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California Veteran’s Home Saved After Bankruptcy

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October 1, 2021
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Many news stories about California’s housing crisis focus on how there are not enough homes.

Another big piece to the housing crisis: predatory, confusing, or incorrect actions by mortgage lenders that can cause people who do have homes to lose them. Homeowners with limited income are especially at risk.

Rhonda Buckingham almost lost her home in San Joaquin County when loan processors mishandled her mortgage after she filed for bankruptcy.

Losing her home would have been a disaster not only for Rhonda, but also for her granddaughter, Nakiya, who is disabled.

Fortunately, thanks to Rhonda’s persistence and with help from CRLA, in 2019 Rhonda saved the family home she shares with her granddaughter.

Bankruptcy Completed, But Where’s My Mortgage?

Rhonda, a veteran on limited income, fell behind in her mortgage after her husband passed away.  She tried to work with her lender to adjust her mortgage and make her payments more manageable. They couldn’t come to an agreement, so Rhonda had to file a Chapter 13 Bankruptcy.  

Filing for bankruptcy meant the court would decide how Rhonda would pay her debts, including her mortgage. She worked with a private attorney to file for bankruptcy and represent her in court.

After Rhonda had met all the court’s conditions for the bankruptcy, it was discharged in 2018, meaning she was now considered current on all her debts. She still owed money on her mortgage but was no longer behind on her payments.

However, Rhonda realized after the discharge that she was not receiving her mortgage statements.  She contacted her lender, OCWEN, who reviewed her file and told her that she had surrendered her home during the bankruptcy.

Rhonda never agreed to surrender her home, so hearing this from her lender was a shock. She contacted the attorney who had helped her, but the attorney was no longer practicing. When she tried to get information from the attorney’s former firm, she was treated poorly and told they could not help her.

CRLA’s Foreclosure Prevention Team Steps In

Rhonda contacted CRLA for help and spoke to Foreclosure Intervention Coordinator Sylvia Torres, who assisted her together with Community Worker Johanna Torres and Directing Attorney Baldwin Moy of our Foreclosure Prevention team.

During this time, Rhonda’s loan was transferred two times, first to a loan servicing company called PHH and then to a second company, New Rez.

Transferring loans is a common practice when loans are being reviewed. Unfortunately, the loan information is not always completely transferred to the new servicer. This was the case with Rhonda’s mortgage loan.

In addition, while homeowners do not receive mortgage statements during bankruptcy, PHH delayed over a year after Rhonda met her bankruptcy conditions to send her mortgage statements. This made it difficult to understand what was happening with her mortgage and to review statements so she could make sure all charges were being properly applied.

With many years of experience helping people save their homes, CRLA’s Sylvia Torres knew how to work with PHH to get them to send Rhonda’s new loan servicer, New Rez, the complete mortgage information and statements.

Missing Information Shows Who Owns Home

Rhonda still needed to confirm that she had never surrendered her home as her original lender said she had done.  

After New Rez got the complete mortgage information, Rhonda’s contact reviewed the loan and saw that the bankruptcy had been dismissed, and that Rhonda had made all the scheduled payments so she was no longer behind. They also stated that the home is Rhonda’s property and in her name, and that there was no evidence that she had surrendered her home.

Finally, after years of arguing with her lender, Rhonda had confirmation that this was her loan and her home.

She is thrilled, but still cautious until she sees her mortgage appear on her credit report as one of her debts. It can take about two months for a mortgage lender to notify credit agencies of the debt.

Rhonda’s Tips for Homeowners

Rhonda told us, “I’m very thankful to CRLA for working with me to understand and get questions answered, but most of all for listening to my concerns and helping me save my family home.”

If you are a homeowner who has filed for bankruptcy, Rhonda’s top tips are:

  • keep on top of your loans
  • ask questions
  • insist you get documents in writing

If she had not been an active advocate with her mortgage, Rhonda might never have known that her home was at risk until it was too late. Now, Rhonda is waiting eagerly to see her home appear on her credit report.

Are you trying to save your home in rural California but unable to afford a private attorney? Contact us!

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Client Stories

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