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San Diegans Rick and Susan Dolfo have launched a class action suit against Bank of America, claiming breach of contract, unfair competition, violation of the Rosenthal Fair Debt Collection Practices Act, and violation of the Consumer Credit Reporting Agencies Act.

“This is yet another tale of Bank of America cheating its customers,” says the complaint filed by the Dolfos’ counsel, Timothy Blood.

The Dolfos did not have an impound account, where the lender collects property taxes and hazard insurance payments in monthly increments, then pays the bills on the customer’s behalf. Though the borrowers claim they were not delinquent on either taxes or insurance, Bank of America set up an impound account on their behalf and began deducting sums from their monthly payment without notifying the Dolfos.

Because the remaining money they sent each month was no longer enough to cover the mortgage payment, B of A declared the borrowers to be in default and began assessing late charges and penalties to their account. Their insurance company and the county assessor began receiving double payments, both from the Dolfos and the bank. The Dolfos further allege that B of A began falsely reporting their account as delinquent to credit bureaus, damaging their credit score.

“Prior to filing this suit, plaintiffs spent months trying to work with Bank of America to solve the problems created by Bank of America: to close the impound account, stop the double payment of homeowner's insurance and property taxes, stop the improper deduction from the monthly mortgage payments, reverse the improper default and have Bank of America correct the improper credit reporting. But, just like millions of other Americans who have tried to work with Bank of America, plaintiffs made no progress, and were constantly put off by Bank of America, mislead and ignored,” the complaint continues.

The suit claims that B of A and its loan servicing arm, BAC Home Loans Servicing (also named as a defendant) have done this to other borrowers as well, sometimes even beginning non-judicial foreclosures on borrowers who have never missed or made a short payment. Such a practice, which does not require court approval of a foreclosure and thus expedites the process, is common in states such as California that use trust deeds instead of mortgages as security instruments for home loans. The Dolfos are seeking class damages as well as punitive damages for the violations listed in the opening paragraph.

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Comments

SurfPuppy619 Dec. 7, 2011 @ 10:22 a.m.

"But, just like millions of other Americans who have tried to work with Bank of America, plaintiffs made no progress, and were constantly put off by Bank of America, mislead and ignored,” the complaint continues."

This is all too common when banks and others get so big and toake over all the competitors there is no competition left in that business sector.

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Visduh Dec. 7, 2011 @ 10:36 a.m.

Even when that bank was a California institution (it isn't any more), it was the absolute WORST bank to deal with. Why anyone chose to do business with BofA was a perpetual mystery to me. In fact over two decades ago, it nearly failed, and needed a bailout. You could have described BofA as inept, bureaucratic, arrogant, insulated, and a whole host of other derogatory things.

This case looks like a dumb administrative slipup that should have been corrected as soon as it was detected. But someone in that megabank just could not admit to making an error, and persisted in it. One can only wonder just where the loan servicing is done. Probably around Karachi or Mumbai. In both places the workers speak something that passes for English, but if you expect them to exercise any common sense, fuhgeddabouddit! They follow their "rules" as mechanistically as any robotic device ever would.

I can only hope that these folks really kick butt with this suit.

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SurfPuppy619 Dec. 7, 2011 @ 4:57 p.m.

2.Even when that bank was a California institution (it isn't any more), it was the absolute WORST bank to deal with. ==

When I was a commercial real estate broker I tried to do some deals with some REO BofA properties, and they were so big they just could not function. Same with Wells Fargo, but BofA was worse than Wells.

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