I have a friend who is going to be appearing PRO SE at her own foreclosure hearing. She told me that PRIOR to going into default on her mortgage payments, she attempted several times to contact the lender, the lender said they are not prepared to talk to her until she was at least 3 months into default. The representative of the lender whom my friend was talking to hung up on my friend after telling her she has to be a minimum of 3 months in default.

I told her that the lender has a responsibility to mitigate (CUT) their losses when the borrower gave them the opportunity well in advance of them suffering any actual loss. Not to do so, they are willfully contributing to their own demise. It doesn't make any sense that the lender be willing to suffer up to a 3 month loss in income (mortgage payments) and then cry foul because they lost money through the borrower not paying them.

By refusing to talk to the borrower, the lender has placed the borrower and themselves in the untenable position of suffering avoidable losses when it could have been avoided had they negotiated with the borrower by making a temporary adjustment to offset any potential or actual losses, the lender could have mitigated their losses.

Am I correct in giving her this point of view? I am not an attorney.

I have a friend who is going to be appearing PRO SE at her own foreclosure hearing. She told me that PRIOR to going into default on her mortgage payments, she attempted several times to contact the lender, the lender said they are not prepared to talk to her until she was at least 3 months into default. The representative of the lender whom my friend was talking to hung up on my friend after telling her she has to be a minimum of 3 months in default.

I told her that the lender has a responsibility to mitigate (CUT) their losses when the borrower gave them the opportunity well in advance of them suffering any actual loss...

By refusing to talk to the borrower, the lender has placed the borrower and themselves in the untenable position of suffering avoidable losses when it could have been avoided had they negotiated with the borrower by making a temporary adjustment to offset any potential or actual losses, the lender could have mitigated their losses.

Am I correct in giving her this point of view? I am not an attorney.


You make a very good argument, but I have never heard of a lender's responsibility to mitigate loss; but we are in uncertain times.
I believe your friend should read through all the mortgage papers, carefully. You may locate an avenue of help if the loan is guaranteed by FHA or HUD, or some other government entity. If the loan is guaranteed, call the agency immediately and ask for help. I have attached an outside, third-party-type advertisement; I read through the FAQ's quickly, and disagree with its bankruptcy answer. I know, personally, that many homes have been 'saved' for their owners through Chapter 13 and Chapter 7.
How Loan Modifications work, what is a loan modification?, loan modification, mortgage modification (http://www.theamericanhomesaver.com/how_loan_modification_works.html)