Home Loans and Support

What is a mortgage loan audit?

A mortgage loan audit can go by several names, including a forensic audit or a forensic document review. The main purpose of a mortgage loan audit is to check for violations of loan or real estate laws on the part of your lender so that you can more easily avoid foreclosure.

This is accomplished by acquiring a loan modification in your favor. See, it is a lot easier to demand a loan modification when you have proof of illegal actions on the part of the lender. Lenders and banks are strictly governed by the Federal Government, and even the slightest violation is grounds for action. 

In other words, say that you are paying a huge sum of money every month as a mortgage payment.

  • Do you feel like the conditions of the loan are not fair?
  • Or, do you feel like something is just out of place?
  • Or, for that matter, are you just struggling to make loan payments while your lender turns a deaf ear to your plea for a loan modification?

If any of these describe you, then a mortgage loan audit might be exactly what you need.

Beware of scammers and shady kitchen top loan auditors!

The economy is in utter turmoil right now and it is hard to make a buck on Main Street. Even all the mortgage brokers and loan officers are out of work. But the facts are many are out scamming innocent homeowners with the mortgage audit or forensic loan document review. Beware of these shady companies and I recommend only getting a mortgage audit from an actual law office that can do something if there is predatory lending violations on your loan.

What the hell is Joe the Loan Officer going to do if he finds violations on your loan? He can’t do much folks! So don’t do business with Joe or any mortgage broker in order to avoid getting swindled out of your hard earned cash.

The audit helps mainly only homeowners with a primary residence and loans that are refinanced in the last 3-4 years because the laws with the most teeth fall under the Truth in Lending Act (TILA). TILA only cover certain mortgage loans and your must qualify in order to be protected by this Federal Law.

If your mortgage is a purchase money loan or 2nd home/investment property, then most likelythe audit will not do much good to help you because it does not fall under TILA and the other laws that may have been broken offer very little recourse. But an attorney still can assist you with a loan modification.

The attorneys in the field of loan auditing can go through all of the numbers, dissecting and looking for anything unscrupulous or illegal with your loan. Statistics show that most loans given out in the past five years have had faulty documentation and mistakes, meaning that you might be entitled to a nice loan modification and not even know it.

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About Moe Bedard

My name is Maurice Bedard, but most people call me Moe. I am the founder of America's #1 Mortgage Forum, LoanSafe.org, and also a website design firm called We Create Web Designs. My online work has been featured in the New York Times, LA Times, Fox Business, and many other media publications. I currently live in Carlsbad, California with my beautiful wife and children.

16 Responses to What is a mortgage loan audit?

  1. Maria I. says:

    I have a first and second mortgage (ARM) thru Indymac. I have been told that they cannot help me with a modification or refinance because my mortgage is “upside down”. I am also not “behind” in my payments. Fannie Mae and Freddie Mac won’t help because we don’t have one of their loans. When we took out the loan, I was told the payments would be $1,200 for the first and only $120 for the second. No one mentioned that this was only an “introductory offer”. I thought my husband could retire and afford this loan. Instead, we ended up owing close to $500 more a month for the full payment! Our previous loan was only $1,900 pre month P&I. My husband and I are devastated. Is there anyone who can help us and would an audit be beneficial? I look forward to hearing from you.

    Thank you,

    Maria I.

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  2. Cindy Magee says:

    Dr. Moe,

    I have been following this website for almost a year and I am finally feeling the fog lifting a bit. Myself and my significant other had a child who’d been missing for 12 years and finally in January of 2007, they found her remains. The expenses for her memorial and buriel, I still haven’t totally paid for, took more than we expected and set our mortgage payments back…finally we received a NOD and Notice of Right to Cure, but it did not look good. This is my partner’s family home and we owe 66,500.00 on a home worth 155.000.00.

    A big ad came in the mailbox from a Homebuyer’s Inc, LLC. They could buy you right out of foreclosure, help you get some credit history built up in a year with perfect payments and then we could refinance down to a lower fixed rate we could afford and still pay on the principle. Right now we are in a 13.25 (13.985APR) with a demand feature, prepayment penalty and interest only.

    I have followed your advice to the letter, but these guys don’t care. Sent a hardship letter, a QWR, which the trustee was not happy with because I only requested the loan documents to balance where my thoughts and concerns were. We called him in about 4 weeks and he wanted to know what my, and I quote “b*&ches” were. I was a little stunned at the lack of professionalism, but we knew how he operated last year, in foreclosure, refused to give us the right to cure the default, just let us know when the sale was. Now I want my QWR answered with all documents so that I can do an audit. It looks like he has already violated HOEPA rules, Truth in Lending doesn’t work for me, the numbers are funny and items on the HUD 1 that were not on the right lines, etc.

    We had to file bankruptcy because the mortage company led us to believe they would modify and once that bankruptcy was dropped they started foreclosure 2 days later.

    We are both disabled and can’t get any help from attorney’s. Prosper Law Corp. were the best, gentlest and genuinely caring company we have spoken to. Kudos for Mr. David Brown.

    I know there are fee’s, valuation, pest control, money we put into escrow that we should have received back and they won’t answer anything…frustrating.

    You are a dear man to start a website that helps us help ourselves, teaches us to protect ourselves and stop rolling over and taking consumer fraud or negligence.

    Please email me with anything…It would be appreciated.

    Thank You Moe,

    Cindy Magee

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  3. Ray says:

    Hi Moe,

    While we were in modification with Wells Fargo they sold our loan to Kondaur Capital. An investment company. They will not give me a HAMP and I got approved for the Obama HOPE program for 250,000. My mortgage is 560,000. The house is valued at 400,000. They denied the HOPE request. They say the only avenue is foreclosure. I have income to support a HAMP modification. What am I to do? I have told my lawyer that I will fight this for as long as I can and then I will destroy this house. I can’t believe what this is doing to my wife and kids. I feel like I’m in a war. Any info you can give me or any places I can turn would really help. Thanks and have a Happy Holiday.

    Ray Paltauf

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  4. help says:

    is indymac crazy

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  5. help says:

    hi moe is there away i can send you an email to ask you a question my email is pickupitems@yahoo.com please email me bob thanks its a question to save my home thank you

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  6. Patricia Richardson says:

    Dear Moe,
    I am wondering…..if the original mortgage docs were found to have serious violations through a forensic audit, doesn’t that make it null and void? How can a lender foreclose on a property if it doesn’t have a legal binding note on it? Who then actually owns the property? I would say the person that has been investing his/her hard earned cash into the property with legal, binding documentation. This seems relatively simple. Tell them ‘SEE YOU IN COURT!’

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  7. willee says:

    Dear Moe, Would you please send me to a site or internet address of attorney(s) who strickly handle mortgage loan audits and predatory lending cases and RESPA violations cases. I need to schedule an appointment/consultation asap to know my rights before it’s too late. I’ve owned my home for 20 years and have been fighting with Indymac/OneWest Bank for 1 year for a loan modification and just want to be legally advised of my legal rights with a legitimate attorney that you may refer or have referred to me by someone who has hired a legitimate one. I don’t want to just guess by looking online. I trust your site for this specific information. I am in Santa Clarita California – about 45 mins from L.A. my email is listed above. Please email me as soon as conveniently possible. would like to get moving on this subject ahead of the One Evil West bank. Thank you very much for your assistance and this great site!

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  8. willee says:

    Dear Moe, I emailed you last week looking for an atty near Santa Clarita, CA./L.A., CA. I really really need to have my loan docs reviewed/audited for predatory lending/RESPA/TILA violations. I’ve been informed that I may have several and I need representation and/or to be informed of my rights! I’m running out of time! I mean I really need to meet with someone/atty by this week (5/17/10)! I realize your very very busy and I thank you so much for taking the time to respond to me. And thank you for helping all of us.

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  9. KellyC says:

    Dear Moe,
    I have been with World Savings/Wachovia -now Wells Fargo for over 13 years. I have 4 loans(2 in SF,Ca that are over 500k 2 in Texas less than70k each) I am 70yrs old and have always tried to invest in property.However, the negative am loans I got myself into have been going upside down.We had a hardship and fell behind. I applied for the MAP program with Wachovia(still servicing our loans)- after providing batches of paperwork to them, they dropped it and are demanding all past due,pluslate charges etc. I am close to the sum 20k but still 4k short- they will not accept the partial, but now the Map program has started again-Should I hire Lawyers -to help with a principle reduction, or loan modification $3500 per property? As Naca does not assist with rental properties. Debt to income ratio is difficult to calculate and the bank uses anything to drop mods?

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  10. RHONDA WRIGHT says:

    I JUST RECEIVED A LETTER FROM THE ATTORNEY THAT K&P WHO I BOUGHT MY HOME FROM HAVE SET A DATE TO SELL MY HOME ON SEPT,7,2010 AT 10:00AM AND I CANT FIND HELP ANYWHERE TO STOP THE FORECLOSURE SALE PLEASE CAN SOMEBODY HELP ME? I’V BEEM SCAMMED I PAID A COMPANY MONEY 2 GRT MY HOME MODIFIED N MAY & NOW CANT GET AHOLD OF THEM & K&P HOMES IS WHO I BOUGHT MY HOME FROM HAVE STARTED FORCLOSURE PRECEDINGS & WANT ME OUT WITHIN A MONTH.I’M A 51 YEAR OLD DISABLED WOMAN ON SSI I DRAW 674 A MONTH & I’M RAISING A HANDICAPPED GRANDSON & ON 7-2-09 I HAD A NIECE BORN ADDICTED 2 DRUGS CPS HAD THE PARENTS SIGN POWER OF ATTORNEY 2 ME AFTER (THE BABY)WAS BORN & I BROUGHT HER HOME FROM THE HOSPITAL UPON RELEASE ,AFTER THE PARENTS KEPT TESTING POSSITIVE 4 DRUGS & REFUSING HELP THE CASE WAS CLOSED LEAVING ME WITH CUSTODY OF HER.I GET 89 A MONTH FROM WELFARE & 199 A MONTH N FOOD STAMPS.I NEEDSOMEONE 2 HELP ME FROM BECOMING HOMELESS WITH THESE BABIES SINCE I KNOW THEY WILL BE PUT N FOSTER CARE IF I LOSE MY HOME.THE COMPANY IS 1st PACIFIC DEBT ASSOCIATES THEIR ADDRESS;1666 garnet avenue suite 225 san diego california 92109 phone:1-866-829-6190 fax:1-888-811-8912 their email:www.1stPACIFICDEBT.COM I’M RHONDA WRIGHT ADDRESS:1717 PELICAN OVAL W AZLE,TEXAS 76020 PHONE:817-444-5658 OR 817-692-0302 EMAIL:RRHONWRIG4@AOL.COM I SENT THEM A POSTAL MONEY ORDER N MAY & WAS TOLD MY ACCOUNT 4 MY HOUSE PYMTS. WOULD BE FROZEN UNTIL THEY GOT MY MODIFACATION DONE THEY SAID THEY WOULD GET MY INTEREST RATE LOWERED SINCE THERE WERE AT LEAST 7 ERRORS N MY PAPER WORK FROM K&P HOME PLEASE HELP ME KEEP MY HOME ITS A MOBILE HOME ON A SMALL LOT & I HAD ONLY 6 YEARS UNTIL IT WOULD BE PAID OFF.I OWE APPROX.25,000 BUT BACK N MAY K&P TOLD ME IF I COULD COME UP WITH 15,000 THEY WOULD CONSIDER IT PAID N FULL BUT I DONT KNOW IF THEY WILL STILL DO THAT & THERE IS NO WAY I CAN COME UP WITH THAT KIND OF MONEY .PLEASE HELP ME OR PLEASE 4WARD THIS 2 SOMEONE THAT CAN. THANK YOU & I LOOK 4WARD 2 YOUR RESPONSE.RHONDA WRIGHT

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  11. P Shaw says:

    Has anyone ever heard of Audit and Stop? I too, like most, am upside down, have been unemployed for 18 months, and my savings is almost gone. This will be the first month I have not made my mortgage payment. My bank (originally National City, now PNC) will not even consider a mod because I have no income. I’ve lived here 10+ years, and never been late before.

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  12. Vickie says:

    I am currently facing foreclosure on my home due to being laid off from employment, I have a job making much less and I’m trying to work with my mortgage lender and HUD. HUD requested some info from me and in the process of finding what they needed I came across the mortgage survey done by the lender. I live in a subdivision with bi-levels, tri-levels, ranches and colonial homes and I noticed today that my house was listed on the mortgage survey as a tri-level but in fact my home is a bi-level. The tri-level homes in my area have a greater value than the tiny bi-levels so I’m curious if this was not done purposely to make the value of my home more than it actually should have been. Also, I paid for one month on my mortgage through the original lender before I received a letter stating that the loan was sold to a different lender. Looking back now and putting all of this together I believe I was a victim of some form of mortgage scam….if those are the right words. I want my original loans documents audited but I’m not sure how to get it done, any suggestions would be greatly appreciated.

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  13. Eric Jones says:

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      (Quote)  (Reply)

  14. Just ran across this page. Wonder just how many homes could have been saved if people really dug into their files. Actually thinking about seeing what can be found in our. We modified our loan, only managed it because I am in the industry and know the game, but wouldn’t mind an audit just to see where they have worked us over in the background.

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  15. Yousuf says:

    I need Audit for my loan . I have 1st and second Mortgage.
    My First Mortgage in 2005 from National City Mortgage at that Time my loan with this Bank was 134400.00 I keep paying my Payments, They told me my balance is 118000 left in 2010.
    during this I lose my job and I was behind few months Payment then I try to get new job and then I try loan modification and PN Mortgage Did Modification for 40 Years and showing me the balance almost 142000$ .
    I am paying my mortgage almost 8 Years and after 8 Years it’s more then I owe them..
    Mt second Mortgage I have 34000 Loan at that time now it’s only 21000$ left..it looks like this is Right but 1st Mortgage from PNC does not looks right.. I want please some one help me to Audi my Loan….I really appreciate.
    Ali

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  16. Sylvia says:

    What does one do when Wells Fargo says you do not qualify for a government loan, but doesn’t give you any valid reasons why? It seems so many of these people with questions are all in the same boat. It’s very difficult to trust anyone at their word. Everyone is out to see how much money they can get out of you. I find it very difficult to believe that I don’t qualify for a government refinance loan, or a modification at the very least. Wells Fargo is saying there is nothing they can do to help me. What can you do Moe?

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