Missouri homeowners have filed a federal class action lawsuit against Bank of America and BAC Home Loans Servicing for refusing to participate in foreclosure prevention programs, despite taking $25 billion in Troubled Asset Relief Program money. The class action is one of several across the country alleging similar complaints against Bank of America and BAC.
The Missouri Bank of America class action lawsuit claims that by accepting the TARP money, Bank of America agreed to participate in at least one TARP-authorized program to minimize foreclosures. Companies that accepted money under the TARP are subject to mandatory inclusion in the Home Affordable Modification Program (HAMP) — a government program designed to stem the foreclosure crisis by providing affordable mortgage loan modifications and other alternatives to foreclosure to eligible borrowers, the lawsuit says.
“Bank of America signed a contract with the U.S. Treasury on April 17, 2009 agreeing to comply with the HAMP requirements and to perform loan modification and other foreclosure prevention services described in the program guidelines,” the BofA foreclosure class action lawsuit says. “Though Bank of America accepted $25 billion in TARP funds and entered into a contract obligating itself to comply with the HAMP directives and to extend loan modifications for the benefit of distressed homeowners, Bank of America has systematically failed to comply with the terms of the HAMP directives and has regularly and repeatedly violated several of its prohibitions.”
The Bank of America HAMP class action lawsuit, entitled Fraser v. Bank of America, N.A., is brought on behalf of all Missouri homeowners whose loans have been serviced by one or both of BofA and BAC, and who have not received a permanent modified loan, despite being eligible for one. The lawsuit is seeking an injunction against the defendants and damages.
A copy of the Bank of America Foreclosure Loan Modification Class Action Lawsuit can be read here.
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