A California man successfully halted a foreclosure sale on his property using the newly minted California Homeowner Bill of Rights to obtain a court injunction against two foreclosing parties: Bank of America and its Recontrust Co. subsidiary.
For simply obtaining the HBOR injunction, the homeowner’s attorney is requesting $20,255 in legal fees and costs – a compensation request that is permissible under HBOR since the legislation allots borrowers reasonable attorneys fees and expenses for successfully obtaining an injunction.
Attorney Robert Jackson with Jackson and Associates out of California says the injunction alone may cost BofA/Recontrust upwards of $60,000 when calculating in attorneys fees and expenses from both sides.
“The biggest problem with the HBOR from the investor standpoint is the litigation risk of having to pay legal fees,” Jackson said. “The way the thing breaks down is when you get an injunction, the prevailing borrower gets all of their legal fees paid by the servicer and the investor.”
This is one of the first legal disputes to show the real strength of HBOR and it’s effectiveness in stalling proceedings and increasing expenses for servicers that are accused of violating one of the provisions of HBOR.
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Sorry JtR, but can someone explain to me the wisdom of why I should buy a house next door to someone who is living rent free indefinitely?
What are the unintended consequences of all this?