Can My Lender Foreclose While I Am Trying To Refinance

Refinancing is a great way to lower your monthly payments and maybe even skip a payment or two. With mortgage rates decreasing all the time, taking advantage of just the right time on a refinance can help free up disposable income and give you just the breathing room you need. The problem many homeowners come across though is that during the refinance process, payments are not made. And when mortgage payments go unpaid, the lender usually takes action to foreclose. This is especially frustrating if you have been working with your current lender in an effort to have them rewrite their own loan, and they’ve advised you not to make your payments.

The process of dual tracking is strictly prohibited, and it works like this:

• If you have asked your lender to look at refinance options on your behalf and that process is underway, the lender may not also foreclose while you are trying to work out a refinance or other repayment plan with them.
• It is considered an unfair lending practice to work with a borrower on a possible refinance or other plan to save their home while also pursuing foreclosure remedies.
• If you are trying to work out a loan modification or other agreement, you have to be at least 120 days past due before the lender can start a foreclosure.

The Consumer Finance Protection Bureau was put in place to help distressed consumers and to help borrowers deal with the complex lending system. With the buying and selling of mortgages and with so many loans being serviced by a third party is has become near impossible for a homeowner to know who to pay each month. Not only can it be difficult to identify your lender, but once you do figure out who to call you are often transferred too many times to count. This leads to important information being lost in translation, or simply never provided to the consumer. If you need help working out a solution for your mortgage that fits your budget, call our office.

For more information about foreclosures and the prohibition against dual tracking, contact us at  www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.