Dec 02, 2009 and April 12, 2010
According to the latest data from the Federal Reserve “approximately 3 percent of the seriously delinquent borrowers received a concessionary modification in the year following their first serious delinquency, while fewer than 8 percent received any type of modification,” at all! Nonetheless, everyone is hawking loan mods these days. It’s a scary thought that people with no legal experience are pushing people into loan modifications without any discussion of a forensic loan analysis or forensic appraisals. The scariest part, when you modify a loan, you essentially WAIVE any claims you have to go after the lender! Why is this important, because the majority of loans closed in this century have problems that the borrower could use against his lender! In fact, and in most cases, lenders are holding nothing but worthless or at best questionable mortgage instruments. If you sign up for a loan modification, you are in essence validating an alleged debt that you most likely don’t have anymore because it was destroyed in the securitization process.
Furthermore, a Loan Modification company cannot guarantee the distressed borrower that their submitted documents for the modification will not be used against them by law enforcement in the future. Prosecutors will be going after borrowers for participating in fraud by overstating their true income. What this does is make any submission to the lender vulnerable unless you have the attorney-client privilege over your submission. (The same is true if a borrower submits financial statements to obtain a Deed In Lieu of Foreclosure or Short Sale.) Therefore, a Loan Modification should be a last resort- a legal maneuver not something done by Joe the Modifier.
The threat of foreclosure is a legal problem, and you start by treating it like any other legal problem. The first basic step it to determine whether the mortgage is legally valid. Wouldn’t you like to know if you could pursue your lender for a better deal before you get their boilerplate modification agreement?
Mortgage Fraud Examiners is a project of Lex Consulting. For over 30 years, Lex Consulting has provided litigation support to attorneys, helping them break into new areas of practice, or providing specialized advice for complex cases requiring novel approaches to the law. Mortgage Fraud Examiners is a team of specially trained attorneys that provides Forensic Document Examinations and Forensic Appraisals, helping borrowers and their lawyers with comprehensive assistance and the evidence needed to bring about positive outcomes in favor of the homeowner.
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