False Foreclosure Is On The Rise

Monday, December 13, 2010, 1:11 AM | 3 Comments

By now, you may be aware of the stories of bank robo-signers powering through hundreds of foreclosure affidavits a day without looking deep into a single one and verifying it. Most of the foreclosures may have involved homeowners who had stopped paying their mortgage. They were genuine and legit defaulters. Whoever has gone through the foreclosure process has experienced financial hell on earth. However, a new financial species has been created known as false or mistaken foreclosure and it is alarmingly on the rise.

We all love to complain, and genuinely I might add, about banks, especially the big ones. The charging of ruthless fees, the bad customer service, but the false foreclosure cases are hardly the usual complaints.

What is False Foreclosure?

False foreclosure is a mistaken foreclosure. Most homeowners are very particular about paying their monthly installment. Some even have paid off their loans. But they still get hit by mortgage foreclosures. When the homeowner calls the bank to complain and asks for explanation, that’s when bad customer service kicks in. They get bounced from one bank official to the next with no resolution while the foreclosure process continues.

Media have reported that false foreclosures are on the rise. As a matter of fact, in November of this year, during foreclosure hearings on Capitol Hill, many senators rebuked the banks somewhat angrily about wrongful foreclosures. What good would the Congress do? Give banks more money so they continue to suffocate consumers?

Diane Thompson, a lawyer with the National Consumer Law Center, has defended hundreds of foreclosure cases. “In virtually every case, I believe the homeowner was not in default when you looked at the surrounding facts. It is a widespread problem throughout the country.”

Go for your gun – financial gun, that is

Such homeowners present their documentation to the bank. But the lending institution has already stopped listening to its customers and turn its financial faces and ears away from them, never to be seen or heard again. So what the homeowner does is hire an expensive lawyer – there are no cheap lawyers in this life of ours – and plan not only to stop the wrongful foreclosure but also to try to win back their costs.

In a case like this, I like to think of the western movies where at the end, two gunslingers duel it out. The bad guy always hits the ground and dies. In real life, unfortunately the bad guy seems to win. Even an act of Congress is unable to rectify financial problems homeowners are facing.

Two kinds of laws

There are two kinds of laws: 1) the ones on paper written so nicely with words people don’t understand, and 2) implementation of the laws by the responsible and respective law-enforcement personnel. It’s a lot easier to create 1) but it’s a lot harder to honor the law in practice.

Congressional Acts and Laws don’t mean anything when they are shown to the public on a piece of paper. The laws must be enforced to protect the innocent consumers.

Media have reported homeowners in Florida, Nevada, Texas and Pennsylvania have filed lawsuits alleging that they were victims of mistaken foreclosure. In many of those cases, the bank went so far as to haul away belongings and change the locks on the wrong homes.

In a Nutshell
It’s mind-boggling that these large banks accepted billions and billions of TARP money from the government, and they are just committing a fraud on the American people. They must be stopped.

If you have encountered such foreclosure, present all your mortgage documentations and monthly payments to the bank. If they are as stubborn as before when they filled up their bellies with government money, find a good lawyer and try to sue them, if for nothing else at least for your peace of mind and your attorney fee.

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  1. 3 Responses to “False Foreclosure Is On The Rise”

  2. By Shafi on Dec 15, 2010, 1:52 pm | Reply

    Suck Dollars: Thanks.

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  2. Dec 13, 2010: False Foreclosure Is On The Rise | Doable Finance dot Com | Miami Florida Foreclosure Attorney – Local Foreclosure Attorneys
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