Message to Homeowners
Homeowners are being told to contact their lender and demand a loan modification. If you haven’t attempted yet – good luck. First, the loss mitigation departments of lenders are completely understaffed and overworked. They cannot effectively service the amount of requests that are presented. Secondly, these trial modifications the lenders are offering are not converting to long term modifications – less than 8% have!.....WHY??????
There are several reasons why it is not in the best interest for your lender to give you a loan modification.
First your lender is performing a Net Present Value analysis on your property. If they find that they can make more money today by foreclosing on your home instead of modifying it – you will not get the help you need. Let’s say you owe $200,000 on a home worth $150,000. The lender will factor that they can foreclose on your home and sell the property for $140,000 or modify your loan. What they are looking at is a forecast of what your property will be worth in a predetermined period of time from now and they will ask themselves which is better… making $140,000 today or modifying a non-performing loan and in a year the lender might only be able to sell your house for $120,000. (just so you know…market analysts continue to predict housing values will decline). Obviously your lender will choose foreclosure and make more money today.
Second, many banks are failing and their assets (some of which are mortgage notes) are being sold at a fraction of what is owed – but they are being insured for the full amount. Also, the reserve limit standards have been drastically loosened – What this is doing is this has taken away any free market incentive for the banks to modify loans now. They make more money from foreclosing on homes.
Third, the HAMP Program… This is the government’s attempt to solve the mortgage crisis. The problem is there is no mandate that lenders have to participate. And if they do – there is no regulation of how they participate. That is why there have been nearly a million requests for HAMP Modifications and less than 8% have been modified.
Mortgage Litigation is the only solution.
Mortgage Litigation is the process of licensed attorneys suing your mortgage lender. The process starts by identifying violations that may have occurred in the origination, implementation, execution or recording of you loan. Over the course of the last 10 years nearly 80% of all mortgage loans have substantial violations. Some of these violations are found in Real Estate Settlement Procedures Act, Truth in lending, appraisal fraud, HUD-1 disclosures, The Home Owners and Equity Protection Act, Mortgage Electronic Registration System improperly foreclosing on properties, failure to record with the SEC or the local county recorder’s office, claiming insurance on your loan and still attempting to collect on the loan. These are just a few of the violations that may exist in your loan. Some of these violations are FELONIES – They are criminal actions!
The Mortgage Litigation process will find the violations in a loan and provide homeowners with experienced attorneys for representation against their lenders. These attorneys then present your case in a court of law seeking specific legal recourse. They will summarize to the court the violations found related to the loan and will include, when applicable, an econometrics damages estimate and a determination of what type of reformation or rescission action you are seeking.
You might ask why this is important to you. In the event you have violations, which 4 out of 5 loans that are reviewed do, then YOU now have leverage against your lender to settle the law firm’s demands. You may have fraud (civil and/or criminal) perpetrated against you and the law firm will now use this leverage to settle this efficiently and effectively to see that you are made whole.
The legal recourse that can be sought is a substantially lower mortgage payment, principal reductions, cash settlements or rescission of the original loan.
But you cannot rely on your lender to help you. Experienced Mortgage Litigation Attorneys do not play the games your lender is offering. They go straight to the US Court System and sue your lender.
