After the nationwide disruption caused by
the Mortgage Meltdown of
2007, the Financial Crisis of 2008, and the ensuing Foreclosure Crisis that continues to
to this day, consumers want sound financial advice they can trust. McDonnell Property Analytics
(“MPA”) is renowned
for its integrity, effectiveness, and its extraordinary ability to present its findings in
Marie McDonnell, MPA’s Founder, began her study of real estate and mortgage financing in 1986 during the height of the Savings and Loans scandal. She immediately recognized that consumers were being steered into complex, alternative mortgage transactions that appeared to be affordable, but contained hidden features and risk layers that doomed the transaction to fail.
Marie observed that while consumers were required to pay for the bank’s attorney at closing, they had no independent financial analyst who could spot bait and switch schemes, predatory lending structures, and other unfair and deceptive acts and practices that left them vulnerable to exploitation by rogue lenders. Although the real estate and mortgage banking industries are geared to help consumers navigate the mortgage loan origination process, there is no organized branch of the financial services industry that supports consumers as they confront problems that arise over the months and years that the mortgage loan is actively being serviced, usually by a non-party to the transaction.
Some problems can cause serious issues, for example:
- An unexpected transfer in servicing rights may result in a lost or delayed payment which the new servicer will recognize as a default.
- Often, documents and data do not board accurately and completely onto a new servicing platform when technology is updated, or servicing is transferred.
- The servicer may make a mistake in adjusting interest rate and monthly payment changes thereby breaching the mortgage contract.
- The servicer may err in calculating the amount due for escrow which may cause an erroneous shortage that can cause “payment shock.”
- The servicer may improperly advance a real estate tax payment or impose force-placed insurance even though the borrower is current on their escrow obligations.
- If, during a dispute, the consumer withholds an escrow payment, the servicer will place the note payment in a suspense account which will trigger a default.
- Once a default is declared, the servicer can impose late charges, property inspection fees, broker price opinions fees, etc., and refuse to accept any further installment payments from the borrower until all arrearages and fees are paid.
- Servicers frequently fail to zero out escrow advances in Chapter 13 bankruptcies which results in a double-billing in violation of the Bankruptcy Code.
MPA’s audits of thousands of loans across the country reveal that mortgage servicing abuse in escrow accounts is the number one problem facing homeowners today and is the leading cause of premature and wrongful foreclosures in the post-2008 Financial Crisis era.
A substantial portion of MPA’s practice is dedicated to foreclosure defense and litigation support services on behalf of consumers in which we document: