Mortgage Lenders and Mortgage Servicers—From Preventable Errors to Wrongful Foreclosure
Most mortgage servicing errors are simple and preventable. When the mortgage servicer fails to promptly correct its error the homeowner suffers devastating consequences including wrongful debt collection, false credit reporting and foreclosure. Here are common examples of mortgage serving errors:
Loan Modification Failures:
• improper modification handling
• failure to honor completed loan modification
• failure to transfer your loan modification to new servicer
• failure of new servicer to honor previous loan modification
• failure of mortgage servicer to return final signed modification
• failure to offer permanent loan modification after successful completion of trial payment plan (TPP)
Wrongful Foreclosure When All Payments Have Been Made:
• You may not understand or know why the servicer is seeking to foreclose on your home. Contact us for a Free Case Review.
Wrongful Collection for Mortgage Debt Not Owed:
• collecting on paid off loan
• collecting amounts forgiven on a deed in lieu
• collecting on amounts not owed due to short sale agreement
• misapplied payments,
• lost payments,
• lost records of payments,
• refusal to accept payments,
• failure to apply a payment as of the date of receipt,
• Improper calculation of monthly payment due
• errors in calculating adjustable rate payment amount
• mortgage servicer is keeping your monthly payments in a suspense account and refusing to apply them to your loan
• failure to pay taxes,
• failure to pay insurance or other escrow items,
• force placed insurance
• improper calculation of insurance and/or taxes due
Unlawful fees and charges:
• unexplained corporate advances fees/charges
• force placing insurance when you already have insurance
• charging fees that the servicer lacks a reasonable basis to charge
Bankruptcy Related Errors:
• Unlawful fees and charges after completing Chapter 13 Bankruptcy Plan
• Wrongful collection on discharged debt
Other Common Errors:
• failure to provide accurate payoff balance amount
• failure to provide accurate information related to loss mitigation options and foreclosure
• failure to transfer accurately and timely information related to the servicing of your loan to another servicer,
If not corrected, mortgage servicing errors continue to spiral into debt collection phone calls, collection letters, robo-calls to your cell phone, demands for money you do not owe, notice of default, threats of foreclosure and even foreclosure notices and foreclosure suits. We have seen numerous cases involving simple, easily detectable errors made by lenders and mortgage loan servicers that proceed to foreclosure proceedings even though the borrower repeatedly notifies the mortgage company of their errors. When these errors are not picked up and corrected by the company, the homeowner is left with the task of cleaning up the mess made by your mortgage company.
We defend the rights of homeowners against wrongful debt collection and wrongful foreclosure threats, and we defend against foreclosures brought about by mortgage servicing errors. If you live in Oklahoma or New Mexico we can assist you directly. If you live in another state, we have co-counsel relationships in many states and may be able to offer you representation with locally licensed counsel or a referral. Contact us for a Free Case Review.
How Do Mortgage Company Errors Happen?
Mortgage errors happen in many ways. They range from simple key-stroke errors, such as the wrong monthly payment amount being recorded or funds being placed into the wrong account, to systematic problems, such as short staffing of workers, outsourcing of entire departments, or the total failure to develop proper systems to handle the volume of business being taken on by many loan servicers. Most errors have things in common. First, the error is ALWAYS in favor of the mortgage company—not in your favor. Second, the error takes place in an environment where the company saves money by taking shortcuts. Examples we have seen include: not hiring enough staff to handle the business volume; not having employees on hand who are adequately trained to do their job; overwhelming workloads; or, worst of all, systematic failures by management to starve the research and complaint departments because they are “cost centers” rather than “profit centers.”
What Our Firm Can Do For You
Our firm has recovered millions of dollars in verdicts and settlements against both bank and non-bank mortgage lenders. We have represented many clients and saved homes from foreclosure. We have recovered just compensation in trial and settlement against mortgage loan servicers who acted improperly and violated the law. We can give you a Free Case Review so that you can learn whether we can help you fight back to save your home. We might be able to arrange for a referral or a co-counsel relationship with an attorney in your state.
We have extensive experience with many mortgage lenders and mortgage loan servicers, including several among these large mortgage loan servicers:
• Wells Fargo & Affiliates (America’s Servicing Company)
• Bank of America Mortgage & Affiliates (Countrywide, BAC Home Loan Servicing)
• Nationstar Mortgage LLC
• Ocwen Financial Corporation
• US Bank Home Mortgage
• PHH Mortgage
• Quicken Loans Inc
• SunTrust Mortgage Inc
• PennyMac Loan Services
• PNC Mortgage
• BB&T Mortgage
• LoanCare LLC
• Provident Funding
• Fifth Third Bank
• Flagstar Bank
• Caliber Home Loans
• HSBC North America
Worst Mortgage Servicers by Number of Complaints
Based upon complaints for a fourteen month period, the following mortgage loan servicers have the highest number of complaints:
1. Bank of America Mortgage Complaints Filed: 9,930 (27% of all complaints)
2. Wells Fargo Mortgage Complaints Filed: 5,051 (14% of all complaints)
3. J.P. Morgan Chase Mortgage Complaints Filed: 3,714 (10% of all complaints)
4. Citibank Mortgage Complaints Filed: 1,703 (5% of all complaints)
5. Ocwen Mortgage Complaints Filed: 1,417 (4% of all complaints)
Contact Humphreys Wallace Humphreys for a Free Case Review to learn about protecting yourself from wrongful foreclosure or wrongful collection by home loan servicers.
What Can I Do To Protect Myself?
You can protect yourself from wrongful foreclosure or mortgage loan servicer abuse by taking action now. Keep good records of your payments. Make note of who you spoke to, when and what was said. You can record phone calls that are made to your phone in Oklahoma. Do not delay taking action to protect your home from wrongful collection and mortgage foreclosure
Federal law—the Real Estate Settlement Practices Act and Regulation X—give you the right to demand answers from your mortgage loan servicer in some circumstances. Mortgage servicers must also correct errors if you follow the required procedures exactly. You must: 1) submit a written letter; 2) your letter must be addressed and mailed to the address your mortgage servicer designates as the address where Qualified Written Requests/ Notices of Error are to be sent; 3) your letter must include your property address, your name and account number; and, 4) your letter must contain specific details which include the reasons for your belief that the account is in error.
How to write a letter to your mortgage loan servicer
• Include your name, property address, and mortgage account number.
• Use the name that is on your mortgage and include your spouse or other co-borrower if they are on the mortgage.
• Identify the error. Tell your mortgage loan servicer exactly what error you believe occurred.
• Give important details: “I made my January payment on time. I paid $1,500 on January 1 but was still charged a late fee.”
• Be specific. Rather than writing “you did not apply my payment correctly,” explain how you believe the payment was incorrectly applied.
• Include documents that prove what you are saying. For example:
“I completed my chapter 13 bankruptcy plan in April. You agreed I was current on my loan in your response to the notice of cure. In May you charged me $1,000 in “Lender Paid Expenses.” I am enclosing your response to the notice of cure showing I was current and your May statement where you are charging me $1,000 for Lender Paid Expenses. Please explain the Lender Paid Expenses charge and please remove them from my account as they are not owed.”
• Be fair. Do not overstate the problem or ask for more information than you need. Don’t use a form letter off the internet with a laundry list of complaints or requests for information.
Where to Send Your Letter
You are required to send your letter to the address designated by your mortgage servicer as the address where it will receive Qualified Written Requests or Notices of Error. You can usually find this on the monthly mortgage billing statement or in the letter you received when your mortgage servicer first notified you that it would be servicing your loan. You may also find this information on the mortgage servicer’s website. Worst case, call your mortgage servicer and ask “What address do I use to send you a Notice of Error?”
Before mailing your letter, be sure you date, sign and make a copy for your records. We recommend that you mail the letter via certified mail-return receipt requested so that you have proof your servicer received your letter. Also be sure to keep a copy of your expenses for mailing.
What to expect
• If you follow these instructions, the servicer must acknowledge receipt of your request and either:
• Correct the error and confirm that the error was corrected, or
• Investigate and determine that no error occurred, and send you a notice explaining why.
• Your servicer might ask you for more information about the error, but your servicer can’t refuse to investigate or determine that no error occurred because you didn’t provide the information.
• A servicer does not have to investigate your request for error resolution if:
• The request is overly broad,
• You are sending in the same request repeatedly, or
• You are requesting help with a loan that was transferred to another servicer or paid off more than a year ago.
• The servicer must acknowledge your letter within five business days of receiving it.
• If you are writing to say your servicer improperly started or scheduled a foreclosure:
• The servicer must respond to your letter before the foreclosure sale or within 30 business days of receiving it, whichever is earlier, if your servicer receives your letter more than seven days before the sale.
• The servicer should make a good-faith effort to respond to your letter, if your servicer receives your letter seven days or less before the sale.
• If you are writing to say the servicer gave you an inaccurate payoff balance, the servicer must respond within seven business days of receiving your letter.
• For all other errors, the service must respond within 30 business days of receiving your letter.
• In some cases the servicer may come back to you in writing and ask for additional information or request an additional 15 business days to investigate and respond to your request.
Contact Humphreys Wallace Humphreys for a Free Case Review or possible referral to a lawyer in your state. We may be able to offer a co-counsel relationship with an attorney in our state if your home is not located in Oklahoma or New Mexico.