It’s not uncommon to see banks and lenders miss important steps in the foreclosure process. If your lender made a mistake, it might just save your home. Here is a list of the most common mistakes we see from lenders today:
· Lost Payments. Sometimes payments should have been applied to your account, but the lender failed to apply them. Verify that all payments were actually applied to your account.
· FHA Insured Loans. FHA loans have special servicing requirements, including a counseling notice mailed to the mortgagor within 45 days of default, a face-to-face meeting with the borrower within 90 days of default and a notice of available counseling. If you have an FHA loan and your lender didn’t comply with these rules, you speak with an attorney or FHA representative immediately.
· Failure to Accelerate the Note. The loan cannot be foreclosed until the loan is accelerated. If the loan documents require you to be notified of the acceleration, failure to send this notice may stop the foreclosure.
· Truth-in-Lending and HOEPA Violations. Violations of federal laws called the Truth-in-Lending Act and the Home Ownership and Equity Protection Act (HOEPA) may be raised as a defense at any time. If these laws have been broken it can immediately stop the foreclosure and even render a mortgage void in a refinance situation.
· Accepting Payments After Foreclosure. If your lender accepts payments after filing the foreclosure and you are not in bankruptcy, there may be a technical defense to stop foreclosure.
· Fraud, Abuse, and Collusion. This doesn’t happen very often, but if you can prove fraud, abuse, and/or collusion, you should be able to reverse the foreclosure and file charges against your lender.
· Failure to Attach Note and Mortgage to Complaint. In most states, the note and mortgage must be attached to the foreclosure complaint. If your lender neglected to do this, the case is not valid. However, your lender may resolve this problem by re-submitting the complaint correctly.
· Incorrect Notice or Service. If you were improperly served with notice of the foreclosure suit, or if other required notices were not accurate, that might invalidate any subsequent order entered by the court.
If you feel your lender has wrongly foreclosed on you, or if you would like to speak with a qualified professional and/or attorney at no charge, please complete our free evaluation form.