From today's LAT: re-fi turns foreclosure nightmare

L.A. Times columnist David Lazarus has written an excellent article today about Lana Ashford, who attempted to re-finance her home with BofA and, through no fault of her own, ended up getting foreclosed instead.  Click here for the link, the title should work too.  I promise that you'll be even more scared to deal with the big banks after reading this.

If you've read this blog before, you'll remember my BofA refinance saga.  My husband and I tried to do a simple home refinance in January 2009.  We were immediately approved, but somehow it still inexplicably took six months to go through.

Here's my question, as a bank customer and also a Realtor who deals with short sales: why, two years into the lending crisis, haven't the banks ramped up enough to service their own loans in a timely, correct manner?  Have they just not hired enough people?  Are they stalling? What's going on?

My refinance, chapter five hundred something

Bank of America actually phoned me about my refinance today! They are just waiting for a questionnaire to be filled out by my home owners association management company. That's all, they say. I asked if we could proceed to closing once they received the document.

No.

Then, it gets assigned to a processor. Then, it takes three to five weeks more.

But at least they called me this time...

Judy's re-fi, chapter 562

Today, the nice folks at Bank of America told me our re-fi probably wouldn't be completed for 75 to 90 days. The last time I spoke with them, they said it would be 60 to 90 days, but the interest rate is locked at 4.375%. The excuse is the same: high volume of business.

I can wait. However, if BofA can't expedite a simple, low-balance re-finance, how are they going to handle mortgage work-outs and the new plan to lower interest rates to help keep people in their homes? Why can't this be just like the credit card companies, where you call your credit card company (say, Capital One) and tell them you've been offered a lower rate on your Visa through another company than they are offering you and then they offer to knock two points off your existing card interest rate?

Update on my refinance

Here's the latest on our home refinance, which we began on January 6: BofA asked for the last two years' tax returns. We turned those in last week. No news since then.