Using Mortgage Tender Negotiations For TILA Fraud Violations To Stop Foreclosure
Posted On February 22, 2019
This information is not legal advice and for informational purposes only.
Learn how to use Tender Negotiations…to rescind and cancel your mortgage loan contract for TILA Fraud Violations to Stop Foreclosure.
If you need to stop a foreclosure and loan modification negotiations have been unsuccessful, this information is going to breakdown all the steps to use Tender negotiations through identifying TILA fraud violations.
“Can you rescind and cancel a mortgage loan contract for TILA fraud violations after three years?”
That’s the most common question most mortgage servicers, mortgage lenders, attorneys representing mortgage lenders, or bankruptcy attorneys and foreclosure defense attorneys “all want to know” about the process to rescind and cancel a mortgage loan contract especially after three years.
Well, homeowners facing foreclosures are rescinding and canceling mortgage loan contracts after 3 years!
A foreclosure defense strategy to resolve foreclosure conflicts through Tender Negotiations, a win-win for the homeowner and the mortgage lender.
Another burning concern is that when a borrower actually rescinds and cancels a mortgage loan contract “is the borrower prepared to Tender payment” to the mortgage lender after doing so.
My decision to write this book was based on my extensive knowledge of mortgage securitization for how Wall Street securitized loans work and The Truth in Lending Act of 1968.
This act is a United States federal law designed to promote the informed use of consumer credit, by requiring disclosures about its terms and cost to standardize the manner in which costs associated with borrowing are calculated and disclosed.
The statement “requiring disclosures about its terms” is the most important factor for identifying TILA fraud violations.
It is very significant to note that “TILA” includes mainly consumer credit loans, such as mortgages, credit cards, and home equity loans. However, TILA does not apply to Purchase Money contracts.
A borrower does not have the right to rescind or cancel under TILA for a purchase money lien. However, there are other issues discovered about TILA fraud violations for how to use “Fraud” as foreclosure defenses.
I am a former mortgage broker with over 16 years of experience…Finance, technology, and mortgage-backed securities are my primary areas of expertise and I am a real estate investor and developer with over 20 years of experience. I also served in the U.S. Navy under secret clearance, so I have a strong understanding of how classified top secret information is handled.
A security clearance is a status granted to individuals allowing them access to classified information that may be related to state or organizational secrets or to restricted areas, after completion of a thorough background check.
What exactly is a foreclosure?
It is a “legal process” in which a lender attempts to recover the balance of a mortgage loan contract agreement from a borrower, who has stopped making payments (a loan default) to the lender that is processed by the lender’s mortgage servicer by forcing the Sale of the Asset used as the collateral for the loan which is the property.
Each state has a standard foreclosure process that is;
Judicial (requiring court approval) or
Non-Judicial (without court approval)
Which gives the exact procedures for how a foreclosure sale is conducted.
For example, in a Judicial foreclosure, the lender initiates a foreclosure by filing a civil lawsuit against the borrower. All parties must be notified of the foreclosure and the notification process vary from state to state.
In a Non-Judicial foreclosure, this process involves the sale of the property by the mortgage lender without court supervision, handled much differently from a Judicial foreclosure requiring no court approval review for a non-judicial foreclosure process.
There is one other foreclosure process that is not often used. However, the mortgage lender must first agree to it and for borrowers who don’t want to go through the foreclosure process, a Strict foreclosure offers an alternative. Strict foreclosure is the process that involves using a “deed in lieu of foreclosure,” or “strict foreclosure”, the mortgage note holder in due course claims the title and possession of the property back in full satisfaction of a debt, usually on the mortgage loan contract where foreclosure proceedings can be avoided.
While many borrowers think that a deed in lieu of foreclosure is better than foreclosure. A deed in lieu of foreclosure actually stays on a credit report the same amount of time as a foreclosure which is seven years.
As well as a deed in lieu of foreclosure also drops a credit score, which varies by how many points. The range can be from 25 points to 250 points.
What are the three most common ways used to stop foreclosure?
Filing a bankruptcy grants “Automatic Stay” protection that goes into immediate effect staying the mortgage lender by an Injunction that prohibits the lender from foreclosing on the property. So as long as the bankruptcy is filed before the mortgage lender forecloses on the property.
A Chapter 13 bankruptcy allows the borrower to remain in possession of the property while repaying the delinquent amount of mortgage payments set up in the bankruptcy plan. Chapter 13 restructures the debts through repayments by some payments made in part and some payments made in full over a period of 3 to 5 years for the repayment plan agreement.
In Chapter 7, bankruptcy will eliminate the borrower’s personal liability of the mortgage loan debt and the borrower will not be liable for any deficiency amount remaining after the foreclosure.
Many homeowners in foreclosure use Chapter 7 bankruptcy to buy time at the last minute. Allowing them to remain in possession of the property under bankruptcy protection without making any monthly payments.
However, the homeowner as the borrower will not be able to keep the property in a Chapter 7 bankruptcy. The property is given up. Unless the homeowner reaches an agreement with the mortgage lender, the automatic stay will be lifted against the mortgage loan contract when payments are not being made on the mortgage.
This may also be a good time to present TILA Fraud Violations to see if Tender negotiations can be worked out once the automatic stay is lifted and the property hasn’t foreclosed yet. Once the bankruptcy is filed the lender will have to restart the foreclosure process all over again.
Short Sale is used most commonly second after bankruptcy to stop foreclosure. For a Short Sale, the net proceeds from selling the property will fall short of the debts secured by liens against the property.
There can be no pre-existing relationship that existed between the seller and buyer in a Short Sale transaction.
This must be an arms-length transaction and the borrower who is the original homeowner must not receive any proceeds from the Short Sale and must give up possession of the property. Not doing so is fraud.
Many homeowners don’t educate themselves properly and often commit fraud in their attempts to stop foreclosure.
A loan modification would seem like the most logical thing to do first to stop foreclosure. However, this is the third most common way borrowers seek to stop foreclosure.
This could be because most homeowners as the borrower are ashamed and afraid to talk to their mortgage lenders about being behind on their mortgage payments.
A loan modification is a process where the terms of the mortgage are modified outside the original terms of the mortgage loan contract agreed to by the lender and borrower. This can also be referred to as debt rescheduling.
FA identified the states with the highest foreclosure rates.
Which states have the highest rates of foreclosure?
Foreclosure rate: 1 in every 744 housing units.
2. New Jersey
Foreclosure Rate: 1 in every 788 housing units.
Foreclosure Rate: 1 in every 1,117 housing units.
Foreclosure Rate: 1 in every 1,286 housing units.
Foreclosure Rate: 1 in every 1,375 housing units.
Foreclosure Rate: 1 in every 1,375 housing units.
7. South Carolina
Foreclosure Rate: 1 in every 1,409 housing units.
8. New Mexico
Foreclosure Rate: 1 in every 1,508 housing units.
Foreclosure Rate: 1 in every 1,559 housing units.
10. New York
Foreclosure Rate: 1 in every 1,672 housing units.
Why Do Most Foreclosures Violate TILA?
In 2013, there were 15 mortgage servicing companies subject to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing, who reached an agreement in principle with the Office of the Comptroller of the Currency and the Board of Governors of the Federal Reserve System to provide approximately $10 billion in cash payments and other assistance to help borrowers.
Securitization of mortgage loans is a process where many mortgage lenders can conceal the identity of who is actually the true mortgage lender funding the mortgage loan at closing when the loan is originated.
Remember I mentioned earlier that the statement “requiring disclosures about its terms“ is the most important factor for identifying TILA fraud violations.
Now don’t confuse this with material TILA disclosures, where disclosures were not provided in the correct manner or the notice of right to rescind and cancel was not given at closing.
Which a borrower only has three years to rescind and cancel the mortgage loan contract if material TILA disclosures were not provided.
That also includes three years to rescind and cancel the mortgage loan for failure to provide the Notice to rescind and cancel at the time of closing. Additionally, the borrower’s right to rescind and cancel terminates upon the mortgage lender curing the violations, unless the borrower mailed a rescind and cancellation notice to the mortgage lender within the three years.
Material TILA Disclosures vs. TILA Fraud Violations
The two are vastly different.
Material TILA Disclosure involves a strict three-year statute of limitations where disclosures were not provided in the correct manner or the notice of right to rescind and cancel was not given at closing.
TILA Fraud Violations involves fraud where the entire mortgage loan contract can be terminated because it was based on fraudulent misrepresentation and misrepresentation of disclosure terms involving who was the true lender funding the mortgage loan contract at closing.
The identity of who is actually the true mortgage lender funding the mortgage loan at closing can be hidden during the securitization process of the mortgage loan contract.
To stop foreclosure, borrowers are raising the foreclosure defense that TILA fraud violations occurred at loan origination at the closing table.
How is this possible??
# 1. At closing the party originating the mortgage loan contract must provide full “disclosure terms” by revealing who is the actual TRUE mortgage lender funding the mortgage loan contract.
So let’s say you sit down at a closing table to do a contract, same as with a mortgage loan contract.
Party A is the Buyer
Party B is the Seller
The Buyer known as Party A takes out a Mortgage Loan to complete fulfilling financial obligations to purchase the property.
The mortgage lender must satisfy disclosure terms to identify who is the true lender funding the loan for the mortgage contract.
# 2. A fraudulent misrepresentation occurs in the disclosure terms when the mortgage lender is stated to be a different party than the party actually funding the mortgage loan contract!
When fraud is involved this vitiates the mortgage loan contract entirely.
This is why these loans are known as Pretender Loans in the mortgage industry, where 15 mortgage servicing companies were subject to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing.
# 3. TILA Fraud Violations is a violation involving fraud and disclosure terms misrepresentation.
Disclosure involves the act of releasing all relevant information that may influence the other person’s decision if the information is not made privy to them.
Terms for disclosure allows each party to acknowledge the terms as well as the conditions in the disclosure terms process.
Fraud is deliberate deception to secure unfair or unlawful gain or to deprive a victim of their legal rights.
Fraud itself can be a civil wrong, a criminal wrong, or it may cause no loss of money, property or legal right but still be an element of another civil or criminal wrong.
How Are TILA Fraud Violations Proven?
The elements required to prove fraud will vary in each state and federal laws.
To prove fraud there must be an established misrepresentation of an important fact, such as the party asserting to the be the true mortgage lender funding the mortgage loan contract was mispresented and false.
The false misrepresentation was relied upon by the borrower that full disclosure terms were being disclosed about who was the actual true mortgage lender funding the mortgage loan contract at closing and influenced the borrower’s decision making to initiate the mortgage loan contract.
All evidence must be presented as facts explaining TILA Fraud Violations.
My book became a best-seller because I broke down step by step how to identify TILA Fraud Violations by conducting a securitization review at closing during the loan origination.
I give all the details for where to look and which TILA statutes reveal how to determine who is funding the mortgage loan contract at closing.
Most people are shocked to learn that their mortgage loan contracts show evidence of TILA Fraud Violations, where the actual true lender funding the mortgage loan contract was not revealed in the disclosure terms.
What this means is that the mortgage lenders expressly asserted to be the lender on mortgage loan contracts, are often not the true lenders.
More people wanted to learn more about securitization and how TILA Fraud Violations could help rescind and cancel mortgage loan contracts.
A step-by-step method to rescind and cancel a mortgage loan contract for TILA fraud violations.
Using Tender Negotiations For TILA Fraud Violations To Stop Foreclosure
Is it possible to stop foreclosure using Tender Negotiation for TILA Fraud Violations??
I have consulted foreclosure defense attorneys and bankruptcy attorneys on this same topic.
Recently, I have also offered my consulting services to attorneys representing mortgage lenders in foreclosures.
Where more borrowers are becoming aware of TILA Fraud Violations and starting to conduct securitization review audits of their closing documents.
I have held special training sessions on mortgage securitization and how-to stop foreclosure by finding securitization flaws as foreclosure defenses.
The one thing that I am certain of, there is a huge need for Tender Negotiation resolution to help borrowers and lenders resolve foreclosure conflict matters.
There is a great need for a middle man to negotiate Tender on a mortgage loan contract once a borrower rescinds and cancels the mortgage loan contract.
The reason most loan modifications are denied is that borrowers are still required to qualify and many can’t qualify.
A growing problem is that many homeowners can’t qualify for a loan modification, to qualify for a loan modification approval is determined by two primary factors:
Size of the mortgage loan payment.
Amount of the borrower’s income.
Which federal guidelines also require that the mortgage loan payment must be less than 33% of the borrower’s income for approval when modifying the mortgage loan contract.
For most mortgage lenders to approve a loan modification, the lender must first adjust the interest rate for the mortgage loan contract.
When the interest rate is adjusted to a lower rate, the mortgage payment can also be lowered.
However, in most situations, it is just not possible to adjust the interest rate lower enough to make the mortgage payment low enough with the borrower’s income to be below the 33% income federal requirements.
This is why so many loan modifications are denied.
Other options for why loan modifications are denied include adjusting the terms, or length, of the mortgage loan so that the borrower will pay a smaller amount over a longer period of time.
Which also can require the mortgage lender to even forgive a portion of the mortgage loan through principal forgiveness, just to get the monthly payments low enough and below the 33% income requirements.
The mortgage lender also has an option to forgive a portion of the mortgage loan to make the monthly payments low enough and below the 33% income requirements. Rarely ever do mortgage lenders agree to forgive a portion of the mortgage loan through loan modification agreements.
A mortgage lender is not required to approve a loan modification, so none of these options have to be accepted. The mortgage lender only has to review the loan modification request and not required to ever approve a loan modification.
Making it much harder for a homeowner to be approved for a loan modification.
The ultimate solutions to stop foreclosure should not only be Bankruptcy, Short-Sale, or Loan Modification.
TILA has strict rules and regulations and when fraud is identified it can VOID everything.
The U.S. Securities and Exchange Commission “SEC” also have strict rules and regulations for how securitization of mortgage loan contracts are to be handled.
When mortgage loans are securitized the promissory notes are established as security instruments and this a violation for where disclosure terms are misrepresented and false.
Most people are attempting to rescind and cancel mortgage loans contracts without the knowledge of the securitization process for understanding how it works to raise foreclosure defenses for TILA Fraud Violations.
In my systems, I offer forms to break all these details down for what to understand about securitization rules and regulations to identify TILA Fraud Violations, a strong foreclosure defense!
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If you want to learn steps for Tender Negotiation to negotiate Tender for mortgage loan contract recessions the Mortgage Tender Negotiation Forms are just right for you so CLICK HERE!
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