Articles

FORECLOSURE PLANS ENDING? WHAT TO EXPECT NEXT.

August 27th, 2020 by Timothy Stull

As a result of the Covid 19 Pandemic, millions of homeowners have been offered forbearance plans by their mortgage servicers.  The thought of “no payments” seemed very appealing to many up front, but the hidden long term agenda is very tricky.  Ultimately a forbearance plan is nothing more than “letting the bills” pile up….then what?  Eventually is you ask a home owner for 10 payments down the road, you may as well be asking 10 million dollars….the money just isn’t there.  Also remember that many home owners that entered into forbearance had problems prior to the Covid 19 pandemic…so that delinquency activity is baked into the overall debt fiasco.  Most individuals feel that recapitalization or moving past due payments to the end of the loan is a guarantee in this process….that is simply 100% false.  The same notions existed in during the last financial crisis and many home owners learned the hard way.  Remember that during the last financial crisis, property values were dropping sharply….this time around we have a booming real estate market.  This adds even more pressure to the situation, since mortgage servicers are motivated to foreclose in order to drive up fees….and this time around they won’t be stuck a loss.  Full loan modifications will be required to recapitalize past due payments.  If the last financial crisis taught us anything, it is that mortgage servicers are truly uncooperative during the loan modification process.  The process itself is a tangled mess!  Arguments, data, documents, tedious work and stressful conversations are the daily routine.  Mortgage servicers have a very hard time staffing to work through process….the turnover rate with the job market is incredible.  Simply put, the process is big time fight.  If you are unable to counter punch during this process, you are destined for failure.  Whether you plan on filing solo or need extra help, we are here for you.  Our firm gives out 100% free advice simply by calling 877.297.7011, emailing info@thefreshstartfirm.com or texting to 312.213.0884.

DEFAULTED SECOND MORTGAGES – BRINGING SETTLEMENT TO THE CHAOS

August 8th, 2018 by Timothy Stull

Defaulted second mortgages are wreaking havoc for many home owners.  Collection agencies and collection law firms have serious interests in collecting on this debt.  The profit margins are high and the collection tools that can be used are vast.  This debt that once was considered undesirable, is now the hot ticket in the collection market.  Rising property values and a booming economy have propped the door open for collection opportunity.  Keep in mind that this is really old and dirty debt though…primarily left over from the great recession.   We recently settled a 92K debt for 8K on one of our client’s default second mortgage debts.  There was 250K equity in the property and the client has a six figure income.  How did we do it?  Listed below are the levels we used to attack from.

  1. Lack of valid accounting records.  Since this debt is so old, most of the accounting records do not exist.  The collection agencies will usually try and fabricate documents to fill the gaps in the records.  We can pick apart the phony records, which leaves violations per the FDCPA.  The FDCPA violations and fraud are used as leverage to negotiate.
  2. Lack of debt validity. All of these debts have been bought and sold on many occasions….many of the firms that once owned them are bankrupt.  In short, nobody really knows who owns this debt.  Since the debt was so undesirable for a long period of time, critical records just vanished.  Valid notes, deeds of trust, affidavits and allonges don’t exist.  These documents are required to prove up the validity of the debt.
  3. Post-Bankruptcy collection violations on discharged debt. While this activity does not apply to all cases, this is a very controversial issue in the market.  Collection agencies / attorneys will send out statements to make it appear that the discharged debt is still owed.  However, the debt has been discharged and only the lien survives.  Many people are tricked into making payments that they are not liable for.  Any statements that are sent by a bill collector must be free of influence to collect funds…this is where the violations are found.  The bottom line is that it is a violation of the Federal Bankruptcy Code to collect money on a discharged debt.

Feel free to call our office at 877.297.7011 or email info@thefreshstartfirm.com if you need help with a similar case.

CAN MY SECOND MORTGAGE COMPANY FORECLOSE ON ME?

May 22nd, 2018 by Timothy Stull

The simple answer to this is YES! Contrary to what the general public has been led to believe, foreclosure action on second mortgages and HELOC’s are really big problem. Mortgage servicers can foreclose, buy out your first mortgage and then proceed with eviction. Since HELOC’s carry the same traits as credit card debts, open foreclosure judgments can lead to wage garnishments and bank levies as well. There are many defenses that you can raise to protect yourself, but they are very complex in nature. Lack of debt validity, statute of limitations and FDCPA violations are just a few that that can be raised. The epic financial crisis in 2007 left a a huge crop of these huge defaulted second mortgages that were purchased by vulture debt buyers. These vulture debt buyers then pad the balances to enrich their bottom line. Firms such as Real Time Resolutions, Ocwen, Rushmore and Mr. Cooper have wreaked havoc on real estate closings and credit reports….simply by violating the law and playing dirty pool. We know how these firms operate and how to force them into compliance. We have helped thousands of home owners with these second mortgage / HELOC foreclosure problems….WE CAN LIKELY HELP YOU!!

THE SERIOUS CASE OF FRAUDULENT LOAN MODIFICATION AGREEMENTS

May 25th, 2017 by Timothy Stull

The foreclosure crisis that launched in 2007, hit a zenith in 2011 and continues to drag on, has new serious problems on the frontier.  As mortgage servicers try to figure out how to handle the problem of serious delinquent loans (12+ months late), the new age of “fraudulent loan modification agreements”  has surfaced.  Padded loan balances, distorted escrow accounts and ambiguous balloon payment terms have wreaked havoc in the market.  Most of these problems start with the trial loan modification agreements, where mortgage servicers lay out a plan with “trial payments” and nothing more.  The problem with the trial plans is that the servicer is not bound to a permanent deal…..they can simply flip the switch at any time.  Though the mortgage servicers will state that the roots of the trial plan are strong, case law has proven that the home owner is left in serious jeopardy with these ambiguous plans ~ https://www.bna.com/bofa-face-rico-n73014446388/.  Racketeering and RICO claims come into the picture and long legal battles ensue.  Recently, Ocwen Loan Servicing was sued by Federal and State authorities, primarily for distorting loan balances and escrow accounts ~ http://www.housingwire.com/articles/39932-heres-a-detailed-breakdown-of-ocwens-new-restrictions-by-state.  In short, this is nothing less than intentional & fraudulent accounting practices.  So why the sudden explosion of fraud?  Well for one, the servicers can get away with it most of the time.  Home owners have been brain washed by the government agencies to handle loan modification negotiations solo….leaving them at a serious disadvantage.  The loan modification agreements are written by corporate attorneys and typically contain legal loopholes that can’t be identified by the common man.  Secondly, the trade profit between mortgage servicers has dwindled greatly.  Payments are harder to collect and pushing delinquent portfolios to performance is getting more challenging than ever.  Therefore, mortgage servicers need to resort to devious and underhanded trickery….via the fraudulent loan modification deal.  In summary, hiring a professional firm to handle the loan modification process is always a good idea.  There is just too much to lose on multiple levels,  during a process that nearly all home owners do not fully understand.  Feel free to call our office at 877.297.7011 or email info@thefreshstartfirm.com for free insight and advice.

HAMP ENDS 12.31.16….SO WHAT’S TO EXPECT NEXT?

December 11th, 2016 by Timothy Stull

The Federal Government mortgage relief programs, like many administration funded programs, is set to close out on 12.31.16.  The most notable relief program in that group is the HOME AFFORDABLE MODIFICATION PROGRAM, otherwise known as HAMP.  The HAMP program, which was launched in 2009, for the most part has been a colossal failure.  Though it has been touted as the engine that has saved homes from foreclosure, the costs incurred to remedy each foreclosure case have been incredible.  The cost of HAMP to each independent taxpayer has been estimated at over $84,000…..and we will be paying that back for many years to come.  A program that was designed to save over 9 million homes in 4 years, has saved a little less than 2 million homes in 8 years.  Keep in mind also that the number HAMP modifications that end up back in default circles right around 50%.  So why didn’t the program work?  Two major issues….first, the HAMP program really has no “teeth” to it.  The banks were advised to cooperate voluntarily and failed to do so.  Since they were given their bailout all up front, there was no financial incentive to cooperate at all.  This is the equivalent of me giving my 5 year old son his allowance up front and then expecting him to do his chores…everyone should get the picture here.   Second, home owners were supposed to receive strong guidance from nonprofit agencies through the process.  This never happened since the nonprofit agencies were overloaded and the workers were underpaid…..most of the clerks / advisors working on cases had very little mortgage or finance experience as well.    There was also no direct incentive for the nonprofit agencies to complete solid deals for the home owners, since they were paid by the Federal Government for simply “submitting” loan modification packages.  NACA and other non profit agencies held rock concert like events to pile in HAMP applications…..even worse, the banks funded the events as well, just to make sure they kept control….sounds like a colluded three ring circus to me!  All in all, this  led to the completion of weak deals, no deal or foreclosure.   So what now?  We are certainly heading into much more aggressive territory in 2017.  Both the banks and the non-bank servicers are foreclosing quicker due to the rising tide in home equity.  We are no longer in a distressed market and they have nothing to lose.  There are certain lines of defense that can be used, but they are much more complex to execute upon than in the past.  Due to the recent shift in the political tide, we are headed back into a capitalist market…which means every man for himself…..the Federal Government is going to stay a million miles away the foreclosure mayhem.  Unless you understand the “game” 150% and have a gladiator mentality, you will need help working through the foreclosure prevention process.  The CFPB has tried to step in and add a layer of protection, however it appears that there are no clear defined rules, which will lead to open arguments throughout the modification process ~ http://www.housingwire.com/articles/37690-cfpb-best-practices-on-how-to-continue-loss-mitigation-needs.  Utilization of the new CFPB mortgage servicing rules, the Nation Mortgage Settlement and independent state laws will be key moving forward.  Stripping down the validity of the debt and applying aggressive foreclosure defense will be crucial as well.  Ultimately, more home owners will need to be prepared come in with down payments to get any proprietary modification done as well.  The “outside the box” process is the way modification deals were completed prior to 2008……and we are heading back into that territory.  Banks, loan servicers and non-bank servicers do not want to complete loan modification deals…regardless of what government propaganda has been disclosed in the past.  There is no “yellow brick road” to follow or “magic carpet ride” waiting…..every case moving forward will be hard fought trench warfare.    Our firm is used to the “trench warfare”,  has the experience, utilizes proven proprietary techniques and know what it takes to win.  We offer a free consultation and  no nonsense approach to success.  Feel free to call us at 877.297.7011.

THE DEBT COLLECTOR’S BEST WEAPON AND LOAN MODIFICATIONS

September 22nd, 2016 by Timothy Stull

As the “loan modification” has become a household word over the last 8 years, the complaints from home owners surrounding the process have surged. Lost paperwork, lack of process transparency and lack of cooperation are definitely at the top of the complaint list. Keep in mind that both banks and non-bank servicers do NOT want to complete loan modification deals. They are driven to foreclose based on the recent rising tide of home equity. They are deemed bill collectors by corporate standard and will do anything to enhance bottom line revenue. This is why when you call into your mortgage servicer, you hear the message “We act as a debt collector and any information will be used for that purpose”…..you do not hear the message “We are here to help you with your loan modification process and will guide you every step of the way”. The debt collection business is all about big money…nothing else. Make no mistake about it, the entire business model is set up around the “money” principal. The front line bill collectors are always paid bonus / commissions based on their production or the amount of money they collect. They are not paid bonus or commission based on the number of loan modifications they approve or complete. The bill collector’s #1 weapon is communication with you directly…..by pressing uncomfortable issues, driving emotion and getting under your skin. If a bill collector can hit a nerve and drive emotion, they have a greater chance of collecting money from you. Pressing the threat of foreclosure is typically the power button they use. If you remove all the idle threats, emotion and chaos that tie into conversation with debt collectors, then you have a great chance of beating them. By blocking the acceleration of the foreclosure process, you will increase leverage greatly as well. The only way to accomplish this is by hiring a third part to represent you, instead of flying solo. Keep in mind that once a debt collector realizes that you are represented by a corporation with clout, they will back off and flag your file. Your case will be handled on a different level that will lead to resolution. Our firm has represented over 10,000 clients with severe debt problems over the last 15 years. We offer top notch free advice and very aggressive representation for those that carry on for the long run. You have nothing to lose by contacting our office at 877.297.7011, since you do deserve an expert in your corner

NON BANK MORTGAGE SERVICERS ~ DEBT COLLECTORS RUNNING WILD

June 7th, 2016 by Timothy Stull

As a 28 year veteran of the financial and credit industries, I remember the days when banks originated a mortgage and collected interest to make their fortunes. Those days are gone….long gone…their exodus has created a giant monster, known as the “non-bank mortgage servicer.” Don’t get me wrong, non-bank servicers have been around for a long time. They are glorified collection agencies that typically take on distressed debt for collection activity. In short, they normally handle collection on mortgage debt that the banks no longer want to deal with. This recent Great Recession and Financial Crisis has caused an explosion of non-bank servicers to pop up….both large and small. Many of these non-bank mortgage servicers /debt collectors are driven by profit and greed, instead of providing proper mortgage loan servicing. In order to understand what motivates the greed, you need to understand the differences in business models that run non-bank servicing. First, if the debt is controlled by an investor, the entity is limited to simply collecting funds in exchange for a fee. That leads many non-bank servicers to distort escrow accounts, pad payment amounts and pad balances to drive more money in. By twisting the accounting on your loan, they can drive in huge profit margins. Ocwen, Nation Star and Selene Finance are notorious for padding the overall balance of the debt, so they can enhance the value of the debt in the free market. For example, if the base rate of a debt is 100 and the escrow is distressed, it may command a value of 115 in the open market. If the loan servicer can collect payments and prove performance on prior distressed debt, the value bumps even higher to 135. Since these debts are traded in large pools of ten million dollars plus, the overall greed is driven by extreme profit margins. To make matters even more complex, these debt are sometimes sold on a split percentage basis. This means a chain of investors can run for an extended time line, which leads all investors pointing the finger at each other for liability. Since investor A owns 16% (2006), investor B owns 32% (2010), investor C owns 17% (2012) and investor D owns 35% (2015), division of labor becomes a very complex issue. The math even gets more complex as the debts are carved up on a percentage basis on each level. Any way you look at this complex math quagmire, it is a big web of lies.

The abuses that run amuck within this sector have hit incredible levels recently. Escrow distortion seems to be the most common complaint from home owners, since it leads to an increased payment. For the non-bank mortgage servicer, distorting the escrow equals a big pot of gold. If the servicer is able to collect even an average of $50 on 500,000 accounts, that equals $25,000,000. The accounting always seems to be fixes that the $50 just vanishes….it never compounds over time. Balance padding is another major problem for many of our clients. Excessive legal fees and arbitrary additions to the balance are the most common problems. Breaking apart the accounting ledgers and conducting a complex mathematical audit is the only way to beat these non-bank servicers at their own game.

Our firm has battled these non-bank servicers for nearly 15 years. We know how they operate from the inside out, so nothing rattles us. We know what makes them tick and how to beat them day in and day out!! Feel free to call our office with any questions at 877.297.7011 or email info@thefreshstartfirm.com.

LOAN MODIFICATION DENIALS AND DECEPTION RUN WILD

September 30th, 2015 by Timothy Stull

The aftermath of the 2008 financial crisis has left a myriad of problems on the foreclosure front. Home owners have been “brain washed” to believe that their lender is looking out for their best interest. The Federal Government has implemented a long series of loan modification programs designed to cure foreclosure crisis. The programs have been a huge failure, largely because cooperation by the banks is voluntary. The denial rates on modification programs exceeds 87% overall, leading ultimately to foreclosure for many. Fast rising home values and an improving economy have steered many banks towards denial. Simply put, it is more profitable for the banks to foreclose instead of modify mortgage loans. Consequently, this has led to a huge spike in foreclosures and evictions. Ultimately, if you rely on the bank or lender to look out for your best interest, you are only fooling yourself. Every loan modification case is a long and brutal battle, similar to trench warfare. Without solid representation and a strong foreclosure defense plan, you will lose your home. The new movie release “99 Homes” depicts the grueling, painstaking and nerve racking process families endure during the foreclosure process ~ https://search.yahoo.com/yhs/search?p=99+homes+movie&ei=UTF-8&hspart=mozilla&hsimp=yhs-004. You really must ask yourself “Can I handle the foreclosure process on my own”? Likely, the answer to that question is “NO” and you truly need someone looking out for your best interests.
Even more alarming are the statistics rising up pertaining to predatory action surrounding loan modifications. Bait and switch tactics, phony trial payment periods and outrageous balloon payments run wild. Certain clauses and innuendos are part of very complex contracts presented to struggling home owners. Ocwen, Nation Star, Seterus, Selene and many other non-bank mortgage servicers are the primary culprits here. Since 99% of home owners don’t understand the tricky language within the contracts presented to them, they get trapped in a worse financial position than when they started ~http://www.cnbc.com/2015/09/29/as-banks-retreat-private-equity-rushes-to-buy-troubled-home-mortgages.html. To make matters even worse, most of these deceptive contracts are reviewed by non-profit government agencies that are supposed to be on “your side”. Any way you want to look at this, the stakes are high and this is this is the big money collection game. Since money is the root of all evil, the true evil definitely abounds within the banks and mortgage servicers. Though the Federal Government has tried to brainwash you into thinking otherwise, “You deserve an expert in your corner”.

Loan modification denial? Here are your next best moves!

May 9th, 2015 by Timothy Stull

The term “loan modification” has become a household word over the last 8 years. Spurred by the financial crisis and housing meltdown, the era of modifying mortgage loans has lingered on at a very high rate. This particular era is something that nobody wants to deal with….the banks, homeowners, government & taxpayers all wish to exult the problems surrounding distressed mortgages. However, these problems are far from over. Many leading economists have predict that nearly 11 million mortgage loans are headed into foreclosure. Failed government programs, weak loan modification deals, mortgage loan servicer abuse & rising home equity lead us into a new upcoming disaster zone. Understand that there was long period of foreclosure stagnation from 2008 to 2012. Economic calamity amongst the banks and Federal Government litigation stalled out the process over 4 years. This period caused a massive log jam of home owners that are severely delinquent on their mortgage loans. Banks are now working through the log jam, profiling each home owner to determine from a collection level. These banks are essentially operating like collection agencies, since they are dealing with large volumes of defaulted loans. These banks / collection agencies are not the operations of yore. They are smarter, technologically advanced and more efficient than even. In this new age of the internet, they are able to socially & financially profile anyone very quickly. They know what you earn, how much money you have in the back & what assets you hold. Simply thinking you can hide information from them is wishful thinking. The home owner’s social and financial profile is the number one reason people are denied for loan modifications.

OK, so now what? Since the loan modification has been denied, the bank / collection agency will likely proceed with foreclosure action. At this point, blocking the foreclosure action with the only effective strategy. The “best offense is an excellent defense” strategic plan will be the only method to proceed with at this stage. Many folks feel that they can simply reapply, call free government counseling services or write simple dispute letters to the bank / collection agency. All of these methods are a waste of time and are not effective in creating leverage. If you proceed aggressively by stripping down the validity of the debt or filing effective FDCPA complaints, you will be gain traction by creating leverage. Filing a 92 point complex qualified written request is also an excellent maneuver. If the opposition fails to file respond to remain in compliance with RESPA, you can proceed with a motion to compel. This motion has a case record of extinguishing foreclosure activity within the courts. Also, if you feel that you have been abused through payment misapplication or escrow padding, you can audit a payment ledger and file the necessary FDCPA complaints. You see, since all banks and collection agencies are collection money for an investor, they need to abide by the FDCPA.

Long story short, if you are able to go through the trenches and battle your lender, eventually they will offer you a deal. Though it is a brutal process, it is very effective. We have executed on the above listed strategy for our clients for over 14 years. We have saved thousands of homes and settled large volume debts in the process. Feel free to call us at 877.297.7011 for free advice or email info@thefreshstartfirm.com.

PREDATORY ACTION WITHIN LOAN MODIFICATION CONTRACTS

March 25th, 2015 by Timothy Stull

Make no mistake about it, the level of abuse on home owners has hit new highs when it comes to loan modifications. Distorted account balances, padded escrow accounts, unnecessary balloon payments, missing amortization schedules, false or no truth in lending statements, phony trial plan offers and incorrect math calculations run wild within the industry. These particular modification offers actually put the home owner in much worse financial position for the long run. Most of the executed plans will fail over time, ultimately leading many into foreclosure and bankruptcy. All of these actions stem from the greed associated within the mortgage servicers (aka collection agencies). Though the pool of servicers / collection agencies has expanded greatly over the last 2 years, Ocwen, Nationstar, Seterus & Caliber remain at the forefront. Since the delinquency level of distressed mortgage debt has hit extreme levels, these collection agencies seek more aggressive means to report higher profits to their investors. The business of collecting on severely delinquent mortgage debt (3+ years late) is a huge money machine. The machine is fueled with large hedge fund investment dollars that in turn hire aggressive bill collectors and attorneys to seek maximum profit. There is absolutely no incentive at all for them to offer a fair loan modification deal that will help a home owner avoid foreclosure. Additionally, since they do not have are reputation to protect, they will get downright nasty with collection efforts. Typically, when a loan modification deal is offered to the “average joe” it is littered with serious predatory discrepancies (described above). These particular predatory discrepancies add serious value to your debt in the debt in the open market. It allows the current mortgage servicer / collection agency to sell the debt at a premium in the open market, once a solid payment history is established. The greed that surrounds the debt trade within the mortgage servicing sector is enormous. It has also picked up a lot of steam in recent years, since mortgage investors seek high profits as they are unable to grab them in the dying new mortgage market. Overall, this quickly developing industry that focuses on greed, deception and abuse spells huge trouble for struggling home owners. Without a strong defensive strategy coupled with experienced representation, home owners are doomed when they face the challenges of distorted loan modification offers. Our firm has handled thousands of cases relating to this issue and we do offer free advice on this topic ~ 877.297.7011.

Ready to get started? Ask a counselor: 1-877-297-7011