Homeowners fight back. File lawsuit against WaMu (for refusing to modify their loan)

[Joanne98]

THE SUIT SEEKS CLASS ACTION STATUS!

WaMu Borrower Purposely Defaults, Gets Foreclosed On, Sues
by: Matt Stichnoth posted on: August 06, 2008 | about stocks: WM Font Size: PrintEmail One problem servicers have run into as they’ve tried to modify delinquent borrowers’ loans has been a difficulty in simply getting in touch with borrowers. People don’t want to hear from creditors—even ones who say they want to help. (That’s why last week Freddie Mac (FRE) announced it will pay servicers to go knock on borrowers’ doors and leave hangers on their doorknobs.)

But what about when borrowers make the first move, and then get no for an answer? In Boston, Lori and Mark Pestana have filed a suit against WaMu (WM) for refusing to modify their loan after they asked for help. First, WaMu declined because the Pestanas weren’t delinquent enough. Then the couple purposefully withheld payment—and the bank foreclosed. Key wrinkle: the suit seeks class-action status.

Uh-oh. If servicers become liable for every mod they didn’t grant to borrowers who wanted them, the numbers could be big. You say the suit’s headed nowhere. Maybe. But in the current climate, in which a loan modification seems to be close to a constitutional right, I’m willing to believe anything. . . .

http://seekingalpha.com/article/89375-wamu-borrower-purposely-defaults-gets-foreclosed-on-sues?source=feed

[fasttense]

1. Seems to me the government is using our money to bailout

these thieves, the very least they could do is help the people they screwed.

[mrreowwr_kittty]

2. Thank you. It's not like the homeowners are asking the gov't to hand money to them.

Like the banks are. They just want to renegotiate to a fixed rate with reasonable payments. IMO, there should be blanket amnesty on all subprime loans, allowing the homeowners to reset to a fixed rate.