If you are contending with a notice of foreclosure it is important to first determine if your mortgage documents are legitimate. Since the housing market collapse in 2009, it has been become public knowledge that many mortgage lenders cut corners and even broke the law in the rush to cash in during the home buying boom.
Banks And Lenders Created Fraudulent Documents
In many cases, banks were doing business at such break neck speeds that there were serious process mistakes made that resulted in incorrect and technically invalid documents being created and issued to consumers and other lenders. This could have happened in a variety of ways and can have a serious impact on consumer’s ability to fight a foreclosure case. Some examples of lender misconduct include robo-signing, defective transfers, and inaccurate documentation to the extent that it renders the documents in question invalid.
Robo-signing is the practice of having documents signed and notarized by a computer. It may sound harmless, but in the case of mortgage documents this practice is actually illegal. By law mortgage documents are required to be signed by an actual person, not a computer program, and to witnessed and signed in front of a notary.
MERS is an acronym for the Mortgage Electronic Registration System. This is an electronic tracking system that resulted in a great deal of confusion as to who actually owned the loans that were being tracked and transferred via MERS.
There was such an enormous amount of activity, first during the boom when the loans were created and again during the bust as loans were re-sold and transferred, that many loans were not transferred correctly or were improperly securitized. Many banks and lenders cut corners and failed to obtain the proper paperwork when they initiated the transfer.
No Legal Standing To Foreclose
In many instances where the loan transfer was not legal; the wrong party is attempting to foreclose. Such parties who bring suits find out that they do not have legal standing and must drop the case. In other cases, the bank may not actually possess the physical documents of your loan and mortgage and as such, they have no legal standing to foreclose on the property in question. Some courts have invalidated the mortgage and dismissed the bank’s claim entirely.
Predatory lending is the act of giving loans to borrowers under false pretenses; knowing that borrower would never be able to repay. Some potentially illegal actions that lenders were known to engage in include:
- Artificially increasing the value of the home
- Submitting altered docs to misrepresent down payments
- Taking actions to secure loans for people under circumstances that were less than honest
In such cases, the loans that were originated might have been invalid from inception.
At DRK law offices we have experienced attorneys available to consult with you about your foreclosure proceedings. There is no time to waste when you are fighting a foreclosure notice, please contact our team today.