Your mortgage is a contractual arrangement, and in jurisdictions like Virginia is probably a loan contract and a Deed of Trust. That means that no matter who eventually holds it, services it, or has the right to receive your money for the payments must stick to the terms of the original agreement. While sometimes the agreement or a later refinance allows for things like interest rate increases or changed payment-due dates, a set of documents exists that set out what the participants in the agreement—you and the lender or creditor—are required to do.
Mortgages are important not only because they are probably your biggest investment, but they are secured by what is probably your most important asset—your home. Being “secured” by your home means the creditor can foreclose the mortgage and take your home if you don’t meet your end of the agreement.
Finally, the servicer is the entity you pay and that communicates with you about the account. The servicer can change without the actual holder of your home loan changing, and the holder of your home loan can change without the servicer of your home loan changing.
Federal law requires that mortgage lenders provide certain information to you when you apply for a mortgage, such as sale price, the total amount you will borrow, the interest rate you will pay, the monthly payment, and a good-faith estimate of closing costs, among other details. If lenders don’t do these things, they violate the law.
Once your mortgage begins, other laws govern how the party accepting payments reports the status of your account to credit reporting agencies and communicate with you when you request information or dispute the accuracy of information. Companies who report information have a duty to accurately report the information relating to your account—like your payment history or any late payments—and violate the law if they do not accurately report.
If your home loan was for a fixed amount rather than a credit line, then when you write to these companies and request information about your mortgage account or tell the company about an error it has made—called a “qualified written request”—the company has to respond that it received the request within 5 business days, and then give you the answer to your request within 30 business days. Such a request must be sent to the address which the servicer has provided and that address may be different than where you send payments.
Because your mortgage is a contract, no one—the creditor, servicer, or other entity—can do things the contract doesn’t allow. That means they can’t add charges or interest that aren’t permitted, change the due date of your payment, place insurance on the property and make you pay for it when you already have insurance, and—most importantly—foreclose without following the steps outlined in the contract. And anyone foreclosing must comply with your state’s law regarding foreclosure.
If you are having trouble paying your mortgage and seek a modification, servicers or lenders will often improperly delay that process. The delay could have many reasons, and one could be simply because it is not in their best interest. Servicers and lenders make money from things like fees taken from loan payments themselves, charges for payments that are late because you can’t afford to make them, and for interest earned while servicers hold on to your money. In other words, little incentives exist for servicers to put enough people to work on modifications, so they are often unnecessarily delayed or never acted upon. Instead, servicers or lenders will continue to ask for paperwork you’ve already submitted or claim that a complete submission lacks something. Under federal law, if you validly seek a mortgage modification, procedural protections exist for you that the servicer must follow while evaluating your request for modification.
Our attorneys have experience dealing with all of these, and most other, mortgage-related problems –
We have significant experience litigating cases against mortgage creditors, servicers, and the credit bureaus over problems arising from mortgage abuse and misreporting of account history. Contact us to discuss, at no charge, any problems you’ve had regarding your mortgage.
And if you have a home in Virginia and someone is threatening to foreclose, we know how to deal with such problems and prevent wrongful foreclosures under Virginia law. We would be happy to discuss, at no charge, the options for saving your home from foreclosure.
If we take your case, we will do so on a contingency basis, which means you won’t pay any of our attorneys’ fees or litigation costs unless we obtain a settlement or judgment on your behalf.