Some 2.8 million homeowners faced the threat of foreclosure last year, but it wasn't supposed to happen to Charlie and Maria Cordoso. In 2005, the New Bedford, Mass. couple paid in full -- in cash -- for a house in Springville, Fla., and rented it out with plans eventually to use the home as a retirement getaway.
They said they were shocked to learn earlier this month that Bank of America had locked them out and removed their clothing and furniture from the property.
"All the love I put in that house -- I fix things up every time I go there," Charlie Cordoso, a construction worker, told ABC affiliate WCVB Boston. "Bank of America or somebody should apologize."
The Cordosos, Portuguese immigrants who are in their 50s, are now suing Bank of America for allegedly seizing the wrong home, and they're not alone: Two other homeowners, one earlier this month in Texas and another last October in Kentucky, also have filed lawsuits alleging that Bank of America attempted to foreclose on their homes even though the bank did not own or service mortgages for the properties.
Bank of America has yet to file a response to the Cordosos' claim and to the Texas claim, in which the homeowner alleges that the bank cut power to his property during the faulty foreclosure, leaving it reeking of fish, which were stored in his refrigerator and freezer. (The homeowner had left 75 pounds of fish at the home after a successful fishing trip to Alaska, according to the lawsuit.)
Bank spokesman Rick Simon said in an e-mail to ABCNews.com that the bank has reached out to the Cardosos' lawyers and hopes "to have the opportunity to work with them to properly assess and address their allegations."
The bank believes that the Texas and Kentucky cases, however, "have no merit," Simon said, and the bank blames others for the errors.
In the Kentucky case, Bank of America was a co-defendant along with a Kentucky corporation that also allegedly worked on the foreclosure. In that case, the bank filed a document claiming that any "injuries or damages" alleged by the homeowner were the result of "negligence caused by entities and/or persons for which BofA is not responsible."
Meanwhile, a local contractor hired "to secure the property for Bank of America" has accepted responsibility for the mistake in Texas, Simon said.
Errant Foreclosures: A National Problem?
The mistakes of local contractors, however, don't get banks off the hook with critics, who allege that the foreclosure systems at Bank of America and other institutions are deeply flawed.
"It's a national issue," said Joseph deMello, one of lawyers representing the Cordosos.
Bank of America actually had planned to foreclose on a property about 10 houses away but mistakenly went after the Cordosos' home instead, deMello said.
The bank first sent workers to begin clearing out and padlocking the home in July. At that point, Charlie Cordoso managed to speak to a real estate agent hired by Bank of America to list the home for a foreclosure sale, according to the Cordosos' lawsuit.
The real estate agent told Cordoso that he would notify Bank of America that they had the wrong house -- but, according to the lawsuit, Bank of America never stopped its foreclosure plans.
In August, unbeknownst to the couple, the bank hired a landscaping service to cut the property's grass and, in the process, broke the Cordosos' fence, according to the lawsuit. In January, the Cordosos said they learned that the bank had cleared out and locked up their home.
"Once this foreclosure train starts moving, they don't let anyone stop it , whether you're right or wrong," deMello said.
The Cordosos, who eventually regained access to their home -- Charlie Cordoso had to break a back screen door to get in -- still don't know where their belongings are and now are worried about finding a new renter for the home in a tough housing market, deMello said.
The last renter moved out, the lawyer said, because she was spooked by the apparent foreclosure.
Foreclosure experts like Rick Sharga, of California-based foreclosure tracking firm RealtyTrac, say cases like these are symptomatic of a broken system strained by the housing boom and bust.
Banks have been "unable to efficiently handle the volume of distressed assets that are coming through," Sharga said. "We also are seeing the results of what had been less-than-rigorous paperwork and documentation management over the last decade or so as loans became commodities that were packaged, sold, repackaged and resold."
"It's almost inevitable that, at some point, if you don't have really tight control on these transactions, you're going to have some issues," he said.
Foreclosure Mistakes: Then and Now
To be sure, banks and mortgage companies made mistakes like those alleged in these suits before the housing market's rise and fall. In 2002, for instance, a Nevada couple sued Countrywide Home Loans -- which was bought by Bank of America in 2008 -- for mistakenly foreclosing on their home while they were out of town. A court ultimately granted them more than $2 million in damages.
Sharga said that while human error contributed to errant foreclosures in the past, they're happening with greater frequency now as banks find themselves overwhelmed with delinquent mortgages.
Bruce Marks, head of mortgage help group Neighborhood Assistance Corporation of America, said that while he hasn't worked with homeowners like the Cordosos, he's seen plenty of cases where homeowners were in the middle of working out mortgage modifications when their banks suddenly began foreclosure proceedings.
It happens because the banks "are overwhelmed, their systems don't work and one department doesn't know what the other one is doing," he said.
On "Super Tuesday" -- the first Tuesday of the month when certain states auction off foreclosed properties -- NACA helped prevent some 1,000 such sales on homes where homeowners were in the middle of loan modifications, Marks said.
"I say to all lenders out there, 'Stop foreclosing until you get your system straight,'" he said.
Since the housing crisis began, a number of banks have announced plans to streamline their mortgage and foreclosure operations, to hire and train more staff and to improve customer service.
That hasn't impressed their critics.
"They clearly haven't done enough to keep pace with the volume of problems," Sharga said.
Meanwhile, the Cardosos are dealing with problems of their own. His housing nightmare forced Charlie Cardoso to miss the homecoming of his stepson, who is back in the United States for a few days after serving a third tour of duty in Iraq , deMello said. The lawyer said the family is trying to make the most of their time with the young man now.
Maria Cardoso said she is grappling with damaged relationships with friends living in Springville.
"We have a lot of friends there, and all that time we were telling them the house [has] been paid [for]," she told WCVB Boston. "And now they think we're lying."