Fight Back Against Your Lender and Win Big Time

If you are a victim of predatory lending or mortgage fraud, it's sometimes possible to have your mortgage voided and to apply 100 percent of your payments to the principal balance. There are certain consumer protection laws in place that are truly affective in helping homeowners fight against lenders who are trying to foreclose on their homes.

Many homeowners are unaware that they can fight back against their lenders and win!

The Truth in Lending Act (TILA) is a very powerful tool in preparing a defense against your lender for violations of predatory lending law. If simple violations of the TILA can be proved in your loan documents, then you can sue your lender. That's great news in a market where borrowers think they have no defense against big lenders with deep pockets.

Many consumers are tricked into signing documents they don't understand. These same documents cleverly hide fees like the yield spread percentage (YSP) and charges. Does your loan have a prepayment penalty? Maybe your lender paid money to your mortgage broker and your weren't aware of this "kick back". Or maybe you signed a disclosure at closing stating that you were not canceling (waiving your right to a 3 day right of rescission)?

Even though these issues may be be insignificant to you, they are very significant in bringing suit against your lender. A simple review of your loan documents can uncover these predatory lending law violations and save your home.

Take for instance this homeowner who we helped out of foreclosure. The homeowner was actually officially foreclosed on and the title was taken out of her name.

Many would come to believe that someone in her shoes was done and there would be nothing that can be done, right? Wrong!

I conducted an audit of the loan documents, discovered predatory lending and thus began the fight against her previous lender to save Carol’s home.

Recently, Carol Tounget was the victim of a predatory lending practice that is unfortunately all too common. Lenders pray upon the needs of desperate homeowners by offering them exorbitant interest rates and fees. After falling behind in payments, Carol found herself facing foreclosure and loosing the house she had lived in for so many years. Realizing that the practices of this lender must be prohibited by some law, Carol sought out my law firm of Fransen and Molinaro, LLP .

“I knew something was wrong, but I couldn’t put my finger on it”, says Carol. Meanwhile her husband had spent countless hours on the internet and stumbled across some information on the Truth In Lending Act. “After, reading as much as I could I sought out an attorney that had experience with these issues. I eventually talked with Nathan Fransen who confirmed my wife’s instinct and my research”, says Howard Tounget. The key to the case became the borrowers “extended rescission rights”. When certain provisions of the Truth In Lending Act are violated, borrowers are allowed to cancel their loan even after it closes.

In this instance, the Tounget’s were able to recover all interest payments they had made as well as the closing costs they had paid. All told, the borrower’s recovered about $40,000. The lender was even required to pay the Tounget’s attorneys fees.

Talking to an attorney as soon as possible is critical”. When searching for the right attorney it is important to find one that has experience in the mortgage industry. Predatory lending and unscrupulous loan practices requires a unique understanding of the ins and outs of the mortgage business.

[melalvz]

Our attorney's discovered that in the original documents we signed a right to cancel with hand written dates. In our copy the document was blank. No dates at all. Therefore, although we signed it , if we reviewed our copy at home we had no dates.. Do you feel this is a strong case. This was an Ameriquest loan.

[Brian K.]

Sorry for the late reply. What dates are you referring to. The date of signature or dates to rescind the loan?

TILA has very strict requirements for what needs to be on the 3 day form.

In relevent part TILA requires that:

There must be delivery to each borrower of two copies of a 3-day notice of right to rescind the loan transaction (non-purchase money mortgages only). The notice must meet all the requirements specified in 12 C.F.R. 226.23(b)(1), including

a. setting forth the date the rescission period expires
b. how to exercise the right
c. how to contact the creditor
d. and the effects of rescission.

The three-day right to rescind is absolute; unless the borrower waives the right as set forth in 12 C.F.R. 226.23(e), the creditor cannot take any action to undermine that right. 12 C.F.R. 226.23(c). Rodash v. AIB Mort. Co., 16 F.3d 1142 (11th Cir. 1994); Jenkins v. Landmark Mortgage Co., 696 F. Supp. 1089 (W.D.Va. 1988).

The creditor must deliver TILA disclosures to each person whose ownership interest in a dwelling is subject to the security interest, and each such person has the right to rescind. 12 C.F.R. 226.2(a)(11), 226.15(a) and (b), 226.17(d), 226.23(a)(1). Westbank v. Maurer, 658 N.E.2d 1381 (Ill.App. 2nd Dist. 1995).

Sorry for all the law stuff, but it is a good start for a TILA evaluation.

[melalvz]

Thanks....

I am referring to our right to cancel. The attorney noted that the original right to cancel had dates that were not typed but written. Our copy was blank. We signed the original. What do you think??

[Brian K.]

Sounds like a case. If you were confused about the time for revocation then it is likely a violation. The notice must state the date that you must act to cancel the mortgage, in your case, your form was blank. I would argue that it is as if they failed to deliver any revocation document.

[Strong Atlanta]

Nathan:

I am not sure where you are located but I am in Atlanta, GA. We have tried to contact and hire 4 or 5 different lawyers but they never went to work for us. We kept receiving excuses that they had not gotten to it, etc. It just doesn't seem to be an interest for anyone. Based on what you have told us above, we could definitely benefit from speaking with a lawyer if you have any suggestions of someone with experience in the Atlanta area.

Thanks for listening.

Strong Atlanta