Tag Archives: Mortgage loan

Using Securitization Audits As An Effective Tool For Foreclosure Defense

30 Sunday Jun 2013

Posted by in Affirmative Defenses, Appeal, Federal Court, Foreclosure Defense, Fraud, Litigation Strategies, MERS, Non-Judicial States, Securitization

≈ Leave a comment

Tags

, , , , , , ,

By now, most homeowners in foreclosure proceedings were suddenly realizing that most loans originated in between 2000 and 2010 were securitized without the borrower’s knowledge. This means the lenders pooled the mortgage with thousands of others and sold these pooled loans to investors immediately or very shortly after loan origination. They were paid in full but retained loan “servicing”, the day to day loan administration operations, for which they now received between $25 and $45 per year for each $1,000 of loan value. This may have been on top of a profit in the sale. On a $400,000 loan the servicer’s financial interest is now only $10,000, not the $400,000 they are trying to foreclose on.

What’s more, in the process of investors purchasing the loan, the originating lender had to guarantee that all transfers were as laid out in pooling and servicing agreements which are on file with the Securities and Exchange Commission. Any violation and the now “master servicing lender” is under obligation to buy back the loan at full price, a guaranteed loss on a now non-performing loan facing foreclosure.

Based on default servicing agreements the servicing lender can use creative loan accounting to essentially position a defaulted loan to where the servicer receives most of all of the property in a foreclosure and the investor owner gets little or nothing, but the loans were insured and T.A.R.P. monies make the investor whole so they don’t miss the property. The servicer sold the loan for payment in full and now gets the property free and clear because the mortgage was not to them, it was to the investor. Is this fair? No, but it is happening every 15 to 20 seconds in the USA.

So how does an attorney you stop this? They use the evidence process in court to introduce findings of a highly qualified expert that is willing to stand behind the issuance and be an expert witness. To keep those costs down in foreclosure and bankruptcy most judges all expert witnesses to appear in a virtual manner, by phone conference or video conference and in so doing enable this type of support in a case at nominal prices.

The evidential findings are based in undisputed facts that are not objectionable because they address genuine material facts pertinent to the case. These facts include showing many defects that prevent foreclosure and bring to light issues the lender foreclosing wants to hide and has misrepresented. Ownership, improper endorsements, subsequent sales, now bankrupt parties, not including real owners as parties in interest, fraudulent use of MERS, fraudulent and collusion on affidavits, robo-signed documents, illegal deed and trustee assignments underlying improper deed enforcement and much more. Basically anything by which the lender can foreclose because that is the only way to sever the risk of lawsuit by the investors. That is why the investors are not being included in the lawsuit. Should they become aware, there could be a class action and because they bought hundreds of thousands of similar problematic loans, the servicer can inherit tremendous risk and potential losses.

The evidence usually turns up facts that conclude the first party ownership is just not there according to law, at least not a secured mortgage anyway. Unsecured the mortgage debt can be crammed down by a bankruptcy Judge or completely discharged after some years in a quiet title action. Those are the legal aspects left up to lawyers and courts.

Faced with losing in court, lenders typically settle and move on. The number of cases winning in this way is a relatively small number. Settlements include loan modifications of terms, acceptance of short sales, waivers of deficiency judgments and having the case dismissed entirely or crammed down by a bankruptcy judge.

The solution? Simple, affordable and fast. – To find out how you can effectively challenge and win your foreclosure defense using Securitization Audit visit: http://www.fightforeclosure.net

How Robo Signing Violations Can Help Homeowners Save Their Homes

30 Sunday Jun 2013

Posted by in Discovery Strategies, Federal Court, Foreclosure Defense, Fraud, Judicial States, Litigation Strategies, Non-Judicial States, Notary, Trial Strategies

≈ Leave a comment

Tags

, , , , , , ,

The Foreclosure process often involves affidavits, which are documents in which someone attests to a set of facts. Foreclosure affidavits typically involve the mortgage servicer confirming that the foreclosure is valid specifically, that the servicer or mortgage holder has a right to foreclose because the mortgagee has defaulted on the mortgage.

Foreclosure Process and Affidavits

Often, mortgage servicers looking to foreclose ask the court for what is called summary judgment, which means they want the court to rule in their favor without need for a trial based on clear evidence that the foreclosure is in order. To show the court that it should order foreclosure, the servicer or mortgage older typically submits affidavits and other proof (such as the mortgage note) showing who in fact owns the mortgage in question. Foreclosure affidavits also include statements about the status of the mortgage account, such as payment history, what is currently owed, when it went into default and how far behind the mortgagee is.

If the borrower does not contest the foreclosure, many foreclosure cases end at this point, with the judge granting summary judgment for the mortgage servicer. This allows the foreclosure to be executed and the property to be sold.

“Robo-signing” and Foreclosure Affidavits

Affidavits are documents submitted to the court in which a person attests to personal knowledge as to what is contained. This means that the person signing a foreclosure affidavit should have verified all information he or she is stating to be true.

The term “robo-signing” has been coined to describe rapid fire signing of foreclosure affidavits without adequately verifying the truth of what the affidavits state. Mortgage servicers who process very high volumes of mortgages in quick succession have been accused of robo-signing to speed up the foreclosure process.

In cases where the mortgage servicer did not review underlying documentation, foreclosure affidavits signed by the servicer may be challenged as inadequate to prove that foreclosure should occur. In some states, foreclosure affidavits must include copies of all documentation on which the affidavits rely. In these states, failure to include such documentation could also be challenged.

Challenging Foreclosure Affidavits

Typically, the mortgagee can challenge the foreclosure affidavits at the point when the bank or mortgage servicer has requested summary judgment. Citing robo-signing to challenge mortgage affidavits is one way to possible stave off summary judgment. Another way to challenge the affidavits is to challenge any inaccurate information about the mortgage and payment history contained in the affidavits.

Though foreclosure affidavits are often perfectly accurate, sometimes they may contain bad information. One example might be if the affidavits state an inaccurate amount owed or payment history. Often, mortgages have been sold many times, with information as to payment potentially lost in the shuffle. Other times, fees may have been attached to the account improperly.

What Happens Next?

Showing that a mortgage servicer’s foreclosure affidavits are inadequate does not resolve the underlying dispute about the property and whether it will be foreclosed. Lenders and mortgage servicers typically rely on affidavits in order to gain summary judgment in foreclosure actions.

In cases where the affidavits are successfully challenged or found lacking by the court, the borrower may not have won a final victory, but has staved off a final decision. Such borrowers then may face the lender or servicer at trial to resolve whether the property, in fact, may be foreclosed and sold.

To Learn How You Can Effectively Use Solid Arguments Such As Robo Signing To Challenge Your Wrongful Foreclosure Visit: http://www.fightforeclosure.net

How to Effectively and Strategically Challenge and Win Your Wrongful Foreclosure Against Your Bank or Lender

18 Saturday May 2013

Posted by in Affirmative Defenses, Foreclosure Defense, Judicial States, Loan Modification, Non-Judicial States, Your Legal Rights

≈ Leave a comment

Tags

, , , , , , ,

The key factors in making sound decision as to how to fight your foreclosure are based on whether your State has a Judicial or non-judicial foreclosure process.

It is vital to determine your strengths and weaknesses in order to know whether to use OFFENSIVE or DEFENSIVE tactics and strategies.

First of all you have non-judicial and judicial foreclosure states. Non-judicial basically means that instead of signing a conventional mortgage and note, you signed a document that says you give up your right to a judicial proceeding. So the pretender lender or lender simply instructs the Trustee to sell the property, giving you some notice. Of course the question of who is the lender, what is a beneficiary under a deed of trust, what is a creditor and who owns the loan NOW (if anyone) are all issues that come into play in litigation.

In a non-judicial state you generally are required to bring the matter to court by filing a lawsuit. In states like California, the fore-closers usually do an end run around you by filing an unlawful detainer as soon as they can in a court of lower jurisdiction which by law cannot hear your claims regarding the illegality of the mortgage or foreclosure.

In a judicial state the foreclosure must be the one who files suit and you have considerably more power to resist the attempt to foreclose.

These are the stage process:

Stage 1: No notice of default has been sent.

In this case you want to get a forensic analysis that is as complete as humanly possible TILA, RESPA, securitization, title, chain of custody, predatory loan practices, fraud, fabricated documents, forged documents etc. I call this the FOUR WALL ANALYSIS, meaning they have no way to get out of the mess they created. Then you want a QWR (Qualified Written Request) and DVL (Debt Validation Letter along with complaints to various Federal and State agencies. If they fail to respond or fail to answer your questions you file a suit against the party who received the QWR, the party who originated the loan (even if they are out of business), and John Does 1-1000 being the owners of mortgage backed bonds that are evidence of the investors ownership in the pool of mortgages, of which yours is one. The suit is simple, it seeks to stop the servicer from receiving any payments, install a receiver over the servicer’s accounts, order them to answer the simple question as to Who is my creditor and how do I get a full accounting FROM THE CREDITOR? Alternative counts would be quiet title and damages under TILA, RESPA, SEC, etc.

Tactically you want to present the forensic declaration and simply say that you have retained an expert witness who states in his declaration that the creditor does not include any of the parties disclosed to you thus far. This [prevents you from satisfying the Federal mandate to attempt modification or settlement of the loan. You’ve asked (QWR and DVL) and they won’t tell. DON’T GET INTO INTRICATE ARGUMENTS CONCERNING SECURITIZATION UNTIL IT IS NECESSARY TO DO SO WHICH SHOULD BE AFTER A FEW HEARINGS ON MOTIONS TO COMPEL THEM TO ANSWER.

IN OTHER WORDS YOU ARE SIMPLY TELLING THE JUDGE THAT YOUR EXPERT HAS PRESENTED FACTS AND OPINION THAT CONTRADICT AND VARY FROM THE REPRESENTATIONS OF COUNSEL AND THE PARTIES WHO HAVE BEEN DISCLOSED TO YOU THUS FAR.

YOU WANT TO KNOW WHO THE OTHER PARTIES ARE, IF ANY, AND WHAT MONEY EXCHANGED HANDS WITH RESPECT TO YOUR LOAN. YOU WANT EVIDENCE, NOT REPRESENTATIONS OF COUNSEL. YOU WANT DISCOVERY OR AN ORDER TO ANSWER THE QWR OR DVL. YOU WANT AN EVIDENTIARY HEARING IF IT IS NECESSARY.

Avoid legal argument and go straight for discovery saying that you want to be able to approach the creditor, whoever it is, and in order to do that you have a Federal Statutory right (RESPA) to the name of a person, a telephone number and an address of the creditor i.e., the one who is now minus money as a result of the funding of the loan. You’ve asked, they won’t answer.

Contemporaneously you want to get a temporary restraining order preventing them from taking any further action with respect to transferring, executing documents, transferring money, or collecting money until they have satisfied your demand for information and you have certified compliance with the court. Depending upon your circumstances you can offer to tender the monthly payment into the court registry or simply leave that out.

You can also file a bankruptcy petition especially if you are delinquent in payments or are about to become delinquent.

STAGE 2: Notice of Default Received

Believe it or not this is where the errors begin by the pretender lenders. You want to challenge authority, authenticity, the amount claimed due, the signatory, the notary, the loan number and anything else that is appropriate. Then go back to stage 1 and follow that track. In order to effectively do this you need to have that forensic analysis and I don’t mean the TILA Audit that is offered by so many companies using off the shelf software. You could probably buy the software yourself for less money than you pay those companies. I emphasize again that you need a FOUR WALL ANALYSIS.

Stage 3 Non-Judicial State, Notice of Sale received:

State statutes usually give you a tiny window of opportunity to contest the sale and the statute usually contains exact provisions on how you can do that or else your objection doesn’t count. At this point you need to secure the services of competent, knowledgeable, experienced legal counsel professionals who have been fighting with these pretender lenders for a while. Anything less and you are likely to be sorely disappointed unless you landed, by luck of the draw, one of the increasing number of judges you are demonstrating their understanding and anger at this fraud.

Stage 4: Judicial State: Served with Process:

You must answer usually within 20 days. Failure to do so, along with your affirmative defenses and counterclaims, could result in a default followed by a default judgment followed by a Final Judgment of Foreclosure. See above steps.

Stage 5: Sale already occurred

You obviously need to reverse that situation. Usually the allegation is that the sale should be vacated because of fraud on the court (judicial) or fraudulent abuse of non-judicial process. This is a motion or Petitioner but it must be accompanied by a lawsuit, properly served and noticed to the other side. You probably need to name the purchaser at sale, and ask for a TRO  (Temporary Restraining Order) that stops them from moving the property or the money around any further until your questions are answered (see above). At the risk of sounding like a broken record, you need a good forensic analyst and a good lawyer.

Stage 6: Eviction (Unlawful Detainer Filed or Judgment entered:

Same as Stage 5.

What are some examples of financial injury due to errors, misrepresentations, or other deficiencies in the foreclosure process?

Listed below are examples of situations that may have led to financial injury. This list does not include all situations.

The mortgage balance amount at the time of the foreclosure action was more than you actually owed.

You were doing everything the modification agreement required, but the foreclosure sale still happened.

The foreclosure action occurred while you were protected by bankruptcy.
You requested assistance/modification, submitted complete documents on time, and were waiting for a decision when the foreclosure sale occurred.

Fees charged or mortgage payments were inaccurately calculated, processed, or applied.

The foreclosure action occurred on a mortgage that was obtained before active duty military service began and while on active duty, or within 9 months after the active duty ended and the service member did not waive his/her rights under the Service Members Civil Relief Act.

If you are ready to take the battle to these interlopers, in order to reclaim the home that is rightfully yours, visit http://www.fightforeclosure.net

Litigating Trial Loan Modification Against Your Bank or Lender

17 Friday May 2013

Posted by in Banks and Lenders, Foreclosure Defense, Litigation Strategies, Loan Modification, Your Legal Rights

≈ Leave a comment

Tags

, , , , , , ,

If you find yourself wondering whether you can litigate your Trial Loan Modification which your Bank/Lender failed to make permanent, you are not alone. Many homeowners all across the nation found themselves in similar situation. This question has arisen many times lately, and still we do not have a confirmed answer. But nonetheless it can be litigated because the trial loan modification is afterall a contract, and every contract can be enforced. This goes back to the first year law school class of contract. It means offer, acceptance, consideration and execution. Here, it has all the elements of contract formation. All the judicial remedies of a contract are available in this litigation also. Why not? A lender cannot be compelled to modify a contract unless they had taken governmental bailout money and there are federal guidelines about foreclosure and the requirements one has to meet. We are talking about folks who had gotten trial loan modification and the banks is reneging on it. Here, someone signed, accepted the trial loan modification and sent quite few payments in executing the offer, and did their part of the bargain.

In the recent past, NCLS has brought four class action suits on behalf of Massachusetts residents to challenge the failure of Wells Fargo Bank, Bank of America , J.P. Morgan Chase Bank and IndyMac Mortgage Servicers/OneWest Bank to honor their agreements with borrowers to modify mortgages and prevent foreclosures under the United States Treasury’s Home Affordable Modification Program (”HAMP”). The complaints are filed with the United States District Court for the District of Massachusetts and assert claims for breach of contract, breach of the implied covenant of good faith and fair dealing and promissory estoppel under Massachusetts common law arising from the financial institution’s alleged failure to keep its promises to modify eligible loans to prevent foreclosures against homeowners who have lived up to their end of the bargain as required by HAMP.

Here are some of the complaints filed for such litigation.

Complaint NO. 1
http://www.nclc.org/issues/cocounseling/content/hamp-BosqueWFComplaint.pdf

Complaint No. 2
http://www.nclc.org/issues/cocounseling/content/hamp-Johnson-BOA-Complaint.pdf
Complaint No. 4
http://www.nclc.org/issues/cocounseling/content/hamp-DurmicJPMorganChase-Complaint.pdf

Complaint No. 4
http://www.nclc.org/issues/cocounseling/content/hamp-Reyes-OneWest-Complaint.pdf

If you are not getting your permanent loan modification with your Bank or Lender, you can contact your congressman or regulatory agencies using the sample letter below.

Regulatory Agency

123 Someplace

Some Where In USA

Dear Regulatory Agency

I am writing to you as a homeowner in foreclosure and wish to draw your attention to issues regarding mortgage loan modification, including the Making Homes Affordable program. The prevailing loan modification policies imposed by government entities and loan servicers expose homeowners to substantial risks in a system designed to generate additional profits to loan servicers and others who reap financial rewards in the foreclosure process, at the expense of consumers.

1. The prohibition against partial payments imposed by many loan servicers quickly forces many homeowners into expensive and unnecessary foreclosure proceedings. A loan servicer may decline a mortgage payment check that is $20 less than the full amount due, with full knowledge – and presumably hope – that it may soon result in thousands of extra dollars in profit should the homeowner later be forced into foreclosure. Such policies are calculated to increase profits to loan servicers, their attorneys and other entities that benefit in the foreclosure process.
2. The notorious “Three Month Trial Period” offered by many loan servicers is fraught with many jeopardizing the homeowners who accept such offers.
a. As loan servicers repeatedly extend the trial period, three months may become a year or two.
b. More than half of all trial periods are cancelled by the loan servicer, most of the time despite the fact the homeowner made timely payments.
c. During this period, foreclosure proceedings remain pending, which permits loan servicers to demand an auction date for the sale of the house, even in cases where the homeowner has fully complied with the Trial Period.
d. No warranty, pledge or agreement is made by the loan servicer upon initiation of the trial period. Servicers are under no obligation to do anything other than re-review the loan modification application. This provides ample incentive to loan servicers to prolong the trial period and revive foreclosure proceedings, after gaining many thousands more dollars from hapless homeowners who were led to believe the trial period would end in a timely manner, including an approval of their loan modification.
e. No details are revealed in advance to homeowners by loan servicers regarding the vaguely-possible, future successful loan modification. Many distressed homeowners have completed the trial period only to receive a loan modification that is financially questionable, such as an ARM mortgage.
f. Further, many loan servicers are misrepresenting the “Three Month Trial” to homeowners as a HAMP product, when in fact the only loan modification available to such homeowners is one of the loan servicer’s own creation and often designed to maximize the potential for default and thus, servicer profits.
3. In many cases, homeowners are awaiting loan modification review while simultaneously in foreclosure. As loan servicers are notoriously slow to both review such applications and respond to homeowner inquiries, auction dates are often set before the loan modification application has been approved or denied. No auction date should be set before a loan modification application has been approved or denied.
4. Many loan servicers require that homeowners not attempt to sell their homes while undergoing a loan modification review. For homeowners already in foreclosure, this policy places them significantly at risk of losing their homes and/or equity in the event the loan modification is denied or has not been approved before the auction date imposed by a court.
a. Homeowners participating in the trial period are also prohibited from placing their homes on the market, which as described above can be a lengthy process, again exposing them to the risk of losing their homes and/or equity.
b. When facing or defending themselves in a foreclosure or while undergoing the often lengthy process of loan modification, a homeowner’s right to sell the property themselves must not be infringed upon in order to generate additional profit to loan servicers. These policies effectively remove a distressed homeowner’s last recourse to mitigate their losses.

In summary, distressed homeowners are inadequately protected under these predatory policies. To more fairly balance the needs of loan servicers and the protection of homeowners, these policies should be implemented and enforced by the appropriate regulatory agencies:

1. Loan servicers should accept and properly apply partial payments of overdue mortgage accounts.
2. Efforts must be made and enforced to ensure that homeowners are able to reliably reach and/or obtain responses to their inquiries of loan servicers.
3. Loan modifications must be reviewed in a timely manner, preferably with a pre-defined time limit.
4. “Three Month Trial Periods” should be accurately identified to homeowners as to whether or not the trial period is related to a HAMP loan modification or the loan servicer’s in-house loan modification.
5. “Three Month Trial Periods” should not be extended, except upon homeowner’s request.
6. Pending foreclosure cases should be promptly dismissed upon the initiation of any loan modification “Trial Period.”
7. Truth-in-Lending Disclosures and all other such disclosures and settlement statements currently required of mortgage lenders should be provided to homeowners before the initiation of any “Trial Period.” This would allow homeowners to make an informed decision regarding the financial suitability of the future loan modification, while still allowing loan servicers to rescind such agreements upon the failure of the homeowner to successfully complete the “Trial Period.”
8. In a pending foreclosure proceeding, no auction date should be set before a loan modification application has been approved or denied.
9. The right of a homeowner to sell the property should not be restricted during foreclosure or loan modification review.
10. All regulations and laws applying to consumer loans, such as RESPA and TILA, must also fairly apply to loan modifications. If first mortgage and refinanced mortgages are subject to such regulations, why are loan modifications not?

Please look into this matter at your earliest convenience.

Thank you in advance for your prompt attention to this important urgent matter.

Sincerely,

John/Jane Doe

After contacting the regulatory agencies or your congressman, if you are not getting the attention or permanent loan modification you feel you deserve, you can visit www.fightforeclosure.net to get your foreclosure litigation package and effectively pursue your next Cause of Action in order to get your Trial Loan Modification Offer, permanently modified.

Qualified Written Request For Homeowners

17 Friday May 2013

Posted by in Loan Modification, Mortgage Laws, Pro Se Litigation, Your Legal Rights

≈ Leave a comment

Tags

, , , , , , ,

There are excellent provisions in RESPA dealing with Qualified Written Requests. Today, we are going to elaborate on these provisions. However, they are not all inclusive. Section 6 of RESPA provides borrowers with important consumer protections relating to the servicing of their loans. Under Section 6 of RESPA, borrowers who have a problem with the servicing of their loan (including escrow account questions), should contact their loan servicer in writing, outlining the nature of their complaint. The servicer must acknowledge the complaint in writing within 20 business days of receipt of the complaint. Within 60 business days the servicer must resolve the complaint by correcting the account or giving a statement of the reasons for its position. This does not absolve borrowers from continuing the payments. They are no defense to payments.
The Real Estate Settlement Procedures Act (RESPA) is a consumer protection statute, first passed in 1974. RESPA covers loans secured with a mortgage placed on a one-to-four family residential property. These include most purchase loans, assumptions, refinances, property improvement loans, and equity lines of credit.

Loan servicing complaints

A borrower may bring a private law suit, or a group of borrowers may bring a class action suit, within three years, against a servicer who fails to comply with Section 6’s provisions. Borrowers may obtain actual damages, as well as additional damages if there is a pattern of noncompliance. The following is a sample qualified written request from you, the borrower, to a lender.

However, as usual, use of this is not equivalent substitute of a licensed Nevada attorney.
Attention Customer Service:
Subject: [Your loan number]
[Names on loan documents]
[Property and/or mailing address]

This is a “qualified written request” under Section 6 of the Real Estate Settlement Procedures Act (RESPA).
I am writing because:
-Describe the issue or the question you have and/or what action you believe the lender should take.
-Attach copies of any related written materials.
-Describe any conversations with customer service regarding the issue and to whom you spoke recently.
-Describe any previous steps you have taken or attempts to resolve the issue.
-List a day time telephone number in case a customer service representative wishes to contact you.
I understand that under Section 6 of RESPA you are required to acknowledge my request within 20 business days and must try to resolve the issue within 60 business days.

Sincerely,

[Your name]

Here is another example:

Attention Customer Service:
Subject: Loan number xxxxxxxxxx
xxxxxxxx xxxxxxxx xxxxxxxxxxx
x xxxxxxx
Xxxxxxxx, CA xxxxx
This is a “Qualified Written Request” under Section 6 of the Real Estate Settlement Procedures Act (RESPA).

I am writing to request:

(1) Copies of all documents pertaining to the origination of my mortgage including my loan application, Right to Cancel, Deed of Trust, note, adjustable rate note, addendum to the note for the interest only payment period, Truth in Lending statements, Good Faith Estimate (GFE), HUD 1, appraisal, and all required disclosures and rate sheets associated with this transaction for the above referenced loan. The copies should be legible and all documents shall be copied in their entirety.

(2) A copy of the loan history including all payments made, all fees incurred, what has been paid out of the escrow account, and how all payments were applied. This information should cover the entire life of the loan.

(3) We have reasons to believe that the loan terms were misrepresented to us at the time of application and further obscured and/or modified prior to signing. I believe that our income was inflated on the application. I also have reason to believe that certain statements were not provided for my approval prior to closing, and that signatures may have been forged on various documents. It is also my /ours belief that certain documents may have not presented at all. Additionally, I believe that a notary was not present to witness my signatures on several pertinent documents and that this transaction did not take place in a legitimate title/escrow/real-estate office with any title/escrow/real-estate professionals therefore leaving us ill advised at the time of closing.

I/we started the process of trying to renegotiate this loan————when I spoke with your HOPE department. On ——-, I faxed a letter of hardship, along with bank statements and pay stubs as she recommended. I was advised that someone would contact me within 7-10 working days and there would be no problem getting assistance to bring the account current and capitalize the negative escrow. On ——-, I called back, as I hadn’t heard from anyone. I was told my payment was going to be ——

Give details, more details, specific facts here about your dealing with your lender on each time you called them.

Most recently you COUNTRYWIDE have sent a demand for payment. This is an enormous amount which just cannot be paid at this time due to very hardship. The situation is urgent. We and COUNTRYWIDE can not drag there feet in this process. We do not want to incur further inflated fees by our home going into foreclosure.

We are very proactive in keeping our family home. This is our primary homes by all means. We do not want to loose it nor do we have to we can make a reasonable payment.

We have been given the runaround by the voice recognition call routing system on numerous occasions.

We have talked to various agents with different versions of what the loan modification process really entails.

We have been re-routed to the wrong department or individual at dozens of times.

We have been disconnected from helpful individuals, when I unsuccessfully tried to call her back I am told it is because she has no extension.

We have been told that the negotiator handling my loan is unavailable to speak to anyone via telephone. All of these calls are documented in your records.

The customer service provided to us has been less than adequate.

We understand that under Section 6 of RESPA you are required to acknowledge our request within 20 business days and must try to resolve the issue within 60 business days.

In closing, we want a payment we know we can live with one that will not get us in trouble again

Sincerely,

REMEMBER: This letter SHOULD NOT be included with your mortgage payment, but should be sent separately to the customer service address.

You SHOULD continue to make the required mortgage and escrow payment until the request is resolved.

You may bring a private right of action under Section 6, if you suffer damages due to the lender’s servicing of the loan. See the RESPA statute and regulations.

Filing a RESPA complaint

Persons who believe a settlement service provider has violated RESPA in an area in which the Department has enforcement authority (primarily sections 6, 8 and 9), may wish to file a complaint. The complaint should outline the violation and identify the violators by name, address and phone number. Complainants should also provide their own name and phone number for follow up questions from HUD. Requests for confidentiality will be honored. Complaints should be sent to:

Director, Office of RESPA and Interstate Land Sales
US Department of Housing and Urban Development
Room 9154
451 7th Street, SW
Washington, DC 20410
Important Tips From HUD:

What Are the Duties of Loan Servicer to Respond to Borrower Inquiries

-(1) Notice of receipt of inquiry
-(A) In general
-If any servicer of a federally related mortgage loan receives a qualified written request from the borrower (or an agent of the borrower) for information relating to the servicing of such loan, the servicer shall provide a written response acknowledging receipt of the correspondence within 20 days (excluding legal public holidays, Saturdays, and Sundays) unless the action requested is taken within such period.
-(B) Qualified written request
For purposes of this subsection, a qualified written request shall be a written correspondence, other than notice on a payment coupon or other payment medium supplied by the servicer, that–
(i) includes, or otherwise enables the servicer to identify, the name and account of the borrower; and
(ii) includes a statement of the reasons for the belief of the borrower, to the extent applicable, that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.
(2) Action with respect to inquiry
Not later than 60 days (excluding legal public holidays, Saturdays, and Sundays) after the receipt from any borrower of any qualified written request under paragraph (1) and, if applicable, before taking any action with respect to the inquiry of the borrower, the servicer shall–
(A) make appropriate corrections in the account of the borrower, including the crediting of any late charges or penalties, and transmit to the borrower a written notification of such correction (which shall include the name and telephone number of a representative of the servicer who can provide assistance to the borrower);
(B) after conducting an investigation, provide the borrower with a written explanation or clarification that includes–
(i) to the extent applicable, a statement of the reasons for which the servicer believes the account of the borrower is correct as determined by the servicer; and
(ii) the name and telephone number of an individual employed by, or the office or department of, the servicer who can provide assistance to the borrower; or
(C) after conducting an investigation, provide the borrower with a written explanation or clarification that includes–
(i) information requested by the borrower or an explanation of why the information requested is unavailable or cannot be obtained by the servicer; and
(ii) the name and telephone number of an individual employed by, or the office or department of, the servicer who can provide assistance to the borrower.
(3) Protection of credit rating
During the 60-day period beginning on the date of the servicer’s receipt from any borrower of a qualified written request relating to a dispute regarding the borrower’s payments, a servicer may not provide information regarding any overdue payment, owed by such borrower and relating to such period or qualified written request, to any consumer reporting agency (as such term is defined under section 1681a of title 15).

(f) Damages and costs
Whoever fails to comply with any provision of this section shall be liable to the borrower for each such failure in the following amounts:
(1) Individuals
In the case of any action by an individual, an amount equal to the sum of–
(A) any actual damages to the borrower as a result of the failure; and
(B) any additional damages, as the court may allow, in the case of a pattern or practice of noncompliance with the requirements of this section, in an amount not to exceed $1,000.
(2) Class actions
In the case of a class action, an amount equal to the sum of–
(A) any actual damages to each of the borrowers in the class as a result of the failure; and
(B) any additional damages, as the court may allow, in the case of a pattern or practice of noncompliance with the requirements of this section, in an amount not greater than $1,000 for each member of the class, except that the total amount of damages under this subparagraph in any class action may not exceed the lesser of–
(i) $500,000; or
(ii) 1 percent of the net worth of the servicer.
(3) Costs
In addition to the amounts under paragraph (1) or (2), in the case of any successful action under this section, the costs of the action, together with any attorneys fees incurred in connection with such action as the court may determine to be reasonable under the circumstances.
(4) Nonliability
A transferor or transferee servicer shall not be liable under this subsection for any failure to comply with any requirement under this section if, within 60 days after discovering an error (whether pursuant to a final written examination report or the servicer’s own procedures) and before the commencement of an action under this subsection and the receipt of written notice of the error from the borrower, the servicer notifies the person concerned of the error and makes whatever adjustments are necessary in the appropriate account to ensure that the person will not be required to pay an amount in excess of any amount that the person otherwise would have paid.
(g) Administration of escrow accounts

If the terms of any federally related mortgage loan require the borrower to make payments to the servicer of the loan for deposit into an escrow account for the purpose of assuring payment of taxes, insurance premiums, and other charges with respect to the property, the servicer shall make payments from the escrow account for such taxes,insurance premiums, and other charges in a timely manner as such payments become due.
(h) Preemption of conflicting State laws

Notwithstanding any provision of any law or regulation of any State, a person who makes a federally related mortgage loan or a servicer shall be considered to have complied with the provisions of any such State law or regulation requiring notice to a borrower at the time of application for a loan or transfer of the servicing of a loan if such person or servicer complies with the requirements under this section regarding timing, content, and procedures for notification of the borrower.

The Real Estate Settlement Procedures Act (RESPA) is a consumer protection statute, first passed in 1974. RESPA covers loans secured with a mortgage placed on a one-to-four family residential property. These include most purchase loans, assumptions, refinances, property improvement loans, and equity lines of credit. HUD’s Office of RESPA and Interstate Land Sales is responsible for enforcing RESPA.

Loan servicing complaints

A borrower may bring a private law suit, or a group of borrowers may bring a class action suit, within three years, against a servicer who fails to comply with Section 6’s provisions. Borrowers may obtain actual damages, as well as additional damages if there is a pattern of noncompliance.

The following is a sample qualified written request from you, the borrower, to a lender. Use this format to address complaints under the Real Estate Settlement Procedures Act (RESPA). Be sure to read more about RESPA, and your rights under this Act, elsewhere on the RESPA site.

Attention Customer Service:
Subject: [Your loan number]
[Names on loan documents]
[Property and/or mailing address]
This is a “qualified written request” under Section 6 of the Real Estate Settlement Procedures Act (RESPA).

I am writing because:
-Describe the issue or the question you have and/or what action you believe the lender should take.
-Attach copies of any related written materials.
-Describe any conversations with customer service regarding the issue and to whom you spoke.
-Describe any previous steps you have taken or attempts to resolve the issue.
-List a day time telephone number in case a customer service representative wishes to contact you.
-I understand that under Section 6 of RESPA you are required to acknowledge my request within 20 business days and must try to resolve the issue within 60 business days.

Sincerely,

[Your name]

For a more comprehensive ‘Trial Ready’ Qualified Written Request that is inclusive in your Foreclosure Defense package, please visit http://www.fightforeclosure.net

Steps To Complete Your Loan Modification Application

15 Wednesday May 2013

Posted by in Loan Modification

≈ Leave a comment

Tags

, , , , , , ,

There is a way that you can gain some control over the outcome of your loan modification and get the help you need and deserve.  You must decide to be as proactive and persistent as possible, after all you are fighting for you family’s home and the bank is not always going to be cooperative.  How can you make sure that you complete your loan modification application correctly and do all the steps the right way?  Here is a checklist you can use to get started.
Step 1:  Before you ever contact the bank to get the loan modification process started, spend just a couple of hours learning the basic guidelines for HAMP-the government bailout plan.  Why this plan?  Well for starters, it is the most aggressive and beneficial for homeowners as it features the lowest terms.  Also, the guidelines for approval are standard and they are published-we know what they are.  It just makes sense to know what you are trying to get approved for before you fill out your application.  Otherwise, how do you know if you fit into the guidelines or not?  This is not the time to “guess”-this is the time to be certain.
Step 2:  Gather all of the required loan modification forms, income documentation, bank statements, monthly bills, and any other paperwork needed to prepare your application.  Set aside several, uninterrupted hours to work on it.  You do not want to start and then have to stop while you search for something-that is distracting and will cause you to make mistakes.  You can follow a checklist of items need in The Complete Loan Modification Guide kit.  You will also learn how to write an effective Hardship Letter to include in your package.
Step 3:  Use all of your income, asset, and monthly expenses to prepare your own financial statement.  Now, this is where it gets tricky.  Your financial statement MUST be completed properly-this means that you have fine tuned your figures so that you know you fit into those HAMP guidelines-the mathematical formula involves your debt ratio, new target payment and disposable income.  How can you know you have done your figures correctly?  Well, you can take a lot of confusion out of preparing your statement by using a software program designed just for homeowners.  This program actually mimics the HAMP guidelines and all you have to do is input your monthly income and monthly expense-all the calculations are done automatically.  You see immediately where any adjustments might need to be made.
Step 4:  Fine tune your budget so that the calculator shows you are passing the HAMP guidelines-then prepare your financial statement using these figures.  Now you can be confident that your budget has the best chance of qualifying.  Follow the checklist to put together your complete, accurate and acceptable loan modification package.
Step 5:  Now you are ready and prepared-call your Bank and tell them you are facing financial difficulties and want to apply for HAMP.  You will be asked to provide your monthly income and expenses-no problem!  You have already done your homework and you can easily and quickly provide the information will need.
Step 6:  Be persistent and follow up at least once a day to make sure that your file is moving forward.  The new guidelines mandate that the bank must provide a final answer to applicants within 30 days of receiving a complete package.  So, now you will have your answer quickly because you knew how to prepare and submit a complete, accurate and acceptable Loan Modification application.

Using Federal Laws To Your Advantage On Your Foreclosure Defense

15 Wednesday May 2013

Posted by in Foreclosure Defense, Litigation Strategies

≈ Leave a comment

Tags

, , , , , , ,

Real Estate Settlement Procedures Act (RESPA)

RESPA was designed to give home buyers and sellers better disclosure of settlement costs; and to elimination of kickbacks or referral fees that tend to increase unnecessarily the costs of certain settlement services.

Prohibition Against Kickbacks and Referral Fees

12 U.S.C. §2607(a); 24 C.F.R. § 3500.14(b). RESPA prohibits the giving or receiving of any fee, kickback or other thing of value for the referral of a “settlement service” (defined at 12 U.S.C. § 2602(3) and 24 C.F.R. § 3500.2).

One court has stated that, in order to state a claim alleging a violation of this section, one must demonstrate:
1) an agreement between the parties to refer settlement service business,
2) the transfer of a thing of value, and
3) the referral of settlement service business. “An agreement or understanding for the referral of business incident to or part of a settlement service need not be written or verbalized but may be established by a practice, pattern or course of conduct.” 24 C.F.R. § 3500.14(e).

Yield-spread premiums: A yield spread premium is a fee paid by a mortgage lender to a mortgage broker for arranging a loan with an interest rate at a higher amount than the par rate. Payment of a yield spread premium is not a per se violation of this section, but may be illegal under RESPA based on a factual inquiry into the circumstances surrounding the payment.

HUD (the agency charged with interpretative, investigative and enforcement powers under RESPA) recommends a two-step inquiry to determine whether a yield spread premium is illegal. First, one determines whether the payment of the yield spread premium was for services actually performed; if it is not, then the payment is an illegal kickback. If the payment was for services actually performed, then one looks at whether the total compensation paid to the broker reasonably related to the value of the services; if the compensation does not reasonably relate to the value of the services, the payment is a violation of this section.

Recently, some Courts have fashioned a five-part pleading standard for alleging a YSP-based violation of RESPA, three-part test and on HUD statements:

“(1) the existence of an agreement between the lender and broker whereby the broker promises to refer settlement service business to the lender;

(2) the transfer of a thing of value between the lender and broker based upon that agreement;

(3) the referral of settlement service business by the broker to the lender and either that

(4) the broker received a YSP without providing any goods or services of the kind typically associated with a mortgage transaction or (5) if the broker did provide such goods or services, the total compensation paid to the broker was not reasonably related to the total value of the goods or services actually provided.. As part of pleading (4) or

(5), a borrower must plead what services were offered, the reasonable value of those services, and the fact that total broker compensation exceeded that value. Also, a borrower alleging a YSP-based violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, or a YSP-based breach of fiduciary duty, can only do so by (also) meeting the RESPA pleading standard.

Prohibition Against Unearned Fees and Fee Splitting 12 U.S.C. §2607(b); 24 C.F.R. §3500.14(c). RESPA prohibits the giving or receiving of “any portion, split or percentage of any charge made or received for the rendering of a settlement services in connection with a transaction involving a federally related mortgage loan other than for services performed.” The regulations further state that, “A charge by a person for which no or nominal services are performed or for which duplicative fees are charged is an unearned fee and violates this section.”
Remedies

There is a private right of action for violation of § 2607 (Illegal referral fee or kickback and fee splitting). Statutory damages: person charged for the settlement service can recover an amount equal to “three times the amount of any charge paid for such settlement service,” plus attorney’s fees and costs. 12 U.S.C. § 2607(d).

Practice Tip:

The bottom line is that any payment by the lender to the broker is illegal if it is not for the reasonable value of services actually performed. So if you see a high up-front broker’s fee plus a yield-spread premium or other broker fee paid by the lender, there’s a good chance the lender-paid fee is “unearned gravy” and constitutes a violation.

There is a private right of action for violation of § 2605 (Servicing requirements and administration of escrow accounts). Actual damages for each failure to comply, additional damages for a pattern and practice of noncompliance, plus attorney’s fees and costs. 12 U.S.C. § 2605(f).

Statute of Limitations

• 1 year for affirmative (kickback and fee-splitting) claims. 12 U.S.C. § 2614;
• Unlimited as a defense to foreclosure in the nature of a recoupment or setoff.

Loan Modification Formula For Wells Fargo Bank

15 Wednesday May 2013

Posted by in Loan Modification

≈ 1 Comment

Tags

, , , , , , ,

The Wells Fargo loan modification formula is utilized in their federal loan modification program which is designed to provide all qualifying homeowners with long-term financial relief through more affordable home loan payments. Considering the fact that this initiative is essentially funded by your tax dollars, you might as well make use of it, and loan modification represents one of the most effective ways of saving your home from foreclosure if you’re facing overwhelming financial hardships.

  • The objective of the loan modification formula

The relevant formula related to debt ratio and target payment is one that has been set by the Treasury. The objective is to bring about a modified mortgage payment that equates to 31% of your gross monthly earnings. This projected payment is what is referred to as your target payment. There are established ways of arriving at the 31% mortgage payment. These include lowering the rate of the mortgage to as little as 2%, prolonging the term of the mortgage to as much as 40 years, or at Wells Fargo’s discretion, writing off a portion of the outstanding principle on the mortgage. You stand a good chance of being approved for a loan modification if the desired target payment in your case can be achieved through one of these means. Your other debts and expenditures also need to be taken into consideration, and you will need to manage your financial situation in such a way so that you have the suitable amount of disposable income available to you.

  • The significance of Target Payments

According to stipulations of the federal HAMP program, an affordable mortgage payment is designated to be between 31-38% of the relevant gross monthly income. In this context, a mortgage payment must be thought of as being made up of a combination of principal, taxes, association costs, and insurance.

  • The significance of Debt-to-Income Ratios

These ratios play a pivotal role in the loan modification process because of the fact that approval is significantly based on financial qualification. Wells Fargo will use your DTI ratio as a guide when reaching an understanding of your ability to make good on repaying your loan. In order for the risk of default to be minimized as far as possible, these ratios must ideally fall within set limits. This is meant to safeguard you as the homeowner from being overwhelmed by your financial obligations.

 Cashflow

Cash flow is part of the Wells Fargo approval formula and tells the bank if you are truly in a financial hardship.  Ideally, after paying all of your monthly bills you should be barely making it or even in a negative cash flow-BUT after the loan mod you need to show that you will have at least $250 left over each month.  Use the Loan Mod Calculator to fine tune your expenses so that your results show you a PASS for these two important categories.