A Document Compliance Review (DCR) is a highly specialized professional service and is a powerful tool to determine if a borrower is perhaps a victim of predatory lending. Our knowledgeable team of experts reviews all prior loan documents on the existing loan(s), performs a thorough investigation for miscalculations, and determines if the loan disclosures were accurate, truthful, and met the requirements of applicable State and Federal laws.
If any violations are found, then the borrower may be eligible for full relief of a predatory loan, or a very favorable loan modification in the case of compliance mistakes. Full relief of a predatory mortgage is a loan rescission. A loan rescission often allows the borrower to keep their home and owe less on it because of the injustice which has been committed. They will be subject to penalties including: all interest paid to date, loan origination fees, all applicable lenders fees, attorney's fees, and penalties imposed for the act itself.
In some cases, the borrower may be ineligible to rescind their loan because they are getting behind on payments or are in a negative equity position and their credit rating may have already been adversely affected by the predatory loan. This makes it difficult or impossible to obtain a new mortgage. There may be legal remedy in this case because the predatory loan caused the hardship in the first place. An attorney would need to determine that based on your personal details. Sequoia Consulting Group will assist you in contacting a reputable attorney.
The most common option is just to mediate the loan with your lender and fight for an affordable loan modification based on the legal violations found in the DCR. The lender is often willing to avoid penalties as a condition of settlement, which is a win-win situation.
What is included in a Document Compliance Review (DCR):
• Initial client interview and consultation
• Complete loan document and disclosure review by an experienced mortgage fraud and compliance professional
• Compliance check with the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA)
· Compliance check of your loan terms and Annual Percentage Rate (APR) for possible TILA violations
· We will provide you with a full report listing all violations and findings
Document compliance review report contents:
The comprehensive report of all factual findings of the review that you receive includes:
· Any and all applicable federal law violations, the actual terms of the loan you now have (as opposed to what was disclosed and represented as what you would have at the time you signed your loan contract)
· An outline of any hidden fees and/or commissions earned by your broker or lender.
· A professional opinion and assessment you can use to pursue possible legal claims against your broker or lender.
What we are looking for:
For the purposes of the definitions below, material facts include the terms of the loan, whether there is a pre-payment penalty, undisclosed yield premium, or any other information which a reasonable borrower would want to know before accepting the loan.
Breach of contract
On any mortgage agreement, the note, deed of trust, and any attachments constitute a legal contract. The broker must follow all terms of the contract such as the way the interest is calculated, and the penalties it assesses. Were there any terms in the contract which the lender failed to follow, they may be guilty of a breach of contract.
Fraud
If any intentional representations, statements, or comments, written or oral, that were made by the loan officer, broker, notary or their agents contradicted the terms of the documents there may be a genuine case of fraud. Intent is important here, as it must be proven in order to make a case of fraud. Otherwise it is most likely classified as negligent misrepresentation.
Negligent misrepresentation
When a broker, loan officer or their agent fails to disclose any material facts to the borrower(s) they may be guilty of negligent representation. If a mortgage professional makes errors which a reasonably diligent mortgage professional would not have made, he or she may be guilty of negligent misrepresentation
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