Home Wrecker: How an Abusive Mortgage Servicer is Transforming Neighborhoods into Rental Markets.

• Author: Parry, Thomas Fox

My friend Mike got evicted by a debt collector on a raw morning in February 2017. Deputies from the Philadelphia Sheriff's Office knocked on his door, and movers rolled up in a big, yellow truck. Soon they were dragging out Mike's bare mattress as the deputies drank coffee around the white gabled stoop.

Wishing that I could do something, I fell into my role as a reporter and got out my pad and pen. "Who's the bank?" I asked Mike. "Who's got the mortgage?"

"Write this down," Mike said, "Bayview Loan." He pointed to a black sedan parked up the hill. "That's their lawyer," he said.

"Who are they?" I asked. "Do they own the place?"

Mike couldn't tell me much more. His baby girl was crying, and his partner, who was pregnant with their second child, was pacing the sidewalk with the phone to her ear, trying to find a place to stay.

At the time, I was writing about insurance for a legal news service, where I saw the same scenario repeat: Something bad happens, say a work injury, or a car accident. Maybe someone dies. Either way, nobody wants to pay, least of all the insurance company. I opened a database I used for this job, West-lawNext, and searched "Bayview Loan."

If it could have, my computer would have burst at the seams. The search result brought back 5,626 court documents, 2,290 complaints, and 1,317 court cases. Bayview, it turns out, is a mortgage servicer, an outfit that collects mortgage payments, with a record of abuse. They sue and get sued a lot.

But once I'd gotten past the court cases, what I found revealed more than phony charges and families pushed into the street. I found an entity composed of myriad companies, almost literally uncountable, nearly all run from a single office in Coral Gables, Florida, and its role in a larger Wall Street betting scheme that transforms neighborhoods into rental markets.

What it shows is that the housing meltdown of the Great Recession, and the predatory practices that led to it, continues still, at least for some homeowners. The period between 2008 and 2012 saw nearly four million home foreclosures, dispossessing up to ten million people. Neighborhoods sank in value, and with that loss went local tax revenues and community investment. In personal terms, foreclosures stoked shame, anxiety, even suicide, according to one study from the National Institutes of Health. The federal government tried to stanch the flow, spending $245 billion to stabilize banks and relieve them of the bad assets largely credited with the fall.

But the bleeding has not stopped, due in part to companies like Bayview Loan, which effectively transfer wealth from low- and middle-income Americans to the international investment class, aided by the federal government. The biggest culprits are the Department of Housing and Urban Development and the Treasury Department, agencies charged with protecting communities and promoting growth.

But first, the court cases.

From among the 1,317 cases, I found 102 that reached the judgment phase, meaning that the courts took the facts as settled. A pattern emerged. In hundreds of pages of these documents, homeowners across the country reported the same experience. Bayview, they say, overwhelms, confuses, and intimidates homeowners into foreclosure, tacking on every last charge they can. Take the case of the Jacobsons.

In December 2008, according to the findings in a state supreme court decision, Robin and Kathleen Jacobson of Elbow Creek, Montana, missed "at least one" mortgage payment on their home in the southern part of the state. Robin built houses, and had taken a hit in the 2008 crisis. Their bank, Citi-Mortgage, contracted Bayview to take over collection, and within three weeks, Bayview delivered a letter threatening a suit for the whole mortgage if all past due amounts were not paid by a certain date. The letter, however, provided no date. Nonetheless, the Jacobsons paid. Bayview refused the payment.

The Jacobsons made another payment. Bayview called and told them to stop, saying that if the couple fell into arrears they could qualify for a "modification" program through the Treasury Department. While the Jacobsons waited for Bayview to initiate the...