America’s Bank of America is in deep water in the State of Utah. The 5th District Court has told it to stop all foreclosure activity until the bank complies with State law, including registering locally, and opening offices at least in Salt Lake City, where its troubled borrowers might just be able to negotiate in person, instead of with a remote call centre over a bad line.
If this Court decision were made permanent, it would affect all banks with customers in Utah, and this has made the day for John Christian Barlow, the St George attorney who filed the suit.
“They are clearly in violation of State statutes that require them to have offices in the State,” he is on record as saying Monday to a colleague. “What it means right now is that Bank of America cannot foreclose on any homes,” he added, “although I do not know how long the injunction will last.”
This is welcome information for desperately troubled underwater households in Utah. It buys them time to re-negotiate, and right now from a slightly stronger position. That applies especially to Bank of America customers, as the 5th District Court has ruled that the bank has neither local offices, nor even State ticket. Bank of America phones have been ringing off the hook since then, although I for one have not heard of a single press enquiry that has been answered directly.
“I can’t imagine the arrogance and audacity of Bank of America and other big mortgage lenders that took billions in bailout funds to help resolve the mortgage mess,” John Christian Barlow, the St George attorney who filed the suit added. “The financial institutions now are profiting by kicking people out of their homes without due process under the law of the State of Utah.”
According to its own statistics Bank of America has foreclosed more than 1,050 homes in the State of Utah, and the troubles are far from over yet. Vice President of the State Bank of Southern Utah cautioned borrowers to continue servicing their loans. “Don’t do anything drastic,” he said, advising that he expected that the court order could be overturned. He added that, while the ruling might defer some Utah repossessions, he expected Bank of America to continue its other banking operations in the State, unless the United States Supreme Court was requested to intervene. “Bank of America will probably try to contest it and go to further court action,” he concluded.
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