Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
Articles |The FORUM |Law Library |Videos | Fraudsters & Co. |File Complaints |How they STEAL |Search MSFraud |Contact Us
We are about to file a 13 to avoid this mess Homeq has created for us.  We just received a phone call from our Insurance agent stating that Homeq called them wanting to pay our insurance in full and escrow it.  Can they do this?  Our insurance is current, we pay by month and it is directly withdrawn from our bank account.  We have NEVER been behind.  

I am at a point of just letting this house go as we have no equatity in it and can no longer take the stress of what they are doing.

Please help
Quote 0 0
Joe B
Linda-

     I doubt very seriously if HomeEQ would take their own money and pay your insurance. So, it suggests to me that they have some of your payments sitting there unapplied... This could be there attempt to send the money away from their account (your account) before you go 13. Then they can show that your are a deadbeat, etc...

     Do you have a current status of your loan, including all fees, charges, "unapplied funds," etc.? Look the payment history over very closely; if my hunch is right, there are some shenanigans going on.

     Do you have an attorney helping you? If so, get her or him to work trying to figure this out. If they have misapplied some payments, there are some serious issues at stake here!

     What else can we do to help?

JB

    
Quote 0 0
Joe

We are not current any longer on our payments.  We are three months behind due to increase in payments.  We just could not hold on any longer.  Funny thing is that I can only talk to their attorney but we are not in forclosure - this has been going on long before we were ever behind.  They are so sneaky I never know what they are up to.  We are due to sign our Bankruptcy next week but we are debating on giving the house back and renting.  I can not see paying $2400/month on a 185,000 mortgage.  We would still not be able to live even in the 13.  So why keep it and put up with the fraud?  Bad thing is they can increase our payments again over next 18 months another 3%.

Joe B wrote:
Linda-

     I doubt very seriously if HomeEQ would take their own money and pay your insurance. So, it suggests to me that they have some of your payments sitting there unapplied... This could be there attempt to send the money away from their account (your account) before you go 13. Then they can show that your are a deadbeat, etc...

     Do you have a current status of your loan, including all fees, charges, "unapplied funds," etc.? Look the payment history over very closely; if my hunch is right, there are some shenanigans going on.

     Do you have an attorney helping you? If so, get her or him to work trying to figure this out. If they have misapplied some payments, there are some serious issues at stake here!

     What else can we do to help?

JB

    

Quote 0 0
Moose

Linda, this isn't and shouldn't be viewed as legal advice but I would suggest you consider the additional burden going into a Chapter 13 will bring instead of a negotiation with them to do a deed-in-lieu of foreclosure with a 60-day broom-clean move out stipulation.

In a lot of cases the only real reason to go the BK routine is to temporarily halt the foreclosure and get to stay in a house for a few months that you probably can't afford to live in.  I shouldn't have to remind you of the other ancillary financial stresses a house like that always brings along with it.

So consider taking the $2K you're going to wind up paying the BK attorney and using it for a rental truck and as a deposit for a leased home - depending on your market, there are probably a lot of them out there that investors have been buying up in foreclosures.  Without a BK or foreclosure on your credit, you stand a much better chance of getting a lease than if you have 90 days late + foreclosure + bankruptcy.  Yes, it might be a smaller house - that actually might not be all that bad in the long run.  You'll save money in other ways with the right leased home.

Consider also there's a general financial rule of thumb that says you buy what appreciates and lease what depreciates, and with housing prices continuing to move downward to real-world levels in most parts of the country, buying a house with anything much over 6-7% interest IS NOT a good investment.  Your equity may not be growing at all in some areas.

And regarding the prospect of negotiating something with HomeEq - I think the chances of them coming to you with an honest, straightforward agreement that has your best interests as one of the considerations is about zero.

I fear you'd only be delaying the inevitable.

Whatever you do, ignore those foreclosure rescue scam things that are probably flooding your mailbox even as I write this.

Good luck.

Moose


Quote 0 0
Moose

Can you explain this to me:?

"a deed-in-lieu of foreclosure with a 60-day broom-clean move out stipulation."

I am not familiar with this.  Since we have a split mortgage can we do this on both?

Thanks for your help.

Linda

Quote 0 0
Quote:
Originally Posted By Linda
Bad thing is they can increase our payments again over next 18 months another 3%.


Interest rates are moving DOWN, NOT UP.  There is a BIT of an exception as to LIBOR Rates due to the flight to quality (risk free Treasuries).  It is IMPOSSIBLE to understand the specifics of YOUR situation without reference to the specific terms of YOUR promissory note.  But worries about further payment shocks are NOT your central short term problem.

Unfortunately, many of the subprime deals had INTEREST RATE FLOORS.  Borrowers were sold a pig-in-a-poke with respect to rate caps and floors and these oppresive terms make it UNLIKELY that you would see any great interest rate and payment relief as a consequence of interest rates.

But Moose nailed it when he said "Consider also there's a general financial rule of thumb that says you buy what appreciates and lease what depreciates, and with housing prices continuing to move downward to real-world levels in most parts of the country, buying a house with anything much over 6-7% interest IS NOT a good investment."

It is one thing to hang on where you have substantial equity or a very strong sentimental attachment to a house that is only marginally unaffordable.  But Moose has long been preaching the advidability of WALKING AWAY one way or other from those situations where the house is inherently UNAFFORDABLE.  The question then is how to best extricate yoruself from your present circumstances.  

Quote:
Originally Posted By Moose 
In a lot of cases the only real reason to go the BK routine is to temporarily halt the foreclosure and get to stay in a house for a few months that you probably can't afford to live in.  I shouldn't have to remind you of the other ancillary financial stresses a house like that always brings along with it.


Well said, Moose!  I want to make the SAME point in a different way.  You need to make a list of the pros and cons of walking away from the house or hanging on, as well as the pros and cons of various alternative approaches to giving the house back.

Some homeowners run up credit card debt or defer other undecured debt payments to try to SAVE THE HOUSE.  Bankruptcy sometimes is a useful avenue for discharging or reorganizing various other debts.  If there are OTHER compelling reasons to seek bankruptcy protection, put these down in the pro column for that alternative.  Then list the cons, including the cost of paying a bankruptcy attorney and filing, as well as the stigma.

Moose's alternative suggestion of a negotiated deed in lieu is a viable alternative, though one which is frustrated where there are second liens involved.  The same objective could possibly be very well accomplished by an AGREED FORECLOSURE including some sort of confession of judgment.  That is that beyond your agreement as to giving back the property, you would essentially AGREE to the foreclosure, speeding things along.  This would still leave the first mortgage holder to contend with the junior lien holders.  But without bankruptcy, you would still remain liable to second lien holders on the promissory note.  Just how serious a problem that is depends upon the amounts of the second liens and your other financial circumstances.

This is really a treacherous ares!  You NEED good legal counsel!

Moose covers this nicely, too, when he says:

Quote:
And regarding the prospect of negotiating something with HomeEq - I think the chances of them coming to you with an honest, straightforward agreement that has your best interests as one of the considerations is about zero.


To the extent that negotiating a deed in lieu or some amicable resolution with the mortgage investor outside of bankruptcy is challenging, this is doubly so where you have other junior liens.  YOU SHOULD NEVER TRUST the mortgage investor to write a fair, balanced agreement.  And you cannot hope to do this yourself unless you are far more conversant with the law and legal research than you otherwise appear.

Moose is RIGHT to suggest that you carefully assess other alternatives.  The viability of these alternatives depend heavily on the totality of your personal financial situation.  So you need to carefully pull this information together into a convenient cohesive package and then try to find an capable attorney with some real consumer debt / bankruptcy expertise and experience.

Ask about and be prepared to discuss alternatives to include voluntarily giving up the house on an accelerated schedule.  AVOID using precious liquid resources to satisfy incessant demands for additional payments by the mortgage lenders if you are just going to walk away anyway.  You are NOT going to be getting any extra points for having made an extra payment on the second mortgage while exhausting all of your cash and other revolving credit.  
Quote 0 0
Homeq's attorney is quickly trying to work out a modification for us.  So are you saying if they come back to us with something, we need to be weiry?  We are working with little time.  We have weighed our pros and cons.  We are to sign next week on th BK but know that if Homeq does not come through with a modification that we will not include them in the BK as we can not afford the higher payments.  And both you and moose are right it would not be a wise investment.

I have told the attorney that we were signing on next week and he sounded paniced.   We do have a BK attorney, however being involved in the MS Fraud I have not found a "good attorney".  They make it seem like you are just a number.
Quote 0 0
Moose

Linda wrote:
Moose

Can you explain this to me:?

"a deed-in-lieu of foreclosure with a 60-day broom-clean move out stipulation."

I am not familiar with this.  Since we have a split mortgage can we do this on both?

Thanks for your help.

Linda


I gather from this there is another lien from a second mortgage.

What the first lien holder wants is to perfect their position so the junior liens don't stop them from foreclosing.

The senior, typically the first mortgage holder, wants to make sure they get their money first.  They are in the driver's seat in any negotiated arrangement and if HomeEq's "attorney" is trying to work out something, YOU MUST ASSUME it will be crafted to protect their interests.

An attorney representing (or working for) a company cannot provide you with legal advice.  Their obligation is solely to their client.  Anything they say to you can't be construed by you as truth or fact when it comes to matters of law.

If you as someone without an attorney come back to them and offer to vacate the home, leave it in "broom clean" condition as long as they don't trash your credit, they may be willing to get it over with. But what you have to make sure is anything, literally any little stinking detail of the agreement is clearly put in writing so they face civil penalties for breaking it.

Again - not legal advice but second lien holders can be a pain the butt but the senior lien holder attorneys know how to deal with them so don't waste your time with them.

If you offer a deed-in-lieu of foreclosure to the senior's attorney with a stipulation that you need "X" number of days to vacate and will leave it in showable condition, you're demonstrating a responsible position.

Having said that, if it's a typical predatory servicer maneuver we've all seen over the years, they'll talk a good game and then the papers you get to sign are complete BS. You sign what you think is a legitimate agreement and a few days later you're served with an eviction notice.

I can't stress how important it is to have local legal counsel review their alleged agreement.  The predators will bury absolutely egregious terms and conditions to put you into a no-win situation if they realize you don't have competent legal advice on your side.

Never take them at their verbal word.  If they tell you you can walk away if you just do X, Y and Z and won't be obligated for A and B, they need to put that in VERY PLAIN English that can't possibly be misconstrued.

And don't accept something in writing from someone other than an officer of the corporation. A letter from the "manager of customer service" may have no legal weight at all because there may not even be such a person.  You must demand that any offer be signed by an officer of the corporation with the power to bind the corporation to the terms of the agreement.

Again - get legal counsel.  Even a half-hour with legal aid will help you dodge the rookie pitfalls.

Moose



Quote 0 0

Well said Moose!  Amen!!

Quote 0 0
Sleuth

This four year old thread, though a little dated, contains some useful analysis by Mr. Roper and Moose.

Quote 0 0
Write a reply...