Do I have a predatory lending case worth fighting in court?

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When I refinanced my home in 2006, I was offered a adjustable rate negative amortization loan. The loan officer told me that the loan would flip over into a more stable loan in one month’s time without any cost to me. The loan did flip but with closing costs that were folded into the new loan. The terms were the same though. I did not know much about differed interest, negative arm loans, sub-prime or any of these other things were. I trusted (regrettable in hindsight) the loan officer at the time and I signed whatever I was told to. Now I am stuck in this monster of a loan but I am not in foreclosure. I have been paying this loan on time but there seems to be no way out of this loan. The principle has gone so high that I would never qualify for new loan or reasonable modification. It does not seem there is any government help for sub-prime loans that are not in foreclosure. I feel what was done to me was totally unfair lending. I would have never refinanced my mortgage a second time, one month later, if I knew it wouldn’t help me out financially.

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3 Comments
  1. Reply
    scott b
    May 17, 2011 at 8:07 am

    YOU are the one that signed the loan papers. I’m very sorry that you were foolish enough to sign something that you either didn’t read or didn’t understand. Sometimes, life’s lessons are expensive. This is one of those times.

  2. Reply
    Germaine Williams
    May 17, 2011 at 8:13 am

    Listen here, I work at a bank and deal with this on a day to day basis. All I got to say is with my knowledge and job put aside… You need to short sale the property while you can if you are not able to pay on it. It unfortunately isn’t a case worth fighting for even though it’s a bad situation to be in.
    Who is your investor? If this is a government loan you can try pursuing modification, it doesn’t matter if your principal balance has gotten higher. At the end of the day you signed the note when you re-financed and it was your job to read everything over and understand it to the best of your ability. I do know how exhausting that is but you have to be so careful with these types of things. You realistically wont be able to refinance again because your house is underwater if you’re principal balance is higher than when you originally got the refi – Those ARM loans are so messed up!!! I KNOW!!! But unfortunately it IS NOT unfair lending even though it seems like it. You’re best bet is to try and work out another modification and if you can’t do that you need to short sale the property. You have to look at this from a long term point of view… if you KNOW that you’re not going to be able to pay the loan down – Why bother keeping the home? Once you pass it will eventually go back to the bank unless you’re successor wants to inherit the remaining debt. IF you don’t have the money to pay it down, or if the bank doesnt want to offer you a modification then short sell it or sell it for as much as you can because if you think your house has gone down…. the value is still plummeting – So NOW is the time to act – Don’t waste your money on hiring a lawyer to fight this in court AND def dont hire a 3rd party company to help you modify the loan because THEY WILL ROB you

  3. Reply
    Betsy
    May 17, 2011 at 8:33 am

    I’d suggest that you contact the United Way in your community and ask them to recommend a good credit counseling or mortgage counseling agency. You need to talk with someone who is pro-consumer and knowledgeable about the current mortgage situation.

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