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How Do You Know If Your Loan Modification Rejection Was Unfair?

How Do You Know If Your Loan Modification Rejection Was Unfair?

Applying for a loan modification (one of your options to avoid foreclosure) is a step in the right direction if you can no longer make your mortgage payments and have received or believe you will receive a notice of foreclosure.  You worked hard to purchase your property. It likely never entered your mind that your financial situation could change and your monthly payments would become unaffordable.  But, as is often the case, life happens, and unfortunately things don’t always go as planned.

If you have applied for a loan modification, you are hopeful that it will be approved in a timely fashion and that your loan can be restructured. This would make your mortgage payments affordable for your current situation and allow you to retain ownership of your property, but many find themselves facing loan modification rejections. In some cases, these decisions are reasonable, but in others they are not.  How do you know if your loan modification rejection was unfair?

Important Things to Remember

Some Loan Modification Rejections Are Reasonable

Not all loan modification applications are going to be approved.  In some cases, the reason for the rejection makes sense.  Consider why many are rightly turned away when they make these requests:

  • Incomplete paperwork
  • Invalid hardship request
  • Title problems
  • Insufficient income
  • Service not provided by your lender
  • Loan-to-value ratio issues
  • Timing
  • Multiple modification requests.

While these reasons may all be valid, you should further explore your options. A South Florida real estate foreclosure attorney can help identify any issues that can be rectified and work with you to respond and reapply or modify your initial request. You want to do everything in your power to have your loan modification approved.

Identifying Unreasonable Rejection

If your loan modification request has been denied, you’ll want to take the time to review the documentation and understand why. After all, if the denial was unreasonable, you want to address the situation.  Two things on which to focus are procedural issues and discrimination.

Look for Procedural Irregularities

Procedural irregularities exist when your lender does not handle your application appropriately.  Their inappropriate actions may include, but are not limited to:

  • Delaying the application process
  • Communicating incorrect information (like requiring you to be in default in order to apply)
  • Committing calculation errors
  • Requesting information already provided.

If these actions contributed to your denial, you should readdress the lender. Engaging the support of a foreclosure defense lawyer is extremely valuable in the process.  They can help identify the issues and know how to respond appropriately.

Were There Discriminatory Practices?

Another reason your loan modification could be considered unfair is if discrimination played a role.   Unfortunately, this can be challenging to identify and even more difficult to prove. But, it does happen more often than we would like to believe.

Examples of discrimination in loan modification include denials based on religion, race, sex/gender, national origin, disability, marital status, and age.  Additionally, the source of an individual’s income can also be a cause for discrimination; this may impact those on public assistance or receiving Social Security. Finally, violations of consumer protection laws can also be considered discriminatory.

Discrimination is categorized as disparate impact or disparate treatment. Disparate treatment refers directly to the categorizations stated above and occurs when lenders treat individuals with protected characteristics differently than others. On the other hand, disparate impact occurs when lenders’ policies are standard, but affect individuals differently.

Carlos M. Amor Can Help You Appeal Your Loan Modification Denial

Experience Matters

For more than 15 years, Carlos M. Amor has been providing outstanding service to individuals in South Florida. He leverages his knowledge, as both a real estate foreclosure defense attorney and a real estate broker, on behalf of his clients; and he has extensive experience identifying and managing the legalities of denied loan modification requests. He understands and appreciates the volatility of the real estate market and works tirelessly on behalf of his clients facing foreclosure.

How He Can Help

If your loan modification has been denied and you believe the reasons to be unfair, Carlos M. Amor can examine your situation and provide guidance moving forward. He will review your submitted documentation to ensure you have proven that you were experiencing financial struggles, that you are overcoming them, and that you can pay your mortgage in the future.  Assuming the documentation you provided was submitted correctly and in a timely fashion, he can review your case to help identify improper actions by the lender, including discrimination or improper procedures. Should these exist, he will address them on your behalf, with the ultimate goal of having your modification appealed.

Your investment in your property is considerable, so you want to do everything in your power to protect your assets and your financial reputation. If your modification was unfairly denied, taking the right steps may make a very real difference in your appeal.

If you need legal real estate services in the Miami, Fort Lauderdale or West Palm Beach areas, contact Carlos M. Amor today at 954-453-7200 to schedule your free consultation. During this meeting, he can gain a better understanding of your specific situation and share how he believes he can help you move forward.


Carlos M. Amor is a skilled and experienced attorney and real estate broker. His legal practice in South Florida focuses on real estate litigation, real estate investments, tax deed and foreclosure auction purchases, traditional real estate transactions, short sales, foreclosure defense, and civil litigation. Carlos thinks “outside the box” and takes a practical approach to finding solutions that benefit his clients. [ Attorney Bio ]