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Foreclosure Strategies

deal with a foreclosure

The best way to deal with a foreclosure is to take aggressive legal action when the foreclosure lawsuit is started and at the same time actively participate in the mortgage modification process. By both fighting the lawsuit, suing the financial institution to set the mortgage aside and working with the financial institution and their attorneys regarding a mortgage modification provides the best possibility of successfully seeing to it the homeowners to continue to live in their homes.

Mortgage Modification

The homeowners can apply for a mortgage modification before they are sued in foreclosure. If the homeowners finds themselves in financial difficulty they should immediately apply for a mortgage modification and submit a hardship letter to the bank explaining their financial difficulties. A mortgage modification can reduce monthly mortgage payments the homeowner has to make and in addition arrears owed to the financial institution can be placed at the end of the mortgage.

Litigating the Foreclosure Lawsuit

When served with the summons and complaint in a foreclosure lawsuit the homeowners should immediately retain competent experienced foreclosure defense lawyers. The attorneys for the homeowner should put in an answer including numerous affirmative defenses and counterclaims seeking to set the mortgage aside. Discovery applications requesting the financial institution to turn over all relevant documents related to the application, underwriting and processing of the mortgage should be instituted.

Foreclosure Sale

If the homeowner’s home is listed for sale in a foreclosure, the homeowner has 2 options. An emergency order to show cause can be brought to the court where the foreclosure is pending requesting the foreclosure sale be stopped. Another route the homeowner can take is to file a bankruptcy in the United States Bankruptcy Court. The filing of a bankruptcy causes the federal court to issue an automatic stay of all foreclosure proceedings. This stops the foreclosure in the state court. The bank’s lawyers and the referee appointed to sell their home are ordered to stop taking any legal action to move forward with regard to the sale of the homeowner’s home.

Types of Bankruptcies

There are basically three (3) types of bankruptcies the homeowner can utilize. Chapter 13 and Chapter 11 bankruptcies set out plans that keep the homeowners, if they have the appropriate cash flow, to become current on their mortgage. A Chapter 7 bankruptcy simply eliminates all of the homeowner’s debt.

Don’t Give Up

It is said that God helps those that help themselves. Sometimes homeowners when faced with foreclosure become depressed. They assume there is nothing they can do and they take no action. This Attorney Elliot Schlisselis the wrong approach. Faced with their home going into foreclosure homeowners should hire competent foreclosure defense counsel. Our office has helped hundreds of homeowners throughout the Metropolitan New York area continue to stay in their homes. We can be reached for a free consultation at our offices in Nassau, Queens and Suffolk Counties at the following phone numbers: 516-561-6645, 718-305-2802 or 631-309-8262. We can be e-mailed at Elliot@sdnylaw.com. We have been keeping homeowners in their homes for more than 3 decades!

Foreclosure And Your Credit Score

New York foreclosure and bankruptcy attorneyThe initiation of a foreclosure lawsuit by a financial institution against you will have a negative impact on your credit score. For most families, their home is their most significant asset and investment. When the family gets served with a Summons and Complaint in a foreclosure lawsuit, not only are they facing the potential loss of their home, but in addition, their credit worthiness is also being negatively impacted. Foreclosure lawsuits generally cause individual’s credit scores to be reduced by between 150 and 300 points. The foreclosure action can remain on your credit report for between 7 and 10 years.

Reduced Credit Scores

The reduction in your credit score may make it more difficult for you to rent an apartment should you decide to leave your home, do a short sale, or give the bank a deed in lieu of foreclosure. In addition, a reduced credit score will make it more difficult to obtain car loans, personal loans and credit cards. Some employers also look into an individual’s credit scores as part of their employment process. A low credit score may lead a potential employer to a negative conclusion regarding an individual’s level of responsibility or character.

Maintaining Your Credit Score During Foreclosure Litigation

Do not despair! Action can be taken to maintain your credit score even during the course of foreclosure litigation. If you have credit cards you should use 2 or 3 credit cards each and every month. It is important you make timely payments on these credit cards even if the payments are only minimum payments. Each time you use your credit cards it will give you positive points on your credit score. In addition, if you have car loans, personal loans, or other debt you should make your payments in a timely manner on these debts. Your continued use of credit cards, paying loans such as car loans, over time will completely rebuild your credit score. My office has represented individuals who while in foreclosure maintained credit scores of over 700 points.

Conclusion

Even though a foreclosure will have a negative impact on your credit score it is possible to maintain your credit score during the course of foreclosure litigation.

New York foreclosure defense attorney IslandElliot S. Schlissel is a foreclosure attorney who is familiar with the multitude of problems caused by the sub-prime mortgage crisis in America. He represents homeowners in foreclosure cases throughout the Metropolitan New York area and takes legal action to preserve their home ownership rights and help them obtain mortgage modifications.

Your Home Was Sold in Foreclosure, So What Do You Do Now?

foreclosure defense lawyers on Long IslandUnfortunately, some homes will end up being sold in foreclosure. If your home is sold in foreclosure, your world will not come to an end! To start with, foreclosure home sales are generally advertised in local newspapers. Sales take place usually on the courthouse steps or inside a courtroom within the courthouse. Referees are appointed by judges to conduct these foreclosure sales. The sale usually goes to the highest bidder. However, if no bidder bids the amount owed on the mortgage, the bank will bid in that amount and the bank itself will take title to your home. Once the bank takes title to your home, you will be considered a tenant in the house. The good thing about this is tenants have rights!

Homeowners in Foreclosed Homes

Now that you are a tenant, it does not mean you will be forced to immediately move out of your home. The bank can bring a landlord tenant proceeding and try to evict you. However, landlord tenant proceedings tend to be long drawn out proceedings. Banks usually take a much softer approach. Your attorney can negotiate a lease where you can continue to stay in your home and pay the bank rent. If you seek to move, the bank may be willing to do what is called a “cash for keys deal”. In these deals the banks will usually pay your moving expenses and give you money for a down payment for an apartment. They will take this action to avoid the necessity of litigating landlord tenant proceedings.

Keeping Tenants In Their Homes

So your home was sold and you are now a tenant, the best way of dealing with your new situation is to have your attorney contact the bank and enter into negotiations with regard to your new status as a tenant. Banks are concerned about their image. They don’t like to put families on the street. They spend millions of dollars on advertising on radio and television trying to show they are your best friend, they are charming and wonderful and are prepared to give money to whoever comes into their branches. The last thing they want is to be thought of as that Simon Legree figure from literature.

Bankruptcy Issues Concerning The Sale of Your Home

Foreclosure cases are brought in the Supreme Court in the county in which your house is located in. Landlord tenant proceedings are either brought in a Landlord Tenant Court or in the District Court where your home is located. Bankruptcy proceedings are filed in United States Bankruptcy Court. The Bankruptcy Court is a Federal Court. It is a higher court. The bringing of a bankruptcy proceeding creates an automatic stay which prevents state court proceedings from moving forward. The automatic stay is the equivalent of a temporary injunction enjoining the state court from allowing either landlord tenant or foreclosure cases to move forward. The filing of a Chapter 7 bankruptcy can stop you from being evicted and can prevent the landlord tenant proceeding from moving forward.

Should you be in the unfortunate position where your house is sold in foreclosure, do not despair. There is still help available. You can contact our law office to discuss your situation. Our phones are monitored 24/7. We can be reached at 516-561-6645, 718-350-2802, or 1-800-344-6431.assistance for homeowners facing bankruptcy

Deficiency Judgements After Foreclosure

To watch today’s blog video regarding deficiency judgements, please click on the link below:

http://youtu.be/ApOfAj0nT8Y

Elliot S. Schlissel is a foreclosure lawyer.  He can be reached by telephone at 516-561-6645 or 718-350-2802, or by email to schlissel.law@att.net.

Filing Chapter 7 Bankruptcy and Keeping Your Home – Part II

foreclosure and bankruptcy attorneys on Long IslandProperty Exemptions in New York

There is a homestead exemption for homes, co-ops, condos, and mobile homes of $150,000 within the Counties of Nassau, Suffolk, Westchester, Rockland, Putnam, Richmond, Kings, Queens, New York, and the Bronx. (If the title to the house were in the name of a husband and wife, each of the parties, if they filed a joint bankruptcy, would have a $150,000 homestead exemption. Therefore $300,000 of equity in the parties’ home could be protected in a bankruptcy proceeding.)

The extent of the New York bankruptcy exemptions and the ability to use these exemptions to save the equity in a home can be further brought out by the following example. In this example a husband and wife own a home worth $600,000. They have a mortgage on the home of $300,000. They are up to date on their mortgage payments. They have credit card debt and other unsecured debt of $100,000. In this case, if the parties qualify for a Chapter 7 bankruptcy, as a result of filing bankruptcy, the parties could eliminate their $100,000 in unsecured debt. Instead of making the payments on credit cards and the other unsecured debts, they can now utilize those funds to pay their mortgage. The fact they had $300,000 of equity in their house would not create a problem because each of the parties could utilize their $150,000 exemption. (Please be advised that this only works in the counties referred to above).

Conclusion

Bankruptcy is not usually the best way to handle being served with a summons and complaint in a foreclosure lawsuit, however, in the right circumstance it is a viable option.assistance for homeowners facing bankruptcy

Filing Chapter 7 Bankruptcy and Keeping Your Home – Part I

foreclosure assistance for homeownersCan you file a Chapter 7 bankruptcy, eliminate all of your debts other than your mortgage obligation, and still keep your home? The answer to this question is, yes! If you are current on your mortgage payments when you file your Chapter 7 bankruptcy, you may be able to protect the equity in your house, if any, by using the New York Bankruptcy Exemptions. You can file a Chapter 7 bankruptcy, eliminate all of your credit card debt, personal obligations, debts to lawyers, doctors, medical debts, money judgments, car repossession deficiencies, and all types of other personal obligations in the Chapter 7 bankruptcy.

After going through the bankruptcy and eliminating all of your debt besides the mortgage, you will be in a better position to make your mortgage payments. You won’t have all the other creditors calling you on the phone and sending letters demanding payments.

Chapter 7 Bankruptcy Trustee

When you file a Chapter 7 bankruptcy, the court appoints a bankruptcy trustee to review your case. The trustee reviews your petition and thereafter asks you questions under oath at a creditor’s meeting at the courthouse. The Chapter 7 bankruptcy trustee is interested in looking into whether you have property which can be sold to benefit your creditors. If the trustee cannot find property which is not protected by bankruptcy exemptions and has marketable equity in it, the trustee will close your case and not go after your property.helping homeowners stay in their homes

The Effect of Bankruptcy on Foreclosure

foreclosure assistance for homeownersIf my debts are discharged in bankruptcy, is the foreclosure over? Even if your debts are discharged in a Chapter 7 bankruptcy proceeding, your foreclosure problems are not over. If you discharge your unsecured debts and you enter into an arrangement to reaffirm the mortgage and make your mortgage payments your problems with the bank foreclosure may be over. In most cases involving a Chapter 7 bankruptcy, the personal obligation portion of the mortgage debt is discharged (erased) but the lien portion of the mortgage on your home still exists.

The Mortgage

A mortgage actually involves two separate and distinct documents. The first document is the promissory note which can be simply described as an I Owe You (IOU). The second item is a lien. Liens on real property in the State of New York are referred to as mortgages.

The Promissory Note

The purpose of the promissory note is to lay out the terms of the financial transaction, such as the amount you are borrowing, the interest rate, and the payment arrangements. The promissory note is actually the document that creates the personal financial obligation to the bank.

The lien which is placed on your home acts as a type of collateral to secure your repaying the IOU (personal obligation portion of your debt). The lien gives the bank security in your home. Even if you file a chapter 7 bankruptcy and discharge the personal obligation (IOU portion) of your debt, the lien still exists and the bank, when obtaining the release from the automatic stay from the federal bankruptcy court, can move forward with the foreclosure on your home.

The benefit of the chapter 7 bankruptcy discharge will prevent the bank from obtaining a deficiency judgment against you. A deficiency judgment involves a situation where the bank sells your home for less than is owed and goes after the balance of the funds they are owed.

Conclusion

A discharge in a chapter 7 bankruptcy discharges all of your personal obligations, except those which are designated as non-dischargeable by statute. After you receive a discharge, the automatic stay from the bankruptcy court will eventually be lifted. Once it is lifted, the bank will still be able to move forward with the foreclosure in a New York State Court unless you have made a payment arrangement with the financial institution.

So what can you do? Meet with a skilled foreclosure attorney. Find out what your rights are, your remedies are, and the best way to proceed.homeowner advocates

Is Bankruptcy the Solution to Stopping Foreclosure Proceedings?

foreclosure assistance for homeownersThere is a common misconception that filing for a bankruptcy, whether it be a Chapter 13 or Chapter 7 bankruptcy, is a solution to being sued in a foreclosure lawsuit. This is generally not the case. Although under certain limited circumstances bankruptcy may be helpful to you, you should consult with a foreclosure lawyer before considering filing a bankruptcy. Although my office has been involved in filing more than 800 bankruptcies, in most cases involving foreclosure, we do not recommend the filing of a bankruptcy in a federal bankruptcy court is the solution to the foreclosure problem. Foreclosure defense has become a niche legal practice. The litigating of foreclosures in New York State courts is becoming a more and more specialized area. Foreclosure defense lawyers over the past 20 years have developed unique skills in defending foreclosure lawsuits which put the banks on their heels and keep homeowners in their homes.

The Automatic Stay

The filing of a bankruptcy will immediately stop a foreclosure from moving forward. However, the automatic stay granted by a bankruptcy court is only a temporary solution to the underlying problem of the foreclosure. Most homeowners whose homes are in foreclosure are not only looking for a temporary solution to the problem. They are looking for a permanent solution. The filing of a bankruptcy is not necessarily the best route to take.

Foreclosure Lawyers

Financial institutions have engaged in numerous fraudulent, unethical, improper practices. There have been many lawsuits by attorney generals in all 50 states as well as the federal attorney general’s office with regard to these improper, fraudulent practices. The banks have been fined more than $100 billion for their improper and fraudulent practices.

There are numerous federal and state laws regulating bank practices. There are also procedural laws to protect consumers in the State of New York with regard to foreclosure lawsuits. There is an entire body of case law that has been developed which can be utilized to stop foreclosure lawsuits in their tracks, and in some situations, get these lawsuits dismissed.

Mortgage Modifications

New York State has a law which requires all financial institutions to negotiate in good faith at foreclosure court conferences with regard to mortgage modifications. The law is designed to help consumers stay in their homes. Unfortunately, the success rate in obtaining mortgage modifications in New York State is very low. However, pressure can be placed on a bank and its attorneys at these conferences to force them to make reasonable offers with regard to mortgage modifications.

Litigating the Foreclosure Case

In a foreclosure lawsuit, every individual has a right to ask for a jury trial. Jury trials provide homeowners with a constitutional level of protection. During the course of these trials evidence of robo-signing, sham foreclosure affidavits, improper bank practices, violation of federal Truth in Lending Laws, violation of New York State Consumer Protection Laws, and violation of procedural laws involving the initiation of foreclosure lawsuits can be put into evidence. If properly presented, these foreclosure lawsuits can be dismissed.

Conclusion

Although the bankruptcy may be a solution to some issues related to foreclosure proceedings, it is generally not the way to go. Homeowners facing foreclosure should fight the foreclosure in the New York State court they are sued in. The best way to deal with this issue is hire an experienced, dedicated foreclosure defense lawyer to see to it your rights are protected and that the banks have acted properly.helping homeowners stay in their homes

New Federal Mortgage Disclosure Requirements

mortgage and foreclosure attorneyThe Consumer Financial Protection Bureau has propounded new mortgage disclosure requirements. Financial institutions and mortgage lenders will need to provide individuals and families who take out mortgages with much more detailed disclosure material at the time of closing on the loan. The new disclosure requirements replace the existing Truth in Lending Statements, HUD-1 Settlement Statements and the present Good Faith Estimate Disclosure Statements required to be provided by financial institutions.

Three Business Day Requirement

All individuals applying for loans must receive, under these new requirements, loan estimates within three business days. These loan estimate disclosure documents must provide the specific loan terms and the estimated expenses the borrower will incur at the time of closing on the transaction. A second additional disclosure statement will also have to be provided to the individuals taking out a mortgage within three business days before the actual closing takes place. This disclosure document will need to provide a detailed accounting of all aspects of the mortgage loan transaction.

Effective Date August 1, 2015

The new rules promulgated by the Consumer Financial Protection Bureau will go into effect on August 1, 2015. All loans processed after that date will require the dual disclosures discussed above.

Financial institutions and mortgage companies have been modifying their procedures to deal with these new rules and regulations that will go into effect in approximately a year and a quarter. These changes to the disclosure requirements which providers need to give consumers, are the most significant changes and modifications regarding mortgage loan disclosures that have taken place in decades. It is hoped that these new disclosure requirements will educate consumers as to how much they are borrowing, how much it will cost them, and whether they can afford to take the mortgage they seek to obtain.

foreclosure advocate for homeownersElliot S. Schlissel is a foreclosure attorney. He has helped scores of New Yorkers stay in their homes and fight off foreclosures. Elliot and his staff of attorneys also assist their clients in filing Chapter 7 bankruptcies, Chapter 13 bankruptcies, and applying for mortgage modifications. Elliot’s greatest satisfaction is when he can help the families he represents continue to live in their homes.

Part II: Other Financial Institutions Deny Mortgage Modifications For Fictitious Reasons

foreclosure defense attorneyChris Wyatt, who had previously worked for Goldman Sacks subsidiary, Litton Loan Servicing, claimed the company occasionally conducted “denial sweeps.” The purpose of the denial sweep was to reduce the backlog of pending applications for mortgage modifications. In these cases, the mortgage modifications were also denied for fictitious reasons.

The Bank of America employees claimed their supervisors encouraged them to provide false information to homeowners. Simone Gordon stated “we were told to lie to customers and claim that Bank Of America had not received documents it had requested.” “We were told that admitting that the bank received documents would open a can of worms.” She claimed the problem that would occur is that the bank would look to be deficient in its underwriting of mortgage modifications.

These mortgage modification applications were supposed to be underwritten within 30 days. The Bank did not have the appropriate staffing to handle the volume of modifications. It was simply easier to just deny them and make up a reason. Simone Gordon worked for Bank of America from 2007 to 2012 as a senior collector. Simone further advised the court that homeowners who were anxious to find out the status of their mortgage modification applications were told their applications were “under review.” They were told this even though nothing had been done for many months with regard to the processing of their applications. In some situations, the homeowners were told their mortgage modification applications were under review when they had already been denied.

Employee’s Rewarded For Denying Mortgages

Simone Gordon’s affidavit states the employees of Bank of America were rewarded when they denied applications and sent the homeowner’s homes to be foreclosed upon. She stated that collectors “who placed ten or more accounts into foreclosure in a given month received a $500 bonus.” There were additional incentives given to employees. They received gift cards to retail stores and restaurants.foreclosure advocate for homeowners

Foreclosure Defense in Valley Stream, Lynbrook, Baldwin, Malverne, Freeport, Oceanside, Long Beach, Elmont, Lakeview, West Hempstead, Hempstead, Merrick and Bellmore, New York

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