Foreclosures and Loan Modifications
Obtaining a loan modification is one of the potential routes to save a home from the foreclosure process. There was a time in New York, and in the United States, when there were a variety of Federal and State programs which helped homeowners who had fallen behind in their mortgage due to unforeseen financial circumstances or other issues which caused them to fall behind on their mortgage payments. However, except for programs that help veterans, there are very few options today regarding mortgage modifications other than dealing with the financial institution which currently holds the mortgage on the homeowners’ homes.
Mortgage Modification Process Substitute
The application process for a mortgage modification can be cumbersome and it may be difficult to meet financial institutions requirements to obtain the modification. A mortgage modification application needs to be submitted with the necessary supporting paper work and documentation required. In many instances a hardship letter will also be necessary. A follow-up process needs to be undertaken to see to it that the financial institution actually gives the mortgage application the appropriate time and consideration necessary to end up with a positive response. During the past few years the criteria for a homeowners to obtain a mortgage modification has become more cumbersome and more difficult.
A law firm that represents homeowners in foreclosure cases can help the homeowner to successfully navigate through the modification process. Elliot S. Schlissel is the managing partner of Schlissel DeCorpo LLP a law firm that has been helping consumers with mortgage problems for decades.
The law office of Schlissel DeCorpo have been defending homeowners regarding mortgage issues for more than three decades. They can be reached at 516-561-6645, 718-350-2802, 631-319-8262 and 914-998-0080 or emailed at Elliot@sdnylaw.com.
Foreclosures and Settlement Conference Requirements in New York
The State of New York has a law which states in all foreclosure cases regarding residential homes that have less than 5 families in them and serves as the principal place of residence of the borrower a “settlement conference” is required to be held. At the settlement conference there will be court attorney referee or a judge which presides over the conference. The specific purpose of the conference is to determine whether the homeowner is qualified to obtain a modification of the mortgage, or is there another way the homeowners can save their home from being sold in a foreclosure sale.
At the foreclosure settlement conference a schedule is set up whereby the homeowner has to comply with the mortgage modification application process. This includes submitting an application in a form provided by the lender, following up to provide documentation of financial circumstances and credit worthiness of the homeowner. In circumstances where the homeowner qualifies for the modification of the mortgage there will usually be a period of 3 or 6 months regarding trial payments. The borrower/homeowner must make these trial payments in a timely manner.
Failing to Qualify for a Mortgage Modification
In cases where the homeowner fails to qualify to obtain a mortgage modification, the court attorney referee or judge will issue an order releasing the case to a trial part for further litigation action regarding the foreclosure. Usually after the case is released to a trial part the attorneys for the financial institution will bring a motion for summary judgment against the homeowner. In many situations this amounts to a trial on paper whereby the financial institution’s attorneys provide documentation of the homeowner’s default in making payments on the mortgage. The financial institution’s attorneys will request that a special referee be appointed to compute damages as to how much the homeowner owes to the financial institution and to eventually sell the property at a foreclosure auction sale. If the homeowner is represented by an attorney, the attorney for the homeowner will submit opposition papers to this application by the financial institution for summary judgment foreclosure and sale. If the homeowner’s attorney has included counterclaims or affirmative defenses in the foreclosure answer, the attorney at this time can cross move to dismiss the case based on the counterclaims or affirmative defenses.
In cases where a homeowner and their attorney has been successful in opposing the summary judgment motion, the Judge handling the case will eventually schedule the case for a trial.
The law office of Schlissel DeCorpo have been defending homeowners regarding mortgage issues for more than three decades. They can be reached at 516-561-6645, 718-350-2802, 631-319-8262 and 914-998-0080 or emailed at Elliot@sdnylaw.com.
Dealing with a Foreclosure
Life is not static. A families financial situations can change related to loss of employment, downsizing employment, financial tragedies, health issues, marital problems and many other issues. When a family falls behind on their mortgage payments it is important they do not ignore the issue. Immediate action should be taken to deal with the potential of a foreclosure and the loss the family’s most valuable asset, their home.
Lenders Action
A financial institution can take legal action when a homeowner falls 2 or 3 months behind in making their mortgage payments. The homeowner will usually receive initially a 90 day notice that their home is going into foreclosure. Thereafter, they will receive a Summons and Complaint from the attorneys from the financial institution outlining the reasons for the foreclosure and they are seeking to remove families ownership of their home and take back the home.
The Foreclosure Process
The foreclosure process in the State of New York is not something a homeowner can navigate or deal with on their own. The best way to deal with the foreclosure process is an early intervention on behalf of the homeowner by a dedicated, experienced foreclosure law firm.
The law office of Schlissel DeCorpo LLP has been representing homeowners for more than 30 years and has helped hundreds of homeowners keep their homes.
The law office of Schlissel DeCorpo have been defending homeowners regarding mortgage issues for more than three decades. They can be reached at 516-561-6645, 718-350-2802, 631-319-8262 and 914-998-0080 or emailed at Elliot@sdnylaw.com.
Foreclosure, What Does It Mean? – Part 2
The Homeowner’s Response
Upon being served with the summons and complaint, regarding notice of the foreclosure lawsuit, in the event you wish to keep your home and contest the foreclosure lawsuit, you need to file a verified answer. This is a response to the summons and complaint, and it will outline any defenses you have to the lawsuit. Be advised if you do not file an answer or you simply fail to respond the court will rule in the case that you have defaulted and the lawsuit will go faster and you’ll lose your home more quickly.
Foreclosure Settlement Conference
Usually within 60 days after your lender initiates the foreclosure lawsuit the Supreme Court in the county where the house is located will schedule a legally mandated foreclosure settlement conference. The purpose of this conference is to see if there’s a way to resolve the foreclosure lawsuit without the homeowners being forced from their home. At the foreclosure settlement conference, issues such as mortgage modifications, forbearance agreements, short sales and other issues will be discussed.
The Discovery Phase
If you put submit a written answer in the foreclosure lawsuit and you contest it, a period begins called the discovery phase of lawsuit. During this time, both you and your lender can request pertinent information and documents from the other side to prepare your respective arguments during motion practice or trial.
Motion For Summary Judgment
In most cases, the financial institution will file a motion for summary judgment. This is a motion by the bank’s lawyers, which asks the court to issue a judgment of foreclosure based solely on the evidence presented in writing. They will claim a trial is not necessary because the case is so one sided. For a homeowner to be successful in defeating the motion for summary judgment, the homeowner simply needs to show there is some issue that should be dealt with at trial. Any issue which is not 100% clearly in the bank’s favor will be the basis for the for the judge to deny the bank’s application for summary judgment motion.
Judgment of Foreclosure and Sale
If the judge rules on the summary judgment motion in favor of the bank, the Court will issue a final judgment of foreclosure and sale and an order to auction off your home. If there is an auction order given, a referee will be appointed, who will sell your home on the Supreme Court steps or in a courtroom in the Supreme Court on rainy days.
Can I Stop A Foreclosure From Moving Forward?
Yes! There are numerous defenses, affirmative defenses, counterclaims and other legal actions which can be taken to stop foreclosures from moving forward and tie up the case in court from three to seven years. The banks have experienced law firms representing them. The best way to you protect your investment in your home and your ability to continue to live in your home with your family is to hire an experienced foreclosure attorney.
The law office of Schlissel DeCorpo have been defending homeowners regarding mortgage issues for more than three decades. They can be reached at 516-561-6645, 718-350-2802, 631-319-8262 and 914-998-0080 or emailed at Elliot@sdnylaw.com.
Missing Mortgage Payments
Homeowners who miss making mortgage payments may be facing the risk of being placed into foreclosure. A foreclosure, is a legal proceeding designed to effectuate the bank taking the house back from the homeowner and thereafter evicting the homeowner from their homes.
AVOIDING FORECLOSURE
The best way to deal with the foreclosure is to avoid it. Homeowners who are falling behind on their mortgage payments, should look into a forbearance agreement which involves delaying their mortgage payments. In addition, they can look into modifying their mortgage to make it less expensive in the short run to keep up with their mortgage payments.
LATE MORTGAGE PAYMENTS
In New York, home mortgage loans have a 15 day grace period regarding making mortgage payments. After the 15 day grace period, the homeowner may incur a late fee on the missed mortgage payment. In addition, missing mortgage payments late or making mortgage payments can have a negative impact on the homeowner’s credit rating.
MORTGAGE MODIFICATIONS
A mortgage modification is a means of restructuring the mortgage payments to avoid default and make the mortgage more affordable for the homeowners. If this is done, it has a minimal impact on any potential damage to the homeowner’s credit score. There are a number of different ways to modify a mortgage. Here’s a list of some of them:
- You can seek to reduce the interest rate on your mortgage payment. ∙ You can temporarily pause making mortgage payments and have them made-up at a later point in time.
- You can ask the bank to reduce the amount of your mortgage.
- In cases where the homeowner has an adjustable rate mortgage, the homeowners can request the mortgage be changed into a fixed rate mortgage.
HOMEOWNERS BEING SERVED WITH A FORECLOSURE LAWSUIT
If the homeowner falls three months or more behind on their mortgage, the financial institution has the ability to accelerate the mortgage, which means call the entire mortgage due and owning and thereafter start a foreclosure lawsuit. A foreclosure lawsuit is usually started by a process server showing up at the homeowner’s home and serving them with the foreclosure lawsuit documents. If served with the foreclosure lawsuit set of documents, the homeowner will be shocked to find out how complicated and long the paperwork is. Foreclosure lawsuit legal documents can be anywhere from 100 to 500 pages long, including exhibits attached to the summons and complaint. What do you do if you get served with the foreclosure lawsuit? It is strongly suggested you immediately hire a foreclosure defense attorney.
The law office of Schlissel DeCorpo have been defending homeowners regarding mortgage issues for more than three decades. They can be reached at 516-561-6645, 718-350-2802, 631-319-8262 and 914-998-0080 or emailed at Elliot@sdnylaw.com.
90 Day Notice Requirement Not Complied With
The plaintiff in this case, a financial institution, had appealed an order denying it summary judgment of foreclosure. A summary judgment motion is a motion that states there is no question of fact and the financial institution should be entitled to enter a judgment of foreclosure and sale without taking the case to trial. As stated earlier, the bank lost this motion and they appealed the loss of the motion. The appeal went to the Appellate Division of the 2nd Department.
The Issue On Appeal
The issue with regard to the appeal was Real Property Actions and Proceedings Law Section 1304 (2) This section requires a homeowner receive 90 days notice prior to the initiation of a foreclosure lawsuit. The Appellate Court found the “notice required by this section shall be sent…in a separate envelope from any other mailing or notice.” This was a strict interpretation of the statute.
The Bank’s Problem
The bank in this case acknowledged the envelope it had sent to the homeowner’s contained the required notice under Real Property Actions and Proceeding Laws Section 1304 but it also included other information in 2 separate and distinct notices. The Appeals Courts ruled the bank did not comply with Real Property Actions and Proceedings Law Section 1304.The appeals court found the bank had not strictly complied with the requirements of this section of the law. Therefore the bank failed to satisfy a condition precedent before it could bring its foreclosure lawsuit. The court went on to hold this strict approach precluding any additional materials to be contained in the same envelope with the notice required under Real Property Actions and Proceedings Law 1304 “promotes stability and predictability.” in foreclosure cases. The decision of the lower court ruling against summary judgment for the plaintiff and dismissing the lawsuit was sustained.
Conclusion
Is the purpose of the 90 day notice under Real Property Actions and Proceedings Law Section 1304 is to give the homeowner’s specific notice they are in default on their mortgage and that they have 90 days to cure the default or a foreclosure lawsuit will be initiated against them to take back the house. This strict interpretation of this section by the appeals courts is designed to clarify to the homeowner the serious nature of this notice and the need to deal with being behind on their mortgage payments prior to the foreclosure lawsuit starting after 90 days.
Elliot S. Schlissel is a foreclosure defenses lawyer who has been helping homeowners form more than 3 decades. He can be reached at elliot@sdnylaw.com or 516-561-6645, 718-350-2802, 631-319-8262.
