Mortgage Service Providers: A Rogue Industry with "Structural Incentives" for Abuses

In recent months, the mortgage servicing industry has emerged from the shadows to take its place as one of the great villains of the mortgage meltdown and foreclosure crisis. Last fall, state attorney generals across the country launched a concerted probe of the industry and compiled a mountain of evidence of deceptive and abusive practices that have had devastating effects on homeowners struggling to avoid foreclosure. The suit filed in just one state, Nevada, against one lender -- Bank of America and its servicers -- runs 152 pages and is filled with horror stories. (See below)

Charges of foreclosure fraud, in which servicers fabricated documents for foreclosure proceedings, are among the least of the abuses uncovered by the probe. More heartbreaking are the stories of homeowners who drained their savings or ran up debt to continue making payments as part of mortgage modifications deals, only to have their homes foreclosed on anyway. Read More

State of Nevada vs Bank of America