Getting a loan modification can be a complicated process. During a modification,
homeowners put up with their mortgage lender’s never-ending requests
for documents and financial information because a loan modification may
be their only hope to avoid foreclosure. Once the modification process
is underway, there may still be additional complications. In some instances,
a mortgage lender may engage in illegal behavior and refuse to honor a
previously-agreed upon loan modification.
Loan modifications have helped thousands of homeowners avoid foreclosure
and make their mortgages affordable. However, many mortgage servicers
will make more money by pursuing a foreclosure than they would by modifying
the mortgage loan. As a result, banks and mortgage servicers do not make
the modification process easy and may attempt to avoid their responsibilities
under the loan modification agreement.
One of the loan servicers’ more common schemes to avoid modification
involves changing mortgage servicers in the middle of a modification.
For example, a homeowner may have received a loan modification from Wells
Fargo. Halfway through the trial modification period, Wells Fargo transfers
the loan to Nationstar for servicing. Nationstar may claim that it had
no idea that the homeowner was in a modification and could refuse to honor
the modification agreement. Nationstar could then attempt to foreclose
on the property.
As of 2014, federal law requires loan servicers to honor existing loan
modification contracts. While this law helps homeowners, many loan servicers
will still attempt to get out of an existing modification and will hope
that a homeowner will not have the resources to sue the company for a
breach of contract.
In addition to changing loan servicers in the middle of a modification,
some loan servicers will intentionally delay the modification process
until it is too late for a homeowner to get help. The loan servicer may
claim that they did not receive certain documents, or may ask the homeowner
to submit the same documents multiple times.
Also, the loan servicer may suddenly stop refusing to accept payments on
an existing loan modification. The loan servicer may point to minor clauses
hidden in the contract that allow the company to refuse payments, and
will use these clauses to pursue foreclosure or require the homeowner
to seek a new modification agreement.
If a mortgage servicer or bank refuses to accept payments or rejects an
existing mortgage modification, you must act quickly to protect your rights.
If you stop making payments because the bank refuses to accept them, the
bank will likely argue to the court that you were the one who breached
the agreement. The longer you wait to contest the mortgage servicer’s
actions, the more likely that the bank’s arguments will be believable.
By hiring an attorney, you can show the court that you are a victim of
the bank or mortgage servicer’s actions. Fighting back against these
practices can help you keep your house and force your mortgagor to honor
your loan modification agreement.
If you are unsure if your bank or mortgage servicer’s actions are
illegal, contact Loan Lawyers today. Our Florida loan modification attorneys
will review your agreements, and can help you fight back against breaches
of your modification contract. To schedule your free and confidential
consultation, contact our office today by calling (888) FIGHT-13 (344-4813).