AboutRegan Shinski Expertise I can answer questions on collections, repossessions, bankruptcy, credit repair, credit counseling, FICO scores, credit planning, and the cause and effect of credit related decisions. I can also answer questions on collection settlements and preparing to sue your creditors for false debts and credit reporting.
Experience Fifteen years ago I was financially devasted due to severe health issues. I filed bankruptcy, had a foreclosure, car repossession, tax lien, and ruined credit. I immersed myself in credit law. I settled dozens of accounts and had them removed to improve my credit. I personally sued four creditors and collection agencies and won cash settlements for their false reporting on my credit reports.
Since then, I have completely recovered and have nearly $100,000 in revolving credit lines and perfect credit. I have owned a credit repair company for the past five years and have an additional three years of specific work in the collections and debt management industry.
I am fully versed in the Fair Debt Collection Practices Acts (FDCPA), Fair Credit Reporting Act (FCRA), and have used them successfully in collection settlements and lawsuits for myself and others. I am also familiar with and abide by the Credit Repair Organizations Act (CROA).
I have deleted or helped delete literally hundreds and hundreds of derogatory items from consumers' credit reports and helped negotiate many settlements with collection agencies and creditors. I have also advised people on bankruptcy at any stage.
In the current credit market, I have successfully advised numerous people on how to obtain credit and how to negotiate for better terms.
Education/Credentials BA - University of Minnesota
I'm in the middle of a nightmare, so my question may be long-winded because of my frustration! We have had loans with a local, regional bank for 5 years now. We have a loan on our home, which was bought cheap for $30,000, then fixed up. My uncle co-signed on the loan, but it wasn't a traditional mortgage loan. I'm not entirely sure what it was, but I think it may have been a home equity line of credit. We also have an auto loan and a personal loan at the same bank. For almost 5 years, these loans have been paid on time and have never been even 1 day late. Recently, my husband got sick, my uncle murdered my aunt, (and also tried to shoot my husband who is the police officer who responded to the scene)and we had numerous emergencies that directly affected our finances. Like the saying goes, when it rains it pours! Well, we ended up being 9 days late on our auto loan and 1 day late on our house payment. The bank called several times a day, at our home and my husband's work requesting payment. The bank's polices (and our payment booklet provided from the bank) state that there is a 10-day grace period on all of the loans. If payments are made within the 10 days, a late fee is not even applied. I contacted the bank and told them that the payments would be made within a week at the latest, and to show good faith, I went ahead and paid half of the auto loan, which was 9 days late at the time.
However, when the house payment was 5 days late, the bank called my uncle demanding payment within 48 hours. My uncle, called me and told me that if the payment was not made in 48 hours, he was kicking us out. I was extremely upset and confused, because our loan papers, payment booklets, and the bank vice-president had told us that there was a 10-day grace period, and our home loan was only 5 days late. Then, I got a certified letter in the mail saying that the auto loan was in default and would be reposessed if it was not remitted within 5 days. The letter indicated the full amount was due, and did not reflect the partial payment I made, which was accepted by the bank several days earlier.
We have now made the other half of the auto loan and will be making the full house payment tomorrow (still within the supposed 10-day grace period). I am confused and scared and I would like some advice on how to handle this situation. I was under the impression that the bank had to honor their policies, and while this month we have been late on 2 of our loans, we have a great history with the bank and have let them know we intend to honor our obligations. I don't understand why the phone calls and letters are so aggressive in light of the circumstances. Also, my uncle has indicated that even if we make the payment tomorrow, he still believes we should surrender our home to him and find someplace else to live. We have 2 small children, we are both in college, and my husband is gainfully employed as a police officer, so we are not rolling in money. It would take us at least a month to save the money to put down for a deposit and rent. Any advice you can give me would be greatly appreciated! Thanks in advance for your time!
Holly
ANSWER: Hi Holly:
I am so sorry for everything you have been through. Cheer up, it will pass :) I had so many thoughts reading your post, I will try and remember all of them.
First off, on the bad side, you are confusing a grace period with due date. There is no contractual obligation that includes a grace period. The due date is the due date is the due date, and the creditor can begin "collecting" (phone calls, repos, etc.) the first day it is late. Not saying I like it or it is fair, it just is what it is. The only exception is if there is a specific recourse layed out in the contract that states otherwise. It is also different for real estate which I will discuss a little later.
Like everyone in this economy, lenders know that people are struggling. It seems most have gone the way of going that extra mile to help customers with modifications, deferments, and other helpful tools. Others have gone the other way to a near zero tolerance level because they don't want to "waste" time allowing the consumer to stall while their secured property (car & real estate) continue to decline in value. These types of lenders are very aggressively collecting. Again, not saying it's right or wrong, just what it is. Try not to take it personally. It's likely all these calls and letters are computer generated and just set to call at day 2.
Your rights in dealing with the ORIGINAL creditor are limited. They can basically call, send letters, even send people to your house without much recourse on your end. This is different with a third-party collection agency - you have MANY more rights in that case. But on the original creditors you only have recourse for harassment. Unfortunately, courts have not said "calling 'X' times" constitutes harassment, so it really has to be an egregious case. It HAS been adjudicated that original creditor companies cannot call before 8:00am or after 9:00pm and you have limited rights to keep them from calling your workplace.
This housing situation is more or a concern to me. From what you have written, I don't understand why your uncle is taking such a hardline. However, I need to know how the house is set-up. Is it your house? Your uncle's and you are renting from him? This is key information in determining your legal rights. If it is your house in your name, whoever the lender is (your uncle, bank, etc.) has to go through the foreclosure process. If are you LEGALLY deemed a tenant, then you uncle would only need to go through the eviction process, no different than if you were renting an apartment in a large complex. Both of those scenarios vary wildly by state, so you have to research your state laws for tenant evictions or foreclosure. In general, a foreclosure is a MUCH, MUCH longer process and there are specific laws written for redemption - meaning if you make the loan current within a certain time, things go back to as they were.
Again, these really vary by state. What you/I need to know is how this house was purchased, who is on the title/deed, if you a renter or owner, and what state you live in. Once you find that out, look up the applicable law. Once you are armed with the information and this happens again, just tell your uncle to take a flying leap if you are within the legal and contractual obligations. There are also various non-profit and governmental agencies that can explain these laws and your rights to you. Normal internet searches and a few phone calls should get you the needed information but they will need the information I mentioned above.
I hope this makes sense. It is unusual that you have such a hardline bank and uncle. Most are more willing and understanding to work with people.
I hope it works out, please let me know if there is anything else I can do.
Regan
p.s. I'm assuming you tried the traditional customer service channels of going to bank higher-ups and explaining the situation? Sometimes a complaint from a long-time valued customer carries more weight if you get the word higher up the food chain.
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QUESTION: Thank you so much for your wonderful advice! The home is in me and my husband's name, with my uncle listed as co-signer and we live in Texas. I am completely lost on the home/renter laws in our state, but I know that we are not considered renters. The deed to the house is in our name. Does this mean the bank will have to go through the foreclosure process? My big concern is being kicked out tomorrow with my uncle not giving us much time to leave. If that decision is up to the bank, then as long as we make our payment and keep the account current, can they still foreclose?
I will take your advice and do some research also. You have been very helpful and thanks for your time!
Holly
Answer Holly:
If it is as you say, you can only be forcibly removed from your house through the foreclosure process initiated by the bank. I suppose there are POSSIBLE options for your uncle to have you removed if he is on the title and illegal activity (drugs, etc.) is happening at a home jointly in his name. I'm sure that's not the case and even if it is, it is also such a remote possibility full of loopholes that protect you, I hesitated even mentioning it.
I don't live in Texas and am not familiar with their laws, but check out these two links:
It appears the lender must send you a letter once it's delinquent. You then have 20 days to pay the past due amount. If you don't, they can send another letter demanding the FULL loan amount. Looks like there must be at least 21 days from that second letter before the actual foreclosure takes place. A typical Texas foreclose takes about 60 days.
So it looks like this 20 day thing is key in your case. Remember, it does not affect your credit until 30 days late but this 20 day this is critical. Technically, at day 21 (after first notice is sent# the lender is under NO obligation to accept anything short of the FULL loan balance or they foreclose and evict.
If you are 5 days late again and your uncle complains, you can politely (or NOT so politely :) show him the statute and tell him to take a flying leap off a bridge!
This is obviously a VERY severe issue. I am not a Texas law expert and have not seen any of your documents, so I always advise second and third opinions and competent legal advice.
