In some cases, a bankruptcy lawyer can help you with foreclosure defense, which is an alternative to filing bankruptcy.
To understand how foreclosure defense works, you first have to understand how the mortgage industry changed its operating basis in recent years. The way the mortgage industry used to work was the individual bought a house using a mortgage company and the mortgage lender held the mortgage until the homeowner paid it in full. Today, mortgage companies bundle mortgages together and sell them as a securities package to trust investors. In essence, the mortgage company you signed a loan agreement with no longer owns your mortgage. So, when you receive a foreclosure notice, it does not come from your original mortgage company. On behalf of trust investment companies, professionals called servicers collect mortgage payments and perform other actions. The servicer also takes action to pursue a foreclosure.
An article released by the National Consumer Law Center explains in detail how use of servicers have fueled today’s foreclosure crisis. Unlike a mortgage company that stood to lose money through a foreclosure, the servicer is more likely to make money through foreclosure and lose money from loan modifications.
However, the securitization and use of servicers has also opened the door for foreclosure defense. A lack of proper paperwork is common and often inadequate to clarify which investment company owns a mortgage. In foreclosure defense cases, Pennsylvania superior courts have demanded that mortgage holders prove they own mortgages before allowing a foreclosure to move forward. Forged documents, lost paperwork, improperly signed documents, and other evidence may be available to fight foreclosure.
Meet with a bankruptcy attorney as soon as possible if you receive foreclosure threats or notices. Harold Shepley & Associates is a Pennsylvania debt relief law firm that offers a free consultation to review your financial situation and advise the best recourse. Call 1-866-284-7062 or visit us at www.shepleylaw.com.