How to Detect Fraud and Errors in Your Loan Documents?

Fraudulent mortgage loans to stop foreclosure in California

Exercise your rights against fraud: your best defense

Some lenders entertain illegal activities in their loan operations. Check if some intentionally blank spaces in your loan document and especially in your note were later filled with sentences that do not exist in your copies.

Note that sub-prime lenders were subject to fraudulent activities more than prime lenders. So, if you borrowed from a sub-prime lender, then you need to review your documents more carefully.

Find errors in mortgage loan documents

Try to find such errors by yourself first. And, get the assistance of a motivated lawyer or loan officer friend to find such errors for you.

If you received Notice of Default (NOD), take it with you. NOD explains the reasons for sending the notice. See if any of such reasons is based on an error in the loan document.

Truth in Lending (Regulation Z) is a lengthy document but it is in plain English that you can understand. Evaluate your loan documents after reviewing Regulation Z and discuss your findings with your lawyer and lender. You may have a great leverage if you find one.

Your next step, after finding such an error, is to ask a judge to issue an injunction or temporary restraining order. Your lawyer can take it from there!

Typical errors in your mortgage loan documents

Loan has been purchased by another financial institution and errors made during transfer
Index used by your bank or lender was based on an index that its merits are doubtful and not used by other lenders.
blank spaces left intentionally to fill out later

Adjustable Rate Mortgage (ARM) loans have been subject to more unfair practices and abused a lot by some lenders.

If the error that you find has been made in all loan documents in general, then you have a company of thousands of borrowers for a class action suit.

Violations of Truth in Lending Regulations

Your lender collected property taxes, insurance premiums, and interest more than allowed by law
Your lender collected fees for illegal kickbacks paid to predatory mortgage broker
Your Adjustable Mortgage Mortgage (ARM) was adjusted in a manner to force you to pay more than you are supposed to pay
Fees that are not disclosed to you
Your cost of loan include charges that are not in disclosure statement
Your ARM lender did not give you the booklet titled Consumer Handbook on Adjustable Rate Mortgage

Sources to find out mortgage lending fraud and predatory loan practices

Predatory loans are the major cause of many problems that we are facing today. Find out if your loan can be considered as one of them. Here are some sources online:

Caution about predatory loan information on National Association of Realtors® web site