMINAL CONFLICT OF INTEREST.