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How to Avoid Mortgage Foreclosure and Stay in Your Home

Updated on May 6, 2011

By Andrew J Thompson, attorney 

If you’ve missed one or more house payments, and received threatening communications from the bank, you know you are faced with a serious problem. 

But it doesn’t mean you will end up homeless or with wrecked credit.  There are alternatives.   Depending on what has already happened, you may be eligible for various kinds of loan workouts or other debt relief.  While you may heard of short sales, a deed in lieu of foreclosure and repayment plans to help the creditor with “loss mitigation” (whose loss gets mitigated, by the way?) , there are other remedies that could work for you.  Along with loss mitigation, you may be eligible for principal reduction, mortgage settlement, or a quiet title action that changes your entire situation.  Instead of being a forlorn debtor, you may be able to control the terms with your bank.

To settle with a mortgage creditor or bank, it’s important to demonstrate some falsehood, material mistake or misrepresentation in the securitization of their loan, with no actual transfers, so that the original mortgage itself was fatally defective.  In doing so, it can enable you to make the case that you  were actually the unintentional seller of a mortgage note into an Investment Trust, that could acquire no right to claim an interest in the property – thus it would remain yours free and clear from any mortgage. 

If the above sounds like a battle of arcane, legal maneuvering, it’s because the creditor who created the situation, calculated the loan repayment schedule, drafted the documents, recorded the instruments, and then immediately assigned or sold “the paper” on which it was all based – set up this battle.

The gauntlet was thrown down, and it went something like this, “Hey little guy, we’re the biggest bully on the block – you signed a note with us in order to get your house, now you will pay it back on our terms, or we will move you out and do the same to the next guy in line for that house.”   The minute you miss a payment, they treat you as if you are at their mercy. 

But federal and state law, and recent court decisions are beginning to level the playing field.  If you don’t want to give up, you don’t have to.  Keep your home, fight for it, do what is right.  Yes, you should pay what you agreed to pay, but you shouldn’t have to pay it to whomever the bank says gets paid, and you shouldn’t have your title to the property threatened by someone who has no right to that title in the first place!

You deserve competent counsel to help you work this out equitably and fairly – not just on the bank’s terms – you have as many or more rights than they do.

Once you have a good attorney on your side, you can investigate a myriad of potential violations that might affect the status of your mortgage.  These include:  Anti-Predatory Regulations (HOPEA), TILA Regulations, UCC Regulations, SEC and RESPA Regulations.  You may also have claims of concealment with negligence,  and possibly fraud on the part of the lender.   Along with Complaints for Damages, the most readily available forms of attack in court for the debtor include claims for:

  • ·         Quiet Title;
  • ·         Slander of Title;
  • ·         Use of False Affidavits;
  • ·         Defective Mortgage and Note;
  • ·         Due Process Violations (in Foreclosure proceedings);
  • ·         Unjust Enrichment;
  • ·         Breach of Contract;
  • ·         RICO Claims; and
  • ·          Abuse of Process

In the end, these are all fact sensitive claims and they demand, sober and careful consideration.   Consult legal counsel to discuss your own situation and assess your rights.

For a free initial consultation concerning a mortgage situation, contact attorney Andrew J Thompson today at (877) 365-1776 or by email: andrew@businesslawindiana.com.

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      Anne 

      7 years ago

      A common one these days. Experts can help you in this. Useful article...

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