In the past several months, some have heralded the fact that the foreclosure crisis is over. Having addressed abuses like overextended credit, wrongful evictions, and other practices that took the dream of homeownership away from many families, lenders seem to have changed the way they handle the foreclosure process. But, have these wrongful practices really disappeared? Or have they just shifted to another segment of the financial industry?
Many lenders have enlisted the assistance of servicers, which basically collect the mortgage payments on behalf of the lender. However, the servicers have powers that are not just administrative. For example, they have some of the same rights as the mortgage lender to grant mortgage modifications or seek foreclosure. In some cases, they may even nullify a modification that the original lender made.
Some analysts and regulators say that with the growth of the servicing companies at lightning speed, many of them have not had the time to upgrade their technology and infrastructure to handle the number of mortgages being tossed their way. Many of those within the mortgage industry believe that this could just be a second wave in the mortgage crisis waiting to happen, as the servicers are now try to make their money on the same mortgages that the lenders had mishandled. This is a nationwide concern that Ohio residents should be aware of.
The Consumer Financial Protection Bureau, which oversees the servicers, is paying attention to their practices. However, it is important for the homeowner to pay attention, too. Without reading the fine print in a notice they may receive, the homeowner may not even know that the mortgage has been transferred to a servicing company.
Homeowners who are facing foreclosure or who are struggling with their mortgage company or servicer may be wise to consult an Ohio attorney who understands the process of foreclosure. It is important for homeowners to understand their rights in order to help prevent foreclosure.
Source: The New York Times, “Loan Complaints by Homeowners Rise Once More,” Jessica Silver-Greenberg and Michael Corkery, Feb. 18. 2014