Ohio Foreclosure Crisis: Who is at Fault?

Authored by E. Ray Critchett

Unfortunately, many Ohioans continue to suffer from job losses, financial hardships and foreclosures. According to RealtyTrac, a California data supplier specializing in foreclosed real estate, one in every 483 homes in Ohio received a foreclosure filing in December 2010. This totaled approximately 10,523 homes in Ohio that received a foreclosure filing just in December. It is hard to imagine what affect it had on each one of those 10,523 families.

Are all of these foreclosures due to the economic crisis? Yes and no. It is true that most of the foreclosures appear to be due to some form of economic crisis that the homeowner is going through, such as the loss of a job, unforeseen medical expenses, disability or divorce. However, many of the foreclosures continue to stem from predatory lenders offering interest only payments, Adjustable Rate Mortgages (ARM loans) which the homeowner could not afford down the road and other improper lending practices.

The media has recently been ablaze with stories of lending institutions that continue to take advantage of homeowners who are going through an economic crisis and are facing the possibility of losing their homes. There are claims that some lending institutions have filed fraudulent documentation with the Courts in their foreclosures; that banks are foreclosing on homes which they do not own; that banks are receiving federal funding to help their customers avoid foreclosure but then turn around and initiate foreclosure proceedings against the homeowner, and that they use constant delay and stall tactics which ultimately result in foreclosure proceedings.

Fortunately, the tactics and improper practices are being brought to light and the lending institutions are being forced to correct their practices and pay for their actions.

If you, your family member or friend have gone through or are going through a foreclosure action which you believe is unjust, feel free to contact our office to discuss your concerns.

Here are a few common practices to look out for:
1. If you have a Fannie Mae or Freddie Mac loan and are in default or facing foreclosure, you may qualify for federal assistance through the HAMP or HARP program. Be sure that your lending institution discusses both of the federal programs as well as their own programs. Keep in mind, the bank may have a financial incentive to avoid the federal programs;

2. If your lender is using stall or delay tactics by asking you for the same information over and over again, or refuses to respond to your requests for additional information or assistance, you may want to find out if they are using these tactics just to avoid qualifying you for a loan modification or refinance so they can foreclose on your home;

3. Incorrect Invoices. Be sure that your monthly statements accurately represent your loan modification or refinance terms;

4. Review your documents to ensure that all of the information is correct: the correct lender, rates, terms, and payment conditions are just a few of the primary areas to check;

5. Finally, there have been reports where employees for the bank have advised customers to “cash in” their savings and/or retirement accounts to keep current on their mortgage instead of discussing a modification or possible refinance. If the bank is giving you financial advice that does not include a modification or possible refinance, you may want a second opinion.

If you, your family member or friend have any questions concerning these issues, please feel free to give Ray Critchett a call to discuss the matters in a confidential setting. You may reach our office toll-free at (855) 2-BUCKEYE or (855) 228-2539; locally at (614) 799-2800 or after normal working hours at (614) 515-5098. You can also send email requests to: ray@buckeyelaw.com.

You can also visit us online at: http://www.buckeyelaw.com/ and http://www.zandhlpa.com/
E. Ray Critchett, Partner.