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Understanding Wrongful Foreclosure: Your Rights and Remedies
Published June 23, 2026 · 5 min read
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Published June 23, 2026 · 5 min read
Fill out the form below and we'll contact you within 24 hours.
Foreclosures are frequently mishandled by lenders and servicers who cut corners. Here are the most common red flags that indicate your rights may have been violated.
Servicer pursues foreclosure while you have an active loss mitigation application in process.
Documents signed in bulk without review of the actual loan file — often by people who had no knowledge of the case.
Assignments and transfers of the note that can't be traced to the foreclosing party.
Wrong amounts due — misapplied payments, unauthorized fees, or manufactured default.
We analyze your loan file for TILA, RESPA, and FDCPA violations, misapplied payments, and chain-of-title defects.
We verify the foreclosing party actually holds the note and mortgage — exposing robo-signed or improper assignments.
We quantify what you're owed — from statutory damages to setting aside the foreclosure sale entirely.
We connect you with experienced foreclosure defense attorneys prepared to take action on your case.
Wrongful foreclosure occurs when a lender or servicer forecloses on a property in violation of the law or the mortgage contract. It's not just unfair — it's illegal. And homeowners have powerful remedies, including setting aside the sale, recovering damages, and in some cases, punitive damages against the servicer. At Dream Financial Management, we help identify wrongful foreclosure claims and connect homeowners with the legal resources they need.
The servicer simultaneously pursues foreclosure and a loss mitigation application. Illegal under CFPB rules if you submitted a complete application 37+ days before the sale.
The party foreclosing doesn't actually own the loan or hold the promissory note. Robo-signing, improper assignments, and broken chains of title are common defects.
Failure to properly serve the notice of sale, improper publication, or foreclosure despite an active bankruptcy stay.
Foreclosing for the wrong amount — inflated fees, misapplied payments, or including amounts you don't actually owe. A loan audit can prove this.
The court voids the foreclosure. You get your home back. Requires strong evidence of illegality.
Compensation for financial losses — lost equity, moving costs, emotional distress. TILA provides statutory damages of $400-$4,000 per violation.
In cases of egregious servicer misconduct, courts may award punitive damages as punishment and deterrence.
Many consumer protection statutes (RESPA, TILA) allow recovery of attorney's fees if you prevail.
For a deeper dive, see our comprehensive wrongful foreclosure guide covering all 8 legal grounds in detail.
We'll review your case, identify violations, and connect you with experienced foreclosure defense attorneys.