Earlier I talked about TILA and RESPA forensic loan audits and how they are limited in their ability to provide relief to homeowners who were victims of predatory lending. In this article, I am going to explore a bit on how we have gone beyond RESPA violations within the HUD-1 Settlement statements to actually help homeowners.
The HUD-1 Settlement Statement is typically a line item receipt of the funds for the loan, complete with parties involved, and who is paying and receiving money. Preparation of the HUD-1 Settlement Statement is governed by RESPA, or the Real Estate Settlement Procedures Act. A violation of RESPA for improper preparation of the HUD-1 Settlement Statement is typically subject to a one-year statute of limitations in which to make a claim for damages.
One common violation I find is not reporting the seller’s identity on the Hud-1 Settlement Statement. This is a clear violation of RESPA, Appendix A that states fill in the names and current mailing addresses and zip codes of the Borrower and the Seller.
To a straight TILA and RESPA forensic loan audit, this seems like an innocent omission, and is typically beyond the 1-year statute of limitations to sue over. However, to my experienced eye, I have helped many homeowners recover from fraud that this little omission is covering up.
Digging deeper through purchase contracts, building contracts, and county records, I have found several occasions where the omission hid undisclosed multiple flip transactions and an inflated property price for the homeowner to sue over. Digging deeper, I have also found the same omissions on other documents prepared for the loan that show illegal conspiracies between title companies, sellers, and others to defraud new buyers. Digging even deeper, I have even gone through title records and stories to verify relationships between parties conspiring to defraud new buyers. This provided many defrauded homebuyers that came to me for help with the proper evidence needed to sue for recoveries.
When I perform a forensic loan audit, I go beyond simple TILA or RESPA violations. Often, the violations are past the period to sue over. More important, simple violations are just the visible tip of an iceberg. That’s why you need to contact me if you need help. I have a decade of experience originating, auditing, and doing quality assurance on mortgage loans. Because of my experience, I am able to tell which simple errors are simple errors, and which ones may be hiding relief for your home.
If you are in need of mortgage litigation support or mortgage forensic audits to help keep your home, contact me here. If you are a lawyer looking to provide your clients with better service and an improved chance of keeping their home, contact me here.
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