Did Bank of America Violate Automatic Stay?

[BkinTX]

Our mortgage is with Bank of America (the recently bought out Countrywide, who was previously our lender, heh, who bought our loan from the ORIGINAL local lender)...

We are also BKing substantial cc debt with BofA.

I called earlier this month to make our mortgage payment (on which we are current). I authorized the payment amt (918.55, specifically). Took down a confirmation number.

I later discovered that the 918.55 had been deducted from my checking account ALONG WITH a separate charge of $31.90, which was NOT authorized.

This is the amount of Countrywide's late fee (BofA's is actually a different amt).

I called BofA to sort it out since we were not behind. The representative told me it was a late fee from November of 2008. I checked my records and no such fee could be found on ANY of my statements.

I acknowledged that it was possible that I did owe that late fee (I had been doing partial payments, bi-weekly, at that time, not knowing that was not acceptable to Countrywide), but it was not shown on any of my statements and why was it only now being asked for...not asked for...taken without authorization.

The fee was waived (credited to my next payment due).

Should I bring this up with my lawyer? Is this a legal thing to do period, much less when a customer is in a bk?

[JRScott]

I would probably let it go if they've refunded it. Depending on your agreement contacting them could have authorized them to charge it I'm not sure, but if its refunded then there is no real action you could take as you couldn't prove damages.

[BkinTX]

We'll see if they refunded it, LOL.

I mentioned that I didn't think it was legal and the rep was quite helpful at that point. I really think they may have violated stay. I don't know that I would do anything about it if it were actionable.

I don't think BoA acts ethically regardless.

[CH33 Paralegal]

yea, if they actually do refund it on the next payment, then you really haven't been wronged, unless you were $31 short of making due for that specific month and incurred late fees or other penalties because of the lack of that $31.00

[BkinTX]

HAHA we were spectacularly broke when they did it (bad month).

I don't feel "wronged" so much as I am curious if what they did was LEGAL.

[music12]

i don't think it's just the stay that they violated. it's an unfair business practice to suddenly, more than 7 months after the fact, charge you a late fee.

did they suddenly remember the fee after you filed bk??

[BkinTX]

Yeah, I think it's crap. I think they scoured our acct looking for something to ding us on.

I don't see how they can pull money out of our checking account (not associated with them) without authorization. Isn't that kinda like...what's that word? FRAUD?

[BkinTX]

When I called I looked over my paper statements and the rep had something else to look at -- our acct info and then a generic statement formatted like the paper statements.

Because of the bk they do not give me online access to view my acct info. This means it's not online at all -- even for the reps to look at.

So she is telling me where the fee should be listed on all these statements and it's absolutely not there.

If I just went by my statements I would have NO IDEA there was such a late fee. It was simply not on any of the statements and no one had ever brought it up, EVER.

They just decided to pull it. Without ever mentioning it to me or authorizing it.

I'm not 100% that I even ever owed it. It's possible but not rock solid likely. I have had late fees a few times before I learned that Countrywide wouldn't let me make bi-weekly payments (they would, however, accept bi-weekly auto drafts with a $8/mo fee attached). I paid everything up.

I'm not behind at all and would have paid the fee had I known it existed.

It's all very strange. But we'll see. The rep gave me her word and her info so I can call them back if they don't credit it to my next payment.

[justbroke]

If they aren't hold on to "property of the estate", it's hard to find them in violation of the stay by exercising control over property of the estate. They're dumb, but not that dumb. Now, if they kept the money... that's a different story.

[BkinTX]

I don't understand what you mean by that...could you explain (as if you are explaining to a, umm, dumb person, hehe)?

[justbroke]

I don't understand what you mean by that...could you explain (as if you are explaining to a, umm, dumb person, hehe)?

LOL

(This may not be right on point, but is close)

There have been cases where, for example, you write a check to a PayDay loan place before filing. You then file and tell the PayDay Loan place that there's a stay and not to cash the check. They do cash the check. Here are two scenarios from that...

Scenario 1: they cash the check, but then they refund it to you after you call. They do not delay or try to stall and rather quickly give you the money back. They are not in violation of the Stay at all.

Scenario 2: they cash the check, but then after you call, they refuse to refund the money. In this case, they are in violation of the stay because they continue to exercise control over "property of the estate".

In both cases, cashing the check is not a violation... even if they knew of your bankruptcy case. Congress added 362(b)(11) to the Automatic Stay because we all know that we still need to write checks after you file. So, they didn't want the mere presentment of checks to be an issue. While you did originally authorize them for the regular payment, their system took the additional amount. However, they immediately returned it, so they are not attempting to exercise control over property of the estate.

Short answer... presentment of checks is not a violation. Keeping the proceeds of presenting the check, can be a violation of the stay if the entity cashing the check doesn't return the proceeds to the debtor, without any delay.

Hope that helps.

[BkinTX]

Thanks for the explanation.

They actually did not offer to return it. I discovered the problem, called, and spent and hour on the phone with them before a supervisor cleared the two options: a) returning the money or b) crediting it to my next payment.

I chose the latter since they already had the $.

It wasn't a mistake on their part. They intentionally took money I didn't authorize and I suspect they hoped I would just ignore it.

I am pissing and moaning here, haha, because I think it's crap but I do realize it's essentially inconsequential.

[CH33 Paralegal]

it makes me laugh....nothing but insults and trashing to countrywide and quesitons about their ethics and competency....until they sell the debt to someone else, and then it's all of a sudden perceived that they did everything right.

Remember that Bank of America bought a big steaming turd. You tell me if you think Countrywide was a legitimate, ethical company that did everything right......

Countrywide probably misrepresented what they were even offering to BOA.

BOA could have possibly been under the impression that you didn't even file. ANd when they take over something the size of c-wide and as screwed up as c-wide, they can't possilby be expected to have everything in order instantly.

[BkinTX]

I was not pleased to have had my mortgage sold to either Countrywide or BofA.

BofA KNEW I filed. They pulled my online access immediately and I spoke to them regarding it. When I call them, I call the BANKRUPTCY DEPARTMENT.

I'm not sure what you're getting at, but you make ME laugh too.

[CH33 Paralegal]

Just getting at my contempt for dishonest countrywide with their deceptive practices.

If you actually talked with BOA before about BK, then yeah, they did technically violate the code by charging you pre pet late fees.