JPMorgan Chase Advised Homeowners to Stop Making Loan Payments…and Then Foreclosed

Tuesday, April 06, 2010

JPMorgan Chase has been accused of telling homeowners to not pay their mortgages in order to be considered eligible for a loan modification—only to then foreclose on the properties for non-payment. The matter was brought to light by a lawsuit filed in Sacramento, where Faiz and Khadua Jahani have accused Washington Mutual and its new owner, JPMorgan, of providing contradictory information and endangering the couples’ ownership of their home.

“I’ve seen this happen to so many people,” the Jahanis’ attorney, Piotr Reysner, told Courthouse News Service. “When they come in here to tell me their story, I can actually tell it to them.”
Reysner said his clients were told by a bank representative that they had to be in breach of their loan terms before they could qualify for a loan restructuring. The Jahanis were allegedly informed to stop making payments for three months. But once they did this, they received threatening letters from the bank instructing them to pay the outstanding amount or else face foreclosure.
-Noel Brinkerhoff
Thanks a Lot, JP Morgan Chase (by Maria Dinzeo, Courthouse News Service)
Jahani v. JP Morgan Chase (U.S. District Court, Eastern California) (pdf)


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