Foreclosure is a fast-paced, difficult process. Rest easy knowing help is on the way
Foreclosure is a fast-paced, difficult process. Rest easy knowing help is on the way
If you can prove that the foreclosing party did not follow the procedural rules for foreclosure or the terms of financing, you may be able to delay the foreclosure, at least for the time-being. You also have several ways you can fight this type of proceeding in court.
How To Fight A Foreclosure – Strategies For Defense
Some of the defenses that you can raise, if you file a lawsuit, include the following:
· The foreclosing party did not follow the specific process for foreclosure. If you find that the foreclosing party did not follow specific state processes for foreclosure, you may be able to challenge the foreclosure. If you are successful, the court system will issue an order that mandates that the foreclosing party restart the process.
· The foreclosing party is unable to show it owns the loan. This defense, many times, is unsuccessful because banks are more careful today about initiating the paperwork for a loan. They also check themselves, in this respect, when facilitating a foreclosure.
· The servicer for the mortgage committed a notable mistake. The servicer of a loan account regularly handles deeds of trusts or mortgages. Therefore, this type of entity is more apt to make mistakes as it receives a large volume of business. You may be able to challenge a foreclosure, in this situation, especially if the payments were credited to the wrong party or dual-tracking was involved. Dual tracking entails pursing a foreclosure simultaneously with a foreclosure avoidance activity, such as a deed in lieu of foreclosure, short sale, or loan modification plan.
· The borrower received fees that were in not authorized by the deed of trust or mortgage.
· Overstating the amount the borrower must pay for reinstatement of a mortgage or deed of
· The borrower is a member of the armed services on active duty. The SCRA (Service Members Relief Act) offers special foreclosure protections for people who serve in the U.S. armed forces.
When The Lender Cannot Obtain A Personal Judgment – The One Action Rule
In California, the state’s one action rule only allows a lender to take one action against a borrower in a foreclosure proceeding. Therefore, he can hold a trustee’s sale, sue for the balance of the debt, or foreclose judicially.
Also, in California, a lender cannot obtain a personal judgment against the homeowner if the financing was a purchase money loan or a refinanced purchase money loan that was transacted after the first of January 2013. Neither can the lender obtain a personal judgment if the loan was seller financed.
Let The Foreclosure Proceed
Sometimes, it is just better to allow a foreclosure to proceed, especially if the home is no longer a good investment or you owe much more for the property than it is worth. If this is the case for you, you will find that you still can go on with your life and make a good start again.
Foreclosure allows you to set the money aside that once went to the former payments so you can find a new place to live. Doing so will give you the ability to save and make arrangements for your future housing.
Be Mindful Of Your Neighbors
Your unwillingness to leave a home can lead to trouble, especially after your home has been sold. That is why you should speak to a foreclosure attorney. Not only does it upset the equilibrium in the neighborhood, it is disrespectful. A foreclosure attorney knows all the timelines, processes, and eviction guidelines. Attaining legal assistance can help you stay on track on how you should proceed – whether you choose to stay or leave.
Also, people who vacate their home during the process can drag down the value of the other homes in the neighborhood. That is why it pays—literally—to use the services of a foreclosure attorney. Abandoned homes hurt both neighborhoods and banks.
Be Wary Of Leaving The Home Before The Sale
Some homeowners panic when they have missed a couple of house payments and believe they need to move out. However, an attorney will tell you that you have a right, legally, to stay in your house until the foreclosure is completed.
A foreclosure process can take as long as a year. On the other hand, a fast-track foreclosure permits a bank to obtain title to a home more quickly so the property will not lose its value. In either event, it is important to stay in the home to normalize, if not neutralize, the situation.
Spanning Out The Foreclosure Process – California’s Homeowner Bill Of Rights
In California, legislation has been introduced where a homeowner is protected during the foreclosure process so that the proceedings span out for a longer period. Protections under the Homeowner Bill of Rights (HBOR) provides special safeguards to California homeowners facing foreclosure.
The goals of this legislation is to give more rights to a homeowner who is going through foreclosure, giving him or her a better opportunity to review loan modifications as well as other methods of avoiding foreclosure.
For instance, the HBOR stops a servicer from recording an NOD (Notice of Default) until 30 days after the servicer has initially made contact to discuss foreclosure options. Contact must be made either by telephone or in person.
Under this law, the servicer contacts the borrower to discuss his or her financial circumstances and look at ways to prevent foreclosure. During the first contact, the servicer must advise the borrower that he or she has the legal right to request a follow-up meeting. This meeting must be over the phone and, if requested, must occur within a timeframe of two weeks.
The evaluation of the borrower’s financial circumstances and discussion of alternatives may take place during the initial contact or at the follow-up meeting. In either situation, the servicer must provide the borrower with a toll-free number of the US Housing and Urban Development (HUD) agency.
The servicer must first try to contact the borrower by sending a first-class letter by postal mail with the aforementioned telephone number. After sending this letter, the servicer must try to phone the borrower at least three times at various hours on different days. If the servicer does not receive a response from the borrower within a 14-day period, a certified letter (return receipt requested) must be sent by the servicer.
Other Noted Protections Provided By The HBOR Law
Some of the noted protections that are also featured by California’s HBOR law include the following:
· Placing a stopper on dual tracking. Dual tracking occurs when a servicer reviews a borrower’s loan modification application or other avoidance option while simultaneously proceeding with foreclosure. Under the HBOR, the borrower may submit an application for a foreclosure prevention option without worrying about a Notice of Sale being posted or the scheduling of a foreclosure sale.
· If an application of this type is pending, these two phases of the foreclosure process cannot take place. Until the borrower receives written notice about his or her eligibility for a foreclosure preventative, a Notice of Sale or the sale itself cannot take place.
· One point of contact. Servicers must supply borrowers with one point of contact during the foreclosure proceedings.
· Robo-signing is not permitted. Robo-signing occurs when a bank employee or servicer signs a
document for foreclosure, such as an assignment or mortgage or affidavit, without knowing if the information is correct or incorrect.
· The paperwork must be accurate and complete. Under the HBOR, servicers must survey the foreclosure paperwork and make sure the documentation is complete, accurate, and supported with details regarding the borrowing’s financing and loan status as well as the servicer’s legal right to foreclose.
· A written denial notice. The HBOR also necessitates that a servicer provide a borrower with a written denial notice if the servicer rejects the request made by the borrower for a first lien financing modification.
Moreover, the notice must give specific reasons for the denial and include information that
allows a borrower to attain more documentation supporting the decision for refusal. The request made by the borrower for the additional paperwork must be made in writing.
The Homeowners Bill Of Rights: When You Can Sue
Because of the implementation of the Home Owner Bill of Rights in California, homeowners can sue the servicer or lender for violations made under certain sections of this law. Relief includes injunctive relief (given before the recording of the trustee’s deed upon sale) or relief for actual damages if the trustee’s deed has been recorded.
Moreover, if the court finds that a violation was reckless, intentional, or resulted from willful misconduct by the servicer of the loan or the lender, the court has, in its power, the right to award the borrower the greater of three times the actual damages or statutory damages in the amount of $50,000.
Do You Meet The Criteria For The HBOR?
The safeguards given to homeowners through the Homeowners Bill of Rights or HBOR apply to first lien mortgages for properties that meet the following requirements:
· Owner-occupied residences
· Residential properties
· Structures featuring not over four units
Small servicers of loans, or entities that perform less than 175 foreclosure sales annually, are exempt from some of the stipulated HBOR requirements.
Where You Can Find Out More Details About The HBOR In California
You can learn more about HBOR regulations in California at the Attorney General’s website for the state. This law is especially important to you in you live in California and are faced with foreclosure.
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