What’s up with banks not allowing you the right to reinstate your mortgage?
We have been getting a rash of phone calls lately from distressed property owners who are mad as heck that the banks will not allow them their legal right to reinstate their loans.
This appears to be a situation that is literally getting out of control. In California you have legal rights, even after getting a notice of default and even while in the foreclosure process.
The law regarding rights to reinstate your loan can clearly be found in the California Civil Code Section 2924:
(e) Reinstatement of a monetary default under the terms of an obligation secured by a deed of trust, or mortgage may be made at any time within the period commencing with the date of recordation of the notice of default until five business days prior to the date of sale set forth in the initial recorded notice of sale.
This is really upsetting me because on one hand Banks are telling people to “stop making their mortgage payment” so that they can be considered for a loan modification. Then, in reliance on the statements made by the “foreclosure specialist” the loan servicers (servicers are companies like JP Morgan Chase, Wells Fargo, Citimortgage, Bank of America, etc.) the borrower stops making payments and then, after not getting a loan modification, they are thrust upon a foreclosure sale date that promises nothing more than a private trustee sale on the court house steps. In this situation, some people just want to get current again and get back on track and forget about the bogus loan mod programs all together. The main problem then becomes that you are trying like crazy to get the mortgage loan servicer to accept your payments, only now they are telling you that you cannot pay the mortgage and cannot bring the loan current.
What is going on here? The loan servicer whose job it is to collect your mortgage payment is now telling you that you cannot reinstate your loan. This is total nonsense. If you have been denied a loan modification, or are in another situation where you are trying to bring your loan current (ex. after a chapter 7 bankruptcy or chapter 13 bankruptcy) and the lender or loan servicer refuses to accept your mortgage payment, DO NOT WASTE EVEN ONE MINUTE, call a real estate foreclosure defense attorney and demand that they give you a reinstatement quote and/or allow you to honor your legal right to reinstate your mortgage loan.
We can be reached at (877) 276-5084. Please note, once a foreclosure sale has transpired, it can be difficult and sometimes impossible to reverse the foreclosure sale. You cannot trust the lenders and loan servicers, and sometimes this is just their problem of being “too big” to be organized. Sometimes I think there are other reasons. Call us if you are having problems!