By Cara O'Neill, Esq.
3. Someone Owns the Property Other Than You
One of the common arguments of foreclosure litigators is as follows: If the current bank can’t produce the original transfer documents demonstrating that the prior bank sold the loan to the current bank, the current bank can’t prove ownership of the loan, and therefore, can't foreclose.
The flaw with this argument is that it assumes the homeowner has rights he does not have. Once the homeowner stops paying and the home goes into default, the homeowner breached his contract. He is out of the game. Possession of the home is a right that belongs to one of the lenders -- and which lender has the right to the home is none of the homeowner's business.
If a problem really exists between the lenders, they can sue each other. So the bottom-line is that any fight under this argument is between the lenders, not the homeowner.
4. Errors in Documents Don’t Mean Free Homes
While robo-signing issues and falsified documents may hold up the process, ultimately, they are delay tactics. Even if you prevail in having the foreclosure reversed, eventually, the time will come to pay for the home. If you can’t, you will lose it anyway, and will have paid a large sum in legal fees and engaged in a lot of stressful litigation for nothing.
5. Don’t Trust People Who Lie
If you find yourself involved in one of these schemes, check your legal filings. If they are riddled with inaccuracies that you are told "not to worry about," or that is "just part of the process," be concerned. It may be a red flag that you don’t have a cognizable case.
To check, ask yourself whether you are willing to testify under oath to such claims. If you aren't, you have your answer. Simply put, while you may be able to delay the foreclosure process with lies, you can’t win with them.
If you are unsure about your case, it is a good idea to seek a second opinion. If you do not have a cause of action based upon the actual facts of your case, you may want to ask for your money back as soon as possible. Chances are the foreclosure firm won’t be around too long.
California Bar Journal: Bar Targets New Breed of Loan Modification Scams[http://www.calbarjournal.com/January2013/TopHeadlines/TH3.aspx]
California Bar Journal: Another Warning About Loan Modification Scams Issued
California Foreclosure Law: Defaults and Foreclosures