Fannie Mae and Freddie Mac Lawsuit Claims
The Fannie Mae and Freddie Mac lawsuit are of great interest to those who follow real estate news. Both these mortgage giants were government sponsored giants, which many would say are predatory lending machines. Many homeowners who applied for loans under the Fannie Mae program, which is named after it’s founder Frank Muny, and the Freddie Mac program who sponsored Freddie Mac, were turned down. The reason given was that the applicants could not qualify because they had bad credit. Both loans are well past their sell by dates and have ballooned in value since being issued.
Fannie Mae and Freddie Mac lawsuit accusations are widespread.
The Federal Housing Administration, or FHA, is in the middle of a multi-billion dollar class action suit involving kickbacks from loans which were falsified. Another suit charges the companies with racking up expenses in a number of forms that were not even present when the loans were made. Last month, shareholders of both Fannie Mae and Freddie Mac filed lawsuits against the government, and the companies respectively. The shareholders’ suit claims that the FHA and Freddie Mac acted together to “misdirectly” defraud the United States housing market by inflating the price of both loans. The suits also charge that the government was aware of the problems with these two programs, but did nothing to correct them.
What is the basis of the Fannie Mae and Freddie Mac lawsuit accusations? These lawsuits arise from a number of different accusations. Some claim that Fannie Mae and Freddie Mac intentionally let houses get foreclosed on in order to keep property owners from exercising their right to redemption. Other suits point to loss mitigation managers, or REO managers, who may have approved fraudulent agreements allowing foreclosure. And finally, homeowners charge that Fannie Mae and Freddie Mac used “robot” systems to submit loan offers to the lenders that approved loans for foreclosure. The lawsuits paint a picture of a deliberate effort by these companies to circumvent the traditional underwriting practices that are used to approve or deny home loans.
How does the Fannie Mae and Freddie Mac lawsuit claims sound?
If the lawsuits are true, the government is responsible for not only the billions of dollars it has already paid out in refunds, but also for the millions more that it will pay out in claims for the damages that it caused. For these reasons, the government has already agreed to temporarily stop foreclosures while it sorts out the lawsuits.
How can you fight back? Foreclosure defense is complicated, so it’s important to retain a good attorney when going through the process. (It’s also a good idea to educate yourself about foreclosure laws and how they apply to your circumstances.) An experienced foreclosure defense attorney can help you understand the scope of the Fannie Mae and Freddie Mac lawsuit claims, and work with you to prepare your case. With enough evidence, your lawsuit should succeed, if it can stand up in court.
Unfortunately, there are many homeowners facing foreclosure who don’t know any better. In order to save their homes, they are often willing to sign fraudulent paperwork or agree to unfavorable terms just to get out from under the threat of foreclosure. Fannie Mae and Freddie Mac lawsuit claims are not your only option; unfortunately, there are literally hundreds of other homeowners facing foreclosure right now in the same situation. Before signing on the dotted line, be sure to research your options and find the best legal counsel to help you protect your best interests.