RESPA

Loss Mitigation Options for Families Facing Foreclosure

Loss Mitigation Options for Families Facing Foreclosure

Federal law requires mortgage companies to offer loss mitigation options to homeowners who are facing foreclosure. Loss mitigation options include:

  • Loan Modification – The lender and borrower agree to extend the life of the loan for a reduction in interest.
  • Deed in Lieu – The borrower offers collateral in exchange for a release from the mortgage.
  • Pre-foreclosure Sale – The borrower sells the property and uses the money to pay off the mortgage.
  • Short Sale – The lender accepts a payoff less than the mortgage is worth. This only applies if the mortgage is more than the value of the property.
  • Cash for Keys Deal – The lender pays the family to leave in order to avoid the cost of eviction.
  • Forbearance – The lender accepts reduced or no payments for a short time in exchange for a later repayment.
  • Partial Claim – The lender advances the fees necessary to bring the mortgage current to the borrower under the condition that they are paid back at a later date.

 

Which options are available depend on the mortgage servicer and the circumstances surrounding the loss mitigation application. The mortgage servicer will be able to present you with information regarding loss mitigation and what is required to file an application. After submitting an application for loss mitigation:

  • Your servicer must respond to loss mitigation application in five business days with the application status:
    • Either complete or incomplete.
    • If incomplete, the servicer must state what is required to complete the application.
  • Your servicer must provide you with an evaluation or complete list of options within thirty business days of receiving the application.
  • If you are denied, you must be provided with an opportunity to appeal.

 

Once you submit a loss mitigation application, before responding to your request the mortgage servicer cannot:

  • File a foreclosure lawsuit.
  • Move forward with the sale of a property.

 

This is known as dual tracking and it is illegal. Doucet & Associates deals with banks and mortgage servicers on a regular basis. If you are having trouble getting a loan modification processed, or if you would like assistance in filing one calls us at (614)-944-5219.

 

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Doucet Sues Caliber for Harassing Homeowners for Amounts Not Due

Doucet Sues Caliber for Harassing Homeowners for Amounts Not Due

Doucet & Associate has filed a lawsuit against Caliber Home Loans, Inc. and the Bank of New York Mellon Trust on counts for RESPA, breach of contract, negligence, intentional infliction of emotional distress, defamation and invasion of privacy.

The homeowners that Doucet represents took out a mortgage with Caliber Home Loans in 2005. In 2009, they were forced to file Chapter 13 bankruptcy and entered into a payment plan to repay Caliber and the Bank every penny owed.

The homeowners paid back what they owed and the bankruptcy Trustee filed a motion with Caliber Home Loans that the homeowner’s loan be deemed current. Caliber Home Loans did not object. During this time, Doucet’s client alleges that a bank representative assured the homeowners the loan would be made current once the bankruptcy was discharged a month later. The bank issued a statement in bankruptcy court claiming the homeowners were not behind on their loan.

The Bankruptcy Court deemed the homeowners’ mortgage current. Yet, the lawsuit alleges Caliber Home Loans refused to acknowledge the court’s decision. Instead, the lawsuit alleges that the bank continually refused to update its records and harassed the homeowners with letters and phone calls multiple times a day.

The lawsuit alleges that the inaccurate reporting to the credit agencies have made it impossible for the homeowners to refinance their home or seek new employment. Most upsetting, however, is the severe emotional damage the bank’s harassments have caused the homeowners, which resulted in a tragic miscarriage of the homeowner’s baby.

The homeowners are seeking actual, punitive, and statutory damages, declaratory and/or injunctive relief, attorney fees and costs and any other relief the court deems appropriate.

Doucet & Associates is dedicated to fighting for the rights of consumers, protecting their interests and offering legal assistance to those who would otherwise be unable to afford it. If you need help with a company that is trying to take advantage of you or a loved one, call the firm today at (614) 944-5219.

 

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Firm Wins Major Appellate Decision

Firm Wins Major Appellate Decision

Doucet & Associates is happy to announce it won a major case in the federal court of appeals yesterday, paving the way for consumers to be able to hold their mortgage companies accountable for failing to adequately respond to mortgage inquiries.

The firm’s client, Christine Marais, faced years of trouble trying to get her mortgage company to correctly apply her mortgage payments when she sent in more than the amount due.After trying repeatedly to get Chase Home Finance to correctly apply her overpayments, she retained Doucet & Associates in an attempt to hold it accountable.The law firm sent a formal written request to Chase pursuant to the federal law, the Real Estate Settlement Procedures Act (“RESPA”), demanding that Chase provide certain account information and that it correct her mortgage account.

Rather than making any corrections to Ms. Marais’ account in response to the firm’s formal demand, Chase’s representative testified in a deposition that it used a form letter to respond to the inquiry, and that letter contained no indication that any substantive review was undertaken of her account.

Chase Home Finance filed a motion with the trial court to win the case based on its outrageous claim that Ms. Marais could not show she suffered damages.The federal appeals court disagreed with Chase, and found Ms. Marais had properly alleged damages, and that she stated a claim to recover for Chase’s failures.The case now goes back to the trial court for further litigation.

The decision, Marais v. Chase Home Finance, LLC was decided by the United States Court of Appeals for the Sixth Circuit and was recommended for publication as binding law throughout the federal court system encompassing Ohio, Michigan, Kentucky, and Tennessee.To the firm’s knowledge, this would be the first appellate level published case on this particular RESPA issue, meaning it will be persuasive authority throughout the United States.

 

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