Former homeowner sues lender in foreclosure challenge

On behalf of The Rollins Law Firm posted in Foreclosure on Thursday, October 4, 2012.

In a foreclosure situation, the lender often appears to have all the power. If a homeowner falls behind on the mortgage, the lender can initiate foreclosure proceedings, taking possession of the home and evicting the homeowner in the process. However, only the actual lender has the legal right to foreclose on a property, and for some homeowners facing a foreclosure procedure, challenging the mortgage company to prove it's the rightful lender can possibly save the home.

Readers in Mississippi may be able to relate to one man's long battle against foreclosure. The man, a 60-year-old unemployed former restaurateur, held police offices at bay with a kitchen knife when they were sent to enforce an eviction notice after foreclosure. He said he thought his life was over when he lost his home. The incident ended with a quick assault by a SWAT team with pepper spray, but the foreclosure battle was far from over.

The former homeowner is suing his lender, challenging the lender's right to foreclose by accusing it of not being the actual holder of the mortgage. This type of challenge has become more common due to the often shoddy paperwork filed by lenders during the height of the housing boom. As lenders turned mortgages into investment packages, the paperwork covering the line of ownership was often lost or incomplete. This made it difficult for lenders who held mortgages at the end of the line of property transfers to prove that they were the proper owners of the mortgages. For this particular homeowner, a lawsuit may be difficult to win because he challenged the foreclosure after it had gone through the court system.

Those facing foreclosures in the state of Mississippi should be aware of how challenging a foreclosure can be an additional tool used to possibly stall or stop proceedings and save a home. It's important, however, to do so in a timely fashion. If you think your foreclosure is unlawful, it may be helpful to speak with an attorney.

Source: NorthJersey.com, "Family that lost Wallington home in foreclosure sues," Kathleen Lynn, Sept. 23, 2012

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