"My story is clear that US Bank bought the already-foreclosed property in a sheriff's sale, and that US Bank is the trustee while Chase is the servicer."
The Huffington Post recently reported on the fate of Minneapolis janitor Rosalina Gomez, who as providence would have it, found out that she was cleaning the executive offices of Richard Davis, the CEO of US Bank, the bank that bought her house, which had been foreclosed upon and was sold in a sheriff's sale in September.
Calling Davis the culprit in this story, Huffington's Arthur Delaney's gotten it all wrong.
U.S. Bank didn't send Ms. Gomez's home into foreclosure; U.S. Bank bought her home in foreclosure. That's a big difference. Chase is the bank that held the mortgage and allegedly didn't make it clear enough to Ms. Gomez and her husband that the loan they were getting had a variable interest rate, that would allow their monthly mortgage payment to climb after a period of time.
I say allegedly because Gomez is not a native English speaker and had to speak through an interpreter for this interview. But the disclosures banks are required to provide are copious and say pretty clearly: "YOUR RATES WILL GO UP!"
Still, that's easy to say when you speak English (and have a law degree). And, of course, the Gomez family was far from alone in this predicament last year.
Gomez's union, The Service Employees International Union, connected the dots between her and Davis and began publicizing the unusual juxtaposition in an effort to renegotiate the union's contract.
Meanwhile, Davis was set to receive an "Executive of the Year" award from the Minneapolis/St. Paul business journal. U.S. Bank is headquartered there. Gomez planned to give Davis a letter of unknown content at the banquet. Even before this took place, however, Davis apparently interceded on Gomez's behalf to arrange a negotiation with Chase Bank to see what could be done to help his janitor.
Nevertheless, says union official Virginia Rodino: "It's that kind of public shaming that was part of it, but she couldn't have saved her house without the parallel struggle of the janitors."
I'm sorry, what? First, there was no shaming, at least not the letter portion of it. Davis had already tried to help the poor woman, a charitable act he had no obligation to do. And there's no shame in buying foreclosed property, especially given that Gomez has the right to buy it back, if she can, for a period of time.
Secondly, Gomez's house has not been saved. The negotiation has only resulted in a 60-day extension, during which Chase has agreed to look into making other arrangements that will put the Gomez's back into their house.
So now that the union has its new contract, will its leadership still care about the Gomez's predicament 60 days from now? Meanwhile, the Gomez's have already moved into an apartment. Says Gomez of her son: "It broke our hearts to tell him we're moving to a one-bedroom apartment because that's all we can afford."
There is no shame, madam, in living within your means.
The villain here isn't the banks, and certainly not Davis, who made a good PR move in intervening for Ms. Gomez, but rather another dark force, the health care industry.
As it turns out, the reason Gomez was forced to refinance her home in 2008 was because her healthcare provider--unnamed but probably provided through her Union--refused to provide benefits for a stomach tumor diagnosed in 2005, calling it the dreaded "pre-existing condition." Ms. Gomez soon found herself saddled with $26,000 in debt, and she has since filed for bankruptcy.
Using shame and guilt to influence in your favor isn't exactly the most noble of acts, especially when it's directed towards the wrong malefactor.
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