Mortgage defects may occur at any step in the process. Generally, issues occur during origination or servicing. Since mortgage notes change hands so many times, the bank which currently holds the loan may have little or nothing to do with the mortgage defect. As a result, their lawyers are eager to avoid foreclosure litigation concerning this issue.
At Roemerman Law, our aggressive lawyers strike while the iron is hot. To take advantage of this situation, we often negotiate with the bank as opposed to filing court paperwork. When individuals negotiate with bankers, the results are usually one-sided in favor of the bank. But when our top financial negotiators talk with bankers, you have a strong voice in the process.
Mortgage Defects in New York
In the relentless pursuit of profits, mortgage brokers and bankers sometimes take shortcuts during origination or servicing. These shortcuts often amount to fraud. Some examples include:
- National Mortgage Settlement Violations: After widespread abuses in the early 2000s, mortgage servicers agreed to end these practices in 2012. But many banks do not fulfil the promises they made.
- Bait and Switch: The final loan repayment terms are almost never like the terms in the Good Faith Estimate. Some discrepancy is acceptable, but many banks push the envelope to the point that the final terms are nothing like the numbers in the GFE.
- Excessive Prepayment Penalties: These additional charges are usually buried deep in the loan paperwork. Excessive penalties make it almost impossible for the homeowner to refinance the note, so the homeowner is stuck with unfavorable terms.
Defects such as these are illegal, and the bank knows that. So, to avoid costly and embarrassing litigation which will almost certainly end badly for the bank, its lawyers are willing to talk.
Possible Solutions
Many times, a loan modification is the solution in these situations. Altering the mortgage repayment terms means that the property remains occupied and properly maintained, the bank keeps collecting money, and the family remains in the home they chose. Everybody wins.
Loan modifications usually involve interest rate reductions, delinquency recapitalization, and/or principal reductions. Even a slight interest rate reduction could save your family hundreds of dollars a month. Delinquency recapitalization allows the homeowner to pay off a delinquent balance in small installments. If there are serious issues with the loan, principal reduction may be available.
There is no reason for a defective mortgage to weight your family down financially. For a free consultation with an experienced New York foreclosure attorney, contact Roemerman Law, P.C. After-hours visits are available.
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