California  |  Real Estate Law

There are attorneys whose practice is concentrated on suing banks because of bad home loans. Some are based on the lenders' having filled in false information on loan applications. Others are based upon taking advantage of the borrowers' lack of understanding of what they were getting themselves into. Whether the lawsuits will succeed is an open question.

If yours is not a home loan but some other type of loan, some of the arguments made by these lawyers might apply to you, too.

Yes you can but at the end of the day what are you trying to do? If it is your home and you are trying to stay in it then you should try for a loan modification. If the bank gave you a loan you couldn’t afford based on false information that could give you additional leverage to get a modification. For help you can go to the Housing and Urban Development website www.makinghomeaffordable.gov and there is an extensive list of non profit outfits that will help you do request to modify your loan if your finances permit. You can also hire a for profit law firm like ourselves to do it for you.

I have participated with loan brokers in defending suits of this kind. Such suits are fairly common these days, and tend to come out of "litigation mill" law firms that crank these suits out on an assembly-line basis. Some of them may have merit, but the plaintiffs don't have the money to pay the law firms more than a small retainer, so no customized research of the facts or the applicable law is done. Then, most lenders resist these suits vigorously. The plaintiff will be facing substantial fees before the case goes to trial in a year or two.