The Latest Wave In The Foreclosure Crisis? Another Bank Branch Foreclosed Upon By Borrower

by:  Peter J. Gallagher

Several weeks ago, we brought you the story of a Philadelphia man who foreclosed on his local Wells Fargo branch ("Turning The Tables: Philadelphia Man Forecloses On Wells Fargo Branch") after the bank failed to pay a judgment the man obtained against the bank for violating the Real Estate Settlement Procedures Act.  The bank eventually paid.  Well, now it has happened again. 

In Florida, which should just change its name to the "Foreclosure State" at this point, a couple recently received a foreclosure complaint from Bank of America.  Nothing too strange in this day and age, except that the couple had paid for their home in full and in cash when they purchased it.   As the Naples News reported — in the cleverly titled "Tables Turned, Bank Pays Up In Mistaken Foreclosure Case" — the homeowners were forced to hire a lawyer, who spent weeks on the phone and in court before the case was dismissed, costing the homeowners $2,500 in legal fees.  The court ordered the bank to pay these fees, but after five more months of phone calls, neither the bank nor its local counsel had paid.

This is where the story gets interesting.  The homeowners' lawyer obtained a writ of execution from the local sheriff in connection with the debt and took it with him — along with local media, sheriff's officers, and a moving van — to a local Bank of America branch and demanded payment or the branch would start losing furniture, money in the cash drawers, and any other assets needed to satisfy the debt.  Not surprisingly, the branch manager quickly cut a check to the couple for the outstanding amount.  In a written statement, Bank of America apologized to the homeowners and did the only thing it could do, blame the law firm that had been representing the company, which has since gone out of business, for failing to respond to the homeowners' requests.

Turning The Tables: Philadelphia Man “Forecloses” on Wells Fargo Branch

by:  Steven P. Gouin

During the past few years, “foreclosure” has joined the national lexicon of dirty words. Americans have grown accustomed to viewing stories about families who have fallen behind in their mortgage payments and seen their bank foreclose on their home.  In fact, over 2 million U.S. homes are currently in foreclosure, almost 3 million mortgages are at least 60 days in arrears, and close to 11 million homeowners, nearly 1 in 4, are underwater – owing more on their mortgages than their homes are worth.  Due to the recession and corresponding collapse of the housing market, there is little indication that this trend will change in the near future.

However, a Philadelphia man provided homeowners a moment of levity in an otherwise difficult situation, and just may have become a folk hero in the process, when he foreclosed on his bank.  That’s right.  Patrick Rodgers, of Philadelphia, recently obtained a judgment against Wells Fargo and ordered a sheriff’s sale of the bank’s branch office. 

When Rodgers was told he had to buy a $1 million insurance policy on his $180,000 home, he demanded to know why.  When Wells Fargo failed to provide him with a timely response, he did some research and learned that the Real Estate Settlement Procedures Act entitled him to an explanation within 20 days.  Because the bank had never answered his inquiry, Rodgers sued for damages and won a judgment of just over $1000.  Wells Fargo refused to pay, and Rodgers enforced the judgment by ordering a sheriff’s sale of his local Wells Fargo branch office.  The notice of sheriff’s sale ultimately prompted Wells Fargo to pay on the judgment, but not before news of Rodgers’s story spread and became another chapter in the ever-unfolding story of the foreclosure crisis.