Taylor Bean & Whitaker Update

ATLANTA (11Alive) - The collapse of mortgage giant Taylor Bean and Whitaker has left hundreds of thousands of homeowners wondering where to send their mortgage payments. The Center for Investigative Action has cleared up the confusion for many homeowners with government backed mortgages (see our previous postings) but we are being bombarded with questions from many of you about other outstanding issues. Like bounced checks received from TB&W, escrow payments not being used to pay for insurance and property taxes.

First of all contact your insurance company and property tax division to see if they can work with you until this all gets sorted out. One county in Illinois contacted us to say they are working with homeowners because they are having difficulty getting tax payments from TB&W. Check out their website here. You can forward the link to your property tax division to see if they can offer some assistance if you are in the same situation.

We dug through bankruptcy filings to get a better understanding of what's going on. We'll post more links below. TB&W serviced approximately 488,000 mortgages worth an estimated 80 billion dollars. 95 percent of those were government back mortgages. 5 percent were mortgages held by private companies like Wells Fargo and US Bank. Everything is now tied up in Bankruptcy court in the Middle District of Florida.

August 3rd: FHA supsends Taylor Bean & Whitaker from servicing its loans. Questions of Fraud are raised.

August 5th: Federal agents raid the offices of TB&W and seize files. TB&W lays off approximately 80 percent of its staff.

August 7: Florida's Office of Financial Regulation issues cease and desist order.

August 14th: FDIC shuts down Colonial Bank and seizes the assets. Colonial is closely linked to TB&W. It had seveal accounts where mortgage desposit payments were made. One account that was used to make payroll for TB&W employees was also being used to deposit mortgage payments from homeowners. It raised a red flag for regulators.

August 21: Florida's Office of Financial Regulation issues a second emergency cease and desist order. TBW is ordered to turn over nearly 35,000 privately held mortgage portfolios to new mortgage loan servicing companies. The Office of Financial Regulationasserts TB&W is not capable of servicing the loans and is putting homeowners at risk for defaulting on payments, insurance and property taxes.

August 24th TB&W files for bankruptcy.

Now it's up to a federal bankruptcy judge to decide who gets what and when. Meaning TB&W customer's mortgage portfolios are either held in limbo, have been transferred or about to be transferred to new mortgage servicing companies.

Federal law allows a 60 day grace period against default, late payment fees and other penalities associated with the transfer of mortgages. It's established by RESPA. The Real Estate Settlement Procedures Act. However, at least two agencies, Freddie Mac and FDIC have told The Center for Investigative Action that they will work with homeowners during this period to make sure they are kept whole.

However, as in any bankruptcy, creditors need to be paid. If mortgage funds were spent it may be up to the FDIC to provide coverage for loans held by Colonial Bank. We are still trying to get answers for other homeowners. Several hearings are planned for September to determine where these mortgages should go. Sept 11 is the first date to watch.

Links to new bankruptcy filings will give you a better idea what is happening.

Click here to see TB&W motion to hang on to payments and other issues.

Click here to see some of Bank of America's problems with TB&W.