I'm looking for interesting foreclosure cases to read...
I'm doing my continuing education homework. I have to practice writing legal briefs. The neat thing about being a Paralegal in the real estate industry are the Lexus-Nexis research moments that make you go hmm...
I'm looking for interesting foreclosure cases to read because in order to establish prima facie entitlement to summary judgment in a foreclosure action, "a plaintiff must submit the mortgage and unpaid note, along with evidence of default (see, Capstone Business Credit, LLC v Imperia Family Realty, LLC, 70 AD3d 882, 883, 895 NYS2d 199 [2d Dept 2010])."
That's not legal advice and don't ask me for legal opinions because you wont get any from me.
That's just me stating a trivial fact that I need to make a note of for my research/homework.
You can Google all kinds of interesting real estate stuff to read and ask your attorney to opine on as you see fit. While I am creating PDFs of my reference material I figured I'd pop in and write a real estate post full of random musings to pass the time (which will also remind me to take breaks - LOL).
According to the electronic documents I'm poking around in, the burden then shifts to the defendant to demonstrate "the existence of a triable issue of fact as to a bona fide defense to the action, such as waiver, estoppel, bad faith, fraud, or oppressive or unconscionable conduct on the part of the plaintiff [**5] (id. quoting Mahopac Nat'l Bank v Baisley, 244 AD2d 466, 467, 664 NYS2d 345 [2d Dept 1997], Iv dismissed 91 N.Y.2d 1003, 698 N.E.2d 958, 676 N.Y.S.2d 129 [1998])."
Here's where my life gets really interesting as a legal researcher because sometimes the "triable issues of fact" can be down right amazing...
People can be happy with you as a real estate broker, get a reference to a mortgage broker, get a loan to terms they agree to, buy a property, then slowly become disgruntled during the recession and decide it's everyone else's fault that the tenants can't help them pay their mortgage like someone may or may not have projected. Sometimes, unsubstantiated allegations of misrepresentation get thrown around and since it's the court who is the final arbiter of the facts everybody has to come in on schedule with their records and explain themselves...
People lazy with their paperwork are sooooooo screwed. Verbal is nice while we are all getting along but once the bickering begins it's the people who can prove who knew what when that appear to do better than the other guy...
The commercial property fighting fascinates me because sometimes cash collateral agreements have arrangements where the buyer's escrow account can periodically be debited to pay down the principal and buyers who forget that little fact may think they are not in arrears on their mortgage payments because they see money debited from their escrow accounts by the bank so don't send additional money towards their mortgage.
Imagine discovering you are being foreclosed upon because you made all these automatic principal payments but skipped paying the bank interest.
More horrifying, imagine not really understanding the significance of banking terms but having a sizable amount of funds on hand so when you theoretically agree to the terms of a cash collateral agreement executed in the capacity of your small business as the president you actually believe your 10% deposit of $ 200,000.00 in an account as additional security wont go anywhere because you don't plan on defaulting. You are told if an event of default occurred then the plaintiff could apply the balance of said account to payment of the "obligations," meaning, all indebtedness, obligations and liabilities arising under said agreement or the note or mortgage.
If you can afford to buy a commercial property and have the cash that stipulation doesn't seem like much of a burden because you are rich, you are dreaming of having a rent roll and reasoning in your mind that this is a long term investment you plan to stick into a trust fund for baby. Now imagine the recession, a Bernie Madoff copycat and another Eron-like series of disasters suddenly wiping you out and all you have is this building keeping you financially afloat. The first nail in your foreclosure coffin? Your tenants move to cheaper digs. Then the dreaded day arrives when you miss a payment because you can't keep the commercial investment property rented at high enough ratio that allows you to survive. You pick your house payments over the mall payments thinking you will catch it up and you still have money in escrow. Holy cow - the bank made a $200K payment on the principal and you are cashless. You thought they were gonna just take $5K out of escrow to cover that monthly payment, leaving $195,000 in escrow.
Suddenly the quote, "...if an event of default occurred then the plaintiff could apply the balance of said account to payment of the "obligations," meaning, all indebtedness, obligations and liabilities arising under said agreement or the note or mortgage..." has new meaning.
I see that phrase a lot... I kinda ignored it too until I read that some default agreements specified how the collateral payments would be made while other default agreements left it up to the bank/plaintiff's discretion regarding how the cash collateral would be applied amongst the accelerated loan principal, interest and arrears....
Another scary thought? Contrary to our hypothetical property owner's arguments/contentions if the $5K vs $200k payment squabble is introduced, researching the issue reveals the possibility that even if the money held in the collateral account was applied solely to satisfy the arrears, it might not constitute payment by the borrower and the property owner would nevertheless still be in default based on the terms of the loan agreements (see generally, Moncreiffe Corp. v Heung, 293 AD2d 324, 740 NYS2d 321 [1st Dept 2002]).
People sometimes tend to miss the point that it's the process of going into default that triggers using the funds being held as collateral. I figured it might make a good blog post to share that little fact.
On a personal note, hubby and I once tried to help a friend not be foreclosed on. After a careful discussion hubby allowed me to influence him on her behalf. We gave her the money yet somehow the payment was one day late. She went one day into foreclosure. It took an amazing amount of negotiating to get her house out of foreclosure because of the bank's delay in processing the cash sitting in her checking account. We were all physically ill behind the thought that you could make the principal, interest and arrears payment in one state while someone in another state was taking your home from you because there was a 24 hour lapse between conversations and paperwork...
Insult to injury? My girlfriend had to pay the bank's attorney and the fees/costs associated with the foreclosure or she would not have gotten her house back. Once you default on a mortgage it can trigger a reality you think you can handle only to discover there is nothing quite like suffering through the financial Armageddon of that type of stress and loss...
Reading all kinds of variations of financial misfortunes (and having first hand knowledge of a few) can make people like me stand on their blogging head not to give legal advice.
I will give you some personal advice: if you can't afford a lawyer go to the legal aid society with your problems and try to find a firm that does pro bono work. Sometimes your union or your spouse's union may have a legal package that can help you. Don't sit there and do nothing. Ask questions and ask for help. If my girlfriend had given up she would have lost everything... She had a union attorney...
Don't snub your union benefits or legal aid people...
A few of you Realtors should use your MLS hotline attorney too (yup - I went there - LOL). ;-)
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