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Bank Attorney is Punished for Failing to Appear

On November 18, 2010, Justice Pagones, sitting in the Supreme Court located in Dutchess County, rendered a decision in the matter of BAC Home Loans Servicing vs. Westervelt. In this case, the bank and the homeowner were directed to appear at a settlement conference. Settlement conferences are required under New York State law in all foreclosure proceedings. The bank’s attorney failed to appear at the settlement conference. At that time, the court could have dismissed the bank’s  foreclosure proceeding. In this case, the court declined to impose this remedy.

Justice Pagones, however, found that the bank attorney’s explanation for his failure to appear at the court settlement conference was inadequate. The court thereafter scheduled a hearing to determine what sanctions would be taken against the bank’s attorneys.

Bad Faith

Justice Pagones reached a conclusion that the attorneys for the bank had acted in bad faith in negotiating a settlement with the defendant. The defendant had made representation that the bank  had, without explanation, refused to re-examine her income with regard to the mortgage modification she submitted. The court pointed out that the financial institution under the HAMP directives had an obligation to review her income.

Bank Barred From Collecting Arrears and Interest

The court scheduled another court conference date. In the interim, the court ordered the bank stop collecting arrears from the date the homeowner received the HAMP denial.  The court also barred the financial institution from collecting any interest that might accrue from this date. The court also waived unpaid late fees and ordered the bank to waive attorney’s fees relating to this case.

Foreclosure Court Conferences

Foreclosure court conferences exist because the State Legislature passed a law in 2010 ordering the financial institution to attend foreclosure court conferences for the purpose of finding alternatives to the foreclosure proceedings. Our law office regularly attends foreclosure conferences on behalf of our clients. We utilize these conferences to try to motivate the attorneys for the financial institutions to work with our clients towards approving mortgage modifications that take the cases out of foreclosure.

Foreclosure Lawyers

The foreclosure defense attorneys at our law office aggressively litigate issues involving defective mortgages, defective foreclosure lawsuits, predatory lending, bad faith and other real estate related matters.  When appropriate, we file foreclosure related bankruptcies, including either a Chapter 7 bankruptcy or Chapter 13 bankruptcy, depending on the circumstances involved with our clients. These bankruptcies stop foreclosure and, in some cases, allow us to eliminate second mortgages.  Prior to filing bankruptcies, we discuss the types of bankruptcies that are appropriate with regard to our client’s specific situation. Call us for a free consultation. We will discuss all foreclosure options available to you. Our phone numbers are 516-561-6645, 718-350-2802 and 1-800-344-6431.

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