Is dual tracking illegal?

Dual tracking is an illegal practice where the mortgage servicer attempts to proceed with a foreclosure sale while a complete loan modification application (which was submitted at least 37 days before the scheduled sale) is still under review. A homeowner can stop foreclosure if the servicer engages in dual tracking.

How many days does a servicer have to acknowledge receipt of a loss mitigation application and inform the borrower whether the application is complete or incomplete?

Notwithstanding delay in receiving required documents or information from any party other than the borrower or the servicer, § 1024.41(c)(1)(i) requires a servicer to complete all possible steps in the process of evaluating a complete loss mitigation application within 30 days of receiving the complete loss mitigation …

Under which circumstance can a servicer begin the foreclosure process?

Under federal law, a servicer generally can’t begin a foreclosure until the borrower is more than 120 days delinquent on the payments. Also, this 120-day wait period applies in the case of a non-payment-related breach of the mortgage contract, like failing to pay the property taxes.

Can you sue a mortgage lender?

As mentioned above, if your mortgage lender commits negligence, you may sue your mortgage lender. Examples of this can include where they negligently fail to include terms in the loan agreement that were agreed to by both parties, or if they breach their fiduciary duties.

Can they foreclose during loan modification?

A loan modification involves changing the terms of your existing loan to make its payment more manageable. It’s one of the options to avoid foreclosure including filing for bankruptcy. As long as you’re on track with your payments, the bank cannot foreclose your home.

Can I keep my house in loss mitigation?

Certain loss-mitigation options may help you stay in your home. Other options may help you leave your home without going through foreclosure. Loss mitigation options may include deed-in-lieu of foreclosure, forbearance, repayment plan, short sale, or a loan modification.

Is forbearance loss mitigation?

Post-Forbearance Loss Mitigation Options – It is the intent of the California Legislature that a servicer offer a borrower a post-forbearance loss mitigation option that is consistent with the servicer’s contractual or other authority.

Is credit score a requirement for loss mitigation?

As such, applying with Keep Your Home California will not affect your credit score. If you’ve fallen behind on your mortgage, remember that the situation isn’t hopeless. The worst thing you can do is ignore the problem and wait for it to disappear.

Is forbearance considered loss mitigation?

Mortgagees may utilize any of several loss mitigation options that lead to home retention, including: FHA-HAMP, long-term special forbearance, mortgage modification, and partial claim (an option exclusive to HUD wherein the Department makes a no-interest loan to the borrower in an amount sufficient to reinstate the …

Are you still liable for mortgage after foreclosure?

Regardless of your state’s deficiency laws, if your home will sell at a foreclosure sale for more than what you owe, you will not be obligated to pay anything to your lender after foreclosure. Your lender is obligated to apply the sale price of your home to the mortgage debt.

What is a mortgage breach letter?

Mortgages and deeds of trust often contain a clause that requires the lender to send a notice, commonly called a “breach letter,” informing the borrower that the loan is in default before accelerating the loan and proceeding with foreclosure.

Are mortgage lenders still dual tracking during foreclosure?

After the mortgage crisis, the Consumer Financial Protection Bureau (CFPB) enacted new laws to protect homeowners during foreclosure proceedings. These new laws specifically prohibit dual tracking, but it appears that at least one mortgage lender is still engaging in this practice. What is Dual Tracking?

What does the CFPB’s new rule on dual-tracking mean for You?

Restricted Dual-Tracking: Under the CFPB’s new rules, dual-tracking – when the servicer moves forward with foreclosure while simultaneously working with the borrower to avoid foreclosure – is restricted.

What are the CFPB’s mortgage servicing rules?

The CFPB’s mortgage servicing rules ensure that borrowers in trouble get a fair process to avoid foreclosure. Borrowers shouldn’t have to worry about mortgage servicers cutting corners or losing applications for relief.

What is the CFPB doing about unnecessary foreclosures?

In too many cases, it has led to unnecessary foreclosures,” said CFPB Director Richard Cordray. “Our rules ensure fair treatment for all borrowers and establish strong protections for those struggling to save their homes.” Mortgage servicers are responsible for collecting payments from mortgage borrowers on behalf of loan owners.