General Information on Wrongful Foreclosure:
Courts are empowered to hear cases in “law and equity.”
Some arguments that have been asserted as grounds for wrongful foreclosure (which should provide grounds for an injunction to halt a sale date – at least that is the goal anyway) are:
(1) The loan is unconscionable and unenforceable (Ex. an Option Arm loan to a non-financially savvy recipient of the loan)
(2) The borrower is exercising their legal right to rescind the agreement (ex. TILA rescission / Civ. Code 1632 rescission / Fraud in the Factum rescission, etc.)
(3) The loan servicer failed to adequately respond to a Qualified Written Request (and an bona fide issue over whether there is a default or what amount was actually owed etc.)
(4) The lender or loan servicer (agent of lender) failed to follow the foreclosure rules (ex. in regard to the notice of default / notice of sale / contact requirements under 2923.5 etc.)
(5) The default was “cured” most likely due to a modification agreement / trial plan agreement etc.
(6) Other equitable grounds
These are just a few ideas that should be looked at in every case. If you have a rescission right, you will need to explore the issue of “tender.” Keep in mind, since there are so many foreclosure lawsuits being filed in this current environment, you need to make sure you case is bona fide, and one the judge will be willing to hear. Foreclosure Attorney may NOT file mortgage litigation lawsuits for the sole purpose of delaying the inevitable where no legal grounds truly exist.
This page will provide general legal information about the topic of WRONGFUL FORECLOSURE and how it may relate to foreclosure defense. All information contained on this website is general in nature, and should not be construed as legal advice or a substitute for legal advice. Although we have tried to be as accurate as possible, the following information may be inaccurate, missing some information, or outdated – as law can frequently change or become modified. If you have questions about your case, please contact a foreclosure defense or bankruptcy lawyer in your area. Please note, comments posted to this blog and emails sent to us are NOT confidential and do not create an attorney-client relationship.
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This page will discuss some of the foreclosure defense strategies we will normally look to when handling a foreclosure defense case in California. The following information is general in nature, and should not be construed as legal advice or a substitute for legal advice. Although we have tried to be as accurate as possible, the following information may be inaccurate, missing some information, or outdated – as law can frequently change or become modified. If you have questions about your case, please contact a foreclosure defense lawyer in your area.
WHAT ARE SOME OF THE COMMON FORECLOSURE DEFENSES OR STRATEGIES?
(1) Seek a Loan Modification / Loan restructuring / Loan Workout (of a commercial or residential loan). This is always the best first line of defense. If your lender or loan servicer will voluntarily modify your mortgage loan (first and/or second mortgage), and possibly give you principle loan balance reduction, this is often your best result. The problem is loan servicers such as Chase, Bank of America, Nationstar, SPS, SLS and PHH are not as eager to give borrowers loan modifications that are “meaningful” and sometimes the modifications are just designed to force you to make the decision whether or not to walk from your property or pursue a short sale or seek a deed-in-lieu of foreclosure. But you can do this yourself, so this is usually a good first item to explore with your loan servicer’s loss mitigation department.
(2) Pursue a short-sale of the property (list the property for sale and see if the bank will accept less than what they are owed). This requires you to list the property for sale, and we recommend finding a real estate agent who has specific short sale experience working with the above loan servicers. We can make recommendations if you need one, just drop us a line below.
(3) File Chapter 7 Bankruptcy or Chapter 13 Bankruptcy (this may or may not save the home from foreclosure but there is at least a temporary “automatic stay” of foreclosure). If you can bring your loan payments current in bankruptcy, including paying all the arrears and past due amounts (usually over 60 months) this could represent a great option for you. In a Chapter 13 you can attempt to “lien strip” unsecured junior (2nd mortgages, such as a HELOC). Stripping a second mortgage can sometimes be as good as getting a loan modification.
(4) Deed-in-lieu of foreclosure (this involves handing over your deed to the lender who accepts the deed and relinquishes your obligation). If you are not protected by the anti-deficiency statutes in California and Arizona (where we are licensed to practice) then the lender or loan servicer may seek the borrower to pay the deficiency or else work out an amicable settlement of the deficiency amount. We can help you negotiate these deals, and try to get the settlement amount as low as possible.
(5) Foreclosure Lawsuit / Mortgage Litigation (in certain circumstances a homeowner may be entitled to seek money damages, an injunction or pursue rescission of a loan, in this event a lawsuit may be proper). Post 2013, a violation of the California Homeowner’s Bill of Rights is another strategy to pursue. The CHBOR allows for injunctions, attorney fees, and $50,000 damages for foreclosing with robosigned documents. Litigation is never an inexpensive option, but sometimes it is the only way to fight to save your home from foreclosure and to seek to set aside foreclosure cases, or consolidate eviction cases with foreclosure cases while filing a lis pendens to cloud the title to the property.
These are the top five strategies, there may be others depending upon the facts of your situation. Contact a foreclosure defense attorney to discuss the facts of your case at (877) 276-5084. We offer unbiased one hour paid consultations to help you determine what the proper strategy is in your case. All California foreclosure reviews are conducted personally with Attorney Steve Vondran, the real estate lawyer. Mr. Vondran has been a thought leader in the foreclosure defense business since the beginning of the mortgage meltdown. He has earned law degrees and real estate broker’s licenses in both California and Arizona.
Other real estate law services we provide to help residential and commercial property owners with distressed real estate issues:
1. Commercial loan workouts – we can negotiate with your landlord for a reduced monthly rent;
2. Residential no advance fee loan modifications (select loans only) See World Savings and Wachovia pick a pay;
3. We send QWR (Qualified Written Requests under RESPA) to loan servicers to challenge billing and servicing disputes;
4. We can send FDCPA “debt validation” letters to default loan servicers;
5. We can submit demands for lenders and loan servicer’s to provide “evidence of indebtedness” justifying the right to pursue foreclosure under CHBOR;
6. Unbiased independent foreclosure review (includes document review, chain of title, and factual phone discussion). Price is $495.
7. We negotiate settlements with junior lienholder (assert defenses such as one action rule);
8. We can negotiate “cask for keys” in eviction cases, or consolidate civil cases with Superior Court civil matters;
9. We can file lis pendens;
10. We can seek TRO and Injunctions to stop your foreclosure sale (or seek to set aside the sale for wrongful foreclosure grounds)
11. We can list residential or commercial property for sale using our real estate brokerage services. This comes in handy when you need a law firm that can guide you as to the real estate aspects of the foreclosure sale, but also help push the short sale through as well.
We are a full service real estate firm that has helped countless homeowners in their fights to save their most precious assets. We have fought for our clients in both state courts, federal courts, bankruptcy courts and adversary proceeding courts. We have fought the biggest banks and their law firms, and we have prevailed in many of our cases. We turn over every stone to fight for you in your case. Give us a chance to discuss your case by calling us at (877) 276-5084 or by filling out the foreclosure review form below: