Wrongful Foreclosure is when a lender, servicer or trustee forecloses on property without following the appropriate legal steps or without the proper authority to do so. We see this happen in various context, the most common of which are the following:
A lender like Bank of America will either sell a loan it originated or will outsource its collections operations to companies like Nationstar or Ocwen Financial. When these loans are transferred, the records are lost or not sent correctly which causes many people to be falsely put into collections or to lose loan modification opportunities which were already approved by the prior lender.
If you have ever tried calling Nationstar or Ocwen, it is almost impossible to reach a live person. This is because, at least at the time of this writing, Nationstar and Ocwen cannot handle the volume of loans they are servicing. As a direct result, they are unable to comply with all the laws and regulations which govern the foreclosure process. Most notably, they rarely, if ever, call to discuss reinstate options and they rarely assign a single point of contact who can be reached on a regular basis. They dual track loan modifications – sometimes because that is their business model, other times because their processes have not incorporated California’s homeowner’s bill of rights, and sometimes because they simply do not have the manpower. Whatever the case, it is illegal to proceed with foreclosure.
The second most common wrongful foreclosure that we see is when a junior lien is purchased by a vulture capitalist. Their business model is to purchase second trust deeds in bulk at a steep discount, and to proceed with mass foreclosure. They do not understand or care what their lien is worth, but they know that some foreclosures will pay out. These entities generally do not comply with foreclosure laws because they do not care, they just want to make money and they know that most people will not hire an attorney to fight.
A bi-product of the vulture capitalist model is when a paid off loan is purchased. This usually happens with defunct banks like Wachovia who sold their loans in bulk. The vulture capitalist does not typically have the means to verify whether the loan is paid off, which leads them into the trap of foreclosing on a home where they have no right to do so.
A Wicked Default
The third most common form of wrongful foreclosure we see is when a lender, usually a hard money lender, takes nefarious action to put a loan into default, resulting in a situation where the borrower is unable to cure the default because the interest rate is too high. There are generally three ways to attack these types of loans: to attack based on fraud, to attack based on usury, and to attack based on improper foreclosure proceedings.
In Business to Defend Your Best Interests
JT Legal Group is a firm comprised of trial attorneys. Since time is of the essence, we do not have the luxury of exhaustive pre-litigation discovery. We generally send demand letters, all in which are qualified written reports pursuant to RESPA and debt validation letters pursuant to the FDCPA. Then, we file a lawsuit. Many of our clients pay a lot of money for exhaustive loan audits, those are usually not helpful because Courts have fashioned remedies for the banks which allow the banks to circumvent issues like robo-signing.
On January 1, 2017, the Survivor’s Homeowners’ Bill of Rights (SHBOR) went into effect. This law protects beneficiaries of real property following the death of a loved one. Many of our prospective clients believing filing a probate petition is enough to stop a sale. It is not enough. Since SHBOR does not apply to most people, its discussion in this article is limited.
Recommendations Regarding the Process of Wrongful Foreclosure in California
Whether you decide to have JT Legal Represent you or if you go with another firm, the most important things to take into consideration are:
- ● Ensure that the company helping you is comprised of real lawyers; there are many companies out there which purport to be attorneys but they might have one on staff for “show.”
- ● Ensure that the company helping you has attorneys or departments which concentrate on real estate litigation in the foreclosure field.
- ● Consult with your attorney to discuss the details of your case, which might include exploring whether you might be eligible to pursue punitive damages for the wrongful foreclosure.
- ● Find out internal policies, for example, at JT Legal Group, we have the following policies:
- ● All voicemails must be listened to before the attorney, paralegal or legal assistant leaves for the day.
- ● All emails must be answered within 24 hours of receipt, 2 hours as the goal.
California Wrongful Foreclosure Attorneys with Experience
JT Legal Group has been successfully handling wrongful foreclosure cases since its inception. It is too burdensome to constantly run metrics, but we recently, in March 2017, conducted a survey of our prior two years, and our success rate for temporary restraining orders for the last two years was 73%. We believe this is a great win percentage against the banks.
If you believe you may have been the victim of a wrongful foreclosure, contact JT Legal Group for a no-obligation consultation with a trusted foreclosure attorney, today.