Banks Admit Mistakes on Military Mortgages - Image: Thetruthabout (Flickr.com CC-BY-SA 2.0)
The past two years have been incredibly bad for banks, especially those that provide mortgage loans for consumers. However, things have gotten worse today after a report showed that several banks had taken advantage of active duty military personnel, directly against the federal regulations.Now many of the banks are doing a song and dance trying to get out of trouble with the feds.
JP Morgan Chase is the first bank to act on the mistakes that were made. They admitted this morning that they foreclosed on 14 homes belonging to soldiers serving overseas and also charged inflated interest rates for those in the military. According to federal law, the interest rate for mortgages is set and cannot be changed for soldiers and those serving on active duty cannot have their homes foreclosed on.
Now Chase has a lot to do. The foreclosures have been spread out over the past two years and most of the homes have been sold to foreclosure buyers. Thus the bank will be on the hook to find and purchase new homes for the soldiers that lost their homes to the illegal actions.
Those that were being charged excessive interest charges will be receiving refunds care of the bank. There is no word when these actions will be taken but it is likely that the bank will move quickly. The longer they take the more government scrutiny that will fall on them while the investigation continues into the banks.
