“Mortgage lawyers near me can help you navigate through complex mortgage issues in a wide number of real estate transactions. From applying for a mortgage loan, to avoiding any error or omission that could create a dispute with the lender, each mortgage transaction involves a few important matters that need to be carefully addressed. Mortgage attorneys near me provide legal assistance in such matters. This article offers a detailed perspective on mortgage issues and the importance of hiring a mortgage lawyer.”
What is a mortgage?
If you have ever bought or sold a real estate property, chances are that you might already be aware of the term mortgage.
The term mortgage, in simple words, is a mode of financing or loan arrangement used for purchasing a real estate property. Although other modes of financing are also available to real estate buyers, including individuals and businesses both, mortgage happens to be a widely used option for this purpose.
Why use a mortgage for buying or financing real estate?
The reason for using mortgage as a means of financing a real estate deal is simple to comprehend.
Not all property buyers will choose to pay the full price of the property upfront at the time of purchase. Rather than doing this, they may prefer to pay it gradually as installments over an agreed-upon period.
The difference between a mortgage and any other type of financing is that the real property in a mortgage transaction is collateral. Being collateral means that the lender has a lien on such property which secures his loan.
What is a mortgage lawyer and what does he do?
A mortgage lawyer is an attorney who primarily holds professional competence and expertise in matters related to mortgages.
Hiring mortgage lawyers near me can not only help in obtaining a mortgage loan, but also in resolving issues that may arise at any point of the mortgage process. For example, a dispute between a lender and a borrower. Disputes can generally arise due to differences in opinion on any clause or condition contained in the mortgage agreement.
In such a case, a mortgage lawyer can assist a mortgagor in understanding his legal rights and duties in a mortgage transaction.
Elements of a mortgage agreement or Parties to a mortgage agreement
Before getting started with mortgages, it is important to understand the principal elements of a mortgage agreement. Doing this will help you understand mortgages, their various aspects, and their use in a better manner.
Essential elements of a mortgage agreement
The following is a list of the essential elements that constitute a mortgage agreement –
- Promissory note
- Deed of trust
The term ‘mortgagee’, also known as a ‘mortgage lender’, refers to the person or institution that lends the loan.
Banks, mortgage companies, and financial institutions are some common examples of mortgagees in most mortgage agreements. Other than these, there are also some federally administered or government-sponsored organizations that provide financing facilities to home buyers.
The term ‘mortgagor’, in a mortgage agreement, refers to the person who has borrowed the mortgage loan.
Until and unless a mortgagor has fully repaid the borrowed amount of the mortgage loan, he does not hold free and clear ownership of the property.
3. Promissory note
A promissory note is a legal contract containing the terms of the mortgage as agreed upon between the mortgagee and mortgagor. These terms usually mention three important things which are –
- promise of the mortgagor to repay the mortgagee with the full and exact amount as borrowed by him,
- repayment period as specified in the mortgage agreement,
- obligation of the mortgagor to repay his/her debt obligation to the mortgagee even if he intends to sell the property before the end of the mortgage term.
4. Deed of trust
The deed of trust in a mortgage transaction functions as a lien on the collateral property in the mortgage agreement.
In case the mortgagor or the borrower makes a default in making their payments in the time and manner as stipulated in the mortgage agreement, the deed of trust allows the mortgagee to sell off the collateral property and recover their full or outstanding payment.
Other parties to a mortgage transaction
Though not necessary, but a mortgage transaction can also have two other parties involved.
- Mortgage broker
- Real estate agent or broker
1. Mortgage broker
As already mentioned, generally more than one institution may offer mortgage loan financing facility to real estate buyers. This means property buyers can apply at multiple places for a mortgage loan. However, choosing the best and most suitable option is certainly not possible for every individual.
In such a case, a mortgage broker can aid in finding the best and the most reliable mortgage plans.
2. Real estate agent or broker
A real estate agent or broker is the person that helps with the buy-sell of real estate property. But apart from this, a real estate broker could also coordinate with the mortgage lender and/or broker to assist property buyers in a better manner.
This can provide real estate buyers with two major benefits.
- First, real estate agents can provide more filtered property buying options based on the mortgagors’ mortgage loan eligibility,
- Second, real estate brokers can help a mortgagor find mortgagees to finance the property they are interested in buying.
Why hire mortgage lawyers near me?
In the context of this article, a real estate transaction cannot complete without obtaining a mortgage loan to finance it. However, the main aim of a real estate buyer is not just to obtain a mortgage loan. Rather, it is to obtain free and clear ownership of the property upon successful completion of all scheduled mortgage payments.
This means that hiring mortgage lawyers near me remains important both during and after the mortgage process.
To explain this more effectively, we have further divided this section into two parts.
The first part highlights the benefits of hiring mortgage lawyers near me.
The second part discusses disputes and legal violations that count as a breach of the mortgage agreement. Any party in a mortgage agreement can be involved in such a breach of contract. Hence, this may cause the other party to seek legal advice from mortgage attorneys near me.
Benefits of hiring mortgage lawyers near me
This part discusses some of the benefits that can be achieved with the help of mortgage lawyers near me.
1. Filing of the documents and paperwork
From applying to more than one bank or financial institution for obtaining the mortgage loan, to submitting all necessary documents and important paperwork to the relevant federal and/or state authorities, mortgage attorneys near me can handle numerous types of matters associated with legal correspondence.
A mortgage attorney can help in many ways to initiate and fasten the mortgage process by –
- completing the necessary paperwork,
- reviewing and removing any discrepancies that may raise conflict and result in a delay,
- doing everything in the manner and time as prescribed by the law for each correspondence.
2. Reviewing contracts and mortgage agreements
Mortgage lawyers near me can also help in reviewing all the real estate contracts and mortgage agreements. Since such contracts and agreements have specific clauses based on contingencies, you must be fully aware of them.
A mortgage attorney can help you understand the impact of any contingency-based terms on your interest, should the event that they are dependent upon occurs.
A mortgage lawyer near me can also help remove such contingent clauses or include consequent terms to minimize their impact on your interest.
3. Title check
Performing a title check is one of the most important things done in a real estate transaction. Title check ensures that the person claiming to be the seller does legally hold ownership status of the property that is being transacted.
But having ownership is also not the only important thing here. Mortgage lawyers near me perform title checks to also confirm that the seller has the right or legal authority to sell the underlying property. This means that the real estate property does not have any lien or encumbrances on it.
4. Preparing agreements and contracts
Mortgage agreements and payment terms are legally binding contracts. Any error or omission in such paperwork, whether deliberate or by mistake, could possibly collapse the whole mortgage transaction.
Thus, it is highly recommended that mortgage lawyers near me are hired for drafting all the legal paperwork. Since mortgage attorneys are the only person having professional competence and vast experience in such matters, they could be entrusted with preparing drafts that will certainly –
- follow all the necessary legal frameworks, laws, and regulations that apply in real estate and mortgage transactions,
- satisfy each party’s interest in the best possible manner,
- include no conflicting terms that could raise ambiguities or even a dispute now or in the foreseeable future.
Mortgage lawyers near me helping to settle disputes and legal violations in a real estate mortgage transaction
The existence of so many parties and complexities in a real estate mortgage transaction raises chances of disputes.
Disputes mostly arise due to the existence of ambiguities or differences between the mortgagee and the mortgagor. Here we discuss four important examples of cases that could raise a dispute between the lender and the borrower.
Remember that mortgage transactions and agreements are legally binding contracts between the lender and the borrower. Thus, any non-compliance by either party to it amounts to a breach of contract. In such a case, the affected party has the right to file for any legal recourse available in a breach of contract situation.
1. Mortgage fraud
Mortgage fraud happens when either the mortgagee or the mortgagor commits fraud or provides fraudulent information.
A mortgagee or lender may commit fraud by forging or fabricating the original mortgage documents. For example, to obtain an unfair advantage over the mortgagor.
A mortgage fraud committed by a mortgagee can be used against him as a legal defense by the mortgagor in a case of foreclosure.
A mortgagor or borrower may commit fraud by presenting false information on the mortgage application to obtain the mortgage loan. This is usually done to conceal information and not reflect their true financial position, which otherwise would likely disqualify their mortgage request.
Examples include mentioning of incorrect credit score, listing non-existent sources of income, or exaggerating the income level.
A case of foreclosure is the most commonly occurring dispute between a lender and the borrower.
Under a mortgage agreement, a mortgagee agrees to finance a real estate transaction upfront for a purchaser. In return, the mortgagor or the buyer promises to return the entire mortgage loan in gradual repayments over a specified time.
However, the mortgagor, either partially or entirely, may delay or stop making payments to the mortgagee.
Consequently, the mortgagee can use his legal right to sell off the collateral property under the mortgage agreement. This way he can recover part of the mortgage loan that is remaining outstanding.
Such act of the mortgagee refers to as foreclosing on the real estate property. The mortgagee can then hold a public auction to sell the property and recover the balance mortgage amount.
3. Predatory lending
Not just in a mortgage transaction but otherwise as well, it is not uncommon for an aware person to take undue advantage of an unaware or susceptible person.
In the context of a mortgage transaction, a mortgagee can obtain an unfair advantage over a mortgagor whose decision he could easily influence.
This is known as predatory lending. In this, the contents of a mortgage transaction tend to be unusually different from what they should normally be.
For example, a first-time homebuyer who lacks mortgage knowledge or a desperate buyer could be easily misled by a mortgagee. This may happen in the form of the mortgagor being made to agree on unreasonably high interest rates, or on terms that could severely affect their financial position or any other interest in the real estate property.
If a person has reasonable grounds to believe that the rejection of his mortgage application is solely based on discrimination, he can sue the mortgagee.
The Fair Housing Act and Equal Credit Opportunity Act define the characteristics of what may represent discrimination.
For example, disqualifying or rejecting a mortgage application because of gender, religion, race, ethnicity, age, etc.
Finding the best mortgage lawyers near me
Mortgage lawyers near me at Attorneys Real Estate Group can help you with numerous issues related to mortgages. Whether you are planning to buy a property with mortgage or want to understand certain matters related to it, we can definitely help.
Our team of expert mortgage attorneys near me can aid you throughout the entire mortgage process. From using our professional ability to help evade disputes, to ensuring a smooth completion and favorable outcome of every procedure involved, we have overseen mortgage issues for several clients like you.
Simply, give us a call at 916-345-2391 or visit our website at Attorneysre.com. You can also get free legal consultation by filling in the form at this link. One of our attorneys will get back to you as quickly as possible and will be glad to assist you. We look forward to welcoming you soon.