MFI-Miami Blog

DITECH BANKRUPTCY LIQUIDATION PLAN IN TROUBLE AS NEW YORK AG INVESTIGATES SHADY RMS SERVICING PRACTICES The New York Attorney General has filed a brief in the Ditech bankruptcy case. AG Letitia James objected to the Ditech bankruptcy liquidation plan. She argues that the plan will strip homeowners of their rights. James also argues that Ditech and Reverse Mortgage Solutions are using bankruptcy protection to circumvent statutory protections for homeowners. The brief also states said that the Ditech has more than 880 foreclosure actions pending in New York. This includes 642 forward and 239 reverse mortgages. The current Ditech bankruptcy liquidation plan threatens to sweep these homeowners’ claims and defenses under the rug. James asserts: A free and clear sale of the Debtors’ mortgage assets would erase the key defenses of homeowners in the foreclosure process.  Read more at  MFI-Miami

Bank of America Warns Ditech’s Sale of Reverse Mortgage Solutions Could Leave Seniors Abandoned Ditech Holdings announced last month that it had  entered into an agreement  to sell Reverse Mortgage Solutions. Ditech is selling the reverse mortgage unit as part of its bankruptcy restructuring. However, Bank of America is objecting to the sale. Bank of America has a servicing agreement with Reverse Mortgage Solutions. They filed a motion in the bankruptcy court objecting to the deal as it currently stands. They also allege that it threatens to abandon the thousands of elderly borrowers whose reverse mortgages are being serviced by RMS. Ditech’s current deal has it selling off the stock and assets of RMS to Mortgage Assets Management. Bank of America claims the sale does not uphold its agreement with RMS. BofA also states their agreement stipulates that RMS provides them with extensive lead time to establish other servicing arrangements of its borrowers. Read more ...

Ditech Customers Win Protections in Ditech bankruptcy As Ditech Promises To Fight Back Ditech customers won a major victory in the long and winding saga of Ditech’s bankruptcy. The bankruptcy Trustee granted a request to create a committee to protect consumer interests in the proceedings. The Trustee’s decision riled Ditech’s attorneys. As a result, they filed a motion objecting to such a committee. They asked the trustee to disband the committee or limit the scope of its involvement in the bankruptcy proceedings. The drama began when a group of Ditech customers formed a consumer committee drama began last month. They soon  filed petitions  with the bankruptcy trustee asking for the creation of a committee to represent the interests of Ditech customers. Read more at MFI-Miami

Reverse Mortgage Solutions Fraud Victims Want Protections In Ditech Bankruptcy Chicago area mortgage broker scammed 125 Chicago area seniors in a reverse mortgage fraud scheme involving RMS. Victims of a Reverse Mortgage Solutions fraud scheme want their money and they want their voices heard. They are concerned that the bankruptcy of RMS’s parent company Ditech will nullify their settlement agreement. The case involved 125 African American families and about six different HECM lenders. The result cost these homeowners and the lenders $7 million and left a number of unwitting borrowers facing foreclosure. Three of those homeowners now have claims regarding their reverse mortgages with Reverse Mortgage Solutions. RMS is a Ditech subsidiary that either acted as the lender or servicer on the loans in the scheme. Two years ago, a Chicago loan officer was charged with defrauding elderly homeowners in a  reverse mortgage scam  by taking out reverse mortgages without the...

Ditech Alert: Ditech Files For Chapter 11 Bankruptcy For The 2nd Time In 14 Months. Is This The End Of Ditech? It appears the financial troubles for Ditech Holdings is are getting worse. A Ditech Alert has been issued by the company. The company has filed for Chapter 11 Bankruptcy for the second time in 14 months. The company  emerged  from Chapter 11 bankruptcy last year after completing a financial restructuring plan that  eliminated $800 million  in corporate debt and  changed its name  to Ditech Holding. But that wasn’t enough to put the company’s troubles behind it.  The Ditech Alert was issued yesterday by the company. The announcement stated that  Ditech Financial and Reverse Mortgage Solutions have entered into a restructuring agreement with its creditors. Read more at MFI-Miami