Legal Question in Real Estate Law in California
In Forebearance Agreement, Bank never put Foreclosure hold!
I fell behind on my mortgage payments and went into foreclosure. I made a deal with the bank to pay $6300 up front and to pay my payment plus $1200 for 10 months. I have held up my end of the bargain. I received a ''Substitution of Trustee'' notice filed 4-24-2006. I called the bank and they admitted to me that this should not have been filed, and that they ''forgot'' to place the foreclosure on hold. The attorney for the bank said that they were never informed that we had entered into a forebearance agreement and that the foreclosure as of today in ACTIVE & PROCEEDING. Now my title is damaged even more than the Notice of Default, the Trustee has been substituted, and the Bank is saying everything is OK. I do not believe them and want to know my rights and how I can protect myself. I know that the Attorney is still charging fee's and who is going to pay for that? All this was never supposed to go past the NOD. Now I have to pay them another payment and I am scared that it is doing me NO good. Please advise.
1 Answer from Attorneys
Re: In Forebearance Agreement, Bank never put Foreclosure hold!
I think the beneficiary of the loan is entitled to change trustees at any time; your forbearance agreement probably doesn't forbid them to do that. It's sort of like substituting lawyers; the other side in a lawsuit can do that whenever they want, even though the litigation has been put on hold by a stipulation or court order.
On the other hand, just as changing lawyers might mean the other side in a lawsuit was planning different and more aggressive tactics, or maybe when the other side in a football game changes quarterbacks, a substitution of trustee may foreshadow a more aggressive posture by the beneficiary (lender).
Since you successfully worked out a forbearance agreement, and are adhering to it, you should continue to show copies of it to whomever seems to be doubting or threatening; make them at least look at it, and tell you whether they agree foreclosure must not proceed, or if they don't agree, tell you excatly why they hold that opinion.
If this doesn't work, see if you can get a local attorney to write a letter on your behalf, or if you can record a notice of the forbearance agreement in the public records.
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