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Foreclosure Defense Advice for 2016

foreclosure attorney New YorkIn many parts of the country, the real estate crisis which has caused the high rate of foreclosures is easing. Unfortunately, this is not the case in the Metropolitan New York area. There is expected to be a large flow of new foreclosure cases coming into the courts in 2016. Here is my New Year’s advice for foreclosures which start in the year 2016.

Don’t Ignore the Foreclosure

In my decades of representing homeowners whose homes go into foreclosure, I am shocked by the number of homeowners who simply put their heads into the ground and ignore the fact that their financial institution is taking legal action against them. There are many things that can be done to stop foreclosures from moving forward, to obtain mortgage modifications, to get banks to pay attention to your situation, to tie cases up in court and to challenge the appropriateness, the standing, the basis of the lawsuit and to move to set the mortgage aside. Do not be an ostrich if your home is going into foreclosure. Obtain the legal services of a competent, experienced foreclosure defense attorney.

Look Into Your Legal Options

As stated in the prior paragraph, ignoring the situation is not a smart option to take. If you haven’t applied for a mortgage modification, apply for one. God helps those who help themselves. The worst that can happen is you will get turned down.

Disaster Situations

If you have been subject to a natural calamity or disaster, which has caused a hardship for you or your family, contact your lender and put them on notice of the situation. They may be able to provide you with a forbearance agreement to help you get on your feet.

Refinancing the Loan

If your mortgage loan is not working out for you, before you fall far behind look into the possibility of refinancing your mortgage. Don’t wait until you are many months behind to consider this option. By then it will be too late!

Sell Your Home

If your home has equity in it, and you can’t afford it, selling your home is an option. You can sell the home and keep the equity which exists in your home. Although many homes are going into foreclosure in the Metropolitan New York area, real estate values are increasing. Your home may be worth more than you think it is worth. This is something you should look into.

Bankruptcy

Bankruptcy should be the last option you look into, not the first. There are two types of bankruptcies a homeowner can file. A Chapter 13 bankruptcy is a repayment plan which can help you become current on your existing mortgage over 5 years. A Chapter 7 bankruptcy eliminates the personal obligation on your debt. The filing of either of these bankruptcies creates an automatic stay received from a federal court. This stops foreclosure lawsuits from going forward during the pendency of the bankruptcy.foreclosure defense lawyer

Court Denies Bank Default Judgement and Appointment of Referee

foreclosure assistance for long island homeownersHomeowners had originally taken out a mortgage with Countrywide Mortgage Company. Countrywide assigned the mortgage to Bank of New York Mellon. Bank of New York Mellon brought a foreclosure lawsuit in Kings County, New York. The foreclosure proceeding was based on the fact the homeowners had failed to make their payments pursuant to the terms of the mortgage.

Non-Party to the Lawsuit Opposes Foreclosure

Rivera, claiming he was not a defendant or a party to the lawsuit but nevertheless an interested party based on his ownership of Ozone Park Management, submitted an affidavit opposing Bank of New York Mellon’s application for a default judgment and appointment of a referee. Justice Francois Rivera sitting in the Supreme Court Part in Kings County which deals with foreclosure lawsuits, found Rivera, a non-party to the lawsuit, had failed to bring a cross-petition for leave to intervene in the case. Since he was not a party to the lawsuit and didn’t intervene in the litigation, his affidavit in opposition to Bank of New York Mellon’s motion could not be considered by the court.

Court Denies The Bank’s Motion

Justice Rivera found the Complaint in the lawsuit was verified by the attorney for the bank. Since it was not verified by a bank officer with knowledge of the transaction, the affidavit of the attorney did not meet statutory requirements. In addition, an affidavit of merit which was submitted from Ussery, an individual representing New Penn Financial, the servicing agent, also did not provide information with regard to what relationship this entity had with Bank of New York Mellon. In addition, the court found the moving papers did not provide documentary evidence showing New Penn Financial even had the authority to make a presentation on behalf of Bank of New York Mellon. Based on the aforementioned, Justice Rivera denied the application for a default judgment and the appointment of a referee brought by the bank.

Conclusion

If you hire a foreclosure defense attorney who digs deep enough, they sometimes find mistakes, omissions, failures to provide appropriate information and other defenses which can be utilized to cause the foreclosure lawsuit to be dismissed.New York foreclosure defense attorney

Bankruptcy And Foreclosure

Please click on the link below to watch today’s video blog:

http://youtu.be/95N3eKJXfRc

Elliot S. Schlissel is a foreclosure attorney who has been helping homeowners stay in their homes for more than 20 years.  He defends his clients in foreclosure lawsuits, helps his clients obtain mortgage modifications, and when appropriate, represents them in bankruptcy proceedings.  He and his associates can be reached for consultation at 516-561-6645, 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

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

Knowledge Of False Information In Financial Documents Used In a Mortgage Transaction Bars Recovery

foreclosure defense attorneysJudge Joseph Bianco, sitting in the United States District Court for the Eastern District of New York, recently had a case involving various improprieties concerning the acquisition of a mortgage. Plaintiffs, in this case, had obtained a mortgage on their home from Countrywide Mortgage Company (hereinafter referred to as “Countrywide”) in the year 2004.

After experiencing financial difficulties involving large credit card debt and anticipating a potential bankruptcy and/or foreclosure proceeding, they obtained a second mortgage on their home in the year 2008. Both the first mortgage and the second mortgage were combined in a “Consolidation, Extension and Modification Agreement (CEMA)”. The plaintiffs presented arguments that the 2008 transaction was fraudulent. They claimed Countrywide placed false financial information into their mortgage application in 2008. They also claim Countrywide concealed the 2004 mortgage was “split” from its underlying note as a result of the assigning of the mortgage to the Mortgage Electronic Registration Systems.

Judge Bianco after considering the arguments rendered a split decision. He rendered a decision dismissing the plaintiffs’ allegations of fraud because they had actual knowledge false financial information was contained in the 2008 mortgage loan documents. In spite of the fact they knew the information was false, they executed these documents. He went on further to say although the plaintiffs allege the 2004 mortgage note was invalid, their “splitting” theory was not in compliance with New York State’s “principal-incident rule”. A mortgage is unenforceable if it is detached from its note. However, the note is enforceable even if it is not maintained with the mortgage.

Quiet Title Claim Allowed to Continue

Although Judge Bianco dismissed the plaintiffs’ claims of fraud to set aside the 2004 and 2008 transactions, he did allow the lawsuit to continue under the theory the plaintiffs’ may be entitled to quiet title on this matter. Quiet title means having the mortgage rendered invalid against the property and the removal of the lien from the property.

foreclosure advocate for homeownersElliot Schlissel is a foreclosure attorney representing families who seek to fight foreclosure lawsuits throughout the Metropolitan New York area.

US Bank and Wells Fargo Violate Duty to Negotiate in Good Faith at Mandatory Foreclosure Settlement Conference

foreclosure defense lawyerJustice Robert Torres, sitting in Supreme Court in Bronx County, recently ruled US Bank and Wells Fargo were barred from collecting any interest, unpaid late fees or attorney’s fees until a homeowner was given an appropriate review and determination of his mortgage modification application. A foreclosure action was brought against a homeowner named Rodriguez in Bronx County.

Rodriguez brought an application to find that US Bank and the loan servicer on this mortgage, Wells Fargo Bank, had violated their duties and obligations under the HAMP guidelines to negotiate in good faith at a foreclosure settlement conference. Rodriguez took the position Wells Fargo mishandled and misapplied the HAMP guideline with regard to his application for a mortgage modification. He further argued both US Bank and the loan servicer, Wells Fargo, had failed to act in good faith as required by financial institutions under the HAMP program.

Court Rules Against the Banks

Justice Torres found that Rodriguez had provided sufficient documentation to his allegations concerning the violation of the good faith requirement by the financial institutions at the settlement conference. His decision stated in this foreclosure proceeding, the financial institutions did not follow HAMP guidelines such as violating section 3408(f) regarding the duty to proceed in good faith. The Court took into consideration the presentation by Rodriguez’s representative that Wells Fargo did not explain why they refused to evaluate him under Tier 1 and Tier 2 programs. Under the HAMP guidelines a loan servicer must evaluate the homeowner pursuant to these guidelines. Judge Torres’ ruling stated Wells Fargo had not complied with the current HAMP directive and failed to work towards a loan modification in good faith.

Conclusion

Financial institutions must cooperate and work with homeowners and evaluate mortgage modification applications pursuant to the HAMP guidelines.

helping homeowners stay in their homesElliot S. Schlissel is a foreclosure attorney representing homeowners in foreclosure lawsuits. His office seeks to keep their clients in their homes by helping them obtain mortgage modifications and by challenging the foreclosure lawsuits brought by financial institutions, and countersuing them for violating federal and state laws.

Part I: Bank of America Employees Lied To Homeowners

mortgage modification attorneysIn a lawsuit filed against Bank of America, six former Bank of America employees and one outside contractor working for Bank of America, filed affidavits with the court, claiming they regularly lied to homeowner’s seeking mortgage loan modifications. The mortgage modifications were denied for made up reasons. These employees were rewarded for denying mortgage modifications and putting the homes into foreclosure. The lawsuit is pending in a United States District Court in Boston, Massachusetts. It is part of a class action brought on behalf of homeowner’s who were trying to avoid foreclosures on their homes pursuant to the governments Home Affordable Modification Program (HAMP).

Bank Of America Denies The Allegations

Bank of America has given a statement through a spokesperson. The statement indicated the affidavits of the employees were “rife with factual inconsistencies.” Bank of America claims to have modified more loans than any other bank in the country.

William Wilson, Jr., who worked as an underwriter for Bank of America and as a manager between the years 2010 and 2012 stated homeowners had to submit documentation of financial information with their mortgage modification applications. Wilson stated that twice a month, the bank required all files that were more than 60 days old had to be denied. This was called “a blitz.” During this period, one team would deny between 600 and 1500 mortgage modification applications all at the same time.

The manner in which the employees justified the turning down of these mortgages was to create fictitious reasons for these mortgage denials. The most common fictitious reason for denying the mortgage was claiming the homeowner had not sent in the appropriate financial documents requested by Bank of America. The Bank of America employees claimed these financial documents were not sent in when the documents were right in front of them!

Erica Brown, a former Bank of America employee, has made statements indicating “Bank of America’s practice was to string homeowners along with no apparent intention of providing the permanent loan modification it promises.” Bank of America and its executives should be subject to criminal investigations with regard to their actions under the HAMP program.assistance for homeowners

Courts Impact On The Foreclosure Crisis

Many foreclosure actions spend years tied up in court. This is caused by lenders losing the note. Lenders also have been guilty of sloppy record keeping, loss of documentation of their standing to sue and other violations of court rules and statutes.

Foreclosure lawsuits today, in many situations, are not initiated by the original lenders. The parties bringing the foreclosure action received the mortgages after a series of transfers. It is estimated, millions of mortgage notes have been lost or misplaced. For a lender to bring a foreclosure proceeding it must be the holder or the assignee of both the mortgage and the note.

Show Me The Mortgage Note Defense

Defense lawyers in foreclosure actions now utilize a “show me the note” defense. This has allowed defaulting borrowers to hold off the foreclosure proceeding from going forward while the foreclosing lender or servicing organization looks for the note. Sometimes while looking for the note, they ascertain they do not physically hold the note and they cannot find out where it is.

How Courts In New York Handle Cases Involving Lost Mortgage Notes

Courts in New York can proceed with foreclosure proceedings even without a mortgage note. To accomplish this, the lender must show to the Court it owns the note. They must present to the Court the facts preventing the production of the note and present to the Court the terms of the note. The lender has to provide the Court with a detailed explanation of the note’s chain of transfers. This is to prove that the prior note holders had the intention to transfer the mortgage and that the current note owner is the rightful recipient of the mortgage.

Financial Institutions Proving Ownership Of The Notes

For financial institutions to prove the ownership of the note they must produce a valid assignment of the note or, in the alternative, they must show the note was physically hand delivered to them. Determining what actually constitutes the physical delivery of the note may vary on a case to case basis.

Lost Mortgage Notes

If the lender can demonstrate to the Court it owns the note it then must provide the Court with a logical explanation of why the note was lost. The lender has the burden of proving the terms of the lost note. To prove this, the lender must provide the Court with information concerning the name of the last holder of the note, the name of the borrower, the name of the person who signed on behalf of the borrower, the type of note, the effective date of the note, the value of the note, the payment terms of the note, the loan number and currently how much is unpaid under the note. The person providing evidence of this information must have personal knowledge of all of this information.

Conclusion

Lenders have heavy burdens to meet before they can successfully bring foreclosure proceedings in New York State Courts when they can’t produce the note or provide documentation of the assignment of the note.

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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