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Article Outlines Multiple Cases of Mistaken Foreclosure Attempts by Lenders

December 13, 2010

When the news of robo-signing broke, one consistent refrain from mortgage servicers and lenders was that it was a technicality. Most or all of the people in foreclosure got there by not paying their mortgages, they argued, so whether the paperwork was in order was ultimately not important. Our Corona foreclosure defense lawyers were therefore very interested in an Associated Press article dated Dec. 8 that tells a different story. The article explains multiple cases in which the lender attempted to foreclose on property it didn't own, that the defendant didn't own or that was up to date. In many of those cases, defendants had to pay large amounts of money to correct errors because lenders refused to do it themselves.

In one case, a bank tried to foreclose on a home that had been paid for in cash, whose owner had never had an account with the lender. Warren Nyerges of Naples, Fla. showed a copy of the cashier's check he used to pay for the house, but no one at Bank of America was impressed. He had to serve as his own lawyer in the foreclosure proceeding, where he was finally awarded $2,500 plus interest for the trouble and cost of fighting their mistake. Another man, Tom Williams of Kansas City, was up to date on his mortgage when GMAC threatened to foreclose unless he paid off the balance immediately -- on a loan set to mature in 2032. The bank put a stop on his account, hurting his and his wife's credit at a time when she was trying to buy a business. Williams said he'd spoken to 25 GMAC employees who promised to help but never did. He was offered a loan modification he didn't want and has had his payments returned. He intends to hire an attorney.

This article describes several other situations like this, some of which have triggered lawsuits. It then goes into detail about the recent history of U.S. mortgage lending, concluding that financial incentives in the fee structures, plus the volume of foreclosures created by lower lending standards, led to disorganization and outright fraud in practices like robo-signing. It also mentioned testimony from several ex-employees who said they had been pressured by banks and law firms to push through foreclosures even when borrowers claimed there was a mistake. As Fountain Valley foreclosure defense attorneys, we are pleased to see these issues covered so thoroughly in the mainstream press. Because we work with homeowners every day, we know lenders' customer service systems are broken, perhaps intentionally -- but their excuses are typically swallowed without question in the media.

Howard Law PC represents clients whose homes are at risk because lenders failed to give their loan modifications or other requests fair consideration. Our Laguna Beach foreclosure defense lawyers have represented these clients since the beginning of the foreclosure crisis, so we know all about the tricks lenders play to try to hasten foreclosure and inflate their fees as much as possible. Often, the first thing we do in a case with an impending foreclosure is file a lawsuit and ask the court to stop the foreclosure, giving it time to review whether the bank's conduct has been legal. At that point, we typically have their attention. Our goal is always to help clients get the best possible outcome -- a monthly mortgage payment they can meet and fair treatment from the lender.

If you're at risk for a foreclosure you don't believe is fair, don't wait to call Howard Law for help. For a free evaluation of your case, contact us through our website or call 1-800-872-5925 today.