Foreclosure Defense Information

real estate and mortgage modification attorneysEconomic Injury in Foreclosure Lawsuits

I have personally spoken to hundreds of homeowners with regard to issues and injustices they have been subject to related to mortgages, mortgage modifications, and foreclosure lawsuits against their homes. However, there is a concept most homeowners do not seem to understand. There is a principle of law which states when you bring a lawsuit you must allege monetary damages. To prove monetary damages you must show there has been an economic injury to you and a certain amount of money is required to redress your grievance for this economic injury (damages). Unfortunately in most foreclosure cases it is extremely difficult for the homeowner to allege economic damages in a countersuit against a financial institution.

Destroying Title To One’s Home

In the counter lawsuits brought by our law firm, we allege there has been economic injury to the homeowner because the financial institution, upon initiating a foreclosure proceeding, filed what is called a lis pendens. A lis pendens is a notice to the world a foreclosure lawsuit has been initiated. The filing of a lis pendens has a negative impact on the title to one’s home. It provides notice to all people interested in any transaction concerning the home that it is involved in a foreclosure lawsuit. Destroying the title to one’s home can be the basis for countersuing the bank for monetary damages.

Fraud

In cases where the bank has engaged in fraudulent activities, has violated truth in lending laws and/or has been involved in predatory lending, there is potential for economic injury the homeowner can recover. Unfortunately the cases do not currently allow a homeowner to set aside a mortgage based on any of those aforementioned theories of recovery. The courts have not granted homeowner’s applications in the past to set aside mortgages and remove the liens from the homeowner’s homes. This is still an avenue which is being pursued by our law office and other law firms defending beleaguered homeowners in foreclosure defense lawsuits brought by financial institutions.assisting homeowners on Long Island

Judge Eliminates All Past and Future Interest in a Foreclosure Lawsuit Due To Bank’s Bad Faith

foreclosure defense on Long IslandLaSalle Bank had brought a foreclosure legal action in the Supreme Court in Suffolk County. In its pleadings the bank claimed they were both the owner and holder of the note which was secured by a mortgage. The defendant in the case did not deny he had defaulted in making 4 mortgage payments. His default was directly related to the fact he was in jail. However, he brought an application to the court requesting all interest on the foreclosed home be eliminated. He claimed LaSalle Bank had unreasonably delayed the legal proceedings in the foreclosure action. They had requested numerous duplicative document demands.

Numerous Duplicative Document Production Requests

The case was heard before Justice Jeffrey Arlen Spinner sitting in the Supreme Court in Suffolk County. Justice Spinner found there were numerous duplicative document production demands. The homeowner had appeared 24 separate times for mandatory settlement conferences. Judge Spinner found LaSalle Bank had not complied with HAMP guidelines. In addition, he found they failed to negotiate with the homeowner in good faith. Justice Spinner found due to LaSalle’s bad faith and the bad faith of their servicing agents, all present, past and future interest on the mortgage in this foreclosure lawsuit was to be eliminated.

Conclusion

Banks need to cooperate to make the HAMP work or they will be punished by judges.helping homeowners stay in their homes

Bank Failed to Follow Notice Requirements

Please view today’s blog video at the following link:

http://youtu.be/NtNmQrCnmTU

Elliot S. Schlissel is a foreclosure defense attorney.  He can be reached at 1-800-344-6431 or by email at schlissel.law@att.net.

Low Cost Loans Designed to Stop Foreclosure On Long Island Are Now Available

loan modification lawyerNew York Attorney General Eric T. Schneiderman has recently held a news conference with regard to the new low cost loan program designed to stop foreclosures. At his news conference he stated “we are going to provide loans to families that prevent them from losing their homes.” He went on to state “we know how hard Long Island was hit by the foreclosure crisis this was the worst of the worst. There was a big boom and a big bust.”

Foreclosures on Long Island

The foreclosure rates in Nassau and Suffolk Counties are among the highest in New York State. The highest rate of foreclosures is in the Village of Hempstead in Nassau County. Hempstead residents have a mortgage delinquency rate approaching 30%.

The New Program

Under the new program, families whose mortgages are overdue can borrow up to $40,000. These low cost loans can be used to bring mortgages up to date and deal with property tax issues. These loans will not be payable until the house is sold or the entire mortgage is repaid. These loans will be interest free. However, the amount due and owing will be adjusted to account for inflation. Applications for these loans will start being processed on September 15, 2014. Applications for Long Island residents will be processed first and a month later residents of other parts of the state can apply for this program. There is a requirement that individuals applying for this program earn less than 120% of the area’s median income.

helping homeowners stay in their homesElliot Schlissel is a foreclosure attorney. Elliot has been helping New Yorker’s stay in their homes for more than 20 years. Elliot and his staff of lawyers litigate foreclosures, deal with predatory lending issues, and assist clients in applying for mortgage modifications. His phones are monitored 24/7 and free consultations are offered.

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.

No Right to A Mortgage Modification

foreclosure defense attorneyA foreclosure proceeding was brought in Suffolk County before Supreme Court Justice Jerry Garguilo. Rivera had executed the mortgage and the personal obligation and he had failed to make his mortgage payments in a timely manner. Rivera had applied to Aurora Loan Services for a mortgage modification. They had taken the position he did not qualify for a mortgage modification.

It Is Alleged The Mortgage Company Acted in Bad Faith

Rivera brought a proceeding before Judge Garguilo claiming that Aurora Loan Services had acted in bad faith because they failed to offer him a mortgage modification or any other agreement to allow him to keep his house from being foreclosed on. It was presented to the court that Rivera was in bad health and could not appear in court. Rivera had a son-in-law by the name of Saburro. He was a loan officer. He came to court and testified Rivera was in bad health and that is why he did not appear in court. Saburro also testified Aurora Loan Services had repeatedly offered Rivera trial mortgage modifications. And at the end of each mortgage modification they would pull the rug out from under Rivera and advise him the mortgage modification was not going to be made permanent.

Judge Holds No Bad Faith

Justice Garguilo found that there were no trial mortgage modifications made. Judge Garguilo took the position the foreclosing bank has no obligation to modify a mortgage. Aurora’s failure to offer Rivera a mortgage modification was not unconscionable and it did not amount to bad faith. Aurora simply had no legal obligation to give Rivera a mortgage modification. It was a totally discretionary decision on their part. Judge Garguilo went on to state in his decision “it was clear the case was not one where a lender wrongfully accepted large sums of money and then refused home retention relief.” The court therefore ruled Aurora Loan Services did not act in bad faith because they did not provide Rivera with a mortgage modification.

helping homeowners stay in their homesElliot S. Schlissel is a foreclosure defense lawyer representing homeowners throughout the Metropolitan New York area whose homes have been foreclosed on by financial institutions.

Home Buyers Misconceptions

foreclosure defense lawyerBuying a home is a complicated undertaking. First home buyers usually rely on discussions with friends and relatives as to what action they should take, what they should do, what they should be aware of, and how real estate transactions are conducted. The lay of the land on home purchases has changed. The mortgage bubble that resulted in the real estate crisis in America has changed some of the ground rules.

Real Estate Brokers Are Not Always Necessary

Real estate brokers provide a valued service to both buyers and sellers. They are very well paid for their services. However, homeowners can sell their homes without a real estate broker. This is especially true if someone is available to show the home during evenings and weekends. A homeowner can advertise the home for sale in local newspapers and/or on the internet, meet and greet the prospective purchasers, and hire an attorney to represent them on the real estate transaction. If the homeowner does not have the time, the patience, or the availability, hiring a real estate broker to represent them may be a necessity. Websites such as www.zillow.com and www.redfin.com can be utilized by a homeowner who seeks to avoid paying the commissions related to listing a home with a real estate broker. Many home buyers today utilize the internet to look at the material on these websites to find the home of their dreams.

Hidden Costs of Owning a Home

The average homeowner, when looking to purchase a home, takes into consideration the mortgage and sometime the taxes on the property. In addition to the mortgage and taxes, homes require heat in the winter and they may require air conditioning in the summer. The fuel oil to heat the home and the electricity to air condition the home can be expensive. Depending on the climate of the area where the home is located, these expenses can amount to between $5,000 and $10,000 per year. Even if the home does not need air conditioning, the electricity to run the appliances, computers, and keep the lights on can be very expensive. The grounds of the home need to be maintained. The homeowner has to maintain his lawn and shrubs and the rest of his property or hire a gardener to do so. The exterior of the home needs to be kept in good condition. Painting needs to be done on a periodic basis and/or the home needs to be sided. Roofs can leak, boilers can break, pipes can leak, electrical issues can develop. These are all potential expenses a homeowner may face.

Down Payment Policies

A 20% down payment is not always needed to obtain a mortgage. If the prospective homeowner is looking to obtain a conventional mortgage from a financial institution, a 20% down payment may be necessary. However, under Federal Housing Authority (FHA) programs, much less is required as a down payment. In some situations, as little as 5% or 10% of the cost of the home is sufficient as a down payment. Programs are available from the Veterans Administration for veterans who can finance a home with a very low down payment.

foreclosure advocate for homeownersElliot S. Schlissel, Esq. has been representing clients in real estate transactions for more than 35 years. His office represents homeowners in buying and selling of homes, defending them against foreclosures, and helping them obtain mortgage modifications when they fall behind on their mortgages.

Foreclosures Loom Concerning Home Equity Loans

mortgage modification attorneysThere is concern there will be a new wave of foreclosure proceedings in the near future related to home equity lines of credit. Home equity loans are a type of second mortgage. Many home equity loans are almost ten years old. The ten year anniversary usually causes the homeowners who have taken out these loans to be forced to start paying back the principal on these loans as well as the interest they have been paying since the loans were originally taken out. It is estimated there is more than $220 billion dollars of outstanding home equity loans with large financial institutions in the United States. When the consumer has to start paying back principal as well as the interest, there is a significant increase in the amount of the monthly payments.

Popularity of Home Equity Loans

Prior to the housing bubble, financial institutions aggressively marketed home equity lines of credit. These lines of credit allowed consumers to pay back more expensive financial obligations such as credit card debts. In addition, home equity loans were used by consumers to buy cars and to take vacations. As a result of banks’ aggressive marketing of home equity loans between the years 2003 and 2007, the amount of outstanding home equity credit increased from approximately $345 billion to $600 billion dollars. Financial institutions that initially approved these home equity loans were counting on the value of the home to increase to support the payment of these loans. Unfortunately the value of homes stopped rising, and during the housing bubble the home valuations were significantly reduced. Large portions of these home equity loans are now unsecured (this means in the event the house was sold, the first mortgage on the property would be satisfied but there would be insufficient funds at the time of the closing of the real estate transaction to satisfy the home equity loan).

Averting a Home Equity Loan Crisis

A home equity loan crisis can be averted if the real estate market turns itself around and real estate values start increasing again. As the real estate values increase, home equity loans will become secured again and in the event of sale of the home, there will be sufficient equity in the homes to pay off the home equity loans.

foreclosure advocate for homeownersElliot S. Schlissel is a foreclosure attorney representing homeowners fighting foreclosure lawsuits. In addition, he helps homeowners obtain mortgage modifications to keep their homes out of foreclosure.

Mortgage Terms – Part I

mortgage modification attorneysMost homeowners in the State of New York hire an attorney to represent them when buying or selling a house. The attorney handles the paperwork, deals with the bank lawyer, and the other parties’ attorney. Unfortunately when homeowners fall behind on their mortgage payments, the banks bring foreclosure lawsuits against them. Homeowners will sometimes research their rights on the internet to determine whether they have viable defenses to their foreclosure proceedings. When reviewing the terms of either a summons and complaint in foreclosure or with regard to the financing of a home through a financial institution, at the time of purchase, it is important to know actually what the specific terms utilized by financial institutions mean.

The Note

The loan document or note refers to a promissory note given by the borrower to the lender. The promissory note creates a contract wherein the borrower agrees to pay a certain amount of money to the financial institution pursuant to specific terms. With regard to notes involved in real estate transactions, the length of the repayment obligation is usually 15 or 30 years. The interest rate on the financial obligation determines how much the borrower will have to pay the financial institution each month. In addition to repaying the interest and principal on the loan, taxes and insurance on the residence are usually added to the monthly payment costs.

A simplified way to look at the promissory note is that it is basically an “IOU”. The note actually does not specifically relate to the property involved. It exists on its own as a financial obligation between the borrower and the financial institution. If the borrower does not make timely payments pursuant to the terms of the promissory note the lender can sue the borrower on the note for breach of contract.

The Mortgage

Let’s start with what a mortgage is not. A mortgage is not a “promise” to pay the loan on the property. The mortgage is not any type of promise. The mortgage is attached to the property by the debt created by the note. The mortgage contains language similar to a deed that gives the lender the right to take the property back if the borrower does not make the timely payments pursuant to the promissory note. In effect the mortgage attaches the note to the property and gives the lender a remedy to sell the property in the event the terms of the promissory note are not adhered to by the borrower.homeowner advocates

Federal Government Seeks $863 Million from Bank of America For Defective Mortgages

foreclosure defense lawyerThe United States government has gone into the Federal District Court in New York City requesting Bank of America pay $863.6 million dollars in monetary damages related to fraudulent activities concerning defective mortgages which were sold by Countrywide Financial Services in 2008. It is claimed Bank of America defrauded Fannie Mae and Freddie Mac, government controlled mortgage companies, with regard to the sale of loans purchased from Countrywide in 2007 and 2008. These mortgage loans generated $1 billion dollars in losses.

The Hustle

The case filed in United States District Court in Manhattan claims Countrywide operated a program called high speed swim lane or HSSL, nicknamed the “Hustle”. The Hustle program was set up to provide financial incentive for employees to make as many loans as possible. The program eliminated many underwriting requirements to ensure loans met minimum standards. The government’s position is penalties are necessary “to send a clear and unambiguous message that mortgage fraud for profit will not be tolerated” stated Judge Jed S. Rakoff, who presided over the trial in this matter. The amount of the penalties requested is based on the losses Fannie Mae and Freddie Mac incurred.

assistance for homeownersElliot Schlissel, Esq. is a foreclosure attorney representing homeowners concerning mortgage modifications and foreclosure litigation.

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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