Fearing Foreclosure, Debtors Sue Lenders Over Excessive Mortgages
Rather than waiting for lenders to foreclose, a group of struggling borrowers in Florida has turned the tables by suing those who gave them mortgages they can’t afford to pay.
“They have beaten their lender to the courthouse by filing lawsuits that allege the institutions committed fraud and violated federal lending laws by overstating the borrowers’ incomes to qualify them for loans, changing the loan terms just before closing, and failing to disclose the loan costs,” reports the Miami Herald.
The 25 lawsuits filed in federal court in Miami and Fort Lauderdale last week by attorney Frank Ingrassia also include claims that borrowers didn’t receive documents detailing the terms of their mortgages 24 hours prior to closing, as required by law, the newspaper writes.
Ira Rheingold of the National Association of Consumer Advocates tells the Herald that similar lawsuits are being filed by borrowers throughout the United States.