Study: Bank of America, Wells Fargo, JPMorgan lead Florida in complaints

Senior Reporter – South Florida Business Journal

Bank of America, Wells Fargo Bank   and JPMorgan Chase Bank    are the institutions Florida consumers complained about to regulators the most in 2011, according to a study by Miami-based bank analyst and economist Kenneth H. Thomas.

Working through his company K.H. Thomas Associates, Thomas obtained records of complaints filed against financial institutions to the Florida Office of Financial Regulation’s    Division of Financial Institutions, the state’s chief bank regulatory agency.

Florida consumers lodged 1,231 complaints against banks in 2011, down from 1,379 in 2010. However, that’s still significantly higher than the 992 complaints from 2008 – when the financial meltdown was just starting to take hold.

The trend in hard-hit South Florida wasn’t so positive. Complaints from Monroe, Miami-Dade, Broward and Palm Beach counties increased to 180 in 2011 from 149 the year before. Thomas said it’s because the housing problems are worse in South Florida.

“Even though the economy has improved in the state, we are still the epicenter for the housing crisis,” he said. “People stilling trying to do workouts and modifications, and they aren’t getting the help they are looking for from these banks.”

Filing a complaint against a bank is a serious matter, Thomas noted, as it involves filling out a five-page form and attesting that the information is true. He recommends that people try to work out issues with their bank before contacting the OFR.

“To get to that point, you have to be really upset,” he said.

The OFR complaint page is here.

The most common complaint in 2011 was account balance disclosures, at 28 percent of all filings, according to Thomas. That includes disputes about overdraft fees – the subject of many lawsuits against banks – and other automatic fees.

The second most frequent complaint was mortgage problems, at 23 percent. Other common issues were general loan complaints and credit card disputes.

Thomas’ records show that most complaints the OFR received in 2011 were referred to federal regulators to follow up on. Only 7 percent of complaints were found to have no violation, and 4 percent were resolved by the OFR.

On the bright side, Thomas noted several banks didn’t receive any complaints. That includes Miami-based City National Bank    of Florida and Northern Trust    .

City National Bank President and CEO Jorge Gonzalez said his institution excels in customer service because it has a 65-year history in the state and it makes sure its bankers don’t have too many clients to service.

“If a banker has 20 relationships, they can probability deliver a high level of service to everybody, but if they have 100 relationships, they can probably only deliver a high level of service to a few of them,” Gonzalez said. “It’s a slightly more expensive model, but you need that for best-in-class service.”

Last year, City National hired Steven Clark as its service director. Clark has experience with customer service in both banking and hotels, such as the Ritz-Carlton. He said his goal is to create a concierge-level customer experience.

Gonzalez said it’s worth it to spend on customer service because that reduces client turnover, which is expensive. He said it’s important to treat all customers the same – no matter how much money they have. Some institutions offer higher levels of service to wealthy clients.

Many banks, especially those struggling with losses, have cut back on staffing levels in recent years. That includes top complaint-getter Bank of America    (NYSE: BAC). Officials with BofA didn’t respond to a request for comment.

Space Coast Credit Union had the most complaints of Florida-based institutions and was in fifth overall. Thomas noted that SCCU had a 0.6 percent deposit market share in Florida in 2011, but attracted 6.5 percent of all complaints.

SCCU spokeswoman Meredith Gibson said the credit union changed its Member Rewards relationship pricing program in 2011 for all 370,000 members, and that resulted in some people moving to different types of checking accounts. She said former members of Eastern Financial Florida Credit Union    , which SCCU merged with in 2009 to enter South Florida, have complained at a higher rate than historical SCCU members.

“They experienced many charges as a result of the merger, and they continue to be unhappy with SCCU’s practices in some areas,” she said. “A particular market condition that caused complaints in 2011 is dissatisfaction with the disposition of requests for mortgage loan modifications. While SCCU has been actively working with members who are experiencing hardships, there are cases where we cannot provide a solution that is satisfactory to the borrower.”

Gibson said SCCU has an internal system for tracking and responding to customer complaints, and these entries are regularly reviewed by senior management.

“To date, the OFR has not found that SCCU is in violation of any regulation and has closed all cases,” she said.

Considering that BofA holds a 19.1 percent deposit market share in Florida, Thomas said its 13.6 percent share of all complaints isn’t that bad. Wells Fargo (NYSE: WFC), SunTrust (NYSE: STI), Regions Bank    (NYSE: RF) and BB&T    (NYSE: BBT) also had a lower ratio of complaints compared to their deposit market share.

However, both JPMorgan Chase Bank (NYSE: JPM) and Citibank    (NYSE: C) had a high share of the complaints compared to their place in the Florida deposit market, Thomas’ study found.

The most banks that received the most complaints in Florida in 2011 were:

  • Bank of America and affiliates: 172
  • Wells Fargo Bank and affiliates: 115
  • JPMorgan Chase Bank and affiliates: 99
  • Citibank and affiliates: 53
  • Space Coast Credit Union: 48
  • SunTrust Bank and affiliates; 48
  • Regions Bank: 25
  • BB&T: 24
  • HSBC Bank and affiliates: 19
  • BankAtlantic (NYSE: BBX); 18
  • Capital One (NYSE: COF): 18
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BRACE YOURSELF FOR TRIPWIRE IN THE HARP PROCESS

March 02, 2012 12:00PM

By Kenneth R. Harney

The most ambitious federal mortgage program to date aimed at millions of underwater homeowners is poised to take off in the coming two weeks, yet some key issues could hinder borrowers’ participation. One of them involves something most owners know nothing about: Who was your mortgage insurer on your underwater loan?

Though it was announced by the Obama administration late last year, the so-called “HARP 2.0″ — the second version of the Home Affordable Refinance Program — will only hit full stride around the middle of this month, when Fannie Mae and Freddie Mac finish tweaking their automated underwriting systems to accept applications, and lenders and mortgage insurance companies start handling large volumes of requests.

The revisions are crucial for owners who have outstanding mortgage balances in excess of 125 percent of the current resale values of their homes. Under the second version of HARP, there is no upper limit on permissible loan-to-value ratios, or LTVs. You can owe twice or even three times the value of your home and still qualify for a refinancing at today’s low interest rates. The earlier version imposed a limit of 125 percent, which cut out millions of the hardest-hit victims of the real estate bust.

The latest HARP also comes with streamlined underwriting — no requirement for physical appraisals in many cases, speedy processing and elimination of some of the deal-breaker fees imposed by Fannie Mae and Freddie Mac in recent years.

The objective, federal officials say, is to get it right this time around by removing the previous obstacles to widespread participation by lenders and severely underwater borrowers. Industry studies estimate that as many as 6.9 million loans could fit the broad requirements for refinancing, but that far fewer — somewhere around 2 million borrowers — are likely to qualify on all the detailed eligibility criteria.

Among the key rules:
— Only loans owned or guaranteed by Fannie Mae and Freddie Mac are eligible. Underwater borrowers who have FHA, VA or other types of mortgages are not. Both companies’ websites offer “look up” features that tell you whether they own your loan.
— Your mortgage must have been purchased or securitized by either company no later than May 31, 2009, and must have an LTV ratio in excess of 80 percent.
— You must be current on your loan with no 30-day late payments during the six months preceding application and no more than one late payment during the last 12 months.

If you think you qualify right now, you can apply to your mortgage servicer and ask how to proceed. Once the fully automated program gets going in a couple of weeks and your LTV is higher than 125 percent, you should also be able to shop around among other lenders who are large enough to run servicing operations of their own.

But be aware of a little-noticed glitch that has arisen in the program that could hamper your opportunity to refinance. Some lenders may not want to proceed with your application solely because of a detail buried in your loan documents that was always beyond your control — the name of the mortgage insurer on your current loan. If it is United Guaranty, they may set your application aside because that firm alone has not agreed to adhere fully to the streamlined procedures other insurers accepted as part of the basic deal with the White House, Fannie and Freddie to kick-start the revised refi program.

The issue is technical and complicated — United Guaranty has refused to waive its rights to force lenders to repurchase what it considers badly underwritten loans, and is requiring additional underwriting in some cases. All other private mortgage insurers have waived their rights. The net effect of United Guaranty’s policy, say lenders and federal officials, is to disrupt the intended fast and efficient processing of HARP refi applications — potentially denying lower interest rates to as many as 10 percent to 15 percent of underwater borrowers who might otherwise qualify.

Some major lenders, such as Quicken Loans, said in interviews that they will have to either set aside or reject HARP applications where the original loan carries United Guaranty insurance. United Guaranty, a subsidiary of giant insurer AIG, said in an email statement to me that it “fully supports the Obama administration’s efforts” in revising HARP, and that only a “minority” of its insured mortgages should be affected by its policy disagreement with the rest of the industry.

Bottom line for you if you’re deeply underwater and interested in a HARP refi: Proceed with your application anyway, but be aware there are tripwires and snares that could derail you.
Ken Harney is a syndicated real estate columnist.

HAMP New Guidelines

Expanding our efforts to help more homeowners and strengthen hard-hit communities | Janus International Realty.

Expanding our efforts to help more homeowners and strengthen hard-hit communities

Expanding our efforts to help more homeowners and strengthen hard-hit communities

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Forbes most miserable cities: South Florida cities top Forbes’ most miserable cities list – South Florida Sun-Sentinel.com

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Just Listed! Fort Lauderdale Waterfront Home…Direct Ocean Access

2701 SEA ISLAND DRIVE, FORT LAUDERDALE, 4 Bedroom/4 Bathroom, Pool, Waterfront…direct ocean access, Stunning modern architecture this award winning custom residence is walled/gated for privacy in secured Seven Isles.Geometric design offers open spaces,luxurious custom finishes throughout, perfect for entertaining or private enjoyment. Limestone & Ipei wood floors,feature fireplace.Epicurean’s kitchen with custom cabinetry…..$3,295,000.00.

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Just Listed…..SW Ranches Equestrian Home 2+ acres

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A great find……if you are looking for a Rental…Palm Aire in Pompano Beach

As most realtors can attest, when we stumble upon a great neighborhood…..we are thrilled and thoughts run through our minds as to “how can we share this with others or market this area?”.   A couple of weeks ago, I was diligently looking for rentals for a client….I typically defer these sort of inquiries to a junior associate, however, I’m a bit short staffed these days…so I decided to take on this task….my client was interested in an inexpensive apartment, good area, safe and in Pompano.    I searched and searched…made calls…and was referred to Palm Aire.    BINGO!!!!! Great development, very well kept condominiums available for rent, nice amenities, and within proximity to the Turnpike and I-95.   The only con is no pets….”pet restrictions.”

The Palm Aire area of Pompano Beach is very extensive, and approximately 1.5 square miles in size. Palm Aire Contains four Golf Courses along with, condos, villas, townhomes, and single family homes. Each property unit has its own recreational area with a pool. There may be 30 or more of these located in Palm Aire. All along the edges of the golf courses are situated condos, villas, townhomes, and single family residences. Palm Aire has many different community associations for the individual residential units. Within the Palm Aire community is the Palm Aire Country Club & Resort. It contains four challenging golf courses and the residences enjoy spectacular views of the well manicured fairways and sparkling lakes. A lovely large canal courses thru Palm Aire surrounded by Condos and other residences. Palm Aire is considered to be a golfers paradise. A superb location as Palm Aire is easily accessible from major airports, interstate highways and the turnpike. Dining, entertainment, shopping, beaches and the major attractions in Fort Lauderdale, Miami and Palm Beach are within a short drive.

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