Mortgage Foreclosure Defense Explained In Online Blog Post
A large percentage of the asset protection inquiries I have received in the past year have been from people concerned about a mortgage foreclosure on one or more of their properties. Most people who contact me are interested in asset protection from deficiency judgments. One of the issues I discuss with my clients facing a foreclosure and a potential deficiency claim is whether the homeowner should hire an attorney to defend the foreclosure even though the homeowner is unable, or unwilling, to continue making mortgage payments. There are advantages and disadvantages to foreclosure defense, and the decision to defend or default depends on the individual debtor's situation and his assets. I found blog post by the Florida law firm of Parker and DuFresne in Jacksonville which post discusses legal defenses to a foreclosure action even when the homeowner is behind in payments. I am providing an excerpt from the post below so that homeowners can learn how some attorneys defend foreclosure suits.
The Parker and DuFresne blog states, in part, the following:
"While you are litigating the foreclosure case, you are not required to make your normal monthly mortgage payments. The legal process will afford you time to reinstate the mortgage, sell your home, file a bankruptcy or move out. You may be able to force the lender to completely rewrite the terms of your note and mortgage, enabling you to keep your home.
This may sound too good to be true, but you may actually have valuable defenses and counterclaims against your mortgage company that could actually prevent foreclosure and even require your lender to pay you damages. Across the country, judges are punishing mortgage companies for incomplete record keeping and for violations of the Truth In Lending Act. You may be able to allege valid defenses including fraud and Truth In Lending Act violations.
Are you aware that your mortgage company is probably not the same company that actually loaned you the money to buy or refinance your home? How do you know if the mortgage company suing you has been properly assigned your note and mortgage? Your mortgage company may have failed to properly assign the note and mortgage before initiating the foreclosure. Does your foreclosure complaint even have copies of the note, mortgage and purported assignment attached?
Most likely, these documents are not attached, and may not even be in the possession of your mortgage company. Your mortgage company may be attempting to substitute your original note and/or mortgage with a purported copy. This is called a "Count to Establish Lost Documents." There are strict legal requirements to establish a lost note or mortgage, and your mortgage company may be unable to meet the requirements if challenged.
If your current mortgage company is not your original lender, it probably has never read your mortgage. Your mortgage may require that the plaintiff accelerate (i.e. demand) the entire balance of the note. Your mortgage company may have failed to do that, which may entitle you the opportunity to cure the mortgage by paying the reinstatement amount. It is also common for mortgage companies to inflate the balance due on the mortgage by charging homeowners junk fees, such as Broker Price Opinions (BPO), property inspections and other "property preservation expenses."
So, essentially, your mortgage company may have filed an improper foreclosure lawsuit, but your time is limited. You have or will be served a copy of the foreclosure complaint by a process server. You typically have only 20 days to respond to the mortgage company's complaint, so you need to see an attorney immediately if you wish to defend against the foreclosure. If you are beyond the twenty days, there are still defenses that can be raised."
I do not handle mortgage foreclosure defense. I know several attorneys in the central Florida area to whom I refer mortgage defense clients. posted by Jonathan Alper, asset protection and bankruptcy attorney, Orlando, Florida
I think before foreclosing on a property all options such as mortgage refinancing or mortgage loan modification should be considered. Foreclosures affect your credit rating for up to 7 years, which is detrimental.
Although a loan does not start out as income to the borrower, it becomes income to the borrower if the borrower is discharged of indebtedness.
Make sure to know the state of your finances before contacting your lender. Determine how much income you're bringing in each month, how much you're paying in bills and where you can cut costs. Just a tip!
I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
Alessandra
http://www.craigslisthelper.info
I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
Alessandra
http://www.craigslisthelper.info
i love this site :)
Jonathan makes some very valid and important points. Check into the above and do whatever you have to in order to keep your home. Anything and everything has to be tried. I have other information if you find that the above is insufficient for your needs.
Good luck
William J. Maschke
http://www.endproperty.com
I love it! That is way cool man! The steps weren’t that complicated too, which is great.
if a foreclosure action is filed in 2009 and the lender has been servicing the loan since 2006 yet the assingment to the lender was dated 2009 but done before the foreclosure action (lis pendens 20 day notice) does that constitute a defense in of itself. they still have been unable to produce the note.
How do you look for information for your blog content?
I noticed that Joe Aldeguer is blogging on here. This man is a piece of garbage and no one should take any advice from him. He knows nothing about finances except how to steal them from everyone he knows and considers his clients. This man is full of greed and nothing else how he has been able to continue opening up company after company with various business partners is beyond me, I guess suckers are born everyday. Joe Aldeguer is full of debt, foreclosed properties, bankrupt companies, and lawsuits galore. Tell 'em Joe we are all dying to hear how well you are doing
Thanks for sharing this informative post .
cut off un-necessary things - cable - eating out etc and you will start saving money immediately!
In State of Florida, how long does the motgage company have to file a suit for defeciency? In georgia they have to ask court to confirm the forclosure sale within 30 days.
Thanks for narrowing down things to simpler terms. This could function as a springboard for me against these mortgage companies. Calgary, where I stay, will be changing their terms in mortgage starting April 16 or so I believe and with these changes it may affect how the majority (which is the middle class) would be able to keep up.
The only real defense to a foreclosure is "do we have the legal mortgage holder filing the lawsuit". If the company doesn't own your mortgage, it cannot foreclose.
So you are either playing for time, or, hoping and praying that the mortgage company doesn't have the proper documents.
Meanwhile, the lawyer has to be paid. Chances are this is not a contingency deal.
I am never sure why anyone tries to defend a foreclosure unless it is in exceptional circumstances. When people tried to take out mortgages they couldn't afford I laways talked them out of it. But, in reality, I knew that they would just go down the street and get it from someone else.
Stop foreclosures bu not lending to people who cannot manage them.
I think that the fact that there are so many foreclosures that the banks have to keep up with, they may have gotten sloppy in their record keeping and follow up leaving them open to lawsuits.
Asset protection is only a concern in a short sale.
Selling to an investor that is adept and experienced at short sale deficiency negotiations (like mine) is the best answer.
We make a cash offer to your lender and negotiate your hardship and deficiency just as the property is listed for sale. If we can't benefit, we will be happy to step out of the deal just for good will.
The big concern is someone with a vested interest in negotiating away the deficiency.
Do not do HAFA. It is a trap. You are at the mercy of your lender