Bamboozled: Bank ‘pulls a fast one,’ misplaces payments, threatens foreclosure, customer says
NJ Advance Media for NJ.com
Bob and Bernice Lagana bought their three-bedroom, two-bath Princeton Junction home in 2000.
In 2013, Bob Lagana filed for bankruptcy, but the couple came to an agreement with TD Bank for a fresh start so they could keep their home.
The Laganas made all the payments, they said, but in 2016, TD Bank tried to put the home in foreclosure for nonpayment.
“I’m sorry I ever did business with this bank,” said Bob Lagana, 64. “I can’t fathom this big a mistake. It’s mind-boggling.”
The Lagana’s history with TD Bank is a twisted mess of misapplied funds, misplaced payments and some pretty shoddy recordkeeping on the part of the bank.
Here’s how it happened.
When Lagana filed for Chapter 7 bankruptcy after his business went under, he initially gave up the home to the bank, he said. As part of that, he was released from the first and second mortgages on the home, Lagana said.
“I was debt-free from the house,” he said. “I didn’t own the home anymore.”
But TD Bank never wanted possession of the home, Lagana said, and it offered a modified mortgage nine months later.
The parties worked out a deal, and the Laganas took a modification loan that included additional payments to repay some back taxes, records show.
But in December 2015, Lagana noticed something funny about the property taxes and back taxes collected with the mortgage.
They were inflated by thousands of dollars, records show.
Lagana said he contacted the bank, and as they all tried to determine the right numbers, the bank sent him a spreadsheet showing all of his payments.
But those payments were wrong, Lagana said. The bank had only marked down some of the funds Lagana was sending on a monthly basis. The rest of the funds were nowhere to be found, records show.
And Lagana had the canceled checks to prove the payments were made.
TD Bank said it would review the records to figure out what happened, Lagana said. In the meantime, Lagana said he told the bank, he would pay the principal and interest, plus the current property taxes. He wouldn’t pay further on the back taxes until the remaining balance was clarified and the bank finished its review.
The bank promised to get back to him with a resolution, he said, and to explain where all the extra money he paid had gone.
A recent mortgage statement showed the Laganas were nearly $21,000 in arrears. Bob Lagana
No call ever came, nor were the account statements made right. The Feb. 2016 statement, for example, said the couple was nearly $21,000 in arrears. That didn’t add up with the Lagana’s cancelled checks.
He said he called TD again in February 2016 and reached a rep who ran through all the numbers with him.
“He said something wasn’t right on the bank’s end,” Lagana said, and he said the rep told him he would talk to some people and get back to Lagana.
Lagana didn’t receive any calls, and when he tried to reach the same rep the next day, the phone number was disconnected, Lagana said.
Still, he kept paying the mortgage, and he worked with an attorney to try to get to the bottom of things, he said.
The attorney couldn’t get anyone on the phone, either, so the attorney wrote to the bank with copies of the cancelled checks, records show.
The bank still didn’t reconcile the couple’s account.
Then in June 2016, a “Notice of Intention to Foreclose” arrived at the couple’s home, saying the couple hadn’t paid the mortgage for April, May or June of 2016.
Lagana had the cancelled checks in hand.
“How can they foreclose on someone who has been paying all along?” Lagana said. “They’re not going to get away with this.”
Lagana’s attorney wrote to the bank in protest, rehashing the payment history and providing proof the mortgage payments were made.
“In the event that this matter is not immediately resolved, the Borrower will commence civil litigation regarding TD Bank’s violation of the Unfair, Deceptive, or Abusive Acts and Practices (‘UDAAP’), Real Estate Settlement Procedures Act (‘RESPA’) and the New Jersey Consumer Fraud Act,” Lagana’s attorney wrote.
A redacted copy of the letter received by the Laganas. TD Bank returned a mortgage payment, saying the funds were insufficient. Bob Lagana
Lagana kept paying the mortgage, he said, and he didn’t hear anything more.
But then in February 2017, TD Bank returned that month’s mortgage payment, saying there was a shortage and it wouldn’t accept less than the full amount due.
But Lagana paid the same amount he had been paying, records show. The back tax issue wasn’t resolved, he said, but the bank never told him to pay more because it was supposed to be sorting things out.
Lagana got a new TD Bank rep on the phone, and he said things started out well.
“She said they were looking into it and they would put a hold on the foreclosure,” Lagana said. “She said it was obvious something wasn’t right and there was a glitch.”
They’d had enough, and they asked Bamboozled for help.
JUST FOLLOW THE MONEY
We reviewed the couple’s timeline, documents, mortgage statements and more, and then we reached out to TD Bank.
It promised to look at the case.
In short order, Lagana said he received a phone call from TD Bank’s attorney. Ryan Gower of Duane Morris in Philadelphia.
“They called me in a state of panic,” Lagana said. “He acted like my best friend.”
TD Bank apparently located the missing money, determining that part went to the mortgage and part went to the back taxes, Lagana said.
“Gower said it was a glitch on their end. There was a mistake,” Lagana said.
Lagana said Gower then asked him to “back off with the reporter,” referencing Bamboozled’s involvement in the case.
“I said let’s see what they do,” Lagana said. “They put me through hell and I was right all along.”
More phone calls ensued, and again the parties rehashed the payment history. Lagana said he was given a corrected monthly payment amount, and it seemed everything would work out.
The bank would send new documents to make it all official, Lagana said.
Bob Lagana at his Princeton Junction home. Andrew Miller/for NJ Advance Media
While we waited for the documents to arrive, we asked TD Bank for a statement on the case.
“When it comes to financial hardship, TD Bank does everything we can to work with and help our customers facing difficulties such as foreclosure,” a spokeswoman said. “We review financials, work with the borrower to ensure monthly payments are affordable, or, inform customers of alternative options to foreclosure.”
The spokeswoman said the bank reached out to the customer but couldn’t comment further for privacy reasons, even though Bamboozled gave the bank a letter allowing it to discuss the case, signed by the Laganas.
When we shared the statement with Lagana, he got more frustrated.
“Why do they keep saying ‘hardship?’ There is no hardship. I’m paying all my bills,” he said. “They just can’t keep track of the payments.”
Not only that, but TD Bank decided to make it even more complicated.
The couple received an email from Gower. It included a copy of a loan modification and a cover letter that practically made steam come out of Lagana’s ears.
“They want to redo the note,” he said. “They will shave off $119,000 but that $119,000 was a second mortgage shaved off in the bankruptcy. Those monies were all wiped out. They’re not doing me a favor. I’m not legally obligated to pay that.”
“Why would they want to modify on top of a modification? It makes no sense,” Lagana said.
Lagana refused to sign the new mortgage. Instead, he’s talking to another attorney and he plans to file suit.
“Nobody pulls a fast one on me,” he said. “It’s the worst bank I’ve ever done business with.”
We’ll keep you posted on the case.