When handling a foreclosure, lenders need to strictly adhere to state law. If you believe your lender is in violation of the law or committed a procedural error, you may be entitled to file a lawsuit to stop the foreclosure and force the process to start over.
Do you have a lawsuit against your lender?
There are a number of violations that may warrant a lender lawsuit. For example, if the lender has not adhered to foreclosure requirements or advised you to fall behind on your payments, there is a very strong chance that you have a claim against them. This is also true if there are accounting errors associated with your foreclosure or delays in the loan modification process.
In addition, the California Homeowner Bill of Rights became a law on January 1, 2013 to ensure fair lending and borrowing practices for California homeowners, as well as to guarantee fairness and transparency for homeowners facing the foreclosure process. Filing a lawsuit may be your best course of action if the lender has violated this law by:
Engaging in dual-tracking
In the past, lenders could foreclose on your home while a loan modification application was still pending. This practice is known as “dual-tracking” and it’s now banned. Under the California Homeowner Bill of Rights, the foreclosure process must cease temporarily while the application is being reviewed. If the application is denied, the lender must wait an additional period of time until the appeals period has expired.
Failing to provide you with a single point of contact
Prior to the implementation of the California Homeowner Bill of Rights, homeowners had to explain their situation to different representatives each time they called their lender for help solving their mortgage problems. Today, your lender is required to provide you with an individual or team that is knowledgeable about your status and can provide you with ways to prevent foreclosure. In addition, these points of contact need to have access to decision makers and they must have the ability to move documents between you (the homeowner) and the mortgage servicer.
Failing to Contact Borrower Prior to Recording an NOD
Lenders are required by law to make several attempts at contact both by mail or telephone for at least 30 days prior to recording a Notice of Default. Ample opportunity must be provided for homeowners to explore alternatives to foreclosure.
Breach of Contract
There are specific steps lenders must take throughout the foreclosure process that often get swept under the rug. These discrepancies are grounds for filing a lawsuit against your lender. A common breach of contract includes failure to provide a permanent modification after offering a trial modification. Another example is a new servicer/lender failing to honor a previous loan modification approval.
Charging Excessive Fees
Lenders often attempt to get away with charging excessive fees on top of mortgage payments which many homeowners do not know are unwarranted. They can easily take advantage of homeowners who trust their services. These fees may show up on your mortgage statements as “foreclosure fees” or “lender fees”.
The process of suing your mortgage lender
If you believe your lender has violated the law when handling your foreclosure, it’s important to hire an attorney who is experienced in these matters, like our lawyers at RA & Associates. We’ll carefully review your loan terms and identify any irregularities involved in the servicing of your loan, your loan history and your payments to determine if your lender has acted illegally. From there, we will document all violations and file a lawsuit on your behalf. In many cases, we will also file a restraining order to stop the foreclosure process until the lawsuit is resolved, which will allow you to stay in your home throughout litigation.
Contact our office today
With over a decade of experience in real estate litigation, the attorneys at RA & Associates have successfully resolved countless cases for our clients. For help with your legal issue, contact our Los Angeles office today for a preliminary analysis of your case.