Buyout of Damaged Homes on Fire Island

foreclosure defense for long islandersIn the 1960’s, the United States Army Corp of Engineers laid out plans to develop a shield for Fire Island, which is located on Suffolk County’s south shore. Under this plan, several thousand homes in flood zones would have been torn down and natural buffers, including wetlands, would have been restored. Unfortunately this never took place.

Superstorm Sandy

After Superstorm Sandy there were scores of homes damaged on Fire Island. Fire Island is a barrier island which lies a few miles from the South Shore of Suffolk County. There are 15 separate communities on Fire Island. After Superstorm Sandy damaged numerous homes, it was proposed that 40 or 50 homes on Fire Island be torn down and dunes be established at those locations to protect the rest of the island. Surveys have been conducted by the Suffolk County Department of Public Works with regard to the amount of land necessary to establish these dunes to protect the island.

It was originally estimated it would cost $46 million to tear down 41 homes and create 15 foot high dunes to protect Fire Island. This estimate has turned out to be too low. It is now estimated it will cost between $60 million and $80 million to tear down the homes, obtain easements and to rebuild the dunes necessary to protect the island.

The Program is Moving Slowly

Homeowners on Fire Island are concerned because the program is now a year behind schedule. There are 41 homes which have been condemned by Suffolk County on Fire Island. These homes cannot be sold. Homeowners who were offered buyouts under this program, who feel they were not offered adequate compensation for their condemned homes, can bring legal action to try to obtain a higher price for their home.

assistance for homeownersElliot S. Schlissel is a foreclosure attorney. He represents homeowners on Long Island and in the City of New York whose homes are in foreclosure. He litigates issues involving improper bank practices, bad assignments, predatory lending, and all types of issues affecting homeowners facing foreclosure lawsuits. In addition, Elliot helps his clients obtain mortgage modifications.

FHA Gives Homeowners a Second Chance to Buy a Home

foreclosure defense for homeownersThe Federal Housing Authority (FHA) has a new program which will stay in effect until September 30, 2016. This program offers homeowners who have lost their homes due to short sales, whose homes have been sold in foreclosure, or who have given deeds in lieu of foreclosure back to financial institutions, a second opportunity to purchase a home. In the past, if a consumer lost their home related to a foreclosure case, they would have to wait thirty-six months before they could apply for a new FHA loan. However, under this new program, they would only have to wait twelve months after a foreclosure sale or a short sale to apply for a new FHA loan as long as they can document the financial issues that caused them to lose their prior home.

Reduction in Income

If the prospective homeowner can show that they had a loss of income of twenty percent or more for a minimum of six months prior to the loss of their home, it will help them qualify under this new program.

Credit Score

Under the new FHA program, the homeowner will need a credit score with a minimum of 640. In the event the prospective homeowner could not meet this credit score requirement, they must go through a HUD approved counseling agency concerning the issue of home ownership and residential mortgage loans.

The homeowner should be aware that supporting documentation with regard to any financial issues, hardships, illness, loss of employment or other problems that caused the individuals to lose their initial home must be fully documented. A letter explaining the situation will not be sufficient to qualify for this new FHA program.

Conclusion

FHA is extending themselves to homeowners and giving them a second chance that has never previously been offered to families who have lost their homes.

helping homeowners stay in their homesElliot S. Schlissel is a foreclosure defense lawyer. Elliot and his staff of attorneys represent individuals and families throughout the Metropolitan New York area whose homes have been foreclosed upon by financial institutions and mortgage companies. Elliot assists his clients in mortgage modifications. In addition, Elliot brings lawsuits against financial institutions who have broken laws, failed to obtain proper assignments and who do not have standing to bring their foreclosure lawsuits. Elliot has an unparalleled record of success in keeping his clients in their homes after foreclosure proceedings have been initiated against them.

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.

Foreclosures Hit Long Island Hard

foreclosure defense attorneyThe foreclosure crisis on Long Island is much more serious than in the rest of the country. On a national basis, approximately 2% of all homes were in foreclosure during the month of January 2014. However, on Long Island, 6.3% of all homes were in foreclosure. That is three times the national average.

Long Island real estate has not recovered as fast as the rest of the nation for a variety of reasons. The court rules concerning foreclosures are designed to protect homeowners. However, the legal protection afforded homeowners impacts on the length of a foreclosure process through the courts in New York. During the 2013 calendar year, 663 homes were sold at auction in foreclosure on Long Island.

Rising Home Prices

Home prices have been rising on Long Island. The rising home prices allows more homes to be sold quickly and should have an impact on reducing the number of homes in foreclosure. The average home price, excluding homes on the east end of Long Island, during the last quarter of 2013 were sold for approximately $360,000. This is up approximately 3% from 2012.

Superstorm Sandy Impacts Homes on Long Island

The large number of homes on Long Island damaged by Superstorm Sandy has had a significant impact on the number of homes going into foreclosures. Many homeowners spent all of their savings bringing their homes back to liveable condition after Superstorm Sandy. However some of those homeowners overspent and fell behind on their mortgages while trying to rectify the problems caused by Superstorm Sandy to their homes.

Delinquency Rates on Long Island Are High

It is estimated approximately 10% of all mortgage loans on Long Island are more than 90 days past due. This is double the national average of 5% of mortgage loans which are 90 days past due.

assisting homeownersElliot Schlissel and his associates maintain one of the busiest foreclosure defense law firms in the Metropolitan New York area. Elliot has been interviewed on radio and in newspapers concerning foreclosure defense issues and is widely considered to be one of the best and well known foreclosure defense lawyers in the Metropolitan New York area.

Foreclosures and the Rental Market on Homes

foreclosure defense attorneysThe large number of foreclosures due to the housing bubble in the United States has created an abundance of homes available for rental purposes. Approximately 20% of all single family homes are now rentals. The large number of single family homes being rented is related to the boom and bust of the recent real estate cycle. The significant number of homes sold in foreclosure proceedings have created an availability of homes for rental by families. In addition, millions of homeowners have lost their homes in foreclosure lawsuits. These families need a place to live. The availability of other homes that have been foreclosed on can be rented by them to meet their need for a place to live.

In addition to homes being foreclosed, homeowners who need cash flow are putting their homes on the market as rentals. They are even doing this during the foreclosure process. Since the foreclosure process in many states takes years, homeowners can literally move out of their home, charge rent to a tenant, and put the rental money in their pockets and not make their mortgage payments.

Rentals are Better than Vacant Homes

Officials in local areas have a preference for foreclosed homes to be rented instead of being left vacant. Vacant homes can be a blight on a neighborhood. They can invite trespassers and can be utilized by children for inappropriate purposes.

Although renting a home does provide a family with a place to live, it may not be their first choice. Their more likely first choice would be to stay in the home they had owned and not to have lost it in foreclosure.

assisting homeownersElliot S. Schlissel is a foreclosure defense lawyer representing homeowners, fighting financial institutions and banks to stay in their homes. Elliot and his associates have been protecting homeowners and keeping them in their homes for more than 20 years.

Stopping Foreclosure in Its Tracks

foreclosure defense attorneysTimes are tough in New York right now. Many businesses have downsized their employees. This has caused layoffs. It is harder to make a living in New York today than it was in earlier decades. Financial difficulties can cause stress. The ultimate problem consumers face is when they receive notice the bank is going to foreclose on their home and put them on the street. Receiving notice your home is going into foreclosure can be deflating. However help exists.

You can take legal action to stop foreclosures from moving forward in New York. You do not have to surrender to the financial institutions and be forced out of your home at a time when your credit is at its lowest point. Hiring an experienced, dedicated foreclosure attorney can make the difference between continuing to live in your home and being forced out of it.

There are numerous steps a foreclosure defense lawyer can take to help homeowners. Forbearance agreements can be negotiated. Mortgage modifications can be submitted. Mortgage modifications can sometimes reduce the principal, provide lower interest rates and more flexible terms. Some lenders are willing to defer significant portions of the mortgage indebtedness to later points in time. When applying for a mortgage modification, it is important the homeowner show financial difficulties. Mortgage modifications are designed to help homeowners who are in distress. Our foreclosure defense lawyers can counsel you with regard to the best route to take with regard to mortgage modifications.

Federal House Authority (FHA) Mortgages

There are special programs set up by the Federal House Administration with regard to homeowners who lose their jobs and have financial difficulties paying their mortgages. The program for unemployed homeowners can excuse the homeowner from paying their mortgage for a period of up to one year. During this period of time, the bank will be unable to foreclose. Our foreclosure attorneys can help you prepare the necessary paperwork and make the application to participate in this program. We can also intercede with regard to the bank or financial institution to help you deal with your current financial difficulties.

Foreclosure Court Proceedings

Foreclosure lawsuits are started by the service of a Summons and Complaint by the financial institution’s attorneys on the homeowner. When a homeowner receives a Summons and Complaint they have between twenty and thirty days to take action to stop the foreclosure in its tracks. Our law firm, when defending a homeowner, immediately files between eighteen and twenty five affirmative defenses. We also regularly countersue (sue the bank) as part of the lawsuit. The squeaky wheel gets more grease is an expression. We stand out from the crowd when defending our clients in foreclosure lawsuits. We pressure the financial institutions to make mortgage modifications and/or withdraw their lawsuits. Legal action can be taken to tie the cases up in court any where from three to six years in the Metropolitan New York area.

In Foreclosure? Do Not Despair

The worst thing you can do if your bank threatens to sue you in foreclosure or serves a Summons and Complaint upon you is to do nothing! If you take no action to defend yourself in the court by submitting a written answer to the bank’s lawyer and to the court, you default. By defaulting, you give the financial institution a win. It is like lying down to die. Don’t do it.

assisting homeownersIf you are facing foreclosure, call us. We will offer you a free consultation. We will provide you with a road map as to what we can do to keep you in your home and defend you in the foreclosure lawsuit. We will give you a written itemized retainer which shows what we will charge you, the basis of our charges, and what we can do for you. Help exists. God helps those who help themselves. If you have foreclosure problems, call us. We are the law firm that can help you. The phones at our law office are monitored 24 hours a day, 7 days a week. We can be reached at 1-800-344-6431, 718-350-2802 or 516-561-6645.

Federal Government Moves Against Banks

foreclosure defense attorneyThe United States government has brought several lawsuits against some of the largest banks in the world. The purpose of these lawsuits was to hold these banks accountable for their mortgage fraud practices. As a result of legal action, JP Morgan Chase entered into a settlement whereupon they have to pay $5.1 billion dollars to the regulator of Fannie Mae and Freddie Mac. This settlement dealt with allegations related to toxic mortgage securities packaged and sold by JP Morgan Chase which was one of the causes of the financial crisis in America. This settlement was part of a larger settlement involving a $13 billion dollar payment between JP Morgan Chase and federal and state officials with regard to the bank’s improper mortgage practices.

Bank of America

A federal jury has found Bank of America was responsible for mortgage fraud during the financial crisis. Prosecutors in the case are asking for approximately $850 million dollars in damages from Bank of America.

Banks Charged for Their Bad Behavior

It is important that the government, even though it is long after the fact, is taking the appropriate legal action to find banks responsible for their wrongdoing which created the mortgage crisis in America.

Homeowners Not Compensated

The settlement between the federal government, JP Morgan Chase and Bank of America allocates approximately $4 billion dollars in financial relief to homeowners who were victimized by improper mortgage practices. Considering the hundreds of billions of dollars homeowners have lost, this is a mere pittance. The government should have required a much larger fine from JP Morgan Chase for its improper mortgage actions and mortgage fraud.

Conclusion

The government’s action concerning illegal mortgage practices taken against large banks is too little too late!helping homeowners stay in their homes

Low Down Payment Mortgages

foreclosure defense lawyerLow down payment and no down payment mortgages played a significant role in the mortgage bubble that developed during the housing boom in the United States. When the housing market crashed, many of the families who had obtained mortgages with little or no down payment found their homes worth less than their mortgages and they had no ability to make their monthly mortgage payments. The reality of the situation was consumers were buying homes they could not possibly afford to keep over the long run.
Although it is difficult to obtain a no down payment or low down payment mortgage today, there are still avenues available to obtain these types of mortgages.

FHA Mortgage Loans

The Federal Housing Administration (FHA) has a loan program where they provide financial guarantees for individuals to obtain mortgages with down payments as low as 3.5%. Although the FHA actually doesn’t act as a direct lender, this federal agency insures loans by financial institutions that provides the financial institution security to offer low down payment mortgages.

Lower Credit Scores

The FHA will provide mortgages to potential home buyers with credit scores as low as 575. FHA mortgages come with restrictions. To begin with, there are caps on the house price related to the region the house is located in. Secondly, the home must be purchased to be used as a principal place of residence. FHA loans cannot be used to purchase investment property.

When an individual or family obtains a low down payment loan from the FHA, they are required to purchase private mortgage insurance. This private mortgage insurance protects the financial institution in the event the homeowner is unable to make his home payments or there is insufficient equity in the home to pay back the mortgage at time of the sale of the home. This private insurance program requires an up front insurance premium that is part of the underwriting costs of the loan. In addition, the homeowner must make monthly payments. Due to the additional private mortgage insurance premiums, the monthly mortgage payments on FHA loans are usually higher than those of conventional mortgage loans.

Veterans Administration Mortgage Loans

The Department of Veterans Affairs (VA) has a mortgage loan program for members in the military and former military members. This allows men and women who served their country to obtain a mortgage with no down payment. Similar to the FHA, the VA doesn’t actually make the loans. What they do is they provide insurance which motivates private lenders to participate in this program. There are specific eligibility requirements under the VA mortgage loan program. VA mortgage loans also carry fees at the time of closing, however they do not require private mortgage insurance, which is required under the FHA program. VA loans are an attractive means of purchasing homes for Americans who served their country in the military.

Private Financial Institutions

As indicated earlier in this article, low down payment and no down payment loans were part of the reason for the housing bubble that existed in this country for the past seven years. Although banks have become more aggressive in marketing conventional mortgage loans, new government regulations related to the Dodd-Frank Act which go into effect on January 10, 2014, will make it very unlikely financial institutions will pursue these type of mortgage loans in the future.

homeowner advocatesElliot S. Schlissel is a foreclosure attorney with more than 20 years experience fighting foreclosure lawsuits. He represents homeowners with foreclosure problems in the metropolitan New York area.

Home Loans Will Be Harder to Obtain in 2014! – Part II

foreclosure defense attorneysFewer Foreclosures in the Future

The creation of the Consumer Financial Protection Bureau (CFPB) may make it more difficult for financial institutions to foreclose on homes owned by homeowners who have stopped making mortgage payments. “For every foreclosure, lenders will have to show the CFPB that there was absolutely no way they could do anything else” according to Gaffney. This will require financial institutions to offer homeowners behind in their mortgage, additional options other than foreclosure. Those options may involve short sales, refinancing, cash for keys arrangements (these are arrangements where lenders pay delinquent homeowners to hand over the keys to their residence and walk away from their homes) and other potential options. Due to the necessity of offering these alternatives, lenders may become concerned that taking back homes from delinquent homeowners will be more difficult. This may result in more conservative underwriting requirements by lenders which will end up shutting more prospective homeowners out of the marketplace to obtain mortgages.

Ability to Pay Rules

Under the new rules going into effect in 2014, financial institutions will have less latitude in evaluating prospective homeowners regarding mortgages. The lender will have to take into consideration the “ability to pay” of the prospective borrower. The following are a list of the new rules lenders will have to take into consideration in underwriting new mortgages in 2014:

  1. Current or reasonably expected income or assets;
  2. Credit history;
  3. Monthly mortgage payments;
  4. Current employment status;
  5. Current debt obligations, (alimony, child support, credit card bills);
  6. Monthly payments on other loans;
  7. Monthly payments on mortgage related obligations; and,
  8. Monthly debt to income ratio or residue income.

Debt to Income Ratio

The debt to income ratio under the new rules will create problems for many families who seek to obtain mortgages. Under the new rules going into effect on January 1, 2014, the monthly debt to income ratio will be set at a maximum of 43%. This means homeowners will not be able to utilize more than 43% of their income to pay all of their financial debts. These debts will include car loans, credit cards, personal loans, and other financial obligations over and above the prospective mortgage they seek to obtain.

Conclusion

Applying for a mortgage in 2014 is going to be more difficult. If you are interested in obtaining a mortgage, apply now!foreclosure advocate for homeowners

How Good Does Your Credit Score Have To Be To Obtain a Low Interest Rate Mortgage?

mortgage modification attorneysIf you are in the market to buy a new home or an existing home, one of the most important issues is whether you can afford the mortgage payments. But before you can consider whether you can make your mortgage payments, you need to obtain the mortgage. Credit scores are the most important factor financial institutions look into with regard to underwriting mortgage loans. Today it is recommended individuals applying for a mortgage have a credit score of 740 or above. Credit scores are based on a total potential perfect credit score of 850 points. The 740 credit score that is requested by financial institutions today is among the highest asked by banks at any point in time. Pursuant to www.zillow.com, a mortgage information company, approximately 40% of Americans have credit scores high enough to obtain the best possible mortgages.

Mortgage Rejection Rate

There is currently a 30% rejection rate by financial institutions for those individuals applying for a mortgage. When you take into consideration the housing market has been improving in the United States, and foreclosure rates have been going down in most metropolitan areas, a 30% rejection rate is very high.

So what do you do if you do not have a 740 or above credit score? You can still obtain a mortgage. However, you will most likely have to pay a higher interest rate for the mortgage.

Credit Reports

Before going into the housing market to look for a home to purchase you should check your credit score. You can obtain a copy of your credit report on the internet. Carefully look at your credit report to determine if all the material on your report is accurate. If there are inaccuracies in your credit report contact the credit reporting agency in writing to correct these inaccuracies. Your credit report will also show you the balances on credit lines, personal loans, and credit cards. It will be helpful to bring the balances on your indebtedness down prior to submitting a mortgage application. Banks take into consideration all of your overall debt when they underwrite a mortgage.

helping homeowners stay in their homesElliot S. Schlissel is a foreclosure attorney with extensive experience in representing clients regarding foreclosure lawsuits, mortgage modifications and fraudulent mortgage practices of banks. His goal is to help clients stay in their homes.

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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