FORECLOSURE IN 2011
If you read our local newspapers or even if you watch TV you are then bombarded with news report snippets of information about the housing markets, real estate, and foreclosure activity. There was a time when real estate drove the U.S. economy upward, now it drains our lives! The latest “gossip” on the street, as gathered by the media, has confused many people! Some reporters go the extra mile and actually speak directly to local attorneys to get the heartbeat and/or pulse of the market. An example of poor unverified reporting: Recently a local popular TV news anchor reported, “Foreclosures are down dramatically because Florida banks are no longer foreclosing local homes.” That information was wrong, misleading and incomplete with unverified facts.
FACT IS: It was true the five major mortgage-servicing banks called for a 60-day moratorium in November so they could review their case files for re-submission to the courts. It was alleged by several states’ Attorneys General, including here in Florida, that some local foreclosure bank attorneys were rushing to get as many foreclosures filed as possible to spike-up their law firm incomes by submitting incomplete or false complaints in record numbers of foreclosures. True, there was a moratorium called but only to allow the same bank foreclosure attorneys to correct their files so they can re-file the foreclosure cases and file new cases as soon as possible – as of the first of the year. (This correction process is called; an Amended Complaint, or Amended Petition).
We can anticipate that during this lag time when foreclosures dropped an artificially low 21% in November 2010 that starting as early in 2011 first quarter we will be witness to a flood of foreclosure activity.
Please do not fall into the trap-thinking that your bank will stop foreclosing as you have been wrongly misled in newspapers and TV reports. That is not true in any sense of fact. FACT IS: The banks that had scheduled foreclosures in late 2010 will now be forced by the bank’s investors or owners of the credit instruments to quickly commence to foreclose on all delinquent mortgages that are more than 90 to 120 days late in monthly mortgage payments. Now that the court has had time to re-evaluate many cases, we anticipate that the faulty paperwork that was previously submitted by overly aggressive banks’ attorneys will be corrected and the courts will start to accept amended filings on all former cases that were filed before November 2010 and all new filed foreclosure cases will be corrected to current courts standards.
“Fallout from the foreclosure robo-signing controversy forced lenders and servicers to hit the pause button on many foreclosures while they scrambled to revamp their internal procedures and re-file or resubmit questionable paperwork.” Said James Saccacio, the CEO of RealtyTrac (an independent agency, tracking recorded foreclosures nationally).
A new report from Moody’s (the Wall Street bank rating service) said that this past year’s freeze on foreclosures will delay the time it takes to foreclose on a property by about three months. “We expect that foreclosure activity in December, will remain artificially low” (giving people a false sense of mistaken security). “Foreclosure rates will accelerate during the first quarter of 2011 as the lenders and servicers catch-up on these delayed proceedings.” Rick Sharga, Senior Vice President of RealtyTrac, said.
Bank repossessions, the actual final stage and step in the foreclosure process after a home fails to sell at auction rose, to a historic high 100,000 homes in September 2010. Anticipate much more in January and February and March 2011. In Florida, we have one home in every 262 households that are in foreclosure right now.
So what can Katz & Associates Law Firm do for you? We have always enjoyed a very favorable ability to defend foreclosure and obtain workouts for many qualified homeowners. Banks still, are not very cooperative to the consumer. Any individual who has tried on their own to get a loan modification finds out the loan modification adjustment is worse than what the bank had previously contracted and more costly as it adds costs to the back end where the home can never be sold in the foreseeable future! But there are new plans that go into effect in January 2011. New plans include Relief for Responsible Homeowners (“RRH”) who have never been late on a mortgage and now if they are underwater can get favorable refinancing of the debt by third party lenders. For homeowners that do not qualify under RRH favorable treatment programs, there are also programs through aggressive forms of private mediation. However under private mediation when a homeowner takes the initial steps and expense (costs under $750 to a private independent mediator) many times the bank will reimburse and agree to an experienced court or state approved private mediator who will actually create forensic accounting (not to be confused with forensic defense) needed for a bank to reassess the current market value of the home vs. the loan. Previously, these programs failed. Now banks must listen. They do not have the qualified bank staff or ability to provide in-house creative finance. Banks today are focusing on collections, not in unique creativity. That is why mediation on a private basis provides that creativity element the bank does not have time to create. If it makes sense and if the homeowner agrees to it and if the terms and conditions are mutually accepted by the bank, the mortgage can be revised accordingly for relief for the homeowner. In many of the successful private mediations where the homeowner paid for the initial costs to hire a mediator through an attorney, when a good result is obtained, the banks will normally reimburse costs to the homeowner.
Foreclosure is a legal process – one that requires a good guide. Never enter into any negotiation, contract, or purchase agreement or refinancing without advice of an attorney knowledgeable in these issues.
For a free consultation regarding your legal rights, or how you can repair your mortgage situation, or to safeguard against foreclosure and aggression by lenders, please contact Katz & Associates Law Firm at either of our two offices.
KATZ & ASSOCIATES LAW FIRM
Katz & Associates, PLLC