​How to Challenge a Mortgage Foreclosure

Can I Successfully Challenge My Mortgage Foreclosure?

In the past, it was relatively rare to be able to form a successful defense against real estate bankruptcy or mortgage foreclosure. However, since the foreclosure crisis, many homeowners have been able to challenge foreclosure actions successfully. This is due in part to emerging evidence that the mortgage servicing industry has been making a multitude of errors. Because of such evidence, courts have shifted their sympathies from the mortgage industry to homeowners.

Homeowners and the attorneys representing them may now be able to take advantage of this judicial attitude change and challenge a foreclosure. Below are some of the most common defenses used against foreclosure:

• Foreclosure Party Did Not Follow Proper Procedures: Each state has specific rules that must be followed for foreclosures. If the party filing the foreclosure action does not follow the state’s procedural requirements, the homeowner may be able to challenge the foreclosure proceedings. If successful, the court will require the foreclosing party to begin the process over.
• The Foreclosing Party is Not Able to Prove They Own the Loan: In this case, the mortgage holder lacks standing to prove they can foreclose on the property. Only the rightful mortgage holder can file a foreclosure. When the foreclosure crisis began, many attorneys asked for proof that the mortgage company held the promissory note. Since then, investors and banks have become more careful about addressing the gaps in paperwork before beginning a foreclosure process. Because of this, it is much harder to win a case based on this type of argument, but your case may be an exception.
• The Company Servicing the Mortgage Made a Mistake: Sometimes the companies that service loan accounts do make mistakes when handling the loans. These mistakes may be things such as crediting payments to the wrong party, pursuing foreclosure at the same time as a loan modification, imposing fees not authorized by the contract or excessive fees, or overstating the amount that you are required to pay in order to reinstate your mortgage. Mistakes on the amount you are required to pay are particularly serious because it may deprive you of one of the remedies available to keep your home.
• You are an Active Duty Servicemember: Under the Servicemembers Civil Relief Act, if you are on active military duty you have special protections. If you obtained your mortgage before you were on active duty, any foreclosure proceeding must take place in court even if your state allows other foreclosures to take place outside of court. If the servicemember obtains the mortgage after starting active duty, they still have certain foreclosure protections on which an experienced attorney will be able to advise you.

Raising a Defense Against Foreclosure

To raise a defense against a foreclosure action, it depends on the type of foreclosure that was filed against you. Your foreclosure may have been judicial, meaning it is accomplished through a civil claim before a judge. Your foreclosure may be what is referred to as a nonjudicial foreclosure, which means you have no automatic means to mount a legal dispute against it. You will have to file a lawsuit claiming that the foreclosure is illegal and state the reason why.

Contact a Foreclosure Attorney Today

If you are facing foreclosure and feel that you might have a defense against the action, you need to speak to an experienced foreclosure attorney like those at Cornwell Law Firm. We will review your case and determine what, if any, defenses you may have against the foreclosure as well as what action will need to be taken to raise the defenses in court. Contact us today to schedule a consultation.