Beware! Stay Safe of these Tactics Mortgage Services Use to Take Advantage of Homeowners

Mortgage services can take advantage of homeowners in a number of ways. As a homeowner, it is important to be vigilant and make sure you understand all of the following points so you can steer clear of any tactics mortgage servicers use to take advantage of you. Your lender or trustee must legally comply with State and Federal laws, including the Homeowner Bill of Rights, which guarantees specific foreclosure protocols. Continue reading to stay ahead of unlawful tactics used by mortgage servicers.

Homeowner is Not Assigned a Single Point of Contact

One of the most common ways mortgage servicers can turn out to be a problem for homeowners is when they do not assign a single point of contact. A point of contact is a department or a focal person a homeowner would contact in case of any problem with mortgage or if they have any questions regarding it. Not having a single point of contact will keep the homeowner wondering about whom to contact if they need to ask anything regarding the mortgage or any other aspect of it. Since mortgage is time sensitive, you need to make sure you only get services of a mortgage servicer that gives you a single point of contact where there is someone available to answer your queries and provide you information.


Homeowner is Not Denied a Loan Modification in Writing or Given a Specific Reason for Denial

Another tactic you should be wary of when dealing with the mortgage servicers is that all your proceedings should be done in black and white. Another tactic used by mortgage servicers to trick homeowners is not giving them a reason why their loan modification was denied and also not denying a loan modification in writing. On the part of the mortgage servicer, loan modification would mean extended payment terms and reduction in the interest rates, something that is not much feasible for them. Thus, they prefer sometimes not to give any reason for why the loan modification request of the homeowner was declined so they can remain on the same terms as was initially the case.


Servicer Does Not Wait Required Time Period Before Pursuing Foreclosure

Another of the main tactics used by mortgage servicers to trick the homeowners is initiating foreclosure without waiting the required amount of time. Foreclosure is a legal process where the mortgage servicer can sell the house of the buyer or take ownership of the property for which the loan was taken in case the buyer is a defaulter. However, there is a proper timeline to follow in case of foreclosure. Many homeowners who are not aware of the process fall prey to these tactics and end up losing their property even when they had time to make payments. It is important to keep these tactics used by homeowners in mind so you know where you stand in case they force a foreclosure on you.


Servicer Charges False Fees or Penalties

Most of the homeowners are not aware of the fees and penalties they have to pay in different cases. This negligence of homeowners is exploited by mortgage services and they will send you notices time and again for various kinds of fees and associated penalties. It is important for you to ask them about each payment you are making. Also, it is always a better idea to ask them for the payment plan and penalties associated with missing payments initially when choosing their service. This will give you the exact dates and the exact amounts that are due during the course of your mortgage payments. Also as them about all the associated fee they will be charging for their services. Having a schedule in hand will help you make an informed decision and you will not end up paying any extra fees and penalties to mortgage servicers.


Servicer Breaches Trial Modification Agreement

A trial modification agreement is a pact between a mortgage servicer and the homeowner to change permanently the terms of mortgage. This is usually done in case the homeowner wants to change the monthly mortgage installments or the interest rates so that it is more affordable. Another common way a number of mortgage servicers trick homeowners and take advantage of them is breaching the trial modification agreement. Although a trial modification agreement is signed with the consent of both parties, many mortgage servicers tend to breach some conditions in it. Since they are professionals and a homeowner might not be too much aware of the tricks of the trade, they end up paying extra to the mortgage servicers. As a homeowner, it is important to make sure the mortgage servicer follows the trial modification agreement. In case they ask for any additional fees or breach any term or condition of the trial modification agreement, you should be aware enough to question them.


While there are many mortgage servicers that are exceptionally honest in their work, there are some black sheep that take advantage of their clients. If you too have fallen victim to any one of the tricks used by mortgage servicers, you can get help of a professional attorney. In case of a foreclosure, you should immediately call an expert foreclosure defense attorney to ensure you don’t end up losing your home. Contact RA & Associates, APC for expert advice on your specific situation. 


RA & Associates, APC
1 (888) 280-1344
505 N. Brand Blvd.
Glendale, CA 91203


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