Michael Lampert Esq., the tax attorney who is Of Counsel to my law office has alerted me that on October 21, 2009 the IRS issued a new form, 4506T-EZ, entitled "Short Form Request for Individual Tax Return Transcript". This new form will make it easier for homeowners trying to short sale, modify, refinance or finance their mortgages to obtain their tax return transcripts.
A transcript is a computer print out that includes most line items on the original return. Many lenders accept the transcript as a substitute for a copy of the original tax return for income and other verification purposes.
Many of you that do short sales or loan modifications are familiar with the old 4506T form usually requested by lenders as part of the request documentation. This new form is a simplified ("EZ") form of the 4506T, Request for Transcript of Tax Return. It is only for obtaining copies of 1040 series (including 1040A and 1040EZ) individual income tax returns. It can be filled out online, printed, and then submitted by fax or mail. Upon the taxpayer's request, the transcript can be sent directly to a third party, such as a lender. It is expected that a request will take 10 days to process.
As a reminder, taxpayers still should keep copies of their original return in a safe place. Copies of the actual tax return can be obtained by filing form 4506, Request for Copy of the Return, usually at a cost of $57 per return and a two month time frame.
Taxpayers also should be careful to fill out all parts of the form, including the years requested and who is to receive the information. Remember that once the IRS sends the information to a third party, such as a lender, the IRS has no control over what a third party does with the information.
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660 RPZ99@Florida-Counsel.com - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers and Sellers with Short Sales and Modifications and Consult with Brokers and Sellers Nationwide! Shortsales@Florida-Counsel.com New Website www.Florida-Counsel.com.
One of the great drawbacks to a broker taking on a short sale listing is the fear and often the reality that the short sale lender will demand a reduction in the broker commissions. This has created all sorts of contraptions to make the broker whole.
I have seen contracts that have inflated commissions designed to make the lender reduce it; I have seen deals to have the buyer guarantee the broker commission short fall. There are more and some not yet invented - I wrote about one 2 years ago in BUYER AGENT REMORSE - PREVENT A COMMISSION REDUCTION ATTACK!
This summer a case was decided in Iowa (and reported by the NAR) where the appellate court said the short sale lender could NOT renegotiate the commission and it is worth noting.
The case of Stewart v. All States Quality Foods decided May 29th has specific facts but I have seen this type of scenario several times and it is worth noting if you are a short sale broker.
In simplistic summary (you can read the case by the link above and it is not too complicated to understand even on a first read!), the broker brought a contract to the lender and in the contract the lender knew that the seller was to get a commission of 10%. The lender said it needed more money and made a counter offer of a specific amount. The broker got that counter offer. Then the lender said it needed to net more and the broker offered to cut its commission to help get part of the way to that number. The lender balked and denied the sale.
The broker sued on its contract for the commission based on bringing a buyer ready, willing and able who met the counteroffer price asked by the lender. The legal theory that won was interference with advangeous business releationship - the listing agreement.
The key issue here is that the lender actively participated in the transaction by making the counter offer request and it being met. Also important is the knowledge by the lender of the existing listing agreement.
In all short sales that we handle we provide a copy of the Exclusive Listing Agreement to the lender, so knowledge in our situations would be met. If the lender makes a counteroffer then the lender is bound to accept it or it has violated at least one legal theory - if you are in Iowa. However the law and doctrines cited by the Iowa appellate court are in comport with many other states caselaw, Florida included.
Be aware of the rights and obligations of the parties to a short sale - especially when the lender oversteps its position as a lender and becomes an active participant.
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660 RPZ99@Florida-Counsel.com - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers and Sellers with Short Sales and Modifications and Consult with Brokers and Sellers Nationwide! Shortsales@Florida-Counsel.com New Website www.Florida-Counsel.com.
Is my mortgage lender guilty of misuse of manpower?
I just received a Saturday morning telephone call from GreenPoint Mortgage wondering why my mortgage payment was late. I asked when it was due and of course was told that it is due the 1st of the month and I have a "grace period" until the 15th of the month.
I realize that if I get the money to the lender on the 1st of the month or the 15th of the month there is no difference. I get no gold star for getting it to the bank before the 15th. In fact the amount of interest I am charged is no different whether I get the money to the bank before the 1st or after the 1st of each month. It is a 15 year amortizing mortgage and in 10 years I have never been late (past the 15th).
So why is GreenPoint Mortgage having precious personnel calling me instead of using that manpower to deal with people actually late on their mortgages or needing and waiting endless months for modifications?
Grrrrr!
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660
Jeff Georghan a Realtor in Pennsylvania put together this detailed analysis of mortgage delinquencies and why the problem is going to get WORSE before it gets better -- I felt this was well worth my bringing it to your attention. -- Richard Zaretsky
This is one of those posts where I wish I didn't have to write it, but felt it was so important to my readers that I would be remiss not to at least talk about it.
Everyone out there probably knows somebody who is behind on their mortgage payments, looking for alternatives and likely also just finding out that their home's value has dipped below what their loan amount is. I know some within my own personal circles. It's a tough situation for me to advise them as a professional because it's such a personal challenge to their pride and self-worth, not to mention their plans and dreams for the family. The question we're asking is "when is this going to stop and where are we heading?"
I'm going to put up a few graphs that show the trends nationally with regards to mortgage delinquincies:
This chart is by quarter - Single-family mortgages set a new record delinquency rate in the second quarter of 2009, according to a quarterly survey by the Mortgage Bankers Association. Those of us in the real estate business see the foreclosure process (just visit the local Sheriff Sale docket to see the current numbers) but the looming delinqency-to-foreclosure issue is far, far larger.
The Wall Street Journal on 8/3/09 reported the following quote: “While subprime mortgages sparked the first round of housing problems two years ago, now "troubles are lurking further up the food chain," says Joshua Shapiro, chief U.S. economist at MFR Inc. White-collar job losses have accelerated while more adjustable-rate loans to prime borrowers are resetting to higher payments. ‘You put all that together, it leads me to believe that the next leg down on home prices is going to come from the top,’ he says.”
The first objection someone may have would be to say "yes, but historically those who are delinqent usually get their act together and come current on the mortgage after a while". That WAS true, but not anymore! We call that the "Cure Rate", that is the rate of delinquencies that go back to current. The Wall Street Journal reported on 8/24/09 about a Fitch analysis that found that the Cure Rate from 2000-2006 was 45% (which means about half of people fix their delinquency). However, as of July 2009 the rate had dropped to just 6.6%! That means that over 90% of delinquent customers are going to foreclosure. Take a look again at the above chart...
The next thing someone will say is "well, that's the 'sand states' and not my area". Here's the chart for all 50 states showing the same breakdown of delinquencies and foreclosures. Guess what - most states have a significant problem, especially compared to historical figures.
Now the next thing someone may say is "aren't those loans going to get 'fixed' by a loan modification?" I know several people right now who are applying for a Lancaster County loan modification but are waiting and waiting. I hope it works out for them...
In reality, loan modifications are hardly making a dent. To me, that's a burning question. Why arent banks being more aggressive in giving customers the option to extend their loan and/or reset to a lower rate? Why are they being SO difficult? The people I know don't want to be foreclosed. They CAN make payments. They just need the terms redrawn to allow them to catch & keep up. Loan modifications are not helping us get this crisis under control.
What are the causes of all these delinquencies? Here's a chart that is enlightening:
Keep in mind, this post is not intended to give us "good news". You may be experiencing good things in your market and that's great. My intent is to get us thinking about the challenges that aren't going away and how we're going to address them as homeowners, agents and professionals. I'd love to hear your ideas!
Does anyone in Versailles have any decency? Two years ago a potential client working as a mailroom clerk for 35 years - came into my office regarding a mortgage modification. He and his wife each made $35,000 annually and he purchased a new Versailles Wellington Florida home costing $1,400,000 for his family and in-laws to live in. He already had a home in Miami with a $170,000 mortgage that he wanted to keep. The 100% financing mortgage was a 1.4% pay-rate negative amortization and had no escrows.
Taxes alone on the house were more than either of their salaries, not to mention insurance, homeowners' association fees and maintenance costs.
His desire was to keep the home and although he was unable to pay my modest legal fee, he came to me 3 times - each time I told him he had been swindled. On top of that, we was about to have mandatory retirement from his long time job.
It seems that this community - the swankiest looking over the top community in the Wellington community in Palm Beach County - is not littered, but now choked with foreclosures with buyers with similar stories. Over 15% of homes in this relatively small community of under 450 homes built beginning in 2005 are in foreclosure. Many of these foreclosure homes never saw a single payment of the mortgage - yet it took lenders 9 to 33 months to file a foreclosure action. Many of these foreclosed homes have never been lived in (buyers take note!).
Now it comes out that most of these buyers all came from areas in the Miami area and many purchased not one, but more than one home - each time qualifying for a mortgage financing while keeping their already mortgaged modest home in the Miami area.
Who benefited? The builder sold the homes at double today's prices as if they each had $10 million dollars hidden in the attic. The mortgage broker fees were significant on the loans. And the poor purchaser sitting in front of me was still dreaming that this home was going to be his retirement paradise.
The Palm Beach Post newspaper this morning has an investigative article on the development "How Foreclosures Hit Versailles" with names, mortgage amounts, addresses of the buyers' modest home and foreclosed home, and lots of pictures. This is the beginning of a valuable investigative effort by the newspaper well worth reading.
The frightening issue is not just that this potential client - and all the others - "qualified" for these mortgages. I could understand if these were "flips that flopped" - but this buyer at least expected that he could afford to keep the house!!! This expectation was not from an insane person, but he had been convinced by an apparently slick sales person that he could achieve an impossible dream and ensconce his family for their retirement in a palace - all on $70,000 a year. I would bet that a good percentage of his co-foreclosed neighbors (that never even moved into their new home - probably because they could not afford the move) had that same dream.
Who pushed these buyers to purchase homes that they absolutely could not keep? What were these buyers thinking? What was the seller thinking? And what was the mortgage broker thinking? Did none of these people have any decency to see what they were participating in was wrong?
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660 RPZ99@Florida-Counsel.com - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers and Sellers with Short Sales and Modifications and Consult with Brokers and Sellers Nationwide! Shortsales@Florida-Counsel.com New Website www.Florida-Counsel.com.
I have previously written about how attorneys can be great and how they can be bad in the field of helping distressed homeowners. Now the California Bar Association has published the preliminary results of an investigation into those attorneys supposedly offering services to help distressed homeowners in one of the hardest hit states.
Attorneys, especially real estate attorney, but also divorce and family law, criminal and commercial law practitioners have had a few dismal years. Finding a new niche appeared easy to some attorneys, especially with promises of "loan modification experts" telling them to just refer the business their way for a referral fee.
As stated in my previous blog articles, the problem is several fold. For one, attorneys to get this business were paying illegal referral fees to non-attorneys. Another is that they were practicing law in states without a license in that state. And yet another is that they were fronting for loan modification firms but not really doing any work for their "client". And the "client" actually was the loan modification firm and not the distressed homeowner.
In my practice, which includes extensive work on short sales and loan modifications as well as foreclosure defense (whatever that means), we have people coming in showing us examples of: Attorneys sending non-legal "salesmen" out to solicit business for a company that the attorney then gets a "legal fee" from; giving false information - I can't say it is "wrong" information because it just isn't; and attorneys offering "delays" as a solution to a distress homeowner - typically saying, "we will delay and delay (for which you will pay me a monthly fee) while you don't pay your mortgage (and stay in the house for free, or collect the rent from your tenant) and then when the bank finally gets through the delays we will offer to settle with them for a modification or whatever". Sound lilke a plan to you?
Distressed homeowners should seek help -- BUT: 1. Be realistic in expectations; 2. If it is too good to be true, it isn't. 3. If you are being pushed to sign up, DON'T! 4. Get recommendations and actually check them out!
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
In March I wrote about the problems tenants faced when the landlord was in foreclosure. See TENANT RIGHTS AND FORECLOSURE - A DISCUSSION OF SAFEGUARDS. Some, but not all, issues have been addressed in new legislation that went into effect May 20, 2009 called the Protecting Tenants at Foreclosure Act of 2009 (note: it is Title VII in this link). There is still the advance rent and security deposit issue as the ACT does not address how the tenant can protect itself from the loss of those monies.
New new Act is very broad and effectively covers every residential mortgage in every state. It does NOT apply to tenancies that are not "bona fide" - and that definition is also very broad. For example, if you are in foreclosure and the tenant is your child, the Act will NOT apply.
The key is when was the lease entered into - was it before or was it after the foreclosure was filed? If it was before the lease was signed, then it takes precedence over the mortgage foreclosure and the tenant cannot be evicted because fo the foreclosure - provided the tenant does not breach the lease. The ONLY exception is if the buyer is purchasing the property as its PRIMARY RESIDENCE, in which event the 90 days.
If the lease was after the foreclosure, then the tenant can be evicted 90 days after notice to vacate is given by the NEW owner after the foreclosure sale. In essence, any lender must give any bona fide tenant 90 days to vacate the premises AFTER the lender or any other buyer at a foreclosure sale acquires title to the property. Of course some state tenant laws still apply, for example, if the prior Landlord (the foreclosed owner) had given a notice to vacate prior to the foreclosure sale occuring (because of a tenant breach) in which event that notice start date would remain applicable.
The HUD explanation is simple regarding the notice to vacate:
(1) The advance notice applies to tenants in any foreclosed dwelling or residential real property, regardless of the type of loan or other security interest on the property.
(2) An advance notice of 90 days is the minimum period of notification. A longer period may be provided, for example, if greater protections are provided by state or local law.
(3) Responsibility for providing the advance notice to tenants falls on the immediate successor in interest of the property, which will generally be the purchaser.
(4) The notice must be given to anyone who, as of the date of the notice of foreclosure, is a bona fide tenant, whether or not there is a lease.
Remember that during the remaining term of the lease or the 90 days notice period, the terms of the lease still apply - the tenant obligations to maintain the premises, pay rent, etc. must still be adhered to by the tenant or they can be sued and evicted by the new owner!This new law is NOT a free ticket for tenants!!!!
It is important to recognize that the new law is only a starting point - STATE LAWS that provide greater protections are still in place and will override the new federal law. I would also note that if the lease term was finished before or during the 90 day period, the lease term is NOT extended by this law and normal state remedies for holdover tenancy would be in effect.
MISSING SECURITY AND ADVANCE RENT PROTECTION FOR TENANTS -
The ACT does not provide any monetary protections that I spoke about in my previous article and therefore the game plan in that article still applies. The problem is that most tenants gave to the original landlord last month's rent and a security deposit. The new owner has no responsibility to the tenant for those monies!! So what to do - see my suggestions in TENANT RIGHTS AND FORECLOSURE - A DISCUSSION OF SAFEGUARDS.
There can be other more imaginative ways to proceed - but remember that because the old landlord that lost the house isn't the owner anymore does not mean that you get a free 90 day pass to live in the house (althought that is how it is likely to pan out for new owners). The new owner can sue the tenant for unpaid rent for the 90 days. That leaves the tenant in a conumdrum of how to recover the deposit and advance rent and that is why participation in the foreclosure suit with a request to the court to deposit monies to the court registry is going to be the best legal route a tenant can take to demand and get fair treatment regarding its financial obligations. My suggestion is to get involved as a tenant in the foreclosure suit when served with the foreclosure summons and complaint. You may want to seek the advice of an attorney in your State when doing so.
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard P. Zaretsky - Palm Beach County Real Estate Attorney- Residential and Commercial- opened up his law office in West Palm Beach Florida in 1978.
Nestor and I had lunch last week with Richard and his son Max who runs their short sale division. Richard Zaretsky is also an Active Rainer. He writes great articles on the particulars of short sales and foreclosures. Reading his blog will keep you busy and learning for hours.
We talked about the short sale business and how they run their short sale division and foreclosure defense divisions and how we run our company. It never ceases to amaze me that when we meet fellow Active Rainers it is like meeting long time friends you have not seen in a while. Of course no meeting with fellow short sale experts would be complete without exchanging war stories.
I was impressed at the level of knowledge of both Richard and Max. We feel comfortable in referring our clients who need foreclosure defense or loan modifications to Richard Zaretsky. They are professional and put their clients first.
Richard and his wife Esther who is also an attorney moved to Palm Beach County Florida in 1975. He was an assistant attorney general of Florida before he opened up his practise in 1978 and he has been in the same building ever since. He graduated Cum Luade from Deleware Law School Widener University. Mr. Zaretsky is AV rated by Martindale-Hubbell, their highest rating for attorneys.
Richard Zaretsky is a member of Temple Emanuel and the Palm Beach Orthodox Synagogue. He has been a board member of the Jewish Community Day School, a past member of the Professional Advisory Committee of the Foundation of the Jewish Federation. He has participated in a lot of community service work.
His expertise in law includes all aspects of Real Estate Law including:
residential and commercial real estate transactions,
loan modifications,
short sales,
foreclosure defense,
lending and mortgage transactions.
Here are some of the posts that Richard has written that are very imformative:
In the preceding blog article I addressed the issues when a borrower waits until they get before a judge to determine that they may want an attorney to represent them. Foreclosure is NOT a Remedy deals with the issues when a borrower has been served with a foreclosure complaint (sometimes mistakenly called a "lis pendens") and more than the time allowed for a response to be filed with the court has come and gone, and no attorney is involved on the borrower's behalf to pursue any available defenses to the foreclosure proceeding. But don't lose sight of the caveat that the borrower should always be looking for alternatives to foreclosure.
These articles discuss:
1. "I have a hearing next week before the judge to tell him my story."
2. "I was served with a foreclosure complaint (lis pendens) months ago".
3. "What does this ‘Final Judgment of Foreclosure' mean?".
This article addresses the 2nd item on the list - I was served with a foreclosure complaint - months ago.
The time to see an attorney is ideally when the borrower realizes that a financial distress problem is likely on the horizon. As for delaying that meeting - it all depends on what threshold events are occurring or have already occurred. Planning and defenses can take time to put into effect or to create, and alternatives to foreclosure take time to establish and put into effect. Any block of time taken off the timeline by procrastination or delay can create a loss of the ability to use that alternative or raise a particular defense to the foreclosure.
The Initial Response
The first thing to realize when you get a foreclosure (lis pendens) complaint served upon the homeowner is that it MUST be responded to within the time stated on the Summons - usually 20 days from the date it was handed to you or posted on your door. Sometimes service is accomplished by "Notice of Action" publication and special rules apply to that type of "substituted" service of process. A "must read" to understand this process is A LAWYER'S EXPLANATION OF THE FORECLOSURE PROCESS.
The Type of Response - Motion to Dismiss / Answer / Affirmative Defenses
The type of response depends on the strategy of the borrower. If there are defects in the complaint then a Motion to Dismiss should be filed. Failure to file a Motion to Dismiss can be a waiver of the defects in the complaint. Defenses should not be confused with defects. Defenses can be pleaded in the Answer as Affirmative Defenses. Failure to plead Affirmative Defenses are waived if not plead. There are specific time restrictions when a defect or defense can be plead (filed). An untimely motion or defense will not be allowed by the court, even if it has merit. For a discussion on the effect of defenses, see FORECLOSURE DEFENSE FALLACY for what may or may not be a valid usable defense.
The Foreclosure Complaint Motion for Default
The key event if the borrower has not responded to the Complaint in a timely manner is whether or not the lender's attorneys have filed a Motion for Default against the borrower. The granting (sometimes by the Clerk of Court instead of the Judge) of a Motion for Default or Entry of Default, prevents the borrower from filing any responsive or defensive pleading for the rest of the case! A default can be set aside by the Judge, but only in certain situations for good cause and it is completely within the Judge's discretion.
The Amended Response
What happens when the borrower filed a letter or some other inadequate pleading in response to the Complaint before retaining us? If we can show that there are likely viable defects in the Complaint or arguable defenses to the Complaint, usually the Judge will allow an amended Answer and the filing of amended or first time defenses. Less seldom is a Motion to Dismiss allowed, unless we can show that the Motion raises good grounds for a jurisdictional defect or significant inadequacy in the Complaint.
During this process the borrower should be pursing other remedies. Our policy is that Foreclosure is NOT a Solution. That is why I just didn't use the term "alternative remedies". Foreclosure is NOT a REMEDY for the borrower - it is a RESULT of unfortunate events.
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
My law practice encompasses assisting and guiding many borrowers that are in financial distress and we take the position that Foreclosure is NOT a Solution. Most borrowers come into the office for guidance and if they are lucky, planning for solution options once they realize that financial distress is a likely scenario. However there is a significant trend this third quarter of the year where we are seeing many more people coming to us with foreclosure suits that were filed many months ago, and now it may be too late to discuss all of the solutions that may have been available to the borrower had they come into the office for a consultation before or at least at the beginning of the process. Unfortunately, some lender representatives encourage their borrower to NOT seek the advice of an attorney or have attorney representation for a short sale or loan modification process - and the borrower often listens to that clearly self-serving advice.
These late comers fall into 3 categories:
"I have a hearing next week before the judge to tell him my story."
"I was served with a foreclosure complaint (lis pendens) 4 months ago".
"What does this ‘Final Judgment of Foreclosure' mean?"
This article will address the first category.
"At the hearing I am going to tell the Judge my story."
I am amazed at the number of borrowers that call or come in and tell me that they have a time to speak to the judge in just a few days. They are usually under the impression that this is a meeting, or maybe a hearing, where they can tell their story to the judge of how the lender promised them a loan modification. Usually part of their story is that the lender also told them to not pay their mortgage for 60 or 90 or more days (see SHOULD I PAY MY MORTGAGE?) and now they have a foreclosure pending.
These people usually also have no clue that they are going into what is 99% of the time, the one and only time they will have the opportunity to see the judge in their foreclosure proceeding. What they also do not realize is that this hearing is NOT an opportunity to present evidence to the judge.
The hearing is almost always a Motion for Summary Judgment. This type of motion allows the judge to only look at the existing court file and consider (a) the legal pleadings (the complaint, exhibits and testimony such as a deposition) that are in the court file. Often there are rules (depending upon the state your case is filed in) that require and limit the consideration of the judge to papers that made it into the court file a certain minimum number of days before the hearing. In Florida, the Lender must have their side of the file complete 20 days before the hearing (see MOTION FOR SUMMARY JUDGMENT OF FORECLOSURE - DEFEATED! AND HOW I DID IT ). NO TESTIMONY is taken at these hearings, which means the court cannot listen and consider any testimony of facts at this hearing - all it can do is see what is in the court file and then listen to argument from the lender and borrower based on and limited to what is in the court file. (A corporate lender needs an attorney but an individual borrower doesn't and can appear without one).
So, the client "telling my story" concept usually does not end up helping the borrower, and frankly, coming in to my office at such as late stage will probably result in my tuning away the potential client unless it is clear that there is some benefit that my representation will possibly bestow upon the potential client
When a person comes into the office and they show me a piece of paper that says that they already had their day before the judge (whether or not they went to the hearing does not matter) and it is a Final Summary Judgment of Foreclosure, it usually is too late to bring into discussion most of the alternative solutions that would have been available if the client came to me months earlier. Now all that is available are fast solutions - a short sale for example, but at a price that will move the property within the next two weeks. The problem is that the low price may not be conducive to the lender approving a sale at that price. In the meantime, the clock is ticking on the date for the foreclosure sale to occur. That date will be stated in the Final Summary Judgment of Foreclosure. We have certainly been successful in getting the foreclosure sale delayed. [Right now I am fighting to further extend a sale from occurring because the lender is actively determining if a short sale contract that was submitted to them 4 months ago at their suggested price is in fact acceptable - the original foreclosure sale was to have occurred 4 months ago.] However, a borrower should proceed with caution such that it is an uphill battle to have a lender cancel an already scheduled foreclosure sale and delaying it is something that cannot be relied upon. Chances are about the same as an amateur playing Roulette.
The sooner a borrower seeks help, the more solutions that may be available. One thing should remain clear - Foreclosure is NOT a solution - it is a result that often times can be avoided.
Copyright 2009 Richard P. Zaretsky, Esq.
Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Legal true life experiences, general observations and commentaries for Realtors, Lawyers and Mortgage Brokers - also see our Palm Beach County Short Sales group blog.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
Posted by 
Who benefited? The builder sold the homes at double today's prices as if they each had $10 million dollars hidden in the attic. The mortgage broker fees were significant on the loans. And the poor purchaser sitting in front of me was still dreaming that this home was going to be his retirement paradise.
;)
;)
