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Fairbanks/SPS
Fairbanks/SPS

Fairbanks/SPS (6)

Best Practices

 

I will try my best to be as complete as possible with this answer while keeping it simple (not using legal-speak). If you're looking for something in a hurry try hitting Ctrl and F keys and then typing in the term you are specifically looking for. This may NOT be a comprehensive list as it is a work in progress to digest the final order. Please remember that no one assiciated with GetDShirtz is a lawyer, this is a layman's interpretation based upon the original Court document associated with the case it arose from. While in 2007 there was a proposed amendment to the original "best practices agreement", those amendments may not be reflected in this interpretation.

Also, keep in mind, that just because the Court order allows them to perform a certain action, your mortgage contract may not. Always read your mortgage contract to make sure they are not violating the terms.

 

 

If you have additional questions try checking out the FTC?s FAQ

 


Fairbanks/SPS May Not:

  1. Fail to accept as of the date received all amounts paid in connection with a loan against principal & interest due, before crediting taxes, insurance or fees[1] unless the loan has been referred to foreclosure[2]
  2. Fail to accept or credit as of the date received, amounts paid in connection with the loan that are less than the total amount due unless the loan is in foreclosure[3]
  3. Misrepresent expressly or by implication any amount the consumer owes
  4. Misrepresent expressly or by implication that any fee is allowed under the loan instruments, permitted by lay or imposed for services actually rendered
  5. Misrepresent expressly or by implication the amount, nature or terms of any fee or other condition or requirement of the loan
  6. Fail to make disbursements of escrow funds for insurance, taxes & other charges with respect to the property in a timely manner.
  7. Charge for force placed insurance before, at no cost to the consumer, 2 written notices providing clear & conspicuous instruction on how the consumer may demonstrate that he/she already has insurance & providing 30 days from the first notice sent & 20 days from the second notice for the consumer to demonstrate coverage
  8. Fail to accept any reasonable form of communication from a consumer of an existing insurance policy, including verbal confirmation of any existing policy number, insurance company or agent name.
  9. Force placing insurance when they know or fail to take reasonable action to determine whether the consumer already has a policy in place.
  10. Fail to refund all force placed insurance fees within 15 days of confirmation of a consumer?s existing policy.
  11. Place a consumer?s loan in default, assess later fees, or initiate foreclosure proceedings solely due to consumer?s nonpayment of insurance premiums
  12. Assess or collect any fee unless it is for services actually rendered and is:
    1. expressly authorized & clearly disclosed by the loan instrument & not prohibited by law
    2. expressly permitted by law & not prohibited by the loan instruments
    3. a reasonable fee for a specific service requested by a consumer & only after clear & conspicuous disclosure of the fee is provided & explicit consent is obtained from the consumer & such fee is not otherwise prohibited by law or loan instrument
  13. Assess or collect any fees prohibited by FHA statutory, regulatory or written handbook requirement.[4]
  14. Impose any fee or take any other action that is prohibited by any state or federal law or regulation
  15. Impose any fee or take any other action that is prohibited by loan instruments or other contractual agreement with the consumer
  16. Furnish any information to the credit bureaus which they know or consciously avoid knowing is inaccurate
  17. Fail to promptly notify the credit bureaus when they have determined that information previously furnished is not complete or accurate.
  18. Fail to provide the credit bureaus with corrections or other information with respect to a consumers status that is necessary for the bureaus to make any corrections to the consumer?s credit report.
  19. Furnish any incomplete or inaccurate information to the credit bureaus.
  20. Fail to report accounts as disputed to the credit bureaus when a consumer disputes the account.
  21. Fail to comply in any respect to the FCRA as amended or may be amended in the future.
  22. Fail to comply in any regard with RESPA as amended or Regulation X including but not limited to:
    1. failing to respond in a timely manner to a consumer?s qualified written request
    2. fail to notify in a timely manner the consumer in writing of any assignment, sale or transfer of the servicing rights to a consumers loan not less than 15 days prior to the effective date of transfer
    3. fail to notify in a timely manner the consumer in writing of any assignment, sale or transfer of the servicing rights to a consumers loan not less than 15 days after the effective date of transfer
    4. impose a late fee during the 60-day period beginning the effective date of transfer
    5. fail to protect a consumer?s credit rating
    6. fail to make timely escrow payments for insurance, taxes & other charges
    7. fail to provide annual escrow statements that clearly itemize payments for insurance, taxes & other separately identified charges
  23. Fail to maintain & provide adequate staffing of a toll-free phone number & address that are specifically dedicated to handling consumer disputes or questions.
    1. phones must be staffed at a minimum every Monday through Friday between the hours of 7 am to 8 pm EST, national holidays excluded
    2. they must maintain the number for 10 years from the date of the order
  24. Fail to acknowledge in writing any consumer disputes within 20 days after receiving it  and:
    1. Fail to complete an investigation of any consumer dispute within 60 days of receiving it[5]
    2. Fail to advise the consumer promptly & in writing the result of the investigation of the dispute, unless an oral dispute, within 20 days after receiving it
    3. Take any legal or other action to collect the disputed amount or any related charges until the dispute has been investigated & the consumer informed of the results of the investigation
    4. Threaten the consumer credit rating or reporting the consumer as delinquent based on the disputed amount until the consumer?s dispute has been investigated & the consumer informed of the result of the investigation
  25. Assess or collect any late fee or similar delinquency charge on a monthly payment when the only delinquency is attributable to late fees.
  26. Assess or collect any late fee or similar delinquency charge once a loan has been accelerated into foreclosure status

Fairbanks/SPS May Not For 5 Years After Date of Order Assess or Collect The Following Fees:

  1. Fees for demand letters, collection letters or notices.
  2. Fees for property inspections unless it is a reasonable fee for inspections actually performed IF:
    1. the consumer?s loan payment has not been received within 45 days of the due date
    2. the inspections are limited to the initial inspection & additional inspections are not more frequent than every 30 days ONLY if:

a. they have been unable to contact the consumer foe the previous 30 days or in the alternative have been able to contact the consumer but have determined the mortgaged property to be vacant

  1. Fees for broker?s price opinions unless it is a reasonable fee for a BPO that has actually been ordered & performed  IF:
    1. the consumer?s loan payment has not been received within 63 days of its due date
    2. the BPO is limited to the initial BPO only & during the course of delinquency are not more frequent than every 6 months
  2. Attorney fees unless:
    1. the fees are necessary to process a foreclosure sale of the property
    2. a law firm has actually performed these services
    3. a law firm has in fact charged Fairbanks/SPS for the services

Fairbanks/SPS May Not In Connection With Any Loan That Was In Default At the Time It Was Obtained:

  1. Use any false, deceptive or misleading representations or means in connection with the collection of any debt including but not limited to:
    1. falsely representing the character, amount or legal status of a debt
    2. falsely representing the character, amount or legal status of any services rendered or compensation which may be lawfully received by a debtor
    3. communicating or threatening to communicate with any person credit information which is known to be or should be known to be false, including failure to communicate that a debt is disputed

       

    4. using any false representation or deceptive means to collect a debt or obtain information concerning a consumer
  2. Use any unfair means to collect or attempt to collect a debt including but not limited to:
    1. collecting amounts not authorized by the agreement creating the debt  or permitted by law
  3. Fail to notify the consumer of their right to dispute & obtain verification of their debt & the name of the original creditor either in the initial communication or within 5 days thereafter
  4. Fail to comply with any aspect of FDCPA

Fairbanks/SPS With Regard To Any Loan Not in Bankruptcy or Forbearance Agreement May Not For 10 Years After Date of Order:

  1. Fail to timely inform the consumer at least 12 days prior to the due date of each monthly payment, at no cost to the consumer, the following information in a clear and conspicuous manner:
    1. the unpaid principal balance
    2. the monthly payment due as of the next due date & the due date
    3. the reason for any changes in the monthly payment amount &/or other amounts due
    4. a complete itemization of each & every fee assessed during the statement period
    5. the toll-free number & address for the consumer to use in the event they dispute any of the information provided
    6. the total amount due on the loan

Fairbanks/SPS May Not Take Any Action Toward Foreclosure Until:

  1. all records pertaining to the consumer?s loan have been reviewed to verify that the consumer has failed to make 3 full monthly payments
  2. confirmed that the consumer has not been the subject of any of the acts or practices prohibited by this Order, the loan instruments or law & if such acts have occurred that they have been remedied
  3. any disputes by the consumer have been investigated & the consumer has been notified as to the results of said investigation
  4. Records shall be maintained sufficient to document the steps taken to investigate and conclude each dispute.


With respect to loans using uniform loan instruments with a ?revision date? prior to 03/99 they may apply payments received in accordance with the provisions thereof .

This part is going before the Court pursuant to a 08/07 filing to amend the FTC agreement & has not yet been authorized by the court.

As long as the short is $25.00 or less pursuant to a 08/07 filing to amend the FTC agreement & has not yet been authorized by the court.

Only applies to FHA mortgage loans

An additional 30 days may be taken if they inform the consumer in writing

Fairbanks 101

Before we begin, one thing needs to be made clear, Fairbanks Capital Corp. has changed their name to Select Portfolio Servicing (SPS). It is the SAME EXACT company just with a new name. I get many, many emails from people saying their loan was sold from Fairbanks to SPS, your loans were not sold, you are dealing with the same company!

1989 ? Fairbanks founded by Thomas D. Basmajian

2000 ? PMI purchases shares of Fairbanks

December 2000 - Fitch Affs Fairbanks Capital's `RSS1' & `RPS2' Resi Servicer Rtgs

December 2001 - Fairbanks Capital Corp. Announces Definitive Agreement To Acquire Bank Of America's Subprime
Servicing Platform
 

March 2002 - Fairbanks Capital Corp. Announces Close of EquiCredit Subprime Lending Acquisition Transaction 

 

May 2002 - Fairbanks Capital Corp. and DLJ Mortgage Capital Sign Letter of Intent for Servicing Arrangement

 

July 2002 ? PMI Increseases Ownership In Fairbanks With Help of GE & FGIC

 

March 2003 ? Fairbanks expands office space

 

03/07/2003 - PMI Group, Inc. Supports Full Cooperation by Fairbanks Capital Corp

 

April 2003 ? Utah Officials investigate Fairbanks

 

05/08/2003 ?Fairbanks Makes Management Changes

 

05/09/2003 ?Moody?s downgrades Fairbanks

05/13/2003 - Mikulski and Sarbanes ask the federal government to investigate Fairbanks

 

05/28/2003 ? Fairbanks Get Financial Aid From Lenders & Shareholders

 

June 2003 ? Fitch downgrades Fairbanks

 

October 2003 ? Fairbanks Ratings Tumble

 

November 2003 ? FTC announces settlement with Fairbanks

 

May 2004 - NTIC Announces Agreement of Understanding with Fairbanks Capital Corp

 

May 2004 ? Fairbanks Settles With Florida

 

June 2004 ? Fairbanks appoints Consumer Ombudsman

 

July 2004 ? Fairbanks changes its name to Select Portfolio Servicing

 

September 2004 ? Fairbanks Agrees To Settle With Michigan Homeowners

 

October 2005 ? PMI sells SPS and SPS Holding Corp. to Credit Suisse First Boston

Joe Moakley Papers

In June of 2008 I took a trip to the John Joseph Moakley United States Courthouse in Boston. For those of you not in the know this is the court where USA and Curry v Fairbanks took place. It is clear from the case files that many people were opposed to the settlement and that many people were confused when it came to how to opt in and/or out of it. I lost count of how many opt out letters were sent to the court instead of Gilardi where they were supposed to go. I did try to get an answer as to what happened with those opt-out requests that were incorrectly sent to the courthouse but was unable to get an answer as the clerk that would have handled them no longer works for Judge Woodlock.

Here is a sampling of the documents I found in the file. Contact and/or identifying information has been redacted to protect the privacy of the indivudual(s) and that is the only information that has been redacted. You can view the documents in their original form by visiting the John Joesph Moakley Courthouse. Some of the documents are complaints that were sent to the Court as late as 2006, others are objections to the settlement. Click on thumbnails for larger image (each will open in its own window).

One of the more interesting documents is this affidavit from Brent Rasmussen dated  May 11, 2004. At the time the affidavit was issued Mr. Rasmussen was a Senior Vice President and Chief Information Officer. Paragraph 4, page 2 is a real "HOOT"

Each one of these documents pertains to a home and a family that Fairbanks/SPS damaged through their often unlawful and always improper manipulation of mortgage loans they serviced for other companies. This page is a work in progress ...

 

Maxwell v Fairbanks

These are just a few of the available documents floating around the internet involving Maxwell v. Fairbanks. As this "Agreement" is new to me, I thought I'd share it with anyone else interested. Bear in mind, as you read, that Maxwell was settled (10/2002) almost two years before USA/Curry v. Fairbanks. This case was heard as an Adversarial Complaint in United States Bankruptcy Court before the Honorable Judge Joan Feeney.

Adversary Complaint
Complaint Answer
In Re Maxwell ThompsonWest
Maxwell Agreement

Ellington Case

A must read for anyone dealing with Fairbanks/SPS is Case No: 1:07-CV-00421-LY-AWA Ellington Credit Fund, LTD and ECF Special Securities, LLC v Select Portfolio Servicing Inc, Manufacturers and Traders Trust Company, MBIA Insurance Corporation, Mountain West Realty Corp., Residential Real Estate Review Inc., Alta Real Estate Services Inc., AND Pelatis Insurance Agency Corp. Cause No. D-1-GN-07-001141 filed in the District Court of Travis County, Texas. I think it's fair to say that if the Plaintiffs in this particular matter contacted some of the actual borrowers whose loans make up the REMICS in question, they would be given a whole new education in what is really going on with the loan as opposed to what they think is going on. They might even find they have forgotten to name a few defendants.

The suit alleges, among other things that Fairbanks/SPS "was not content to make an honest profit from servicing the Subject Loans. Instead, Fairbanks undertook a systematic campaign to boost their profits by dishonest and illegal practices." The suit goes on to specifically lay out that Mountain West Realty Corp., Residential Real Estate Review Inc., Alta Real Estate Services Inc., & Pelatis Insurance Agency Corp., were created and are owned by Fairbanks for the sole purposes of boosting their profits while not actually performing any real function. This got us here at GetDShirtz wondering if there were any other companies that fall into the same category, even though they may not be part of this particular suit. Check out what we found.


GetDShirtz has done a little digging and has confirmed that not only are Mountain West Realty Corp., Residential Real Estate Review Inc., Alta Real Estate Services Inc., & Pelatis Insurance Agency Corp., are owned and operated by Fairbanks/SPS and that they share the same South West Temple address in Utah as the Fairbanks/SPS office but that they are registered to do business in other states. Interestingly enough, we have found that Pelatis Insurance Agency was formerly known as Fairbanks Insurance Agency up until the Curry class action lawsuit.

The suit alleges the following with respect to each of these companies. Following each allegation you will find a partial list (more to come soon) of links taking you to the Secretary of State website for each state where we have found a listing. In some instances you will need to enter the name of the company to do your own search and in others it will automatically take you to the document.

Mountain West Realty Corp.: "Through Mountain West, Fairbanks/SPS required the real estate brokers who actually did the work to pay Mountain West a healthy share of the commissions on the foreclosed home sales. At times, in the appraisal listing agreement, Fairbanks negotiated for itself  and a local broker a $2000.00 minimum commission. In those instances, neither the broker nor Fairbanks had any incentive to sell REO property for more than $60,000.00, demonstratably leading to fire-sale prices when the objective appraisals before and after the sale supported a much higher price."

 

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Pelatis Insurance Agency Corp.: "To profit from this practice [force-placing insurance] Fairbanks required that the insurance companies or brokers who actually placed such over-priced insurance on the properties pay a share of their commissions to Pelatis Insurance Agency, a front company that Fairbanks established to collect such commission in each state where it serviced mortgages."

 

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Residentail Real Estate Review Inc.: "A review of the Servicing Advances paid to the front companies demonstrates that Fairbanks ordered an excessive number of broker price opinions [BPO] on the defaulted loans in the securitization. Thus, in addition to paying itself for these fees through its front companies, Fairbanks paid itself more for more frequent broker price opinions and inspections than necessary to properly service the loans. Fairbanks took unauthorized payments through Residential Real Estate for over-priced and overly-frequent property inspections and broker price opinions..."

 

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Alta Real Estate Services: "Fairbanks took unauthorized payments through Alta for over-priced and overly-frequent property inspections and broker price opinions..."  

 

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Fairbanks Capital Corp./SPS

Fairbanks Capital Corp./SPS- Select Portfolio Servicing

GetDShirtz gets email from many people saying that their loan was sold from Fairbanks to SPS. YOUR LOANS WERE NOT SOLD THIS IS THE SAME COMPANY.

A must read for anyone dealing with Fairbanks/SPS is Case No: 1:07-CV-00421-LY-AWA Ellington Credit Fund, LTD and ECF Special Securities, LLC v Select Portfolio Servicing Inc, Manufacturers and Traders Trust Company, MBIA Insurance Corporation, Mountain West Realty Corp., Residential Real Estate Review Inc., Alta Real Estate Services Inc., AND Pelatis Insurance Agency Corp. Cause No. D-1-GN-07-001141 filed in the District Court of Travis County, Texas.

The suit alleges, among other things that Fairbanks/SPS "was not content to make an honest profit from servicing the Subject Loans. Instead, Fairbanks undertook a systematic campaign to boost their profits by dishonest and illegal practices." The suit goes on to specifically lay out that Mountain West Realty Corp., Residential Real Estate Review Inc., Alta Real Estate Services Inc., & Pelatis Insurance Agency Corp., were created and are owned by Fairbanks for the sole purposes of boosting their profits while not actually performing any real function.

This got us here at GetDShirtz wondering if there were any other companies that fall into the same category, even though they may not be part of that particular suit. Here's what we found so far.


Do you think that Select Portfolio Servicing f/k/a Fairbanks Capital Corp. is violating the "Best Practices" agreement made with the FTC when it comes to the servicing of your loan?

 

 

If you answered yes, then you are not alone! "Best Practices" refers to an agreement made between the FTC/HUD and Fairbanks, it has nothing to do with the money settlements made as part of the Curry Class Action although both cases were filed in the same Federal Court in Boston.

There seems to be a lot of confusion when it comes to the class actions. The cases in questions were; UNITED STATES OF AMERICA, Plaintiff, v. Fairbanks Capital Corp., Fairbanks Capital Holding Corp., and Thomas D. Basmajian and Alanna L. Curry, Marlene L. Brenes and Thomas O. White individually and on behalf of all others similarly situated, Plaintiffs, v. Fairbanks Capital Corporation, Defendant. The United States of America case was authorized by the FTC and HUD. Curry et al was brought by regular citizens.

If you happened to be a "certified victim", that is someone whose mortgage loan was serviced by Fairbanks between January 1, 1999 and December, 2003 (referred to as the "class period"), then you received a document called NOTICE OF PROPOSED CLASS ACTION SETTLEMENT AND SETTLEMENT HEARING. It seems to me that the root of all the confusion lays within this document as it addressed both the USA v. Fairbanks case and the Curry et al v. Fairbanks case.

Each and every "certified victim" had the right to choose whether or not they would be involved with the Curry Class Action and whether or not they would choose to receive funds from the Redress Fund. However, no one could opt-out of the injunctive relief provided by USA v. Fairbanks. That means that each and every person that has a loan serviced by Fairbanks was to benefit from "best practices" or the new way that Fairbanks was supposed to be doing business.

Aside from all that is the fact that Curry et al ONLY covered the class period, which was between January 1999 and December 2003.

Fairbanks changed its name to Select Portfolio Servicing following the legal actions however THEY ARE STILL BOUND BY THE AGREEMENTS they made. (Please seeThe FTC/HUD Settlement With Fairbanks Capital Corp.)

 

I have proof that SPS/FB has seriously and consistently violated the terms of injunctive relief pursuant to USA v. Fairbanks after December 2003. I know there are others out there who have proof of the same. I would like to communicate with each and every single person who believes that post December 2003 SPS/FB violated "Best Practices" with regard to the servicing of their mortgage. 

Your opt-in/opt-out status from the original class action DOES NOT MATTER.
It DOES NOT MATTER if you are no longer being serviced by SPS.
It DOES NOT MATTER if you have already lost your home.

What matters is whether or not since the inception of the "best practices" agreement SPS complied with the terms of "best practices" with regard to your loan.

 

Until further notice, I am no longer using a form to have people contact this website, all information will be kept confidential (not for public display). At this time this is a fact- finding mission and no guarantee or representations of legal representation are being made. Please send an email containing your name, city, state, daytime phone number, evening phone number and an explanation of what is going on to  This e-mail address is being protected from spambots. You need JavaScript enabled to view it

If you have questions or concerns you may email me directly at  This e-mail address is being protected from spambots. You need JavaScript enabled to view it and I will do my best to answer your emails or put you in touch with a person who can.

We can fight the good fight and REALLY win this time, not just let the lawyers fill their pockets and let the crooks off with a slap on the wrist.

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Contact

Technical issues should be addressed to ShirtzMaster@GetDShirtz.com

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