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Class Says Chase Fumbled Mortgage Payments

(CN) - Chase Home Finance overcharged the bank account of a retired Massachusetts couple, ruined the couple's credit and threatened to foreclose on them over disputed missed payments, according to a class action in Worcester Superior Court.

Patricia and Carlton Maggs say they never had any problem paying the mortgage on their home in Westminster, Mass., which they bought in 1977, until Chase replaced Washington Mutual as their mortgage servicer in October, 2009.

Under the Maggs arrangement with WaMu, the bank automatically withdrew $694 from the Maggs' checking account every month for monthly mortgage payments, according to the complaint.

The Maggs say WaMu agreed not to take more than the agreed upon amount from the Maggs' account on any one month without first obtaining the couple's permission.

But in February 2010 - without first notifying or receiving consent from the Maggs - Chase withdrew $1,667 from the Maggs' checking account, causing "catastrophic damages to the plaintiffs, who could not replace the approximately $1,000 excess funds that should not have been taken," according to the complaint.

The Maggs say their fixed finances have become increasingly tight in recent years, as Carlton had a series of strokes in January 2004 and Patricia developed health problems in 2009.

Chase claimed the excess funds were for real estate taxes, but the couple says those bills were taken care of and that Chase has been "falsely posturing" to take the couple's equity in their $275,800 home, according to the complaint.

Patricia says her credit score has dropped from 750 to 544, greatly aggravating her already "severe mental stress."

The Maggs' attorney wrote Chase in August about unauthorized withdrawal and to inform the bank that its mail to the Maggs had not been delivered, according to the complaint.

Despite this written notice, the Maggs say they have been harassed by Chase collection agents, while the bank ignores the Maggs' phone calls and efforts to rectify the situation.

A class action is appropriate because Chase has harmed many people whose mortgages the bank services, and they do not speak out "for fear of retaliation."

"Chase, as part of a scheme and/or business practices, has employees allegedly in the 'Executive Office of the President' charged with doing nothing to assist consumers," such as the plaintiffs ... [and who] refused to assist the plaintiff or even to consider handling a Home Affordable Modification Program request even though they are required by law and by Freddie Mac-written policy to do the same," according to the complaint. "The Executive Office of the President's mandate is to kill claims not to do what is fair, reasonable or required to be done and it is a sham and fraud on consumers."

The Maggs seek compensatory and treble damages, alleging breach of contract and unfair trade practices. They are represented by Evans J. Carter of Framingham, Mass.

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