Banks Overcharged, Improperly Foreclosed on Military Families
The true extent of the foreclosure fraud perpetrated by the nation’s largest banks remains unclear, but recent revelations show that it includes overcharging and improperly foreclosing on the homes of American military families. JP Morgan Chase admits it overcharged several thousand military families for their mortgages and improperly foreclosed on more than a dozen families.
The admissions come out of a lawsuit filed by Marine Capt. Jonathan Rowles who has been in a fight with Chase for about five years.
Under the Service Members Civil Relief Act (SCRA), active-duty troops generally receive mortgage interest rates around 6 percent and are protected from foreclosure. The law is designed to protect service members and their families from financial distress while on active duty and in harm’s way. But Chase apparently repeatedly violated the law.
To try and remedy the error Chase plans on mailing a total of about $2 million in refunds to those families overcharged, while those who improperly lost their homes have or will get those homes back.
Now if only the hundreds of thousands of Americans in similar circumstances were so lucky.
Rowles story is familiar to an astonishing number of Americans. The bank began overcharging the family in error and then improperly sent the matter to a collection agency, despite the fact that the family continued to make payments. Bank records show they were being charged rates above 10 percent, despite the contracted for 6 percent.
While Chase insists the overcharges were a blip in their operations, the fact that Elizabeth Warren tapped Holly Patreaus to specifically work on consumer protection issues for military families suggests otherwise. Lenders know the law, they just wont abide by it until forced.
photo courtesy of respres via Flickr