Mortgages

Foreclosures: The Note and Mortgage

July 9, 2024 by Elliot Schlissel

When a homeowner decides to buy a home he or she must obtain the finances to pay for the home. The homeowner usually goes to a financial institution, submits an application and if they are approved they receive a loan. There are two (2) parts to the loan them receive. The first part is a note.

The Note

The note is a written agreement that the financial institution is lending a homeowner money and it contains the homeowner’s agreement to repay the money. The note includes the terms and conditions of the repayment: such as whether the note is to be repaid in 15 years or 30 years. It also includes the rate of interest charged on the loan and the late charges, fees and expenses. In simple terms, a note is an IOU.

The Mortgage

The mortgage is a contract that gives the financial institution, lender, a lien on real property. In simple terms, the home is the collateral that secures the note for the financial institution. The terms of the mortgage spell out what the financial institution can do should the requirements of repayment in the note and mortgage are not met by the homeowner. What the mortgage lender usually does is they foreclose on the mortgage for the homeowner’s failure to make the timely, monthly payments required by the note.

The law firm of Schlissel DeCorpo LLP has been helping families deal with mortgage and foreclosure problems for more than 30 years. We can be reached at 718-350-2802, 516-561-6645 or 631-319-8262 or by e-mail at info@sdnylaw.com.

Filed Under: Mortgages Tagged With: Foreclosures: The Note and Mortgage

$539 million dollars for The American Rescue Plan Act

January 3, 2022 by Elliot Schlissel

$539 million dollars has been appropriated pursuant to an act of Congress for New Yorker’s who are in foreclosure or behind on their mortgages. New York State has received a block grant of $539 million dollars from the federal government. These funds are to be distributed to homeowner’s who are behind on their mortgage or their property taxes or are behind in other housing related expenses. Homeowners who qualify can receive up to $50,000 from the New York recently approved Homeowner’s Assistance Fund. This is not a loan. This is a grant. These fund were appropriated by the federal government to assist homeowners in each state that had fallen behind on expenses related to their mortgages. New York States share of this fund was $539 million.

The American Rescue Plan Act

The 539 million dollars allocated by the federal government to the State of New York was part of the American Rescue Plan Act. Homeowner’s who seek to receive the fund under this federal program must have experienced a financial hardship related to the covid 19 pandemic. New York Governor Hochel is in charge of the program to distribute these funds.

The following is a list of the documents that will be necessary to submit to the portal created by New York State for homeowners’ to qualify to receive up to $50,000 from the New York State homeowner assistance fund:

Proof of Ownership

Copy of your deed, property tax bill, co-op statement, mortgage statement or homeowner’s insurance policy.

Proof of Identity

Copy of passport, social security card, drivers license, Military ID or naturalization card.

Income Documentation

From all adult members of the household: tax returns, two most recent paychecks/paystubs or 1099 forms.

In the event you receive income based benefits such as SNAP, HEAP, public assistance or section 8 you will need to provide documentation of this.

Proof of Delinquency

In addition to all the above-referenced items, you will need proof of your delinquency on making your current housing payments. The State requires a mortgage statement showing a default or a delinquency notice on co-op/condo charges. If your property taxes are behind, you need to show the amount that is past due on a delinquent tax notice.

This program is estimated to be opening for applications on January 3, 2022 on a first come, first serve basis. This means when the fund is used up, and the 539 million is spent everybody who applies after these funds are spent will be closed out.

My office will be available to help homeowners apply for funds under this program.

Elliot S. Schlissel, his partner and their associates have been helping homeowners deal with foreclosure related issues for more than 3 decades. He can be reached at elliot@sdnylaw.com or at 516-561-6645.

Filed Under: Mortgages Tagged With: The American Rescue Plan Act

Lack of Standing Defense Waived

February 17, 2020 by Elliot Schlissel

The issue of standing in a foreclosure lawsuit is a basic issue. The affirmative defense of lack of standing basically says that the financial institution bringing the lawsuit does not have authority to bring this lawsuit.

The Nielsons

In May 2009 the Nielsons’ defaulted on making payments on a $660,000.00 loan to the New York bank’s predecessor. This loan was secured by property located in Kings County.

The Mortgage Assignment

In September 2009 pursuant to a mortgage assignment, U.S. Bank brought a foreclosure lawsuit in Supreme Court in Kings County. A decision was made by the trial judge granting summary judgment and foreclosure and sale to U.S. Bank.

The Appeal

The Nielsons brought an appeal challenging the trial court’s decision granting U.S. Bank summary judgment. The Appeals Court (the Second Department in New York) held that a defendant in a foreclosure lawsuit must submit an affirmative defense as part of their pleadings alleging lack of standing. The failure of the Nielson’s to allege this affirmative defense amounted to a waiver of that affirmative defense. Therefore, the trial court’s granting the motion for summary judgment for U.S. Bank was upheld.

Conclusion

Every answer in a foreclosure lawsuit should contain the affirmative defense of lack of standing. Until discovery proceedings are effectuated by the attorney for the homeowner, the homeowner will not be sufficiently knowledgeable as to whether the financial institution bringing the foreclosure lawsuit has actual standing to bring the foreclosure lawsuit.

Elliot S. Schlissel, Esq. is a foreclosure defense lawyer representing homeowners throughout the Metropolitan New York area for more than 3 decades. He can be reached for a free consultation at 800-344-6431 or you can contact me by e-mail at Elliot@sdnylaw.com.

Filed Under: Foreclosure Defense, Mortgages Tagged With: Financial Institution, Loan

Homeowner Successful In Showing Bank Had No Standing to Bring A Foreclosure Lawsuit

December 30, 2019 by Elliot Schlissel

Beneficial Homeowners Services Corp. had provided a loan to Carpenter when he bought his home. They claimed with regard to the loan Carpenter had signed a promissory note and said note was secured by a mortgage on his house.

Carpenter failed to make his mortgage payments. This caused Beneficial to start a foreclosure lawsuit. In the foreclosure lawsuit Carpenter alleged various affirmative defenses. One of those affirmative defenses was that Beneficial lacked standing to bring the lawsuit.

The Summary Judgment Application

Beneficial brought a motion for summary judgment. They alleged in this motion there was no question of fact that Carpenter took out a loan, signed the note and they held a mortgage on his property. Therefore they should be entitled to a judgment of foreclosure. This was the second time they had brought the same motion.

Bank Not The Correct Party

Carpenter alleged as a defense the bank was not the appropriate party to bring the lawsuit. The formal defense in legal terms was the bank lacked standing to bring the foreclosure action.

The Standing Party

Justice Robert Muller who sits in Clendon County, in upstate New York, ruled that Beneficial failed to establish standing as a matter of law. They had submitted a power of attorney whereby an assignee Caliber was authorized to act as attorney in fact for Beneficial. However, Justice Muller found the alleged power of attorney was insufficient to establish Beneficial had standing to prosecute the alleged default by Carpenter. Judge Muller pointed out the affidavit submitted by Beneficial did not clarify how Wells Fargo Bank came to act as a custodian for the note. Judge Muller also pointed out Beneficial failed to provide documentation of the alleged relationship between Caliber and Beneficial. This was the basis for Judge Muller to deny the plaintiff’s application for summary judgment.

Elliot S. Schlissel, Esq. is a foreclosure lawyer who represents clients throughout the Metropolitan New York area in foreclosure matters and bankruptcies. He can be reached at 800-344-6431 or e-mailed at Elliot@sdnylaw.com. His office offers free consultations to individuals who have foreclosure related issues.

Filed Under: Foreclosure, Mortgages Tagged With: foreclosure lawsuit

A Court Bars Enforcement of Mortgage Due to Violation of Statute of Limitations

September 20, 2019 by Elliot Schlissel

In a case before Supreme Court Justice Debra Silber who sits in Kings County, a homeowner brought an action for a declaratory judgment. The declaratory judgment was pursuant to Real Property Actions and Proceedings Law Section 1501.4. The homeowner wanted the court to declare that the mortgage on the homeowner’s property was not enforceable. The homeowner’s claim was it was not enforceable because the six year statute of limitations had expired. The homeowner asked Judge Debra Silber to have the mortgage cancelled, discharged an struck from the records of the New York City Register

Summary Judgment

The homeowner asked the court pursuant to a summary judgment motion declaring that on the basis that there were no issues of fact disputed that a trial would not be required on the issue of the mortgage being unenforceable due to a six year statute of limitations acted as a time bar.

Acceleration of the Mortgage

Issues were raised in this case with regard to the acceleration of the mortgage and the deceleration of the mortgage. Judge Silber granted plaintiff’s application. She found that the plaintiff had shown on her papers that she was entitled to a summary judgment cancelling and discharging the mortgage on her property. The homeowner had shown that the mortgage had been accelerated on or about April 16, 2009. The homeowner commenced her action to discharge the mortgage and have it cancelled on February 10, 2018. Since more than six years had expired, the homeowner was entitled to a judgment dismissing and cancelling the mortgage of record on her property.

Elliot S. Schlissel, Esq. is a foreclosure attorney. He has been representing homeowners in foreclosure cases throughout the Metropolitan New York area for more than 45 years. Elliot and his firm actively litigates the defense of foreclosure lawsuits against homeowners. He can be reached for a free consultation at 800-344-6431 or e-mailed at Elliot@sdnylaw.com.

Filed Under: Mortgage Modification, Mortgages Tagged With: mortgages

Issues Concerning Notice of Foreclosure Mailing

September 9, 2019 by Elliot Schlissel

In a case before Justice Robert Quinlan, who sits in Suffolk County Supreme Court, a foreclosure lawsuit was brought by Deutsche Bank National Trust Company, as trustee. The action was to foreclose a mortgage on a residential property. Certain affirmative defenses in the homeowner’s answer to the bank’s complaint were dismissed by Judge Quinlan. However, Judge Quinlan did not grant the bank a full summary judgment decision striking defendant’s answer. He set the action down for a limited trial on plaintiff’s proof of defendant’s default in payment; its standing to bring the action; its proof of mailing of the notice of default required by the mortgage; and the sufficiency of the notices required under Real Property Actions and Proceedings Law Section 1304 (which involves the notice of foreclosure proceeding being brought) as well as the proof of their mailings.

The Homeowner’s Defense

The homeowners’ motion to dismiss claimed the bank could not establish the mailing of the notices under Real Property Actions and Proceedings Law Section 1304. Judge Quinlan found the homeowner’s arguments that they did not receive the notices was not sufficient to have the case dismissed. He found all the bank’s lawyers had to do was to establish the notices were mailed.

Conclusion

This is a very bad decision. The purpose of mailing is to give the homeowner the pre-foreclosure notice. If the homeowner never received the notice, there was no communication and the statutory intent behind giving the homeowner notice has not been met. In this case there are still issues to be dealt with at trial. However, I disagree with the Judge’s decision with regard to adequacy of an affidavit of mailing being sufficient with regard to the pre-foreclosure notice by the bank’s attorneys.

Elliot S. Schlissel, Esq. is a foreclosure lawyer. He has been defending homeowners throughout the Metropolitan New York area for more than 45 years. He can be reached for a free consultation at 800-344-6431 or e-mailed at Elliot@sdnylaw.com.

Filed Under: Foreclosure, Mortgages Tagged With: Foreclosure Mailing, Property, Real Property Actions

Predatory Lending

April 16, 2018 by Elliot Schlissel

Predatory lending refers to misleading, fraudulent and/or unfair mortgage practices that financial institutions sometimes engage in during the loan origination process. When financial institutions engage in these practices it can create loan terms with the homeowners which are unreasonable and benefit the financial institution at the expense of the homeowner. Predatory lending involves practices which take advantage of the homeowner and financially benefits the lender.

Low Income Borrowers, Minorities and the Elderly

Low income borrowers, the elderly and minorities are more often at risk for predatory lending practices involving subprime loans than other potential homeowners. Sometimes predatory lending involves charging excessive and unnecessary fees and expenses. In other situations, predatory lenders may add on unnecessary insurance to the cost of the mortgage loan. Excessive pre-payment penalties also are a type of predatory lending practice.

Victimized by a Predatory Lending Institution

If you and your family have been victimized by predatory lending practices you may be entitled to legal relief. It is strongly suggested you contact a foreclosure lawyer to review the circumstances involved regarding your mortgage and advise you whether you have a basis for legal action to deal with this issue.

The law office of Schlissel DeCorpo LLP has been litigating predatory lending issues and other foreclosure defenses for more than 45 years. We offer free consultations and can be reached at 516-561-6645, 718-350-2802 or 631-319-8262. We can be e-mailed at Elliot@sdnylaw.com.

Filed Under: Mortgages, Predatory Lending

Long Island Mortgage Fraud Scheme

October 26, 2017 by Elliot Schlissel

Two men from Long Island have been charged with running a $30 million mortgage fraud scheme. The case is pending in Federal Court in the Eastern District of New York located in Central Islip. The prosecutor on the case, Artie McConnell, in his closing statement to the jury stated these two “stole more money than a man with a mask and a gun ever could,” referring to the two men charged with the mortgage fraud. The two defendants in the case are Aaron Wider, who was the head HFTC Corp. in Garden City and Joseph Ferraro, Jr., who is from Long Beach.

The Scheme

Ferraro and Wider were involved in a scheme where homes were purchased and thereafter sold to a trust on the same day. The homes were then subject to an inflated appraisal and they were resold at much higher selling prices, sometimes as much as double. Thereafter Mr. Ferraro and Mr. Wider sold the “toxic mortgages” in the secondary mortgage market and kept the difference between the real and inflated values. This scheme took place between 2003 and 2008. Each home involved in the scheme ended up in foreclosure. In the end, the mortgage holders on these homes were high and dry.

Elliot S. Schlissel and his associates are foreclosure lawyers. They help homeowners who have fallen behind in their mortgages stay in their homes.

Filed Under: Mortgage Fraud, Mortgages

Trump Administration Creates Mortgage Problems For Potential Homeowners

May 1, 2017 by Elliot S. Schlissel

Picture of a home

Donald Trump shortly after becoming President of the United States signed an administrative order to stop a fee rate cut for mortgages from going into effect. This fee rate cut would have saved potential home buyers who do not have the funds for large down payments – significant amounts of money. As a result of the action taken by the Trump administration 40% of all millennial home buyers will find it more expensive to pay their mortgage.

The Actual Events

A few hours before Donald Trump was sworn in as President he signed an order which set aside action taken by the Obama administration that would have lowered monthly fees for prospective homeowners who buy homes and have less than 20% of the cost of the home to pay as a down payment. These prospective home buyers who do not have 20% to put down for the purchase of a home use a government program operated by the Housing and Urban Development Department known as “FHA Loans” to insure their mortgages. The decrease in the cost of the FHA fees would have saved the average prospective homeowner who takes out an FHA backed mortgage in the State of New York about $1,000.00 a year.

The FHA loan fees were raised during the height of the real estate crisis. The action was taken to cover short falls within the FHA program. The action taken by the Obama administration was designed to bring the FHA costs to the level they were at before the housing bubble crisis took place. The action by Donald Trump has the impact of reducing the buying power of prospective homeowners. The amount of money that could be used for mortgage payments will be reduced by the approximately $1,000.00 a year that has to be paid for the FHA insurance fees.

Mortgage Insurance

Prospective homeowners who do not have 20% to put down as a down payment on a home must buy mortgage insurance. This mortgage insurance covers the potential losses to the financial institution if they are unable to make their mortgage payments. This is necessary because when homeowners do not have 20% to put down on their home there is often insufficient equity in their homes for banks to cover their potential losses in the event the home is foreclosed upon and sold.

Attorney Elliot Schlissel

FHA loans are most often utilized by young home purchasers. Almost 40% of all home purchases by younger purchasers are FHA backed loans.

Filed Under: FHA Loans, Mortgages

Reverse Mortgages: What Are They and How Do They Work?

April 7, 2017 by Elliot S. Schlissel

reverse mortgage

A reverse mortgage is a mortgage loan given to senior citizens that seek to utilize the equity in the home to support themselves in their old age. Generally speaking, the loan does not have to be repaid until the last surviving spouse either dies or permanently moves from the home. In the event of the death of the last of the husband and wife to die the estate of the second to die has approximately 6 months to repay the entire balance of the reverse mortgage or take action to sell the home for the purpose of paying off the reverse mortgage. After the reverse mortgage is paid off the rest of the equity derived from the sale of the home becomes an asset of the estate. Should the home be underwater, be worth less than the reverse mortgage, the estate and either the executor or administrator of the estate will have no personal liability with regard to paying off the portion of the reverse mortgage not covered by the sale of the home.

Who Is Entitled to Obtain a Reverse Mortgage?

Eligibility to obtain a reverse mortgage requires all of the homeowners be a minimum of 62 years of age. In addition, all mortgages on the home must be paid off prior to obtaining the reverse mortgage or at the time of obtaining the reverse mortgage. The home must be the primary residence of the individuals seeking to obtain the reverse mortgage. In addition, the homeowners must continue to pay homeowners’ insurance and property taxes of every type and nature that accrue on the home. The taxes can be property taxes, school taxes, town taxes and village taxes.

Loan Amounts

The amount the homeowners can obtain from the reverse mortgage depends on four (4) specific issues: the interest rate at the time of the reverse mortgage loan, the appraised value of the home, the age of the parties seeking to take the loan and the current government imposed lending limits at the time of the loan application.

How Reverse Mortgage Payments are Made

Attorney Elliot Schlissel

Reverse mortgage payments can be made on a monthly basis for as long as the homeowner lives in the home, for a fixed period of months or the homeowners can take a lump sum out all at once. In addition, the reverse mortgage can create a line of credit the homeowners can access at any time. It is not recommended that the homeowners take the lump sum of all the funds from the reverse mortgage. In these cases the homeowners may not be able down the road to pay at one time the taxes on the home. The non-payment of the property taxes on the home or failure to pay the homeowners insurance is a basis for the financial institution bringing a reverse mortgage foreclosure lawsuit.

Filed Under: Mortgages, Reverse Mortgages

The Note

The Mortgage

The American Rescue Plan Act

Proof of Ownership

Proof of Identity

Income Documentation

Proof of Delinquency

The Nielsons

The Mortgage Assignment

The Appeal

Conclusion

The Summary Judgment Application

Bank Not The Correct Party

The Standing Party

Summary Judgment

Acceleration of the Mortgage

The Homeowner’s Defense

Conclusion

Low Income Borrowers, Minorities and the Elderly

Victimized by a Predatory Lending Institution

The Scheme

The Actual Events

Mortgage Insurance

Who Is Entitled to Obtain a Reverse Mortgage?

Loan Amounts

How Reverse Mortgage Payments are Made

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