For the past couple of years, it has become a fairly common practice for lenders and servicers to employ forensic loan audits on pools of mortgages, with the goal of uncovering patterns of noncompliance with federal and local regulations, the presence of fraud and/or the testing of high fee violations. Unfortunately, for these same lenders, the practice of forensic loan auditing has slipped over to the consumer side of the market and is now being used against the lenders themselves in the fight for obtaining an equitable Loan Modification or Shortsale for homeowners, investors and attorneys. The “forensic loan document review” also known as a ”mortgage audit ", "Forensic Loan Analysis"” or Forensic Loan Audit" can then be used by locally-licensed attorneys in each State to take legal action, or used as leverage for meaningful loan negotiations whether it be a Loan modification or Short Sale by the homeowner or thier third party representatives such as Financial Relief Solutions (FRS).
Lenders are and should be worried, as a swarm of potential lawsuits could fly in their direction. These might not always be hefty lawsuits, considering they mostly represent individual loan amounts, but they are annoying and the fees to defend the institution from these efforts can mount up very quickly. In addition, if homeowners are successful in the bids to rescind a loan, the lender has to pay back all closing costs and finance charges. TILA's statute of limitations extends back three years, so most people who end up on their lender's doorsteps are people who financed or refinanced during the boom period of 2005 through early 2007. If serious violations are discovered, the borrower can move to have the mortgage rescinded. Lenders are also concerned because it is very hard for a bank to mount an effective defense against people who can prove that their loan contained violations and it is extremely difficult for lenders to defend against a lawsuit when they face a bona fide rescission claim. If you are a homeowner struggling to get the attention of the overworked loan servicers, who are scrambling with as many loan modifications and workouts they can come up with, you can get to the head of the line sometimes if you show up with an attorney and forensic loan examination, saying, 'Here is a TILA violation; we want to rescind. It brings the settlement offer to the table a little faster.
Additionally, in this age of securitization, many banks don’t own the loans they originated, but this is not a defense. If they don’t own the loan anymore, they are going to have to get in touch with the servicer who does.
Forensic loan audits expose mistakes and unscrupulous lending practices that will assist the borrower in negotiation efforts. Federal-, state- or county-specific lending violations and the legal guidelines for remedy, can pave the way to successful and expedient modification.
Up to 95% of mortgages may be legally unenforceable due to defects like lost documents, improper notices, appraisal and/or predatory lending. A Forensic Loan/Mortgage audit will help you to get "noticed" by your lender. After our examinations, lenders suddenly get religion and become much more cooperative in renegotiating the terms of a loan and will place your loan modification case or short sale at the top of the list. You need to take advantage of every conceivable resource that you can find to use against your lender. We do a forensic document examination to examine whether or not there are any legal violations. We give you another piece to use against your lender that nobody else does.
The following are common reasons to conduct a Forensic Loan Audit:
General Loan Documentation Errors - Real Estate Settlement procedures Act (RESPA) Violations - Truth In Lending Act (TILA)
Violations - Home Owner EquityProtection Act (HOEPA) Violations - Good Faith Estimate Compliance - Misleading Disclosures -
Overstated Home Values - Overstated Income In The Loan Application - Lender And Broker Misrepresentations - Usury Violations
Excessive ARM Adjustments - Excessive Points & Fees - Predatory Lending - Forgery- Loan Flipping
Our Audit also includes a bottom-line recommendation for loan modification terms and short sale negotiations, providing a framework for negotiations between homeowners and lenders.
This service is a very specialized and imperative in identifying if a borrower is a victim of predatory lending. Our team of specially trained experts review all loan documents and perform a thorough investigation for miscalculations and to determine if the loan terms are accurate, truthful, and met the requirements of the applicable federal statutes.
The goal of the Forensic Loan Audit is to determine whether there were violations of federal law in your loan documents.
(Predatory Lending and Origination Fraud)
If these violations are found, then the borrower may be eligible for complete relief of the predatory loan (refinanced only)or a very favorable loan modification. Complete relief of the predatory mortgage is called as a loan rescission. Meaning the lender takes back the “predatory loan” and awards or credits back to the borrower all interest made on payments thus far, loan origination fees, all applicable lenders fees, penalties and attorney’s fees.
However, in most cases the borrower may be ineligible to rescind their loan because they are just too far underwater to obtain a new loan to replace the old loan and their credit rating may have been adversely affected by the loan that has cause them pain and suffering.
The most common option is just to mediate the loan with your lender and fight for an affordable loan modification based on the legal violations on the loan. Everyone wins here. The homeowner has their loan fixed and may have their principle balance may be reduced also. The lender does not lose their shirt because they have mediated the matter without employing their full legal staff on the file and wasting operating expenses. What do we do on a forensic loan document review for attorneys or borrowers?
We review your loan documents (the papers you signed when you applied for the loan and the papers you signed when you closed the loan). We investigate whether the information and calculations provided in those documents was accurate, truthful, predatory and met the requirements of the applicable federal and state statutes. We look to what the lender, broker, and agent told you about the loan. We focus on whether the loan you were told you were getting was actually the loan you received.
A true “forensic loan audit” examines homeowners' appraisal, mortgage and supporting documents, in the context of the dealings surrounding the creation of those documents; so legal defenses can be discovered that a homeowner can use to avoid foreclosure. Or to use the law offensively to obtain favorable refinancing on the borrower's terms, an equitable and fair Loan modification, an approved Short sale, a possible principle reduction, etc..
As experienced mortgage auditors we can uncover Fraud, Miscalculations, Violations etc. quickly. Other violations are harder to find and require in depth examination of the loan documents. After determining if your loan documents indicate whether there is a case worth pursuing we can inform you what course of action to take. We allow you to directly communicate via email with a loss mitigation officer working on your file/case to give you exceptional clarification, service and support.
FORENSIC LOAN DOCUMENT AUDIT - Some Of The Things We Review and Document:
• An overview of the clients complaint
• Complete deatails of the loan transaction
• Complete mortgage compliance report
• Detailed list of all parties to the transaction
•
Narrative report
•Report regarding applicable right to cancel notices and disclosures
•Report on specific Truth in Lending Act (TILA) and Real Estate Settlement & Procedures Act (RESPA) violations
• Amortization schedule
•Yield Spread Premium report
• Good faith estimate report
• Uniform residential loan application summary
• Opinion section summarizing conclusions of the audit
CONSTRUCTIVE FRAUD?
We investigate material facts including the terms of the loan, whether there is a prepayment penalty, or any other information which a reasonable borrower would want to and should know before accepting the loan. Did the mortgage broker or loan officer or anyone working for the broker or loan officer fail to disclose any material facts to the borrower?
FRAUD AND NEGLIGENT MISREPRESENTATION
Were any representations, statements, or comments, whether they be written or oral made by the loan officer, broker, notary or anyone else which contradicted the terms of the loan documents?
NEGLIGENT MISREPRESENTATION
When a mortgage professional makes errors which a reasonably diligent mortgage professional would not have made, he or she may have made a negligent misrepresentation.
BREACH OF CONTRACT
The note and its attachments are a legal contract. The broker must follow all the terms of the contract such as the way the interest is calculated, and the penalties it assesses. Were there any terms in the contract which the lender failed to follow?
THE LOAN AUDIT REPORT
•Results and a report of all factual findings of the forensic loan document review/audit
•Any and all applicable federal law violations
•The real terms of your loan
•Outline of hidden fees and/or commission earned by your broker or lender
•A complete assessment so you can pursue possible legal claims against your broker and/or lender
• A bottom-line recommendation for loan modification terms and short sale negotiations
*** E-mail contact/communication for clarification or questions
Loan Modification:
After the Audit and Review of the current terms of your predatory or unaffordable loan, and documenting the Federal, State Violations and Fraud your lender may have no other choice but to alter the payment terms to make the loan affordable and equitable with a possible principle balance reduction as well. Lenders, servicers, and homeowners are going to be dueling over loan modifications for some time to come, and the comprehensive analysis provided by a Forensic Loan Audit from Financial Relief Solutions will be an essential negotiating tool for an equitable and fair modification.
Our Forensic Loan Audit includes all the information homeowners, loan modification companies and attorneys representing borrowers need to negotiate a modification solution, and it provides an analysis that allows you to quickly review or order loan modifications, and provide the expeditious, equitable relief many homeowners are seeking.
The bottom line is:
1. One of the most effective tools to cut through the toxic mortgage maze is a loan/mortgage audit or forensic loan document review that can help discover legal violations on your loan, which will help you negotiate your loan/mortgage before you are late.
If your lender or servicer is facing a lawsuit based on legal violations on your mortgage, or they can simply avoid litigation by modifying your loan, guess what they will do? 99% of the time they will cave to your demands and give you a sweet, affordable, equitable and fair loan modification (one much better than you could have ever imagined or obtained on your own).
If they don’t assist you with a modification and there are legal violations on your loan, please consult with an attorney right away! We have seen modifications down to as low as a 2% interest rate using the above methods.
Our Forensic Loan Audit service fee - only $599!
This service is available to consumers, brokers, attorneys, Non-profits, legal aid law firms and law enforcement. Please call (877) 717-6759 for details or you may email to Audit@financialreliefsolutions.com
Note: There are no guarantees, promises or representations made that a loan audit will reveal any of these loan compliance or legal errors. Every file is different. Financial Relief Solutions.com has no obligation to file any lawsuits or initiate any other legal proceedings following this service and/or following any loan audit. Always consult your own attorney for your state laws on any legal decision you need to make. No promises are made contrary to this position.
Call us at 877-717-6759 for a FREE consultation with Financial Relief Solutions or visit us on the web at www.FinancialReliefSolutions.com
Financial Relief Solutions (877) 717-6759 Fax # the same
Office: by appointment only:
2375 E. Camelback Road Suite 500
Phoenix, Arizona 85016
(602) 774-4802
(602) 774-0449
(877) 717-6759
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