By Robb Hicken/ BBB’s chief storyteller
In this day of mortgage modification, defaulting loans and repossession, all bankers need is a letter claiming an investigation is being done.
Marsha K. Williams, vice president & retail and business relationship manager at Syringa Bank, did not know what to expect when a client called saying she had a letter that an investigation into the bank’s lending practices under way.
“As you see, it is basically an offer of a refinance,” Williams says. “But, the way that it is worded is to approach the fear of the customer to convince them that they could be in a fraudulent situation with our bank.”
The letter reads: “Our office is investigating the lending practices of Syringa Bk to determine whether Syringa Bk engaged in deceptive or fraudulent lending practices. Records indicate that you may have the type of home loan or mortgage our investigative auditors are reviewing.”
Williams says, “Obviously, they got the information from public records as indicated in the footnote.”
Better Business Bureau called the number 888-297-6998, and Hal answered. When BBB asked for the name of the company, the man disconnected the call. Emails and faxes were not returned.
In small print, at the bottom of the letter, it states the company is not a law office and does not practice law. Securitization Audits are the only services offered. The disclaimer declares this is an advertisement for services only. There’s nothing stating how the audits will be used once they are produced.
Here’s how it works:
A third-party researcher scours various publicly available resources and records to find proof that your loan was securitized, meaning the loan was pooled with other loans and sold to investors.
A well-trained auditor can pinpoint the location of the loan among hundreds of thousands of investments. After discovering the exact location of the loan, the audit would be turned over to the mortgage holder. The audit, a multi-page document and an affidavit, can be admissible in court. The document will show whether the loan was securitized and in some cases what investor pool your loan belongs in.
Most information is public and available from the SEC. What the company provides is an affidavit– a statement of fact – that the loan was securitized.
There is nothing illegal about the letter, or the “advertisement” being sent out, the wording “an investigation” can cause angst in recipient and banker.
“I felt like this was something that perhaps you needed to make the public aware as I am sure it will cause a lot of confusion,” Williams says. “I am sure we are not the only bank that has been mentioned in the letters.”