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A precautionary tale of woe and mortgage lending deceit

"I think there are hundreds, or thousands, of Mrs. Biggses out there," says an attorney who recently took legal action on behalf of one Laura Coleman Biggs in a flatly notable -- some people in Arkansas and elsewhere might opt for the term outrageous -- foreclosure-related matter.

And that is worrisome.

Here's why.

Biggs' husband died in 2003. The retired nurse and widow from California continued living in the couple's home and wrestling with mortgage obligations, but they eventually became too onerous.

Biggs found herself perilously close to losing her home to foreclosure in late 2013. She was subsequently offered a refinancing package by a Bank of America subsidiary, but accepting the terms would have -- as noted by a media report chronicling her story -- "sucked out the equity she'd built up in the home."

And here was the real kicker: Biggs was utterly unaware that, before her spouse died, he had purchased foreclosure protection from the Bank of America that would have paid off most of the couple's mortgage loan upon his death.

The bank reportedly knew that. So, too, did the subsidiary and the insurance company underwriting the policy. Instead of dutifully paying out the proceeds, the BOA subsidiary continued to demand a monthly mortgage payment for over a decade, along with the very insurance premium that was supposed to be paid only until her husband's death.

That sordid reality obviously did not sit well with Laura Coleman Biggs, whose attorneys recently filed a federal lawsuit alleging fraud and negligence against BOA, its subsidiary and the insurer.

Reportedly, the bank -- but only begrudgingly and in installments -- has fully reimbursed Biggs for her losses over the years.

Source: Miami Herald, "As it moved to seize home, bank never told widow her loan was insured," Kevin G. Hall (McClatchy Washington Bureau), April 16, 2015

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