SMITH LAW represents individuals in a wide range of consumer protection matters. Particularly, SMITH LAW has extensive experience representing homeowners in disputes involving wrongful foreclosure actions based upon fraudulent foreclosure documents; sham loan modification offers; breach of the terms of the security instrument by the creditor; failure to comply with the duty to exercise the power of sale in good faith; foreclosure by the servicer rather than the owner of the note (lack of standing); and transfer errors in the loan pooling (“securitization”) process.
A wrongful foreclosure situation can arise as a result of misapplied payments, errors in interest charges, improper fees, and situations where the servicer forecloses in its own name when it does not own the homeowner’s note. Recently, an increasing number of wrongful foreclosures have arisen from fraudulent loan modification offers. This generally occurs where the bank tells the homeowner that in order to be evaluated for a loan modification he/she must miss anywhere from one to four mortgage payments. Once the homeowner falls behind on his/her mortgage payments, the bank represents to the borrower that he/she is being evaluated for a loan modification, while simultaneously commencing foreclosure of the homeowner’s property. Additionally, fatal errors related to the transfer of loans that were pooled into “securitization trusts” on the secondary loan market may prevent the creditor from foreclosing altogether.
A wrongful foreclosure lawsuit may take several years to resolve. Prior to the foreclosure sale, the homeowner may petition the court for an injunction in order to stop the foreclosure sale while the lawsuit is pending. If the foreclosure action is successful, the creditor could be enjoined from foreclosing. Generally, an injunction may be granted where: (1) the homeowner is entitled to relief; (2) the failure to grant an injunction would cause irreparable injury to the homeowner; (3) the creditor threatens to do some act that violates the homeowner’s rights related to the loan or the property (including eviction); and (4) monetary compensation would not afford adequate relief. When a foreclosure action is brought after the foreclosure sale has occurred, a prevailing borrower may either have the sale set aside or may receive monetary damages.
SMITH LAW works on behalf of its clients to recover damages incurred as a result of wrongful foreclosure. Specifically, victims of wrongful foreclosure may recover either title to the property or the greater of the value of the property at sale or the borrower’s equity in the property (less any amount still owed to the foreclosing entity). Additionally, where the bank committed fraud or acted with willfulness or malice, victims of wrongful foreclosure may also recover punitive damages, attorneys’ fees and court costs.
SMITH LAW primarily provides “unbundled” services on an hourly, flat fee, or “fee per project” basis to its consumer protection and foreclosure clients. Unbundled services consist of consulting, conducting legal research and drafting legal research memorandums, pleadings, motions, briefs and discovery for pro se litigants. Additionally, SMITH LAW occasionally represents consumer protection and foreclosure clients in a more traditional “trial lawyer” arrangement designed to provide direct representation throughout an entire lawsuit.