My work on foreclosure problems has involved negotiations with lenders for short sale, and litigating against a foreclosing lender for various reasons. Among those reasons are the bank's failure to comply with requirements with respect to notifying the borrower of the right to cancel, whether the terms were unfair or deceptive (a "teaser" rate is one example), and whether the lender is the proper foreclosing entity. Questions can come up, particularly in loans which have been "securitized", as to just who is the owner of the note secured by the trust deed, and where is the original note.
Foreclosure situations arise not only in the context of bank violations of disclosure laws and the like, but also in situations where a family member or friend has ingratiated himself or herself with someone, frequently an older person, and borrowed against the older person's property. Then one of the questions which comes up is whether the foreclosing lender knew or should have known what was going on.
Many companies bill themselves as foreclosure advisors. Some of those entities have been scams. But not all are scams. Some properly provide a service. Some mortgage advisors go as far as to advertise a guaranteed result. For a fairly high fee, they promise to get the lender to reduce the client's principal balance, reduce the interest rate, and/or move arrearages to after the last scheduled payment. All of those things are possible. However, it is normally quite difficult to get the lender to reduce the principal balance.
There are also lawyers who advertise heavily their expertise in foreclosure situations. Some of those lawyers are indeed very competent. Some are less competent.
Under certain circumstances, it is possible to demand that there be a rescission of the loan. This is a of remedy usually associated with the lender's failure, at the time the loan was made, to provide proper disclosures of the three day right of rescission before the loan closed, or incorrect information in the Truth In Lending statement. Rescind the deal with the lender is not tantamount to hitting the lottery. It is true that under certain circumstances, the lender may be required to return all interest and closing payments which it received. That can be a significant amount of money. However, the borrower must repay the principal amount of the loan (usually by refinancing). This remedy is limited to situations in which the loan was made less than three years ago. Very importantly, it does not apply to purchase-money loans. Purchase-money loans are money borrowed to purchase the property. As can be seen, if the loan exceeds today's fair market value of the property, there are a limited number of scenarios in which it would make sense to rescind. Essentially the borrower would be "buying" the property from the lender for the amount of the loan, even if it exceeds present-day fair market value.
If you bring your situation to me, I do not guarantee any result. What I would do, for a fee considerably less than the big advertisers, is to spend time reviewing your loan documents to see if there are any violations of the law or any other problem which might get in the way of the lender's foreclosing on the property. Then, after having received information from you concerning your present income situation and the value of the property, I would submit a request to the lender that it consider modifying the loan under your particular circumstances. I would of course follow up on that request by trying to reach a "real person" at the lender's offices. That frequently is difficult to do, because lenders are handling so many foreclosure situations these days. My proposal would be to work for a few hours on your situation in an attempt to get a response from the lender one way or the other.
I try to keep my fee for this work at a reasonable price. I would be happy to discuss this with you in an initial telephone discussion. Please contact me if you would like for me to look into your situation for you. I am available to work for clients from any part of California on this type of matter.
Contact me at 805-284-9703 for a free initial consultation on your will contest matter.
Se habla español. Spanish language services available.
I am also a licensed real estate broker.
Dennis J. Shea
903 State Street, Suite 208
Santa Barbara, CA 93101
Telephone: 805-284-9703
Fax: 866-786-0933
