'It has just wrecked my whole life': Texas woman, 85, says she faces homelessness after her bank disputed an 'oral agreement' to modify her mortgage — here's what happened and how to avoid it

Where did it all go wrong?

Jefferson's upscale home, which she’s lived in since 2002, is more than just a roof over her head — it represents a lifetime of hard work. As a nurse, Fox 26 reports she was among the first non-physicians to own a medical clinic in the greater Houston area. Jefferson says she put her life savings into the house.

But the decision to get a loan modification may have cost her dearly.

“[She] spoke to someone and it was an oral agreement,” Kietha Hamilton, an attorney representing Jefferson, told Fox 26. “They never got it in writing.”

Afterward, Jefferson’s bank disputed the mortgage payment amounts, and according to the broadcaster, in 2019, the bank filed a motion for summary judgment to take the house. It’s now in foreclosure, documents obtained by Fox 26 show.

Foreclosure occurs when a borrower fails to make the necessary mortgage payments, and the lender takes legal action to reclaim the property. In most cases, the process is initiated after the homeowner misses multiple payments, and can take months to complete.

Jefferson’s legal team says they’re engaged in a lawsuit to recover the equity — estimated to be $400,000 — from the million-dollar property.

Fox 26 didn’t indicate if they tried to reach the bank or its legal representatives for comment.

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How to protect yourself

Mortgage modifications are commonly for borrowers facing financial hardship. They can provide relief by altering the terms of a loan, such as the period of repayment or interest rate. Modifying a loan is similar but separate from refinancing a loan. Legal experts, including Jefferson's attorneys, stress the importance of getting any loan modifications to your mortgage in writing.

“With real property, everything needs to be in writing,” Hamilton said.

Verbal agreements are difficult to enforce. A formal, written contract signed by both parties helps prevent misunderstandings and provides legal protection. Homeowners looking to modify their mortgage may also want the help of a real estate lawyer to review the new terms.

“Bottom line is: get everything in writing,” Charles Herbert, another member of Jefferson’s legal team, told Fox 26. “Follow up and, as they always say, read the fine print.”

Jefferson's situation highlights this essential piece of advice for anyone navigating the complex mortgage modification process. It could help protect your home and your future.