Chicago family refuses to leave home after foreclosure fraud

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Silva Tellez remembers holding the phone in her hand and dialing the number that came on the letter about her mortgage. It rang and rang, she says, but finally a machine picked up.

“It said, ‘Your loan modification is denied,'” she says. “That was it.”

Tellez was shocked. She and her husband, Alvaro, hadn’t missed a payment since their loan modification was granted. What they hadn’t realized was that the bank had already started the foreclosure process.

Today, the Tellez family is standing up, with help from the Chicago Anti-Eviction Campaign, and saying they won’t go, even if the sheriff comes to evict them, because they were victims of the sub-prime loan craze and foreclosure fraud.

Foreclosure fraud has been in the news a lot lately. It’s not just the so-called “robo-signers” either. Propublica’s Marian Wang detailed the various ways banks are swindling homeowners, including foreclosing on people who aren’t even behind on their mortgage. One of those ways is the dual-track foreclosure and loan modification process, which the Tellez family says they are dealing with.

Banks aren’t supposed to foreclose on homeowners until they’ve exhausted all available loss mitigation options.
But foreclosures and loan modifications being processed simultaneously
by different divisions within the bank can cause many struggling
homeowners awaiting approval for a loan modification to be foreclosed on

Silva says when her loan was sold from Fremont Investment and Loan to Litton Loan, she was told she could continue the modification with the new company. But twice, when she tried to send in the paperwork and then the payment a week later, she was told that the check got there before the paperwork and thus couldn’t be processed. The third time, she was told the modification went through and continued making the lower monthly payments.

So when the Tellez received the answering machine message that their modification had been denied and that Litton Loan had auctioned their house, bought for $405,000 in 2006, to HSBC for a mere $10,000, they were shaken.

“I was thinking we had lost our house,” Silva says. “I thought it was over.”

But then she met someone from the Chicago Anti-Eviction Campaign. “They told me it wasn’t over,” she says. “That I could keep fighting. So I am.”

So today, the Tellez and their allies will stand up against the banks and companies that are trying to take away their home. Will they succeed? Only time will tell. But Silva Tellez hopes that her family’s fight sends a message to other families in the same predicament.

“I want them to know that no one is alone,” she says. “Somebody out there can help you.”

HSBC spokesman Neil Brazil said HSBC, which was the target of the campaign’s protest, did not initiate the Tellez’s foreclosure.

Our records indicate that HSBC Bank USA
acts only as trustee for the trust that owns the above property so in this
in this case, it is inappropriate for us to comment.”

We reached out to Litton Loan late Thursday afternoon, and will add comments from them as soon as they are available.

This story has been updated from a previous version to reflect new information provided by sources.
Photo credit: taberandrew

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  • I believe I can beat HSBC and Fremont, and save everyone from this fraud. Let me know if you want to find out how and begin to unite.

  • Litton did this to us too--we are not leaving our house either--read our story at

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