Reuters:

"Joseph Keller doesn't expect he'll live to see the end of 2013. He blames the house at 190 Avondale Avenue.

Five years ago, Keller, 10 months behind on his mortgage payments, received notice of a foreclosure judgment from JP Morgan Chase. In a few weeks, the bank said, his three-story house with gray vinyl siding in Columbus, Ohio, would be put up for auction at a sheriff's sale.

The 58-year-old former social worker and his wife, Jennifer, packed up their home of 13 years and moved in with their daughter. Joseph thought he would never have anything to do with the house again. And for about a year, he didn't.

Then it started to stalk him."

- In 2010, the county sued Keller because the house, already picked clean by scavengers, was in a shambles, its hanging gutters and collapsed garage in violation of local housing code.

- The tax collector started sending Keller notices about mounting back taxes, sewer fees and bills for weed and waste removal.

- Last year, Chase's debt collector began pressing Keller to pay his mortgage, which had swollen, with penalties and fees, from $62,100.27 to $84,194.69.

- Worst of all, last January, the Social Security Administration rejected Keller's application for disability benefits; the "asset" on Avondale Avenue rendered him ineligible. Keller's medical problems include advanced liver disease, hepatitis C and inactive tuberculosis. Without disability coverage, he can't get the liver transplant he needs to stay alive.

Mr. Keller is still legally responsible for the home he left after the bank foreclosure notice, because months later, Chase filed to dismiss the foreclosure judgment and the order of sale.

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Federal prosecutors hit Bank of America with a $1 billion lawsuit Wedesday, accusing the bank of mortgage fraud that contributed to the housing crisis. Bank of America became entangled in the scheme -- known as “High-Speed Swim Lane” or “Hustle” -- when it purchased Countrywide Financial in July 2008, just as the economy was slipping into recession. Countrywide, a mortgage lending giant, was already known for approving risky loans when it introduced its “Hustle” program to churn out more loans, effectively eliminating a system that ensured the mortgages were being made to buyers who could afford them. A top U.S. attorney said the bank’s fraud was “spectacularly brazen in scope.”

Via:

Wednesday's case, originally brought by a whistleblower, is the U.S. Department of Justice's first civil fraud lawsuit over mortgage loans sold to the big mortgage financiers, which were bailed out in 2008.

It also compounds the legal problems that Bank of America Chief Executive Brian Moynihan faces over the second-largest U.S. bank's disastrous July 2008 purchase of Countrywide Financial Corp, once the nation's largest mortgage lender.

According to a complaint filed in Manhattan federal court, Countrywide in 2007 invented and Bank of America continued a scheme known as the "Hustle" to speed up processing of residential home loans.

Operating under the motto "Loans Move Forward, Never Backward," mortgage executives tried to eliminate "toll gates" designed to ensure that loans were sound and not tainted by fraud, the government said.

This led to "defect rates" that approached 40 percent, roughly nine times the industry norm, but Countrywide concealed this from Fannie Mae and Freddie Mac, and even awarded bonuses to staff to "rebut" the problems being found, it added.

Defaults and foreclosures soared, yet the bank has resisted buying back many of the defaulted loans from the scheme, which ran through 2009, the government added.

Much more at Reuters.

Selling a home can be a difficult, stressful process, even now after the nation's largest banks have paid billions to settle claims of robosigning, and foreclosing on homes without properly vetting the paperwork.

Now imagine going through the process, receiving multiple offers...the hard part is over, right?

Not for Lily Diaz, a California woman who after receiving two offers on her house, discovered that Wells Fargo had actually foreclosed on the home months earlier.

Via:

Diaz said she was shocked because she has the paperwork that shows she completed a loan modification with Wells Fargo in January.

She said she made every monthly payment on time since it was approved.

“Wells Fargo apparently didn’t let title know the modification was accepted and they let the foreclosure proceedings continue,” said Duarte. “Wells Fargo knows they made the mistake. They don’t know how to fix it.”

As it stands now, the home can’t be sold.

Wells Fargo contacted Diaz to resolve the problem, but in the meantime, Diaz lost two offers on her home.

Despite efforts by federal regulators, it doesn't seem that the problem of mistaken foreclosures has been resolved, as unfortunately, cases such as Lily Diaz' are still not rare.

Wells Fargo, the nation's largest mortgage lender, agreed to settle with the Justice Department Thursday to resolve allegations that it steered blacks and Hispanic borrowers into subprime loans when similarly qualified white borrowers received mortgages with lower rates.

The settlement, which must be approved by a judge, requires Wells Fargo to provide $125 million to borrowers, $50 million in down-payment assistance in hard-hit regions where Justice found evidence of discrimination, and additional compensation to blacks and Hispanics who were wrongly placed into subprime loans.

[Via]

From Houston, Florida comes this report of a couple who after falling on hard times financially and facing foreclosure decided their only option was to end their lives. They each left detailed suicide notes that included family contact information, as well as details for their funeral arrangements. It was more than a month afterwards before anyone became alarmed enough to check on the pair.

The reporter noted that his station doesn't normally report on suicides, but that the station felt perhaps they could use the March, 2011 report as a moment to inform people in need that other options exist.

There is no database that keeps track of foreclosure related suicides, and that is likely because it's difficult to label a death due to foreclosure alone, as noted in this research from 2011, conducted by a pair of economists who were able to tie health problems to the rise in home foreclosures:

New research by Janet Currie of Princeton University and Erdal Tekin of Georgia State University shows a direct correlation between foreclosure rates and the health of residents in Arizona, California, Florida and New Jersey. The economists concluded in a paper published this month by the National Bureau of Economic Research that an increase of 100 foreclosures corresponded to a 7.2% rise in emergency room visits and hospitalizations for hypertension, and an 8.1% increase for diabetes, among people aged 20 to 49.

Each rise of 100 foreclosures was also associated with 12% more visits related to anxiety in the same age category. And the same rise in foreclosures was associated with 39% more visits for suicide attempts among the same group, though this still represents a small number of patients, the researchers say.

Teasing out cause and effect can be delicate, and correlation doesn't necessarily mean foreclosures directly cause health problems. Financial duress, among other issues, could lead to health problems—and cause foreclosures, too.

The economists didn't find similar patterns with diseases such as cancer or elective surgeries such as hip replacement, leading them to conclude that areas with high foreclosures are seeing mostly an increase of stress-related ailments.

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What do you do when banks that took billions in taxpayer dollars foreclose on those very same taxpayers? Why, you foreclose on the banks, of course! Occupy Miami decides to move into Wells Fargo and another set of occupiers get comfy in a Bank of America. Check it out and get inspired.

I've written about some foreclosures fights in Minnesota in recent weeks, and this video is an update on the progress of those actions.

Filmmaker Peter Leeman's original subjects approached Occupy Minneapolis and asked for help with their struggle. Occupy Homes MN, a sub-section of Occupy Minneapolis that deals exclusively with protecting homeowners, took up the cause of these folk and organized a direct action.

In this video, dozens of people march to the house of U.S. Bank CEO Richard Davis to demand justice for homeowners. Its inspiring to see this call for US Bank to help their own clients pay their mortgage and keep their houses. "We bailed them out with our tax dollars when they were in trouble at the start of the housing crisis they created," said Monique White, who was featured in "Monique's Story". "Now we need them to work with us to help stabilize our communities, instead of tearing them apart."