Even small mistakes in the paperwork may give borrowers the legal leverage to persuade lenders to rework their mortgages.

By Lew Sichelman
United Feature Syndicate

October 12, 2008

WASHINGTON — Homeowners who are having difficulty getting the attention of their lenders to discuss their troubled mortgages might want to obtain a forensic loan review to determine if their lenders made any mistakes when the mortgage was issued.

Even a $30 miscalculation on the lender's part could be an actionable offense, and the threat of a lawsuit can be enough to persuade the lender to deal with you in trying to find a way to help you work through your financial difficulties.

In a forensic loan review, a legal pathologist scours your loan documents looking for errors in, among other things, the truth-in-lending statement the lender provided shortly after you applied for your mortgage and the lender's annual percentage rate calculation so you could compare loan costs.

If the truth-in-lending statement doesn't match the HUD-1 closing-cost sheet you received at closing, if the APR is off by just a hair, you might have cause for legal action against the lender.

[Read More!]

By Mary Frances Gurton Staff Writer
San Gabriel Valley Tribune

PASADENA - Tommie Brown said he worked hard, paid his bills on time and kept his credit clean all his life, only to fall victim this year to a $350,000 mortgage fraud scheme.

The longtime Pasadena resident said he became aware of the scam after a mortgage lender who had befriended him used his personal information to purchase two homes in Georgia unbeknownst to him.

“I went to purchase a used car in El Monte last July,” said Brown, 60, sitting in the dining room of his modest Pasadena home. “When they ran the credit check, I found out there are loans in my name on two houses in Georgia.”

Embarrassed and uninformed as to how to handle the problem, Brown said he has yet to contact police and avoids calls from creditors at Washington Mutual and other financial services corporations asking for payment on the notes.

“I told them I had no part in stealing the money,” said the retiree, who spent 27 years in the shipping and receiving department of a local Vons market. “I just want to get through this and come out the way I was before.”

Various types of identity fraud, ranging from bait-

and-switch scams, pyramid schemes, variable annuity sales, online escrow fraud and charity scams, are perpetrated against seniors each year - and are continually evolving, according to experts.

In 2005, there were 8.9 million identity theft cases reported nationally, with about 1 million of those in California, said Melanie Bedwell of the Department of Consumer Affairs.

Seniors are especially vulnerable, according to Petra Niles, director of the Elder Abuse Prevention Program at Wise Senior Services in Santa Monica.

“On a day-to-day basis, we get several calls on all kinds of cases,” said Niles. “This is happening all over the state.”

Niles said it is common for perpetrators to build relationships with numerous seniors, all the while testing for those who may be easy prey for a tried-and-true scam.

“When they see they are pliable,” she said, “then they move in.”

In Brown's case, a mortgage lender he says worked for a firm in Long Beach helped him with an earlier investment, he said.

When she later asked him to sign some loan documents, he did not know he would be at financial risk, he said. Representatives from the companies that issued the now-defaulted loans are calling him for payment.

“I feel stupid for trusting her,” said the bifocaled Brown, who said he has owned his current house on North Hudson Avenue since 1983. “I think she did it before and got away with it.”

Calls to the mortgage broker's telephone were not answered.

Niles also said that, although it is common for victims like Brown to feel ashamed and not want anyone to know what happened, it is important for them to “cross-report” to concerned agencies.

“He needs to report this so they can get an investigation going,” she said.

Public Outreach Specialist Jacqueline Wiley-Sistrunk of the California Department of Corporations agreed.

“He needs to file a complaint with our agency,” she said, “There are always problems with predatory lending, and it is especially an issue with seniors.”

Meanwhile, Brown said he did not know what to do.

“I just ignored it and hoped it would disappear,” he said, “but I want to do what's right.”

SACRAMENTO — With the enactment of SB 1018 (Simitian), which requires all bank employees to report all suspected cases of elder financial abuse going into effect today, the California Bankers Association has compiled a list of tips to help consumers be more vigilant in keeping seniors safe.

“More and more, California’s seniors have become the targets of unscrupulous fraudsters who want nothing more than to part seniors from their hard-earned money,” said CBA president and CEO Janet W. Lamkin. “While law enforcement, along with California’s financial institutions, work hard to make sure that suspected cases of elder financial abuse are reported and investigated, we want to remind all Californians that we all have a role to play in keeping our seniors safe.”

Elder financial abuse is a somewhat unique crime in that, oftentimes, it is a member of the family, close friend or caregiver who ends up perpetrating the crime, making it that much more difficult to detect.

commercial, industrial and community banks and savings associations

[Read More!]

TO REPORT A PROBLEM

Consumers who think they or their loved ones have been involved in this or a similar scheme are encouraged to call their state's Attorney General. For California Residents, Click CA Resources

RALEIGH - N.C. Attorney General Roy Cooper has sued two California companies, accusing them of fleecing elderly residents out of their life savings by selling them living trusts and annuities they didn't need.

Cooper filed the lawsuit against American Family Prepaid Legal Corporation Inc. and Heritage Marketing and Insurance Services, both of Irvine, Calif., for using aggressive sales tactics on elderly consumers. Both companies were sued last month by the Pennsylvania attorney general for the same tactics.

“What they try to do is to scare seniors into buying these living trusts and then into buying these overpriced annuities,” Cooper said Monday.

In one case, the lawsuit says, a Heritage agent convinced an 84-year-old man to buy two annuities worth $547,000, using the proceeds of his stock portfolio and another annuity. The man ended up paying $175,000 in capital gains taxes, which was not disclosed to him. He had to pay fees for cashing in one annuity to make the investments, where if he had waited 12 days, he wouldn't have had to pay any fees, according to the lawsuit.

In another instance, the lawsuit says, a Heritage agent sold an annuity to a 70-year-old woman who had been diagnosed as bipolar and paranoid schizophrenic. The agent took the woman to the bank to withdraw $29,000 to pay for an annuity even though she needed the money for her medical care, the lawsuit says.

Mildred Honeycutt, 74, of Raleigh, thinks American Family Prepaid Legal preyed on her 80-year-old sister, who was shopping for a will. Instead, the company sold her a living trust for $1,995.

“They took advantage of her,” Honeycutt said.

In a statement issued Monday, the American Family Legal Plan expressed disappointment that a lawsuit was filed. “We stand behind the affordable, quality service we have provided for thousands of clients in North Carolina and throughout the U.S.,” the statement said.

The lawsuit explains how officials say the companies worked together to prey on the elderly:

American Family Prepaid Legal would solicit customers via mailings and phone calls encouraging people to buy legal services plans to create living trusts to avoid paying probate costs.

Once a customer was interested, a sales agent would visit the person at home to make the pitch. The company billed its living trust, which cost $1,995, as a bargain in comparison to what someone would pay in probate costs, the lawsuit says. But for someone to pay almost $2,000 in probate costs, his estate would have to be worth more than $500,000, the suit says.

A living trust, Cooper says, “can be beneficial to people of means who are trying to avoid certain taxes.” But for the consumers these companies targeted, it was not a good decision, he said.

[Read More!]

Julius Tutinas received $61,154.48 in Medicaid services before his death in 1997. He left a surviving spouse, Beverly; because the couple's home and car were in joint names, she acquired ownership without the necessity of a probate proceeding. Beverly died, in turn, in 2001, leaving a will naming her two sisters as coexecutors. The coexecutors disallowed a claim filed by the state Medicaid agency for the cost of care provided to Mr. Tutinas, and then petitioned the court for instructions about whether to allow the claim. The trial judge found that the agency was permitted to assert its claim against the estate of a surviving spouse. The state Court of Appeals, with one judge dissenting, reversed and ruled that the Illinois law purporting to give the agency power to assert such a claim exceeded the authority granted under the federal Medicaid law. The state Supreme Court agrees with the Court of Appeals, ruling that while the federal law would permit an estate recovery action against the Medicaid recipient there is no authority for an action against the surviving spouse's estaate. "As we have just indicated, the Act provides three and only three exceptions for when the state may seek reimbursement for costs correctly expended on behalf of a Medicaid recipient. All are specifically directed to the etate of the recipient. No provision is made for collection from the estate of the recipient's spouse." Although Iowa, New Jersey, Nevada, Minnesota and Idaho cases cited in the opinion do permit recovery against a surviving spouse to the extent of assets received from the Medicaid beneficiary, those cases all appear to be based on state statutes expanding the definition of "estate" as permitted by federal law; since Illinois has not done so, no recovery is permissible against the surviving spouse's estate.

Full case: Hines v. The Deparment of Public Aid
Illinois Supreme Court, May 18, 2006

Husband and wife held a $451,791.50 account as joint tenants, and the signature card indicated that only one signature was required to withdraw the funds. Wife went to the bank alone, withdrew the entire balance, deposited it into a new account titled in her name with a POD designation to a third person, and died six months later. Husband brought a declaratory judgment action against the bank, seeking a determination that the bank wrongfully allowed his wife to "unilaterally divest" him of his property, and argued specifically that in the absence of clear disclaimer of a tenancy by the entirety the account should have been considered as marital property. The trial court granted summary judgment for the bank, and the state Court of Appeals agrees. The depositors contract in this case is clear and unambiguous, and although it imposes a difficult burden on the husband to make his claim against the POD beneficiary it is better to impose that burden on him than on the bnak, which would have no equitable claim to recovery.

Full case: Scott v. Union Planters Bank, N.A.
Missouri Court of Appeals, Southern District, May 15, 2006
http://www.courts.mo.gov/courts/pubopinions.nsf/8e937ac7ce0301288625661f004bc963/
8ae58930616b530f8625716f00734a48?OpenDocument

Only lowest of the low prey on OAPs
HELEN MARTIN

THIEVING is a despicable crime. Shoplifters may delude themselves that the only victim is a global retail chain, but we all suffer as a result.

Burglars convince themselves that their victims are insured anyway - or should be. Even bank robbers may see themselves as romantic Bonnies and Clydes, out to relieve the fat cat banks of just a small proportion of profit.

And, as long as no violence is involved, robberies don't usually rank highly in the public mind against murder, rape and terrorism. But one particular crime wave rippling across the Lothians should revolt and disgust us all even when the haul is relatively low.

Over the last fortnight, at least 14 elderly people between 70 and 93 years of age have been robbed in their homes by bogus workmen claiming to be from utility companies. In some cases, not surprisingly, there was no cash to be had. In others, there were small nest eggs carefully put by for emergencies.
[Read More!]

SEATTLE POST-INTELLIGENCER
Frist promises Senate vote as early as next week
Saturday, May 6, 2006

By MARY DEIBEL
SCRIPPS HOWARD NEWS SERVICE

WASHINGTON — Stephanie Letzler is a typical high-school junior shopping for colleges this spring, but she's hardly typical when it comes to college costs: She knows she'll graduate “without owing a dime,” thanks to family money she'll inherit someday.

“If Congress kills the estate tax, I inherit tax-free but not guilt-free when my friends will have to take out big loans for college and spend the first 10 years after graduation paying their debts,” says Letzler, 17, a banker's daughter from Baldwin, N.Y.

Letzler and other members of Responsible Wealth, a group of wealthy taxpayers formed to fight estate-tax repeal, have redoubled their efforts in advance of a Senate vote that Republican leader Bill Frist of Tennessee has promised as early as next week on repealing federal estate taxes or, more likely, slashing them drastically.

[Read More!]

Sunday May 14 10:27 AEST
Too many retirees will find themselves broke if they live longer than expected and Australian fund managers aren't doing enough about it, according to an asset consultant.

Most people don't understand the financial implications of an increased lifespan said Mercer Oliver Whyman director Anthony Bice, who issued the warning despite acknowledging the Australian government's recent reduction of super taxes would help address the longevity problem.

“There's a danger that without underlying protection for the longevity risk then people might end up falling short when they hit 80 to 85,” he told delegates at the Institute of Actuaries of Australia conference in Sydney.

[Read More!]

“May 16, 2006
Lung capacity linked to dementia
By Alex Cukan
Researchers at Sahlgrenska Academy in Goteborg, Sweden, found a strong statistical correlation between lung capacity and dementia.

The study covers a total of 1,291 women whose lung capacity was first monitored in 1974 and then in 1980 when the women were in middle age. The monitoring was then repeated several times up to 2000. Of these women, 147 had developed dementia, 96 of them in the form of Alzheimer's disease.

The study shows that there is a clear statistical correlation between the functioning of their lungs and their risk of developing Alzheimer's disease.

"Our theory is that poor lung function leads to the brain receiving less oxygen, and this in turn increases the risk of dementia," says Xinxin Guo, a post-doctoral fellow at the Sahlgrenska Academy.

The findings are presented in the American journal Neurobiology of Aging.”

UPI.com: Lung capacity linked to dementia

BRAIN SCAN: Study finds brain changes that may predict dementia and Alzheimer's.

New York: A new study has identified structural and metabolic brain changes that may predict dementia or cognitive decline in normal older adults. Furthermore, the anatomical location of these changes suggests Alzheimer's disease pathology.

To determine if brain imaging could identify predictors of dementia in people with normal mental function at baseline, researchers followed 60 Latino individuals who were 60 to 100 years old for an average of 4 years.

The subjects underwent examination with two imaging techniques-positron emission tomography or PET imaging and magnetic resonance imaging or MRI. At follow-up, six subjects developed cognitive impairment or dementia.

According to Dr. William Jagust of the University of California at Berkeley and colleagues, there was a ''high positive correlation'' between faster declines in cognitive function on a standard test and lower glucose metabolism in key areas of the brain.

The pattern of glucose metabolism, together with the location of brain regions that are predictive of Alzheimer's "suggests that these findings are due to the detection of presymptomatic Alzheimer's disease, the researchers conclude."