Articles Posted in Foreclosure Defense

Reverse mortgages are a great way to provide retirement funding but they do come with traps for the unwary.  In a recent Forbes article, “Additional Risks of Reverse Mortgages,” complaints to the Consumer Financial Protection Bureau remain high.  Areas of concern include servicers that:

• make it difficult to coordinate payment;
• act as if property taxes and other homeowner obligations are not met;

In a recent case, Harbin v. Roundpoint Mortgage Co., No. 18-11713 (11th Cir. Dec. 17, 2018), the Eleventh Circuit confronted a situation where a borrower applied for a loan modification and was told that the foreclosure sale was “temporarily postponed.”  This borrower decided not to file bankruptcy to stop the foreclosure when she was told this by her mortgage company.  Who wouldn’t?  When the sale went through anyway, she sued.  The appellate court held that the borrower “reasonably could have believed . . . that the foreclosure had been ‘suspended temporarily'” and that the statement was ‘material’ because it was the key to [the borrower’s] decision whether to file for bankruptcy before the June 3 sale.”

Beware out there – consult with a foreclosure defense attorney or a bankruptcy attorney to make sure you know what’s going on with your home if it is in foreclosure — and the various options on how to keep your home.

I’ve written before about the requirement in FHA mortgages that the lender send certified letters and conduct a face-to-face meeting with a borrower before initiating a foreclosure.  When a lender fails to do that, the may be liable for the damages sustained in a wrongful foreclosure.  There are other advantages as well to allow for the transfer of the debt to a third party or even another family members in case they wish to keep the home if the borrower becomes ill or even passes away.  Also it’s easier to obtain deficiency waivers of the debt in case a short sale or foreclosure occurs.

Conventional mortgages are not assumable.  However, similar to veterans who have VA loans, a consumer with an FHA loan may sell his/her home to a purchaser who is willing to assume the existing mortgage and continue making payments pursuant to the existing lending agreement.  HUD and FHA approval is necessary for a loan assumption to occur, and requirements include:

• Manual underwriting to ensure that the homebuyer is creditworthy

If you have a FHA mortgage and have not had a face-to-face meeting with your lender, this may be the ticket to stop the foreclosure!

Foreclosures are on the rise in Florida:  Tampa/St. Pete is up 75%; Orlando is up 198% and Jacksonville is up an astonishing 332%.  While Tampa is the strongest real estate market of these other Florida metro areas, this uptick bears watching.  Overall, I’d have to say as a foreclosure defense attorney that lenders appear to have corrected many of their ways regarding properly documenting a mortgage and its subsequent assignment.  But lender practices are often still deficient.  A foreclosure defense attorney just needs to be more diligent in representation to ensure our laws are followed.

A mechanism that was designed to prevent unnecessary foreclosures is found in FHA mortgages and is known as the face-to-face meeting requirement.  FHA notes specifically limit acceleration of the debt and foreclosure only when permitted by HUD regulations.

It’s well known that Florida foreclosure attorneys vary in experience and results.  Some do loan mods, some don’t.  Some do short sales, some don’t.  Some file bankruptcies, some don’t.  Some do appeals, some don’t.

We’ve always taken what I call a holistic approach.  While we can try for a dismissal and we’ve had many dismissals over the years, we are really looking for a complete and final resolution for the client.  A dismissal means the bank/lender will just keep coming back and file yet another foreclosure.  Some clients want that – they just need time in the house without a mortgage payment while they get back on their feet.  Some have saved some funds to apply to a down payment for another home that is not underwater.  Some try for a free house, which very rarely happens.

But many of our clients want to move on, they need some time to come to that decision, which occurs during the foreclosure defense case, but ultimately, they may seek a deficiency waiver, cash for keys and an extended move out date.  We negotiate that.