Rescission, TILA Violations and I'm fighting back!

[gigi in fla]

Poppy:

I know square footage can be off somewhat, but 228 sq, ft.? I don't think so. Here is what happened: The appraisal was coming in too low, the letter from the broker to the State confirms that and she mentions the loan was "impossible" due to the "low" appraisal. Now, don't know if I mentioned this but she shared ooffice space with the appraiser. All three parties (broker, lender and appraiser) knew the home would not appraise for $200,000as indicated in her letter. So what did they do? They used the gross square footage (not what is under heat and air) to beef up the appraisal and then, unbelievably, they ignored a comp in my own subdivision because it sold for only $172,000. Then, they went over a mile a way and "found" a comp that sold for $205,000. If that is NOT fraud, I don't know what is. This explains the broker not answering the lawsuit; the appraiser calling me and threatening me and the lender doing the same.

As for the lender, they knew about the low appraisal per the broker's letter as their underwriter refused to accept the appraisal and they were reducing the value by $15,000. The loan went through when they switched to the ARM loan and at that point, most likely had the appraiser adjust the appraisal.

Thankfully, I don't see any judge or jury looking favorably on any of these parties especially now with sub-prime loans in the news almost daily. I am one of the folks who did NOT apply for this type of loan, I was victimized by the broker, lender and appraiser and hopefully, I can beat them up and get some money from them before they all are out of business.

Thanks again for your input. Would you like me to send my docs for you to look at?

Gigi

[Moe Bedard]

Good morning Gigi.

It really looks like you need a "real" document review and an attorney that know what they are doing. I think between Poppy and I, we have given you as much as we can give as far as advice and now either you need to take it to the next level.

The loan document review service is through Marshall and Poppy will review for him. Then you can see where to go form there based on a "professional full audit".

I say this with full confidence based on what you have mentioned in your posts and it would be hard to help any further without actually having the "physical" loan documents.

You understand, right?

[gigi in fla]

Do I contact Marshall or Poppy? Can you have one of them get in touch with me so I can send to appropriate parties? Bank Fraud Victim Center now wants to charge a ridiculous amount. I will pay whoever for an audit, just want it done by competent professionals, not scam artists.

Thank you and yes I totally understand!

[Moe Bedard]

GiGi,
You need to contact Marshall and here is the contact information for him:

FORENSIC LOAN DOCUMENT REVIEW FEE SCHEDULE
$500 for one loan
$700 for a combo first and second mortgage
Non-profits or legal aid law firms receive $250 discount on all services

Please call us at 310-860-4764 for a FREE consultation with attorney Marshall Rosenbach.

Good Luck with the Review!!!

[gigi in fla]

Thank you soooo much!! I will call them tomorrow and set it up to have this done ASAP.

[Moe Bedard]

Sounds Good.........
Please keep us posted on your progress....

[gigi in fla]

Will do.....have a Qualified Written Request the lender never responded to so lots going on. Will call Marshall's ofc. tomorrow to get things rolling. I know there are violations, I need someone to confirm and this is the best site anywhere for that.

Running to watch the Super Bowl -- Go Giants!! Will let you know what happens w/Marshall's ofc. and audit

[gigi in fla]

***:

I spoke to Mr. Rosenbach briefly earlier, he was in the middle of something and said he'd get back to me. I just left a voice message for him as he wrote me on here and said he wanted more details. Hopefully, I hear from him this afternoon.

If he is unable to do the audit, do you have anyone else you can refer?

Thank you,

Gigi

[Moe Bedard]

GiGi,
I don't see why he wouldn't be able to do the audit............he is helping several others here as well.
Let me know when you hear from him.......

[gigi in fla]

I spoke to him earlier, he is supposed to e-mail me with his info. so I can send him a check and the docs for the review. Haven't received the e-mail from him yet. Will keep you posted.

Thanks.

[gigi in fla]

Just wanted to give an update. I found an attorney in South Florida who will be representing us in our lawsuit against the broker, appraiser and lender. I also got a call from the State of Florida's investigator regarding the status of my claim against the appraiser. They have been investigating them for the past 7 months regarding the appraisal of our home. They found probable cause the appraiser made errors in our appraisal - which is great news! This appraiser called and threatened me after the State started the investigation. They overinflated the square footage by 228 sq ft. and the value by $25,000.00. The appraiser was not hired by the lender. They had checked the value of a home we had a contract on prior to the purchase of our home and they correctly told us the home was over-priced; they should have done the same thing in this case yet they didn't. In fact, they are the one who e-mailed us MLS listings and our home was one of them. I am so looking forward to litigating this case against them, if they decide to continue after the State's probable cause letter and they have to respond!!!

[Moe Bedard]

Great news, who is the attorney? Did Marshall ever get back to you?

[gigi in fla]

The attorney is someone I know down in West Palm Beach, and he is friends w/Jim Bonfiglio who is the top TILA attorney in the State. I spoke to Marshall and he seemed pressed for time and he told me that on purchase mortgages there can be no TILA violations and that simply is not correct. I spoke to Mr. Bonfiglio, representatives w/FDIC and HUD and they confirmed this.

[Moe Bedard]

GiGi,
I am so glad that your case is being looked at and investigated......
Please keep us posted each step of your journey..

Good Luck with the fight!!

[InCalifornia]

Originally Posted by Moe

When borrowers apply for a mortgage loan, mortgage brokers and/or lenders must give the borrowers:
.....a Good Faith Estimate (GFE) of settlement costs, which lists the charges the buyer is likely to pay at settlement. This is only an estimate and the actual charges may differ. If a lender requires the borrower to use a particular settlement provider, then the lender must disclose this requirement on the GFE.
......If the borrowers don't get these documents at the time of application,[/B] the lender must mail them within three business days of receiving the loan application.
....The RESPA statute does not provide an explicit penalty for the failure to provide the Special Information Booklet, Good Faith Estimate or Mortgage Servicing Statement. However, bank regulators may choose to impose penalties on lenders who fail to comply with federal law. Please read the section on RESPA enforcement for more information.
.....Individuals have one (1) year to bring a private law suit to enforce violations of Section 8 or 9. A person may bring an action for violations of Section 6 within three years. Lawsuits for violations of Section 6, 8, or 9 may be brought in any federal district court in the district in which the property is located or where the violation is alleged to have occurred.
.......HUD, a State Attorney General or State insurance commissioner may bring an injunctive action to enforce violations of Section 6, 8 or 9 of RESPA within three (3) years.
.....A borrower may bring a private law suit, or a group of borrowers may bring a class action suit, within three years, against a servicer who fails to comply with Section 6's provisions. Borrowers may obtain actual damages, as well as additional damages if there is a pattern of noncompliance.

Any attornies (or consumers that actually experienced it) on the forum know if a lis pendens could be filed to stop a foreclosure if the Good Faith Estimate wasn't provided as indicated above? Many thanks!

[Moe Bedard]

RESPA Disclosures

Information by State
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Disclaimer

One of the purposes of RESPA is to help consumers become better shoppers for settlement services. RESPA requires that borrowers receive disclosures at various times. Some disclosures spell out the costs associated with the settlement, outline lender servicing and escrow account practices and describe business relationships between settlement service providers.

Good Faith Estimate of Settlement Costs.

RESPA requires that, when you apply for a loan, the lender or mortgage broker give you a Good Faith Estimate of settlement service charges you will likely have to pay. If you do not get this Good Faith Estimate when you apply, the lender or mortgage broker must mail or deliver it to you within the next three business days.
Be aware that the amounts listed on the Good Faith Estimate are only estimates. Actual costs may vary. Changing market conditions can affect prices. Remember that the lender's estimate is not a guarantee.

Keep your Good Faith Estimate so you can compare it with the final settlement costs and ask the lender questions about any changes.
Servicing Disclosure Statement.

RESPA requires the lender or mortgage broker to tell you in writing, when you apply for a loan or within the next three business days, whether it expects that someone else will be servicing your loan (collecting your payments).

Affiliated Business Arrangements.

Sometimes, several businesses that offer settlement services are owned or controlled by a common corporate parent. These businesses are known as "affiliates." When a lender, real estate broker, or other participant in your settlement refers you to an affiliate for a settlement service (such as when a real estate broker refers you to a mortgage broker affiliate), RESPA requires the referring party to give you an Affiliated Business Arrangement Disclosure. This form will remind you that you are generally not required, with certain exceptions, to use the affiliate and are free to shop for other providers.

HUD-1 Settlement Statement.

One business day before the settlement, you have the right to inspect the HUD-1 Settlement Statement. This statement itemizes the services provided to you and the fees charged to you. This form is filled out by the settlement agent who will conduct the settlement. Be sure you have the name, address, and telephone number of the settlement agent if you wish to inspect this form. The fully completed HUD-1 Settlement Statement generally must be delivered or mailed to you at or before the settlement. In cases where there is no settlement meeting, the escrow agent will mail you the HUD-1 after settlement, and you have no right to inspect it one day before settlement.

Escrow Account Operation & Disclosures.

Your lender may require you to establish an escrow or impound account to insure that your taxes and insurance premiums are paid on time. If so, you will probably have to pay an initial amount at the settlement to start the account and an additional amount with each month's regular payment. Your escrow account payments may include a "cushion" or an extra amount to ensure that the lender has enough money to make the payments when due. RESPA limits the amount of the cushion to a maximum of two months of escrow payments.

At the settlement or within the next 45 days, the person servicing your loan must give you an initial escrow account statement. That form will show all of the payments which are expected to be deposited into the escrow account and all of the disbursements which are expected to be made from the escrow account during the year ahead. Your lender or servicer will review the escrow account annually and send you a disclosure each year which shows the prior year's activity and any adjustments necessary in the escrow payments that you will make in the forthcoming year.

[InCalifornia]

Do these TILA and RESPA violations apply even if the loan is to non owner-occupied?

[tnjburgio]

I live in CA and purchased my home 3 years and 1 mo ago. I received a modification on my mortgage in January and the terms were brought back to the original rate and a 30 year fixed. A month ago my husband lost his job and since then can't pay the mortgage. I have an attorney and I will meet with him this week but I am very confused. When we received the application and the terms of the loan - it was supposed to be a 40 year fixed with a baloon in 30 years. No problem. The day the loan documents were signed a notary brought them to us and the loan we signed for was an ARM and not what my other paperwork said we would get. WE WERE NEVER NOTIFIED OR TOLD OF THE CHANGE BEFORE THIS TIME. I called the broker and his act words were take it or leave it. Well we took it, all my stuff was on a moving truck and I would have had no place to live and did not want to loose the deposits we put down. We figured we could refinance in 2 years and everything would be ok. Stupid assumption.

Is it too late for us? Should we just walkaway? I am hearing we have 5 years in CA and then I hear 1 year. Should we just get prepared for the inevitable? I have had perfect credit until now, but come Tuesday I will now be 30 days late on the mortgage.

Thanks for any advice I can get.

[faith]

[QUOTE=tnjburgio;99186]I live in CA and purchased my home 3 years and 1 mo ago. I received a modification on my mortgage in January and the terms were brought back to the original rate and a 30 year fixed. A month ago my husband lost his job and since then can't pay the mortgage. I have an attorney and I will meet with him this week but I am very confused. When we received the application and the terms of the loan - it was supposed to be a 40 year fixed with a baloon in 30 years. No problem. The day the loan documents were signed a notary brought them to us and the loan we signed for was an ARM and not what my other paperwork said we would get. WE WERE NEVER NOTIFIED OR TOLD OF THE CHANGE BEFORE THIS TIME. --------------------------------------------------------------------------------------------------------------tnjburgio,

I think you are a victim of what we called Mortgage Bait-and-Switch. These abuses were cited by attorneys general and other officials from 49 states in a settlement with mortgage giant Ameriquest earlier this year. Bait-and-switch tactics are alleged in class actions, including one against Wells Fargo, which advocates say has prompted changes in company policy. At closing, subprime borrowers are often presented with terms that do not match those previously offered, and then pressured into signing documents they have not had time to review

Consumer fraud laws, including requirements that lenders disclose the terms of a loan and borrowers’ cancellation rights, have been important tools for attorneys fighting predatory lenders. But with thousands of lawsuits filed on behalf of subprime borrowers across the country, many consumer advocates are calling for government regulation of the subprime industry.

Federal statutes require pre-closing disclosure of estimated loan terms, pre-closing disclosure of actual loan terms for high-rate and high-fee €mortgage loans, and notice when changes are made from the terms applied for by the borrower. • State statutes and common law prohibit fraud, deceit, and misrepresentation in loan transactions.

The Truth in Lending Act (TILA) sets out detailed disclosure requirements that govern virtually all consumer credit transactions, with the goal of promoting informed consumer choice. The Real Estate Settlement Practices Act (RESPA)6 dictates procedures and forms for residential real estate closings to make clear to borrowers the true costs of buying and refinancing. Complementary provisions of TILA and RESPA require lenders to provide ‘‘good faith estimates’’ of both loan terms and costs early in the mortgage process. Clearly, Congress had the bait-and switch problem on its mind. However, neither law has prevented problems or provided much relief for unsuspecting and unsophisticated consumers
.
TILA requires a good faith estimate of its required disclosures, including annual percentage rate, finance charges, payments schedule, and more, also within three business days of submission of a mortgage loan application. However, the requirement applies only to purchase money mortgages. Refinances, where many of the worst practices appear, are not covered. Further, court decisions give lenders great leeway in their ‘‘good faith’’ estimating and have not applied TILA to prohibit abuses. One analyst has concluded that, far from protecting consumers, the loose requirement for good faith estimates ‘‘creates a federally structured opportunity for lenders to use bait-and-switch consummation tactics.’’

Congress however is unlikely to pass comprehensive legislation that deals with predatory lending. They will probably make a show of some sort of legislative fix, but legislation is not the answer — self control and common sense are needed on the part of the buyers/borrowers. At closing, subprime borrowers are often presented with terms that do not match those previously offered, and then pressured into signing documents they have not had time to review.” TAKE THE TIME to read the contract — if it sounds too good to be true, it probably is, if you don’t fully understand it — DON’T SIGN! If there is pressure to sign —THAT’S A RED FLAG. DON’T! “

Have a Real Estate Lawyer, check their licensing if they are allowed to practice in your state, go to BAR Association website to check the lawyers status, or have a financial advisor that you can trust, or savy friend look over the contract. Be honest and up front with him about your income and other expenses. Put off buying if the cost is more than sensible.

You may file a complaint against your lender to your State Attorney General, if you are in California, he is Attorney General Edmund Brown, search the web, they have forms to file complaint online.

You have mentioned that you have a lawyer, make sure he is a Real Estate Attorney.
Here are the questions you need to ask your lawyer.

How are you paid? Ideally, the first payment AFTER contract signing and last payment of 50% at closing.

What will you not negotiate? Even after an offer is accepted, lawyers will refuse to negotiate “non-legal” issues. This usually means anything having to do with the price.

Will you go through the contract with me before signing? You should hear a non-hesitant yes. And it’s a good idea to do this after you’ve had a chance to read it on your own.

How many real estate transactions do you handle a year?- minimum of more than 20 closings a year.

How much experience do you have closing? Listen carefully to his answers and follow your instinct.

How much do you charge? The best answer is flat fee, don’t do hourly.

Who is handling the file? The best is a partner or senior attorney. The worst answer is “we have a whole staff of people to help and I oversee it all”.

Who will be at the closing? This should be the person who handled your file along the way. You don’t want someone who doesn’t know anything about you and your file.


Source: A BAR Journal

[tnjburgio]

Thanks for the advice. My mortgage servicer is ASC, owned by Wells Fargo, they are my 3rd mortgage company. I also wonder how many original documents they have, if any. I know that the original mortgage company is out of business and the broker filed bankruptcy in May of this year. It was all a sham and I am getting burned in the end.