What Constitutes a "Bad Faith Mortgage?"

A bad faith mortgage in Joplin, Missouri is not unusual. As a law firm that works with borrowers, we understand the circumstances that often lead homeowners and homebuyers into mortgage litigation, as well as the legal strategies necessary for a successful mortgage lawsuit. These circumstances include:

• High cost loan. Mortgage rates that are at eight percent or higher are an indication you need to renegotiate mortgage terms to receive a lower rate.

• Bad credit loans. Loans that are made to people who have poor credit scores and lower income often are an indicator of mortgage loan fraud. Simply, the fraudulent players in the industry often take advantage of those who can least afford it.

• Bait-and-switch schemes. When a lender offers a mortgage renegotiation, and then changes the terms, it can make a bad situation even worse for the borrower.

• Negative amortization loans. A type of bait-and-switch, this is when the mortgage negotiation results in a low introductory rate but which can (and does) later escalate to an unmanageable level.

• Loan modification scam. A classic mortgage bad faith practice is when homeowners, already in distress, are required to pay an upfront fee to a loan modification firm to do what homeowners could do themselves or with the free assistance of a non-profit housing counseling agency.

• Mortgage service scam. A sure sign of mortgage fraud is when, at the closing for the new loan, you are told you owe fees that were not previously discussed or at terms that were not part of the original agreement. Often, the existing lender will try to convince the borrower that they have no other options but to work with their terms.

• Loan packing. Mortgage broker fraud is apparent when new, surprise fees for unnecessary services are added to the new loan closing costs. This is similar to paying extra charges at an auto shop for repairs and parts that you did not authorize.

• Loan flipping. Mortgage fraud laws prohibit lenders from selling the borrower on refinancing a loan that is of little or no benefit to the borrower. The lender makes money from the transaction, entirely paid for by the borrower.

• Equity stripping. Mortgage lending fraud clearly occurs when a bank or other type of lender will lead the borrower to use home equity to pay off debts. After a point, the money owed on the equity loans becomes unmanageable and the borrower must turn the house over to the bank.

We can help you find your way out of a bad faith mortgage

The Hershewe Law Firm is known for our legal skills and record of integrity, compassion, community service, and the personal attention we provide every client we represent. We help borrowers find their way out of bad faith mortgages. Call 877-382-9734 or contact us online today for a free consultation about your case.