You won't take my money, but you want to foreclose on me???

By
Mortgage and Lending with Social Media - Infinity Home Mortgage Company, Inc
foreclosures
 
It has gotten really ugly out there in the last 12 months. What happened to common sense?  What happened to if someone got behind on their mortgage payments, but later on they brought me half the money?  I am sure if you had owed $10,000 to a bookie that they would call you constantly and threaten you per se. But if you said I can give you $5,000 now and $1,000 a week for the next 5 weeks, that they might be okay with that.

Overall, I know banks aren't in it to keep tabs on who owes them what. But isn't something better than nothing? When does bad get really bad?  This did happen in the past, if you were 3 months behind, that the lender wanted it all at once. But in today's economy and such, again, where is the common sense.
 

Please read below an e-mail from someone that came across my blogs.

 

Dear Jeff,

 

My credit is ruined, with plenty of fault my own. Reality of my situation though is Homeq servicing has rejected payments, pushed accepting them to the point of foreclosure. And processed foreclosure the first day after two thirty day past due periods. Thats on the 61 to 63 day late. (Evan when I have managed to send the past due and current month payments in full within the 3rd month). They evan stamped my payments RECEIVED Dated the last day of the 3rd month. Never attempted to process, and returned them well into what would then be my fourth month in default. Obviously refusing any further payments, requiring me to pay legal fees of around $2,100. keeping my mortgage in default just that much longer. Making my $1,200 mo. into a $1,990. for the next three months. (I think that HomEq is not set up to receive bimonthly mortgage payments.) Something i specifically requested when I originally refinanced, and was granted in my original agreement. So what I am asking is what they have done legal ? And what can I do ? And under the current situation is my request to pay bimonthly to escape homeq sound plausible? With them as my servicing company i will surely never get 12 months reported of mortgage payments on time. Im too often looped into legal fees and struggling to just catch up. Thank You for any time and help you may lend to my situation. SINCERELY

 

 

frustrationNow, some of what you read above doesn't seem possible. Can a bank foreclose upon you if you hadn't missed 4 consecutive payments. Yes, that is true. But are banks and investors pushing the envelope, pushing the borrower into a frenzy, especially if they don't know their rights?  Are banks and investors getting away with this? Sure, we don't know if this borrower has their story straight either. But this isn't the first time that I have heard this.

Then we have another issue on hand.  Legal Fees !!!  I am no lawyer, but many of the legal fees passed on from the banks seem awfully high. You wonder whose hands are in whose pockets. It would be like a realtor trying to get me referrals, but would want an extra $1,000 per client. Gee, I would have to pass that fee onto the borrower then. Can there be any restriction imposed to limit these such legal fees?  What se thee?

 

 

Overall, if any of this happens to you, seek a lawyer. And don't wait until you are served with letters or a foreclosure notice. The longer you wait, the harder it will be. Isn't that what we are told anyhow?




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Copyright © 2008 by Jeff Belonger

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Copyright © 2011 by Jeff Belonger of Infinity Home Mortgage Company, Inc

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. J. Hollis Jensen 10/22/2008 01:21 PM
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Jason Sardi
Auto & Home & Life Insurance throughout North Carolina - Charlotte, NC
Your Agent for Life

Jeff - I say that banks aren't in the business of owning homes (they seem to be very bad homeowners, just take a gander at short sales for example).  Communication is vital.  I believe borrowers should call their lenders BEFORE they know they are going to fall behind, that will avoid a lot of headaches in the long run.

Oct 15, 2008 07:09 AM #1
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Jason Sardi
Auto & Home & Life Insurance throughout North Carolina - Charlotte, NC
Your Agent for Life

... and as far as legal fees, I wonder if their fees (legal/attorney) should be regulated just like lender's... their version of Section 32.

Oct 15, 2008 07:13 AM #2
Rainer
84,353
Joe Adams
Major Mortgage USA/Branch Manager - Montrose, CO

Now wait a sec......  isnt foreclosure help and stopping it all part of this "bailout"?  Are not the lenders suppose to work with the distressed homeowner to work things out????????

Oct 15, 2008 08:28 AM #3
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Jason Sardi
Auto & Home & Life Insurance throughout North Carolina - Charlotte, NC
Your Agent for Life

One would hope, Joe.  One would hope...

Oct 15, 2008 08:57 AM #4
Rainmaker
720,487
Teri Eckholm
Boardman Realty - White Bear Lake, MN
REALTOR Serving Mpls/St Paul North & East Metro

Jeff--Wow! That is one ugly situation! Good advice to find legal assistance on this one.

Oct 15, 2008 09:01 AM #5
Rainer
116,822
Bo Hussung
Bell Title /Triserv LLC - Nashvle, TN

Jeff,

These stories will be coming forth more often, unfortunately as we continue to wait for the economy to turn. It is no secret or maybe it is, that one of the biggest cash flow /revenue generators for servicers is late fee and legal fees. Most notes in the fine print stat that of course here is a grace period, but 31 days late is grounds to call the note (although I have never seen that happen) and I think a lender /servicer would be hard pressed to exploit it if there was a strong payment history. But the sad truth is when the fine print is read closely, albeit with a 200x300 microscope, the lender pretty much has all the rules in their favor.

Noneheless, hwat Jason says is true, one, they do not wish to be in the RE biz and 2 most will owrk wih you, if you communicate with them. I think it is important to tell clients at closing and throughout the relationship that this is critical to having an open working relationship with the lender. As for the bi-monthly payments, the borrower could do this himself.

Interesting post. I hipe this works out for he above.

Thanks

Bo

Oct 15, 2008 09:02 AM #6
Rainmaker
111,102
Lewis Poretz
Apex Home Loans - Annapolis, MD
Business Development Manager

Does any of that now 700 Billion pitched in by the Government go to people like the one above? I bet not......

Oct 15, 2008 09:08 AM #7
Rainmaker
221,048
Michael Wayne Jackson
Coldwell Banker - Novato, CA
Realtor - Seniors Real Estate Specialist Novato

I agree Jeff. Something should be better than nothing for the lenders today.

Oct 15, 2008 09:38 AM #8
Rainer
172,065
Fred Chamberlin
Guild Mortgage Co - Oak Harbor WA - Oak Harbor, WA
Oak Harbor/Whidbeynulls, #1 Experienced FHA Mortgage Consultant

Jeff, I just talked to a homeowner this last week that was having difficulty with the same lender. Do you suppose there is a pattern here? I think that most lenders, if they have any sense, will do whatever they can to help the homeowner get out of this predicament. Some, are just stupid!

Oct 15, 2008 10:02 AM #9
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Fran Gatti
RE/MAX Integrity - Medford, OR
Managing Principal Broker - RE/MAX Integrity

I feel for this homeowner.  Times are tough and it sounds like he is trying to be honorable in making his payments as best he can and keep his home and not just hang it up and walk away.

Oct 15, 2008 10:39 AM #10
Rainmaker
120,917
Richard Sweum
1st Security Bank - Everett, WA

This type of treatment has reached epidemic proportions.  Banks are completely unable and unwilling to work with borrowers in a way that will actually help folks out.  This is the downside of securitization and non-local lending and servicing.  Damn sad.

Oct 15, 2008 10:52 AM #11
Rainmaker
2,783,241
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

Jeff, It's hard to believe the banks not only won't work with these homeowners who are trying so hard but they are now adding expensive legal fees?  I like your advice to get an attorney themselves to represent them and help them hold onto their homes.

Oct 15, 2008 01:51 PM #12
Rainmaker
218,589
William Collins
ERA Queen City Realty - Scotch Plains, NJ
Property and Asset Management

Brian,

Thanks for the post. This mentality of the lenders is what one would have expected in the past. However, today one would think that some money and no foreclosure costs would be the preferred approach.

Oct 15, 2008 02:54 PM #13
Rainmaker
595,381
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate

So, is it legal? Aren't the lenders required to disclose what will happen, when they fund the loan? What are the laws? Or does each lender get to make up their own rules?

Oct 15, 2008 05:46 PM #14
Rainmaker
1,052,992
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Sorry to say but it seems the decision makers in many banks are not the brightest bulbs. There are so many times I hear stories like this and I am just left to scratch my head in disbelief. It's the same thing with short sales.

Oct 16, 2008 01:49 PM #15
Rainmaker
400,528
John Cannata
214-728-0449 http://TexasLoanGuy.com - Frisco, TX
Texas Home Mortgage - Purchase or Refinance

There are lenders helping homeowners.  I can not speak for the example above, but lenders are looking at customers financials.  If they work with them, can the homeowner actually afford the house?  if the answer is no, the customer has too many bills and ultimately will lose their house, then the lender will end up further in debt themselves (foreclosure expenses).  At some point, the lender must cut the strings and let homeowners fall into foreclosure.  Its very sad, but its true.  As pointed out in other comments, if the customer communicates, they may be able to salvage something earlier.  If they wait for things to happen, certain laws fall into place.  if the lender accepts one payment, then they will start over again with the foreclosure proceedings.  As you know, if you start over, you incur additional expenses.  Why would a lender do this, knowing what your past payment history has been?  Again, if the customer can show from their bills and income that they can afford the payments, then most lenders will work with you.  As you mentioned, they do not want to own these homes.

Oct 16, 2008 02:53 PM #16
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Larry Bettag
Cherry Creek Mortgage Illinois Residential Mortgage License LMB #0005759 Cherry Creek Mortgage NMLS #: 3001 - Saint Charles, IL
Vice-President of National Production

Unfortunately, if they take "partial payments" they seem to have set a standard by acquiescing to non-performance or partial peformance.  I think that these issues need to be addressed so that Lenders can acquiesce without losing their ability to foreclose on the property.

 

Oct 17, 2008 02:54 AM #17
Rainer
57,817
Lori Franks
Real Estate Consultant - Brookings, OR
Brookings, Oregon

Jeff- I had a mortgage with the aforementioned co. years ago. Never again!  I don't doubt the scenario one bit. I think we are going to continue to see events like these for awhile before it gets better. It is a sad state of affairs.

Oct 17, 2008 06:42 AM #18
Rainer
38,744
Kevin & Maryellen Garasky
KMG Mortgage Group - Kevin & Maryellen, Idaho & Washington - Coeur d'Alene, ID
KMG Mortgage Group - ID & WA

Jeff - Long before owning my own Broker office, I used to work in Loss Mitigation at Mellon Bank (I'm dating myself: Mellon Bank sold their mortgage side to Chase in 1998'ish).  Banks won't accept partial payments because they are afraid that it will hinder their ability to foreclosure (not that we need anymore of that right now, anyway).

To answer Jason Sardi's question: Yes, there are limits to attorney fees and costs - they are determined at the state level.

In the example you gave, it is CRAZY (absolutely CRAZY!) that the bank won't accept his money!!!  If this borrower were to contact me in "the day", I would put him on a forbearance agreement without thinking twice.  The problem we have now, however, is that loss mitigation "specialists" are no longer specialists.  They are hired hands with one job to do: collect money, period.

It's sad.

Oct 20, 2008 04:39 PM #19
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