Are you facing foreclosure or has the bank already foreclosed on your home? Were you surprised by the bank’s actions? Are you thinking there could be mortgage fraud lawsuit is potentially in play? Maybe they promised that they would work with you to save your home. But, instead of helping you, did the bank give you misleading information about your options? Maybe they promised a loan modification and then did not follow through on it.
Here are some signs that you might have grounds for a lawsuit against your mortgage company:
- Your lender promised a loan modification but foreclosed on you during the process.
- You qualified for your mortgage loan with no job and no down payment. After an interest rate increase, you can’t pay, and the bank is threatening to foreclosure.
- The mortgage company misapplied your payments, and your loan is in foreclosure status as a result.
- Your loan was transferred to a new lender, and they are refusing to honor your loan modification.
Unfair Mortgage Practices
If your bank failed to follow the law and is trying to foreclose on you illegally, you can file a lawsuit against the mortgage company. Here are some of the biggest mortgage fraud scams.
Many mortgage companies engaged in what is known as predatory lending to get homeowners approved for mortgages that they did not qualify for—usually with very high-interest rates. This results in defaults and foreclosures due to the banks predatory lending schemes. Sometimes, customers have been approved for large mortgages without any money down or a job.
Banks would use fraudulent accounting mortgage and Ocwen mortgage scams to get the loan approved in these cases. Sometimes, property appraisers were even paid to overvalue the real estate. Eventually, homeowners lose their homes when interest rates rise, and they can not afford payments. Click here to learn more about predatory lending from Business Insider.
Mortgage Loan Securitization
Sometimes companies will promise a struggling homeowner that they can secure a home modification for the consumer by performing a financial audit on the mortgage lending documents. The purpose of this is to find fraud in the loan documents. These services usually just result in the homeowner being scammed out of money.
Fraud Involving Dual Tracking
You may be a victim of loan modification fraud if your lender forecloses on you during or shortly after the process of obtaining a loan modification. Mortgage companies cannot pursue a foreclosure while a loan modification is in the process or while consumers are actively working with their banks to obtain a modification.
A lender might tell you that they have denied your loan modification and then you receive a foreclosure notice immediately afterward. This is a sign of dual tracking. The foreclosure process should completely freeze until the modification process is over.
If you receive a foreclosure notice right away, then the bank likely continued tracking your loan for foreclosure while you were working on a loan modification. This is considered to be fraudulent and could very well be grounds for a lawsuit.
Note: Believe it or not, some get confused between fraud, felony and misdemeanors. Here’s a reference to understand it a little better: What’s the Difference Between a Misdemeanor and a Felony?
Lender Refuses to Honor Modification
Here at Consumer Action Law Group, we have many clients who have come to us and said: “my mortgage company sold my loan and now the new company wants to foreclose.” Mortgage lenders regularly buy and sell loans. Sometimes, when a homeowner is in default, and their loan gets sold, the new bank refuses to honor promises made by the old mortgage company.
As a result, many homeowners believe that they are going to get a loan modification and are surprised when they end up in foreclosure instead. Don’t let the banks do this to you. They must honor any modification agreement set by the original servicer even if they say that they weren’t aware of any deal.
If you have tried to obtain a loan modification from the mortgage company without luck, a mortgage attorney can help you. A lawyer can help you resolve issues with your lender and get your loan modification approved. Stop racking up huge fees and penalties from the mortgage company. Seek the help of a skilled mortgage attorney to help you negotiate a fair deal with your bank.
If you believe that you are a victim of mortgage fraud or you are getting the runaround about a loan modification from your bank, then you need an experienced mortgage attorney to help you understand your rights and options.
Call (818) 254-8413 for your free consultation today.