Foreclosure Defense and Mortgage Abuse

Attorney in Fairhope AL

Experienced Foreclosure Defense Attorneys in Alabama

At our firm, our attorneys focus on protecting the rights of individuals who have been wronged by mortgage companies,  lenders and loan servicing companies.  The following information is solely provided to give you a general idea of the law under Mortgage Fraud and Wrongful Foreclosure.  If after reading the information below, you believe you need a lawyer or need further information please contact our office for a free consultation.

Wrongful Foreclosure: We Represent You!

There are several types of wrongful foreclosure cases taking place throughout the country today.  Here are a few that we have seen in our practice:

  • A borrower has made all of their payments on time.  Sometimes the owner has come out of a bankruptcy and is current, or there is a transfer of the loan servicing company.  Many times there are multiple transfers, only compounding the problem of a servicing company keeping a proper record of payments.  In any event, the mortgage servicing company has failed to apply all payments properly to the account, placing the borrower behind on the loan.  After numerous contacts by the borrower, the loan is not updated, and the borrower is placed into foreclosure.
  • A widespread issue we see is the misapplication or miscalculation of the escrow on mortgage loans.  If a mortgage is a escrow loan, it means that the servicing company takes out of your monthly payment funds for the taxes and home owners insurance due on the property.  Many times, the servicing company fails to take out the proper amount, or improperly calculates the amount to come out, causing a homeowner to pay more per month.  After a period of time, the borrowers become delinquent on the loan and the home is placed into foreclosure.
  • Finally, the majority of cases involve modification.  Under the Home Affordable Modification Program (HAMP) or other variations of the modification programs, lenders have caused borrowers to lose their homes to foreclosure.    In these type of cases, borrowers contact the loan servicing company  and are asked to provide large amounts of paperwork such as proofs of income, bank statements, income taxes, hardship letters and other items.   Once the homeowner sends in the requested items, they usually receive no response and are forced to contact the lender weeks later to determine if the documents were even received.  Generally, the homeowners  continue to send in the documentation, only to be frustrated  by the lack of communications with the lender.  Some homeowners are placed into a trial payment program under HAMP with the promise of a permanent modification.  However, many times a permanent modification never takes place and the homeowners continue making trial payments for years.  Finally, the foreclosure proceedings begin while the borrowers are informed that a permanent modification will soon be approved.  The homeowners, trusting the lender, ignore the foreclosure as instructed only to find out weeks later that their home was indeed foreclosed.

How our firm can help

On a typical case in Alabama, in order for the lender to eject or remove a homeowner from the property after foreclosure, a lawsuit has to be filed in Circuit Court.  Once that is filed, if after reviewing the facts of a case, we determine that there are willful or negligence claims we can bring on behalf of the borrowers against he lender/loan servicing company, we file an Answer on behalf of the client and counterclaims against those entities for wrongful foreclosure, breach of contract, fraud and other violations.

We have been successful in aiding clients in these types of situations.  There are other types of mortgage fraud problems, such as violations of the Truth in Lending Act (TILA), Real Estate Settlement Procedures Act (RESPA) and other Federal guidelines that govern mortgage loans in our country.  If you believe you have been a victim of mortgage fraud or a wrongful foreclosure, please contact us immediately to know your rights.

Mortgage Fraud/Foreclosure Defense FAQ’s 

A lady called today and said I owed them $ 8000.  They threatened to take my home and said they had a big file on me at the police office. This is the first time I ever heard from them.

No. This is a typical threat from collection agencies. This is also a Fair Debt Collection Practices Act (FDCPA) violation. They cannot threaten you with actions that they cannot legally make. You should contact an attorney in your area that handles those types of cases or feels free to contact my firm.

Q.  The store Motherhood Maternity signed me up for a credit card without my permission or knowledge. The request was denied and I only knew of this application when the letter from Barclays Bank arrived stating such. In fact, I’ve never even stepped foot in the store. My husband bought me some items there and I guess sign me up for a magazine or mailing list or something along those lines. I have had a hard time getting the inquiry removed, as the credit card company (Juniper/Barclays Bank) claims that they have informed TransUnion of the unauthorized application but TransUnion says they have yet to get the request. This debacle dates back to December 09. It is now May 2010. What are my rights, what can I do and is there enough merit for a lawsuit against any or all of these entities?

A.  You have certain rights under the Fair Credit Reporting Act (FCRA) You need to dispute this inquiry yourself by sending a dispute letter detailing the event and why it was an unauthorized inquiry to Trans Union and any other of the credit reporting agencies (CRA), Equifax and Experian if they are reporting the inquiry as well. The CRA’s have 30 days to investigate and provide you with the results of that investigation. If it is still reporting, you can dispute once again, (I usually advise my clients to do at least 2 disputes) and if the results still do not remove the inquiry, you can look at filing a lawsuit against the CRA who is still reporting it if the inquiry is causing you damages.

Q. I filed bankruptcy in 1977 and owed my federal credit union. This debt was submitted when I filed bankruptcy. I have since have built my credit score. Last week I was trying to purchase a car and the dealership applied for credit for me through this credit union. I was turned down because they still had on their books a loan that I had over 30 years ago, How long should credit union hold this against me? I spoke with someone and the lady said I would never be granted a loan. Is this the law regarding credit? I don’t think everyone is treated that way? You would think I committed murder or something.

A: Negative accounts are only supposed to report on your credit for 7 years. What you should do is send a dispute to the credit reporting agencies (Equifax/Trans Union/Experian) who are reporting this debt and ask them to remove it. Do a detailed dispute letter, identifying the account, and also in that letter let them know of the damages this has caused you. Make sure you provide evidence of who you are, copy of DL, SS#, and card. Send this by certified mail and make sure you save copies of everything. The agencies have 30 days to respond. If they don’t remove the debt, then you need to contact a lawyer who specializes in these kinds of cases as now the agency and the creditor are in violation of the Fair Credit Reporting Act (FCRA) and possibly other consumer protection statutes. Good luck.

The Fair Credit Reporting Act (FCRA), a federal law, was created to help protect the privacy of information in the files and reports that are created by each “consumer reporting agency” (CRA). This information shows whether or not you pay your bills on time, what credit accounts you have open or closed, and your long-term payment history.

In addition, the report provides personal information including social security number, address, phone number and place of employment. If you apply for a credit card, bank or another loan, or seek housing through rental, those you apply to will need to see your report. The FCRA gives you specific rights, some are outlined below. You may have additional rights under state law.

Contact the CRAs listed under “credit” or “credit rating and reporting.” Because more than one CRA may have a file on you, call each until you locate all the agencies maintaining your file. The three major national credit bureaus are:

P.O. Box 740241
Atlanta, GA 30374-0241
(800) 685-1111.

P.O. Box 2104
Allen, TX 75013
(888) EXPERIAN (888-397-3742).

Trans Union
P.O. Box 1000
Chester, PA 19022
(800) 888-4213.

In addition, anyone who takes action against you in response to a report supplied by a CRA — such as denying your application for credit, insurance, or employment — must give you the name, address, and telephone number of the CRA that provided the report.

Yes, if you ask for it. The CRA must tell you everything in your report, including medical information, and in most cases, the sources of the information. The CRA also must give you a list of everyone who has requested your report within the past year — two years for employment related requests.

Sometimes. There’s no charge if a company takes adverse action against you, such as denying your application for credit, insurance or employment, and you request your report within 60 days of receiving the notice of the action. The notice will give you the name, address, and phone number of the CRA. In addition, you’re entitled to one free report a year (1) you’re unemployed and plan to look for a job within 60 days, (2) you’re on welfare, or (3) your report is inaccurate because of fraud. Otherwise, a CRA may charge you up to $9 for a copy of your report.

Under the new law, both the CRA and the information provider have responsibilities for correcting inaccurate or incomplete information in your report. To protect all your rights under this law, contact both the CRA and the information provider.

First, tell the CRA in writing what information you believe is inaccurate. CRAs must reinvestigate the items in question – usually within 30 days — unless they consider your dispute frivolous. They also must forward all relevant data you provide about the dispute to the information provider. After the information provider receives notice of a dispute from the CRA, it must investigate, review all relevant information provided by the CRA, and report the results to the CRA. If the information provider finds the disputed information to be inaccurate, it must notify all nationwide CRAs so that they can correct this information in your file.

When the reinvestigation is complete, the CRA must give you the written results and a free copy of your report if the dispute results in a change. If an item is changed or removed, the CRA cannot put the disputed information back in your file unless the information provider verifies its accuracy and completeness, and the CRA gives you a written notice that includes the name, address, and phone number of the provider.

Second, tell the creditor or other information provider in writing that you dispute an item. Many providers specify an address for disputes. If the provider then reports the item to any CRA, it must include a notice of your dispute. In addition, if you are correct — that is, if the information is inaccurate — the information provider may not use it again.

A reinvestigation may not resolve your dispute with the CRA. If that’s the case, ask the CRA to include your statement of the dispute in your file and in future reports. If you request, the CRA also will provide your statement to anyone who received a copy of the old report in the recent past. There usually is a fee for this service.

If you tell the information provider that you dispute an item, a notice of your dispute must be included anytime the information provider reports the item to a CRA.

Only if you say it’s okay. A CRA may not supply information about you to your employer, or to a prospective employer, without your consent.

Not without your approval.

“Investigative consumer reports” are detailed reports that involve interviews with your neighbors or acquaintances about your lifestyle, character, and reputation. They may be used in connection with insurance and employment applications.

You’ll be notified in writing when a company orders such a report. The notice will explain your right to request certain information about the report from the company you applied to. If your application is rejected, you may get additional information from the CRA. However, the CRA does not have to reveal the sources of the information

“Investigative consumer reports” are detailed reports that involve interviews with your neighbors or acquaintances about your lifestyle, character, and reputation. They may be used in connection with insurance and employment applications.

You’ll be notified in writing when a company orders such a report. The notice will explain your right to request certain information about the report from the company you applied to. If your application is rejected, you may get additional information from the CRA. However, the CRA does not have to reveal the sources of the information

Seven years. There are certain exceptions:

  • Information about criminal convictions may be reported without any time limitation.
  • Bankruptcy information may be reported for 10 years.
    Information reported in response to an application for a job with a salary of more than $75,000 has no time limit.
  • Information reported because of an application for more than $150,000 worth of credit or life insurance has no time limit.
  • Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer.

No. Only people with a legitimate business need, as recognized by the FCRA. For example, a company is allowed to get your report if you apply for credit, insurance, employment, or to rent an apartment.

Creditors and insurers may use CRA file information as a basis for sending you unsolicited offers. These offers must include a toll-free number for you to call if you want to remove your name and address from lists for two years; completing a form that the CRA provides for this purpose will keep your name off the lists permanently.

You may sue a CRA, a user or — in some cases — a provider of CRA data, in state or federal court for most violations of the FCRA. If you win, the defendant will have to pay damages and reimburse you for attorney fees to the extent ordered by the court.

Yes. If your credit application was denied, the Equal Credit Opportunity Act requires creditors to specify why — if you ask. For example, the creditor must tell you whether you were denied because you have “no credit file” with a CRA or because the CRA says you have “delinquent obligations.” The ECOA also requires creditors to consider additional information you might supply about your credit history. You may want to find out why the creditor denied your application before you contact the CRA.

Contact an attorney to see if you have a legal recourse in the matter. Also, contact the FTC to report any violations.

Consumer Response Center — FCRA
Federal Trade Commission

Washington, D.C. 20580.
For More Information

The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint or get free information on consumer issues, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at The FTC enters Internet, telemarketing, identity theft and other fraud related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

Federal Trade Commission
Bureau of Consumer Protection
Office of Consumer and Business Education