Lenders in violation of the Truth In Lending Act are not always nefarious scoundrels and unscrupulous snakes. Sometimes a mortgage company simply miscalculates a finance charge and that miscalculation becomes a part of your mortgage documentation. It may not even be found for years, if at all.
Nevertheless, it could mean a refund of all of your finance charges if it is found.
Even if the financial error is a mere $25, you could end up with a refund of your interest payments even if you’ve paid in thousands of dollars in finance charges. With your right to rescission you can make a right wrong, but you should prepare yourself with a second mortgage because if you win your case and your loan is rescinded you will still have to pay the principal balance on your home.
Let’s say, for instance, that you buy a house for $250,000. After two years of making steady payments you’ve paid out $27,000 in interest. You’ll still be in the hot seat for the principal balance of the home so subtract your interest refund from that - $223,000 - and you’ll need a new loan for that amount. You’d better have that lined up with a new lender before the end of your day in court because once the loan is rescinded, it’s a done deal.
This is where you need to seek legal counsel. And make sure you choose an attorney who specializes in loan modifications.
Forensic loan auditing is catching on like a wave. That’s both good and bad.
The good is that homeowners now have a tool that will allow them to fight back against unscrupulous lenders and predatory mortgage companies and win in court or meet at the negotiating table and walk away with a fair and equitable loan settlement. That’s the good. But what is the bad?
Any time you have a large group of people focused on a single activity or even there will be another group of people preying upon them. Forensic loan audits have allowed homeowners to fight predatory loan sharks, but spam companies are popping up left and right claiming to be loan auditors and preying upon innocent homeowners, sometimes cheating them out of thousands of dollars and still causing the homeowner to lose their home or sign away their rights.
When you seek a forensic loan audit for your client, look for an honest, reputable company with a track record. Find one that offers comprehensive and accurate loan audits and offers a guarantee.
Litigating a loan settlement claim can get sticky without the right documentation. When you enter into court on behalf of your client you want to have all of the documentation necessary to present your case and get a win for the client. That means uncovering any lender violations that give your client the right to rescind their loan. How do you find that information out? Should you wait for the discovery phase of your court case?
Waiting can be detrimental to your client and to your reputation as a tough lawyer. You need to know the facts before you enter discovery and the best way to get down to the core of your client’s case is to order a forensic loan audit.
The forensic loan audit can tell you several things about your client’s mortgage, including:
- Is it an FHA or non-FHA loan?
- Are there TILA violations that can give your client rescission rights?
- Is it subject to HOEPA law?
- Does the loan provide your client with a net tangible benefit?
- Did your client’s mortgage company make any substantial material claims or misrepresentations that caused your client to enter into a loan that is detrimental to their welfare?
And it can do a lot more. This is just the tip of the iceberg. Bottom line, if you are litigating the case and expect to win, you’ve got to know who your client is doing business with and how they are doing business. The forensic loan audit can tell you that.
Learn more about lender litigation strategy now.
If your loan situation comes down to a fight - as many do - then you want a tough, smart attorney at your defense. And on your offense.
One of the most important parts of your fight against your mortgage lender will be setting up an alternative funding source just in case things turn really sour. After all, you don’t want to lose your home while you are fighting for your rights.
An alternative funding source helps you do four things:
- Get out of a predatory loan
- Meet all your financial obligations in case you have an extended right to rescind your mortgage loan
- Remove yourself from an abusive loan servicing operation
- And provide stability while you transition from volatile and inappropriate loan products designed to take away your wealth and redistribute it into the pockets of your lender into fixed rate mortgage products that are predictable, wise, and designed to help you create and protect your wealth
Most homeowners don’t have an advocate. They are in it alone and unscrupulous lenders know this. That’s why they’ve stacked the deck in their favor and are all too willing to sell you adjustable rate mortgages you don’t need and other loan instruments that are damaging to you, your credit, and your financial health. They really don’t care about you at all.
Litigation isn’t fun. We all want to avoid it if we can. But you’d rather go into court than be taken advantage of. But before you do, set up your alternative funding source so that you have a safety net in place if things get really nasty.
Learn more about lender litigation for the loan modification process today.