Wrongful Foreclosure.

Wrongful Bank Foreclosures

Wrongful foreclosure is an issue that has affected thousands of Americans’ lives in the past few years. Until the National Mortgage Settlement many banks were wrongfully foreclosing on homes without legal support for the borrowers. Many people were in the middle of a loan modification, short sale, or refinance and found themselves without a home. Meanwhile our active duty military service members may have been the hardest hit of all, with some losing their homes whilst overseas serving the nation. We have talked about some of the issues with the review of loans previously, thousands of loans were “robo-signed” for quick, unconscious approval or progression of paperwork through the various channels in various banks. It appears that the banks had largely automated loan approvals and foreclosures as they were not sufficiently staffed to meet volume of either.

If you went through foreclosure, also called a “trustee sale” in California, recently and experienced one of these situations as outlined below, you may be a victim of wrongful foreclosure.

• Not in default but foreclosed on – Some homeowners lost their homes in the housing crisis for no reason other than processing error on the lender’s side. This is one rare circumstances where banks have actually apologized to the homeowners.
• In the middle of a loan modification – Many homeowners were advised to stop payments so that they would qualify for loan modifications. Scammers, phone bankers trying to make bonuses, and just plain ignorant real estate agents have taken advantage of their clients’ trust to make a quick, dirty buck.
• Behind on payments but could have caught up if not for fees – Many banks’ primary goal is to maximize income. This has been done by applying payments incorrectly first to fees and then to actual principal and interest, charging exorbitant fees for nebulous benefit, and other predatory lending practices.
• Dual tracking – The practice of dual tracking is when a lender will continue processing a foreclosure even though a loan modification or short sale is in process. Typically it’s a case of the right hand not knowing what the left is doing only in the case of the big banks it’s more a matter of willful, profit-driven, ignorance versus innocent stupidity. Here in Sacramento, former Monarchs player Ruthie Bolton was a victim of dual tracking and was quite outspoken about it.
• The bank did not complete its due diligence – Many homeowners have lost their houses to foreclosures that may not have had the proper paperwork filed in the court. Since California is a non-judicial foreclosure state this is most likely not as big of an issue here but the banks have certainly shown that compliance with the letter of the law is only in their interest when it makes them money.

Most banks and mortgage lenders doing business in California are subject to the strict laws of California when it comes to how they treat homeowners. In addition the list below are “servicers” who also come under the rule of law in California.

List of mortgage servicers licensed and regulated by the Department of Business Oversight with more than 175 Foreclosures in calendar year 2012 and are subject to specific requirements:

• BAYVIEW LOAN SERVICING LLC
• CARRINGTON MORTGAGE SERVICES, LLC
• CITIMORTGAGE, INC.
• FIRST MORTGAGE CORPORATION
• GMAC MORTGAGE, LLC
• GREEN TREE SERVICING LLC
• GUILD MORTGAGE COMPANY
• HOMEWARD RESIDENTIAL, INC.
• OCWEN LOAN SERVICING, LLC
• NATIONSTAR MORTGAGE, LLC
• PENNYMAC LOAN SERVICES, LLC
• PHH MORTGAGE CORPORATION
• PROVIDENT FUNDING ASSOCIATES, L.P.
• RESIDENTIAL CREDIT SOLUTIONS, INC.
• SAXON MORTGAGE SERVICES, INC.
• SELECT PORTFOLIO SERVICING, INC.
• SETERUS, INC.
• SPECIALIZED LOAN SERVICING LLC
• SUNTRUST MORTGAGE, INC.
• VERICREST FINANCIAL, INC.

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