Since the real estate bubble burst in 2007 we hearing all sorts of horror stories about how banks and other mortgage lenders have been putting the screws to homeowners. Well now its payback time as HSBC Banks has been sued by New York State Attorney General Eric Schneiderman.
According to WIVB-TV, Schneiderman has filed a lawsuit HSBC stating that it has deliberately broke the law.
“When a bank like HSBC flagrantly disregards the law and systematically hurts homeowners all across our state, they have to be held accountable,” Schneiderman said.
In New York State when a bank files a foreclosure notice, they are required to request a settlement conference to give homeowners one last chance to keep their home. This is called the Homeowner Protection Program, which requires a bank that files a foreclosure notice to request a settlement conference within 60 days. One of the victims of HSBC was homeowner Tracy McClary of Buffalo who at the conference stated it took HSBC over a year to file for a settlement conference.
“I am currently working two jobs to make these payments which are now almost double the amount of my original home loan,” McClary said.
Schneiderman estimates that 25,000 across New York State are facing this kind of nightmare. The problem is that when a homeowner is in foreclosure they are unable to renegotiate their mortgage. According, to Erie County Executive Mark Polancarcz, the law was enacted to help homeowners solve their financial problems with the bank and save their credit.
“That if you do fall behind in your mortgages, you do have an opportunity to get out from it, and you don’t fall into this endless cycle where you are stuck in a home that you can’t pay for, and the banks refuse to move forward, and your house is in foreclosure, which destroys all of your credit,” Poloncarz said.
New York State’s lawsuit against HSBC isn’t going to be the end of it. Schneiderman said he isn’t done as he is already looking into other banks like Wells Fargo and Bank of America who are engaging in abusive foreclosures.
One question I have now is the U.S. government going to follow New York State’s lead and start making banks pay up for all the things that they have done. I have my doubts about that as Republicans like to defend big business and will most likely call it a witch hunt to distract the American people from the real story which is the alleged crimes the Obama administration committed! (Please note that the last part of the sentence was written in sarcasm)
Now, if the federal government doesn’t do anything hopefully other states will follow New York State’s lead and file lawsuits against the likes of HSBC who don’t give a crap about anyone and will do anything just for the sake of the almighty dollar. At least for now homeowners in Western New York can take some relief in the fact that HSBC and other banks are finally being sued and getting what they deserve at the hand of New York State’s Attorney General.