Facing foreclosure is stressful and, after everything you have put into your home, you might wonder if you can avoid it. Many homeowners do not realize that sometimes lender mistakes can save your home from foreclosure.
There are a few common issues to consider that might help you prevent foreclosure.
Did your lender follow the proper notification procedures?
The foreclosure process requires the lender to send a series of default notices before the foreclosure as well as specific notices when the foreclosure begins. Any failure to follow those guidelines may prevent the foreclosure on your home.
Were you a victim of predatory lending?
Predatory lending refers to any lending process that, while beneficial to the lender, becomes virtually impossible for the borrower to pay back. Balloon loans that exceed a borrower’s ability to repay or loans that push the borrower’s debt-to-income ratio beyond a sustainable level qualify as predatory lending. The subprime mortgage crisis led to regulations that minimize these instances, but they still happen. If your mortgage was a result of predatory lending, fight your foreclosure on those grounds.
Did your lender mismanage your payments?
A careful review of your mortgage payment history can uncover mismanagement on the part of your lender. Delays in recording payments to increase late fees, penalties and interest rates may wrongfully put you at a disadvantage and lead to your foreclosure.
Mortgage lenders are not infallible. Recognizing the vulnerabilities and mistakes can help you determine if you have grounds to fight your foreclosure and keep your home.