House almost paid off gets hit with foreclosure

Raymond and Diane Bernstein have lived in their Sylmar, California house for 25 years, but they are now being forced to move out due to a series of accidental missed payments on their home loan.

The house was almost paid off, with just $37,000 still owed on the loan, and the Bernsteins had enough equity to ensure the mortgage would not default. But a missed second payment on the mortgage has put the property in foreclosure and brought a lawsuit on behalf of the Bernsteins against their mortgage lender Citibank, NBC Los Angeles reported.

In an interview with the news source, Raymond Bernstein said he set up a repayment plan with the lender, and made his first mortgage payment of $4,000 in January.

"My bank got bought out and my automatic payments got shut off without my knowing, then the mortgage owner then sends a notice I am behind," Bernstein said.

The bank says it never received the second payment that Bernstein said he mailed. After foreclosing the property and selling it off at an auction, the bank will get a $218,000 profit on the home the Bernstein family had almost paid off.

Some lenders, however, are trying to work with borrowers struggling to make their mortgage payments and are facing foreclosure. In St. Louis, Chase Bank has opened a new resource center for homeowners to meet face-to-face with financial advisers in an effort to help borrowers understand their refinancing options to avoid foreclosure. 

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