|
With all this talk of bail-out, where is the help for those who have struggled but managed to make their loan payments? We have solutions for those who have missed payments and those who have not yet missed payments.
If you would like to get out from under your mortgage payment load without damaging your credit or being forced into a rental, read on.
If you have been sold a refinance mortgage in the last 5 years, your loan was probably misrepresented to you in one or more significant ways. It is called Predatory Lending and it is a violation of federal and state law (TILA & RESPA).
The mortgage loan crisis was not caused by greedy consumers who lied about their income, as some would have you believe. It was caused by a Wall Street and Banking group that convinced Federal regulators to change the rules. These changes allowed mortgages to be sold that could not be paid off by the borrower without sale of their home or continued refinance. When home prices declined, these two possibilities disappeared and people lost their homes as a result of being sold a bad loan.
Fortunately, several consumer protection laws had been passed that can now be used to bail out those who have been sold a bad loan. These laws are called Truth-in-Lending Act, RESPA, Regulation Z and several provisions of laws against Unfair Marketing Practices.
The Rudder Foundation is a 12 year old community services foundation that is concerned about these unfair loans. They will take legal action against your lender if your loan is in violation of these consumer protection laws. And, almost every mortgage or refinance written in the last 5 years has been found to be in violation.
You do not have to be in default of your mortgage, miss a payment or have any damage to your credit rating to qualify for relief from a bad mortgage.
What is Predatory Lending?
Anyone who is on a fixed, retirement income who has been sold an adjustable payment mortgage, has been a victim of Predatory Lending. How can a person on a fixed income handle a big increase in their mortgage payment? They cannot. The loan was sold to them by lenders who know that the borrower would be forced to either refinance, sell their home or lose it in foreclosure. That is not fair lending.
Do you understand how a negative amortization loan with a cap works? Neither do most mortgage loan processors. It has been described by banking regulators as “inherently deceptive.” What you can understand is that not too many years into the loan, you can no longer defer half of your payment. From one month to the next, your mortgage payment will double! Who can handle that without refinance, sale or foreclosure?
Any loan that cannot be paid by verified income of the borrower is defined as a Predatory Loan. Any loan that mis-states the cost to the borrower or the effective interest rate is a “material mis-representation.” These and other violations can allow a mortgage loan to be rescinded through legal action.
How Does It Work?
The Rudder Foundation has developed a forensic analysis procedure that examines your loan documents for violations of TILA, RESPA and other Federal and State regulations. You receive a report showing exactly how your loan was mis-represented to you and how the lender has taken advantage of you. If no violations are found, your deposit is refunded.
An analysis of your financial position is completed by Rudder counselors to determine the amount of a fair loan you can handle. The analysis report is discussed with you by our counselors and you make the decision to proceed with the legal process called rescission. Rescission requires the lender to remove all evidence of the loan from your credit and to remove the security (trust deed) from your loan upon mailing of a notice of rescission that we record in public record. All moneys that you paid on the loan --costs paid in escrow, legal fees and all mortgage payments of principal and interest -- are credited against the principal amount of the note. A new mortgage is negotiated on your behalf that reflects the lowest possible interest on fixed 30 year terms and your verified ability to pay.
Fred Westcott is the founder and Executive Director of the Rudder Foundation.
|
