FAQ's
What is a forensic loan audit?
A forensic loan audit by Loan Audits CAL is a loan document review and analysis that searches for violations of Truth in Lending laws, as well as UCC, SEC and other state and federal statutes.
I've heard a lot about strategic default lately. Can an audit help me with that?
Strategic default has gotten a lot of press lately and there is some confusion as to what that process actually entails. It is not as simple as just tossing your lender the keys to your home; foreclosure is a legal process, even in non-judicial states, that has implications for your credit and, possibly, taxes.
In states with deficiency judgments, the lender can collect on the amount you owe on your mortgage. Strategic default is tricky, depending on where you live and where your property is. Lenders sometimes buy back properties at auction at a much lower price and pursue the (former) borrower for the rest.
Many people do not realize that an audit may reveal discrepancies that would allow the borrower to receive money back from the lender or to reduce their mortgage principal.
A forensic loan audit can tell you possible angles, strategies and options you have with regard to your loan. A forensic loan audit allows you to make an educated decision based on an evaluation of your loan and what can be done after its findings. It can find discrepancies to erase a deficiency judgment, allow you to walk away with clean credit and a variety of other options.
Every loan is different, therefore, an evaluation needs to take place in order to see where each borrower stands.
Can I wait to do an audit/modification?
Absolutely not. Like any legal situation, time is of the essence. With every passing day your options for saving your property are getting smaller. The sooner you begin the auditing process the sooner we can provide you options and the better your chances for salvaging your property. Unfortunately, if you wait too long to before taking action it is possible that there is nothing we will be able to do for you and you will inevitably lose your property.
What can I do once you find a violation?
There are many things a borrower can do, depending on the findings of the auditor. A loan audit can reduce a mortgage principal, create equity in a property, improve credit scores, give traction to modify a loan with a stubborn lender, set aside or cancel a foreclosure - it all depends on the findings of the loan in question.
What if I've been turned down for a modification?
Borrowers who have been turned down for a modification are excellent candidates for audits. A forensic loan audit by Loan Audits CAL can help you gain traction with a stubborn lender. In fact, we are often retained by attorneys who have trouble with their clients' lenders and during litigation to give their cases more impact. An audit can be invaluable in prodding your lender to act and achieving the result you want.
How does the process start?
We review all of the paperwork given to you before, during and after the loan process. This includes: A Deed of Trust or mortgage, any and all Right to Cancels, any and all Riders, any and all Truth in Lending statements, HUD-1, the initial application (1003), the closing instructions and any other paperwork that the borrower has been given.
How often are violations found?
Violations are found in about 94% of the examinations we do. More than likely, if you had a loan that was refinanced or granted between 2001 and 2008, we'll find something. We also find problems with loans that are older than that.
Who can get a loan audit?
Anyone who has a mortgage. Many homes are now underwater because of falling housing prices -- audits can reveal violations that can reduce a mortgage principal and a whole lot more.
Should I get a loan audit before or after modification?
Preferably, an audit should be done before a modification in order to include the findings in the modification process. This can produce much better results. But, an audit can be done after the modification process, especially if the modification isn't as low as you requested or feel that you would like a principal reduction as well.
Does the audit have to be paid in full before it is finished?
We can receive loan paperwork and do an evaluation before being paid -- however, we do require an engagement agreement to be signed in order to start any work on an audit. When the audit is finished, we require payment before the audit is released and before the consultation with the auditor.
How long does it take to do an audit?
It can take up to 10 days to do a residential audit and 45 days for a commercial audit to be completed. For litigation purposes, we can expedite a residential loan audit to be completed within 2-3 days.
What if I've already lost my property to foreclosure?
We know that losing the place you lived with your family is a devastating experience, emotionally and financially. Most people do everything in order to save their homes, exhausting all forms of cash and credit to hold on.
If you have lost your property to foreclosure, let us review your mortgage documents to see if your are due a refund of funds paid into your loan. Federal laws extend the ability to recoup funds owed from lenders because of foreclosure.
Instead of you owing money to your lender, your lender may owe you. What a great surprise!
Do you have attorneys that you work with?
Yes. If additional help is needed, we have a referral network. We do not receive any compensation for our referrals to modification companies or attorneys. We only work with established companies with a proven track record of success. Our small referral network is top notch - and reduce their initial fees for referred clients from Loan Audits CAL.