Foreclosure Knowledge

Top 5 Tips For Home Sellers

2011-03-31T21:14:00.000-07:00

Top 5 Tips For Home Sellers

Sell Your Home In 72 Hours Or Less

2011-03-31T21:13:00.000-07:00

Sell Your Home In 72 Hours Or Less

How To Sell Your Home or Real Estate Fast In A Slow Market

2011-03-31T21:12:00.000-07:00

How To Sell Your Home or Real Estate Fast In A Slow Market

Realty Executives How to Sell A Home Real Estate Video

2011-03-31T21:10:00.000-07:00

Realty Executives How to Sell A Home Real Estate Video

The Road To Millions -- Showing Houses & VA Mortgage Loans

2011-03-31T21:08:00.000-07:00

The Road To Millions -- Showing Houses & VA Mortgage Loans

Contact 2: Mortgage Modifications

2011-03-29T21:52:00.000-07:00

Contact 2: Mortgage Modifications

Fooled by the Sub-prime Mortgage

2011-03-29T21:51:00.001-07:00

Fooled by the Sub-prime Mortgage

Non-Transparency When Undergoing a Loan Modification with Banks

2011-03-29T21:49:00.000-07:00

Non-Transparency When Undergoing a Loan Modification with Banks

The MERS Mortgage MESS

2011-03-29T21:47:00.000-07:00

The MERS Mortgage MESS

How to Trade a Mortgage For a Free and Clear Home

2011-03-29T21:46:00.000-07:00

How to Trade a Mortgage For a Free and Clear Home

US Sub-prime mortgage crisis explained in 10 mins

2011-03-29T21:44:00.000-07:00

US Subprime mortgage crisis explained in 10 mins

Home Foreclosure Help

2011-03-29T21:41:00.000-07:00

Home Foreclosure Help

Keep your house without foreclosure and short sale

2011-03-29T21:15:00.000-07:00

Keep your house without foreclosure and short sale

DISTRESSED PROPERTY DIFFERENCES

2011-03-29T21:14:00.001-07:00

DISTRESSED PROPERTY DIFFERENCES

Rep Biggert Calls for End to Failed Foreclosure Program

2011-03-29T21:11:00.000-07:00

Rep Biggert Calls for End to Failed Foreclosure Program

Creative Real Estate Agent Mastermind

2011-03-28T18:58:00.000-07:00

Creative Real Estate Agent Mastermind

Stop Foreclosure in Court

2011-03-28T18:56:00.000-07:00

Stop Foreclosure in Court

Sell Your House Fast - Stop Drowning In Debt

2011-03-28T18:54:00.000-07:00

Sell Your House Fast - Stop Drowning In Debt

How to Buy Foreclosure Homes: Beginners Guide

2011-03-28T18:53:00.000-07:00

How to Buy Foreclosure Homes: Beginners Guide

US home prices hit nine year low

2011-03-28T18:51:00.000-07:00

US home prices hit nine year low

Mortgage Strike secret revolt revealed SEIU Lerner

2011-03-28T18:49:00.000-07:00

Mortgage Strike secret revolt revealed SEIU Lerner

REI Tip: How to Quickly Assess Average Cost of a Rehab

2010-09-13T21:59:00.000-07:00

REI Tip: How to Quickly Assess Average Cost of a Rehab

Flipping Houses - Estimating Repairs

2010-09-13T21:55:00.000-07:00

Flipping Houses - Estimating Repairs

Sell Houses in 36 Hours? Nathan Big Can...

2010-09-13T21:52:00.000-07:00

Sell Houses in 36 Hours? Nathan Big Can...

Be More Productive, Get Things Done, Make More Money

2010-09-13T21:51:00.001-07:00

Be More Productive, Get Things Done, Make More Money

Review of Virtual Short Sale Investing Blueprint

2010-09-13T21:45:00.001-07:00

Review of Virtual Short Sale Investing Blueprint

Real Estate Investors - Big News and Invitation to Webinar X

2010-09-13T21:40:00.000-07:00

Real Estate Investors - Big News and Invitation to Webinar X

Crazy Awesome Landlord Form: The Way Things Work for Real Estate Investors

2010-09-13T21:31:00.001-07:00

Crazy Awesome Landlord Form: The Way Things Work for Real Estate Investors

Honest Review: 6 Figure Syndication Secrets by Brad Wozny

2010-09-13T21:26:00.000-07:00

Honest Review: 6 Figure Syndication Secrets by Brad Wozny

Wholetale Vs Retail Real Estate Deals

2010-09-13T21:20:00.000-07:00

Wholetale Vs Retail Real Estate Deals

Real Estate Option Vs Contract

2010-09-13T21:14:00.000-07:00

Real Estate Option Vs Contract

Bandit Signs - How Tony Severino Skirts the Sign Police

2010-09-13T21:12:00.000-07:00

Bandit Signs - How Tony Severino Skirts the Sign Police

Honest Review: THE RED PILL

2010-09-13T21:10:00.000-07:00

Honest Review: THE RED PILL

Competition Killer: How to Keep Your Seller from Cheating on You

2010-09-13T21:05:00.000-07:00

Competition Killer: How to Keep Your Seller from Cheating on You

Fannie and Freddie Haven't Stopped Foreclosures

2010-09-13T21:03:00.000-07:00

Fannie and Freddie Haven't Stopped Foreclosures

Locating Deals - Flipping - Wholesaling Houses Real Estate Investing make money coach trainer

2010-09-13T21:00:00.000-07:00

Locating Deals - Flipping - Wholesaling Houses Real Estate Investing make money coach trainer

When Real Estate Investing Courses Are Wrong

2010-09-13T20:49:00.000-07:00

When Real Estate Investing Courses Are Wrong

Real Estate Investing Tip: Becoming A Foreclosure Insider

2010-09-13T20:46:00.000-07:00

Real Estate Investing Tip: Becoming A Foreclosure Insider

How to Mine the MLS for a New Opportunity Market

2010-09-13T20:43:00.000-07:00

How to Mine the MLS for a New Opportunity Market

Competition Killer: 3 Genius Ways to Gain Instant Rapport and Credibility

2010-09-13T20:39:00.000-07:00

Competition Killer: 3 Genius Ways to Gain Instant Rapport and Credibility

Competition Killer, Pt 2 - Stop Chasing Stupid Deals

2010-09-13T20:37:00.000-07:00

Competition Killer, Pt 2 - Stop Chasing Stupid Deals

How to Flip Your House in Any Market in 3 Days

2010-09-13T20:32:00.000-07:00

How to Flip Your House in Any Market in 3 Days

Finding Foreclosure Help in New Hampshire

2010-09-08T17:25:00.000-07:00

Finding Foreclosure Help in New Hampshire

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Manchester Field Office

Norris Cotton Federal Building
275 Chestnut Street, 4th Floor

Manchester, NH 03101-2487

Phone: (603) 666-7510

Fax: (603) 666-7667

TTY: (603) 666-7518
Jurisdiction: State of New Hampshire

Gregory G. Carson
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

New Hampshire Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 60 days.
The borrower has no rights of redemption.
The lender may sue for deficiency judgements.
In addition to the regular judicial and non-judicial processes of foreclosure, New Hampshire also has special methods to foreclose which includes the Entry under Process, Entry and Publication and Possession and Publication.

Judicial Foreclosure
A complaint must first be filed by the lender in the court that has jurisdiction over the property to issue a declaration of sale. Before the sale can proceed, the court gives a time period for the borrower to pay the amount the he owes plus additional costs that the lender incurred during the foreclosure process. If the borrower is unable to pay his debts, the property can be sold to the highest bidder at an auction. The lender can also bid for the property.

Non-Judicial Foreclosure
If the power of sale clause is present in a mortgage, the non-judicial process is used. This clause states that the borrower has allowed the lender to sell the property to pay off his debts in the event of their default. In this process, the lender or a trustee has the power to sell the property at an auction by following the “Power of Sale Foreclosure Guidelines” below.

Power of Sale Foreclosure Guidelines
If the power of sale clause states the specifics of the sale, these must be followed. If not, the non-judicial foreclosure process must proceed as follows:

A notice of sale must be recorded in the county where the property is located. A copy of this notice must also be sent to the borrower at least 25 days before the date of sale.

The notice of sale must be published in the county newspaper in 3 consecutive weeks so that the public will be informed about the sale. The first ad should be published at least 20 days prior to the foreclosure sale.

The notice of sale must contain the important information regarding the sale such as time and place of sale, as well as a description of the property. This notice will also serve as a warning for the borrower that the property is to be foreclosed.

The foreclosure sale must take place on the property itself if it is not stated in the power of sale clause.

Finding Foreclosure Help in Nevada

2010-09-08T17:23:00.000-07:00

Finding Foreclosure Help in Nevada

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Las Vegas Field Office

Dept. of Housing and Urban Development
300 South Las Vegas Blvd.,
Suite 2900
Las Vegas, NV 89101-5833
Phone: (702) 366-2100

Fax: (702) 388-6244

Kenneth J. LoBene
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Reno Field Office

U.S. Department of Housing and Urban Development
Reno Field Office
745 West Moana Lane, Suite 360
Reno, NV 89509
Phone: (775) 824-3700

Fax: (775) 824-4978

Tony Ramirez

Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Nevada Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 120 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
Deeds of trust and mortgages may be foreclosed in Nevada using the judicial or non-judicial process.

Judicial Foreclosure
The judicial process is done when there is no power of sale clause in a mortgage deal. This is done by filing a lawsuit to obtain a court order to foreclose the property. When this happens, the lender can sell the property. The borrower may still reclaim the property by curing the default within 1 year.

Non-Judicial Foreclosure
If the power of sale clause is present in a mortgage deal, the non-judicial process is used. In the process, the borrower has pre-authorized the lender to sell the property to pay off his debts in the event of a default. The process of the non-judicial process is outlined below.

Power of Sale Foreclosure Guidelines
If the power of sale clause includes the specifics and terms of the sale, this must be followed. If not, the non-judicial process must be done as follows:

The foreclosure sale must be done during the time and place indicated in the notice of sale. It must also be done the same way that real property are sold.
The borrower has a chance of curing the default within 15-35 days from the declaration of the notice of sale.
An intent to cure must be filed to stop the processing of the foreclosure process. This must be filed 15 days before the foreclosure sale.
At the latest, the payment must be made the noon before the date of the sale.
Lenders have up to 3 months to file for deficiency judgements, while borrowers have no rights of redemption.

Finding Foreclosure Help in Nebraska

2010-09-08T17:20:00.000-07:00

Finding Foreclosure Help in Nebraska

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Omaha Field Office

Edward Zorinsky Federal Building
Suite 329
1616 Capitol Avenue
Omaha, NE 68102-4908

Phone: (402) 492-3100

Fax: (402) 492-3150

TTY: (402) 492-3183

Jurisdiction: State of Nebraska

Clifton E. Jones
Field Office Director

Office Hours: 8:00 a.m. to 5:00 p.m.,
Monday through Friday

Nebraska Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, which typically takes 180 days.
The borrower has rights of redemption.
The lender may not sue for deficiency judgements.
The judicial process is the only foreclosure process available in the State of Nebraska.

Judicial Foreclosure
The lender must file a court order to foreclose. Once the court finds that the borrower is in default, it sets a specific time period for the borrower to pay the balance that he owes. If he is unable to pay within the given time period, the property will be put up for sale.

In Nebraska, a property may be sold entirely or just a portion of it. Once the sale is approved, the borrower may still postpone the sale up to 9 months by submitting a request to delay the foreclosure. This must be done within 20 days after the court has ordered the sale to proceed.

If the suit is still being processed by the court, the borrower can stop the foreclosure process by paying the balance that he owes, plus interest and other costs that have been incurred during the entire foreclosure process. But if any problems still arise in the future, the foreclosure process can still be continued. Once the sale has been confirmed by the court, the borrower cannot reclaim the property anymore.

The sale must be announced to the public through 3 ways:

By posting a notice of sale on the courthouse door.
Posting the same notice of sale in 5 other public places around the county.
Publishing the notice of sale in the newspaper for 4 weeks.

Finding Foreclosure Help in Montana

2010-09-08T17:18:00.000-07:00

Finding Foreclosure Help in Montana

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Helena Field Office

Department of Housing and Urban Development

100 Neill Avenue
Suite 5, #27
Helena, MT 59601

Phone: (406) 449-5050

Fax: (406) 449-5052

TTY: (406) 449-5050

Jurisdiction: State of Montana

Joel Manske
Acting Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Montana Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 150 days.
The borrower has no rights of redemption.
The lender may sue for deficiency judgements but varies by process.
The judicial and non-judicial processes may be used by lender to foreclose on mortgages in default in Montana.

Judicial Foreclosure

In this foreclosure process, the court gives the borrower a time period for him to come up with the payment for his debts. If he is unable to pay after the time period has passed, the foreclosure sale can then proceed.

Non-Judicial Foreclosure
In this foreclosure process, the borrower has already pre-authorized the sale of the property to pay off his debs in the event of a default. This is stated in the power of sale clause. The lender or a trustee has the power to sell the property but must follow the guidelines stated below.

Power of Sale Foreclosure Guidelines
If the power of sale clause does not state the specifics of the sale, the non-judicial foreclosure process must be carried out as follows:

Finding Foreclosure Help in Missouri

2010-09-08T17:16:00.000-07:00

Finding Foreclosure Help in Missouri

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Kansas City Regional Office

400 State Avenue
Room 200
Kansas City, KS 66101-2406

Phone: (913) 551-5644

Fax: (913) 551-5469

TTY: (913) 551-6972

Jurisdiction: State of Kansas and Western half of Missouri

Office Hours: 8:00 a.m. to 5:00 p.m.

Monday through Friday

St. Louis Field Office

1222 Spruce Street

Suite 3.203
St. Louis, MO 63103-2836

Phone: (314) 539-6583

Fax: (314) 539-6384

TTY: (314) 539-6331

Jurisdiction: Eastern half of Missouri

James Heard

Field Office Director

Office Hours: 8:00 a.m. to 5:00 p.m.
Monday through Friday

Missouri Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 60 days.
The borrower has rights of redemption.
The lender may not sue for deficiency judgements.
Lenders in Missouri may use the judicial or non-judicial process to foreclose on mortgages in default.

Judicial Foreclosure

In this process, lawsuit have to be filed by the lender to obtain a court order to foreclose. Once the court approves of this, the property can be sold to the highest bidder at an auction.

Non-Judicial Foreclosure
When there is a power of sale clause present in a mortgage deal, the non-judicial foreclosure process is used. This clause gives the lender the authority to sell the property in the event of the borrower’s default. The foreclosure sale must be done by follwing the guideliens stated below.

Power of Sale Foreclosure Guidelines
If the power of sale clause does not state the specifics of the sale, it must be conducted as follows:

A notice of sale must be sent to the borrower at least 20 days prior to the sale.
This notice must also be published in the county newspaper where the property is located.
The trustee is responsible for conducting the auction and selling it to the highest bidder for cash.
The lender is also alowed to bid by subtracting the amount that he bid from the loan of the borrower.

Finding Foreclosure Help in Missouri

2010-09-08T17:13:00.000-07:00

Finding Foreclosure Help in Mississippi

2010-09-08T17:11:00.000-07:00

Finding Foreclosure Help in Mississippi

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Jackson Field Office

Dr. A.H. McCoy Federal Building
100 W. Capitol St,
Suite 910
Jackson, MS 39269-1096

Phone: (601) 965-4757

Fax: (601) 965-4773

TTY: (601) 965-4171

Jurisdiction: State of Mississippi

Mary Merchant
Acting Field Office Director

Office Hours: 8:00 a.m. to 4:45 p.m.
Monday through Friday

Mississippi Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 60 days.
The borrower has no rights of redemption.
The lender may not sue for deficiency judgements.
Lenders in Mississippi may foreclose on mortgages in default through a judicial or non-judicial process.

Judicial Foreclosure

The judicial foreclosure process is used when there is no power of sale clause in a mortgage deal. This involves filing a court order to foreclose. Once the court approves this, the property can be put up for sale.

Non-Judicial Foreclosure
In a mortgage with the power of sale clause, the non-judicial foreclosure process is used. This clause states that the borrower has allowed the lender to sell the property to pay off his debts in the event of his default. For the lender to sell the property, he must follow the guidelines stated below:

A notice of sale must be posted in the county courthouse where the property is located, and published in the county newspaper once a week for 3 weeks. This notice must contain the pertinent information required such as the name of the borrower, and the time and date of sale.

For the borrower to stop the foreclosure process, he must pay the remaining balance of his loan as well as additional costs. If he is not able to pay within the given time period, the foreclosure sale will continue and the property will be sold to the highest bidder at an auction, which will be conducted in the property itself.

Borrowers have no right of redemption after the property has been sold.

Finding Foreclosure Help in Minnesota

2010-09-08T17:09:00.001-07:00

Finding Foreclosure Help in Minnesota

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Minneapolis Field Office

International Centre
920 Second Avenue South, Suite 1300
Minneapolis, MN 55402-4012
Phone: (612) 370-3000
Fax: (612) 370-3220

TTY: (612) 370-3186

Jurisdiction: State of Minnesota

Dexter Sidney
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Minnesota Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 60 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
Lenders may foreclose on mortgages and deeds of trust in Minnesota through a judicial or non-judicial process.

Judicial Foreclosure
When there is no power of sale clause present in a mortgage deal, the judicial process is used. This is done by filing a lawsuit to obtain a court order to foreclose. Once this is approved, the property can be put up for sale.

Non-Judicial Foreclosure
If there is a power of sale clause present in a mortgage deal, then the non-judicial foreclosure process is used. When the borrower defaults on a mortgage, the lender gains the power to sell the property as long as he follows the “Power of Sale Foreclosure Guidelines.”

Power of Sale Foreclosure Guidelines
In the State of Minnesota, there are conditions that need to be met before a non-judicial foreclosure process is to continue. These are:

There must be no existing lawsuit on the mortgage payment.
There are no records of new mortgage lenders.
An existing notice that has been sent 8 weeks before the foreclosure.
The non-judicial foreclosure process can be done by following these steps:

A notice of sale must be published, which includes the description of the property, the names of the parties involved, information about the mortgage, as well as the time and date of the foreclosure sale.

The sheriff we be the one conducting the sale, where the property will be sold to the highest bidder at the auction. A certificate of sale will be given to the winning bidder.

The lender may file for a deficiency suit up to 1 year from the date of the foreclosure sale, but it is limited to the fair market value of the property and the remaining balance on the loan.

Finding Foreclosure Help in Michigan

2010-09-08T17:07:00.000-07:00

Finding Foreclosure Help in Michigan

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Detroit Field Office

McNamara Federal Building
477 Michigan Avenue
Detroit, MI 48226

Phone: (313) 226-7900

Fax: (313) 226-5611 or 226-3197

TTY: (313) 226-6899

Lana J. Vacha
Field Office Director

Office Hours: 8:00 a.m. to 5:00 p.m.

Grand Rapids Field Office

99 Monroe Avenue, NW
Suite 402
Grand Rapids, MI 49503

Phone: (616) 456-2100

Fax: (616) 456-2114

TTY: (616) 456-2159

Louis Berra
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.

Flint Field Office

Phoenix Building – 4th Floor
801 S. Saginaw Street
Flint, MI 48502

Phone: (810) 766-5112

Fax: (810) 766-5122

TTY: (810) 766-5106

Louis Berra
Acting Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.

Monday through Friday

Michigan Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 60 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements but varies by process.
A judicial or non-judicial process may be used to foreclose on mortgages in default in Michigan.

Judicial Foreclosure
The lender files a lawsuit to obtain a court order to foreclose. If the court finds that the borrower is in default, it gives the borrower a specific time period for him to come up with the money that he owes. If the borrower is unable to pay his debts within the given time, the property will be put up for sale.

Non-Judicial Foreclosure
This foreclosure process is used when there is a power of sale clause present in a mortgage deal. This means that the borrower has pre-authorized the sale of the property in the event of his default. The lender or a trustee may sell the property following the “Power of Sale Foreclosure Guidelines.”

Power of Sale Foreclosure Guidelines
The following guidelines are to be followed if there are no specifics of sale included in the power of sale clause:

A notice of sale must be published in the county newspaper where the property is located. This must be done at least once a week for 4 consecutive weeks. A copy of the notice must also be posted on the property itself within 15 days of publishing the ad in the newspaper.

The notice of sale should have the important information about the sale, including a description of the property, the parties invovlved, the time and place of sale, etc.

The sheriff or the trustee can conduct the auction at any time between 9am-4pm of the specified date.

A sale may be postponed by putting up a notice during the originally scheduled date of sale. If it is to be postponed for more than a week, it must be advertised the same way the original sale was done.

Finding Foreclosure Help in Massachusetts

2010-09-08T16:47:00.000-07:00

Finding Foreclosure Help in Massachusetts

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Boston Regional Office

Thomas P. O’Neill, Jr. Federal Building
10 Causeway Street, 3rd Floor
Boston, MA 02222-1092

Phone: (617) 994-8200

Fax: (617) 565-6558
TTY: (617) 565-5453

Jurisdiction: State of Massachusetts

Richard A. Walega

Regional Administrator

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Massachusetts Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, typically 90 days.
The borrower has no rights of redemption.
The lender may not sue for deficiency judgements.
Lenders in Massachusetts can use a non-judicial process or an entry by possession to foreclose on mortgages or deeds of trust in default.

Foreclosure by Possession
The lender may gain possession of the property if a borrower defaults in the mortgage. This is done by obtaining a court order and entering the property peaceably. If the lender remains in possession of the property after 3 years, he then becomes the permanent owner.

Non-Judicial Foreclosure
This process is used when a power of sale clause is present, which means that the borrower has agreed that the lender sell the property in the event of his default. The lender or his representative may sell the property by following the guidelines stated below.

Power of Sale Foreclosure Guidelines
Unless the terms of the sale are included in the power of sale clause, the foreclosure process must be carried out as follows:

A notice of sale must be recorded in the county where the property is located, and a copy must also be sent to the borrower at least 14 days before the date of sale. An ad announcing the sale must be published in the newspaper once a week for 3 weeks with the first ad published at least 21 days prior to the sale.

This notice of sale should contain the important information about the sale, which includes time and date of the foreclosure hearing, date of the mortgage, names of the parties involved, etc.

The sale is to be conducted at the time and place specified on the notice of sale, through a public auction where the property will be sold to the highest bidder.

The borrower has no rights of redemption.

Finding Foreclosure Help in Maryland

2010-09-08T16:41:00.000-07:00

Finding Foreclosure Help in Maryland

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Baltimore Field Office

City Crescent Building
10 S. Howard Street, Fifth Floor
Baltimore, MD 21201-2505

Phone: (410) 962-2520

Fax: (410) 209-6670

TTY: (410) 209-6681

Jurisdiction: State of Maryland (Except as noted below under Washington, DC)

James Kelly
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

District of Columbia Field Office

820 First Street, NE, Suite 300
Washington D.C., 20002

Phone: (202) 275-9200

Fax: (202) 275-6381

TDY: (202) 275-6388

Jurisdiction: Washington, DC; City of Alexandria, VA; Fairfax County, VA; Arlington County, VA; Prince William County, VA; Loudoun County, VA; Montgomery County, MD and Prince George’s County, MD.

John E. Hall
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.

Monday through Friday

Maryland Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available but with restrictions.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, typically 90 days.
The borrower has no rights of redemption.
The lender may sue for deficiency judgements.
Three foreclosure processes can be used by lender to foreclose on mortgages in default in Maryland. These are by judicial, assent to decree, or non-judicial foreclosure process.

Judicial Foreclosure
When no power of sale is present in a mortgage deal, the lender must file a lawsuit to obtain a court order to foreclose. Once the court has proven that a default has occurred, it will set the amount that the borrower has to pay in order to cure the default. The borrower must pay the amount within a given time period, or the property will be sold to pay for the debt.

Assent to Decree Foreclosure
In this foreclosure process, it has been previously agreed on by the lender and borrower that for a specific default, the lender is permitted to sell the property. This will be done by filing a complaint to the court but no more hearing is necessary for the foreclosure sale to proceed.

Non-Judicial Foreclosure
The non-judicial foreclosure is used when there is a power of sale clause present in a mortgage deal. This clause states that the borrower permits the selling of the property to pay off his debts in the event of his default. An order to docket must first be filed for the foreclosure sale to start but no hearing will be needed.

Foreclosure Guidelines
A notice of sale must be published in the county newspaper where the property is located. This must be done for 3 weeks with the first ad not later than 15 days before the sale, and the last ad not more than 1 week before the sale. The notice of sale must also be sent to the borrower not more than 30 days and not less than 10 days before the sale.

The sale is to be conducted by an authorized person, which can be held at the property itself, in the county courthouse or any place indicated in the notice of sale.

If the sale needs to be postponed, the announcement should be done in the same way that the original sale was advertised.

Once the sale has been completed, the person who conducted the sale must file a report with the court. The clerk will then issue a notice that describes the property and states that the sale will be approved within 30 days as long as no reason has been found that proves that the sale should not push through. This will be published n the county newspaper for 3 consecutive weeks until the 30 day period expires.

Deficiency judgements may be filed until 3 years after the sale, but it is limited to the difference between for the balance of the loan in default and the price of the property during the sale.

Finding Foreclosure Help in Maine

2010-09-08T16:40:00.001-07:00

Finding Foreclosure Help in Maine

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Bangor Field Office

Margaret Chase Smith Federal Building
202 Harlow St., Suite 101
Bangor, ME 04401-4919

Phone: (207) 945-0467

Fax: (207) 945-0533

TTY: (207) 945-0401

Jurisdiction: State of Maine

William D. Burney
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Maine Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, typically 90 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
Lenders in Maine may foreclose on mortgages in default through a judicial process or a strict foreclosure process.

Strict Foreclosure

In this type of foreclosure, the property belongs to the lender for the duration of the mortgage. As long as the borrower settles all of his debts, the property will be returned. But if any conditions of the agreement are broken before the debt has been paid, the property permanently become owned by the lender. He may choose to keep it or put it up for sale.

Whatever the lender chooses to do, the borrower has a 3-month (post-1975 mortgages) or 12 month period (pre-1975 mortgages) to reclaim the property. The lender must hold on to the property for the entire duration of the redemption period for the foreclosure process to be finalized. If the lender wishes to sell the property, he must first file a lawsuit and wait for the redemption period to pass before continuing with the sale.

Deficiency suits may be filed but is limited to the difference between the fair market price and the remaining balance of the loan.

Judicial Foreclosure
The strict foreclosure process is the main method used in Maine, but the judicial process may be used under special circumstances.

Finding Foreclosure Help in Louisiana

2010-09-08T16:38:00.000-07:00

Finding Foreclosure Help in Louisiana

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

New Orleans Field Office

Department of Housing and Urban Development
Hale Boggs Federal Building
500 Poydras Street, 9th Floor
New Orleans, LA 70130

Phone: (504) 671-3001

Email: LA_Webmanager@hud.gov
Fax: (504) 671-3751

Marvel Robertson
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Shreveport Field Office

Department of Housing and Urban Development
Shreveport Office Building
401 Edwards Street, Suite 1510

Shreveport, LA 71101-5513

Phone: (318) 226-7030
Email: LA_Webmanager@hud.gov
Fax: (318) 676-3506

Martha Sakre
Field Office Director

Office Hours: 7:45 a.m. to 4:30 p.m.
Monday through Friday

Louisiana Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, typically 60 days.
The borrower has no rights of redemption.
The lender may sue for deficiency judgements.
Lenders in Louisiana may foreclose on mortgages using the judicial foreclosure process.

Judicial Foreclosure
Louisiana has two types of judicial foreclosure process, the executory process and an ordinary process.

The executory process is used when a mortgage deal has an authentic act that imparts a confession of judgment. This is done by the borrower acknowledging to the obligations of the mortgage in the presence of a notary public and 2 witnesses. The lender may just present the original note and a certified copy of the mortgage, and the foreclosure process will proceed quicker and easier.

This process entails the lender to send a notice of demand for delinquent payments to the borrower. If the borrower is unable to come up with the payment within 3 days, the property can be put up for sale after 30 days of advertising.

Deficiency judgments may be filed but borrowers have no rights of redemption.

Finding Foreclosure Help in Kentucky

2010-09-08T03:12:00.000-07:00

Finding Foreclosure Help in Kentucky

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Louisville

Dept. of Housing and Urban Development
Gene Snyder Courthouse
601 W. Broadway, Room 110
Louisville, KY 40202

Phone: (502) 582-5251

Email: KY_Webmanager@hud.gov
Fax: (502) 582-6074
TTY: (800) 648-6056

Jurisdiction: State of Kentucky

Krista Mills
Field Office Director

Office Hours: 8:00 a.m. to 4:45 p.m.,
Monday through Friday

Kentucky Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process.
The borrower has rights of redemption.
The lender may sue for deficiency judgements but with restrictions.
Lenders in Kentucky may foreclose on mortgages in default through a judicial foreclosure process.

Judicial Foreclosure
In the judicial foreclosure process, the lender files a lawsuit to obtain a court order to foreclose. If the court finds that the borrower is in default, it sets a time period for the borrower to cure the default. If the borrower is unable to pay his debts within the allotted time, the property will then be advertised for sale.

The property will first be appraised before it can be put up for auction. If the winning price is less than 2/3 of the appraised value, the borrower has 12 months to match this price plus interest to be able to reclaim the property.

If the borrower is personally served with a lawsuit or fails to answer, a deficiency judgment may be filed. This amount can only be the difference between the foreclosure sale price and the original mortgage price.

Finding Foreclosure Help in Kansas

2010-09-08T03:10:00.000-07:00

Finding Foreclosure Help in Kansas

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Kansas City Regional Office

400 State Avenue
Room 507
Kansas City, KS 66101-2406

Phone: (913) 551-5644
Email: KS_Webmanager@hud.gov

Fax: (913) 551-5469
TTY: (913) 551-6972

GENE LIPSCOMB
Deputy Regional Director

Jurisdiction: State of Kansas and Western half of Missouri

Office Hours: 8:00 a.m. to 5:00 p.m.
Monday through Friday

Kansas Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, which typically takes 120 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
In Kansas, lenders may use the judicial foreclosure process to foreclose on mortgages in default.

Judicial Foreclosure

The lender must file a lawsuit to obtain a court order to foreclose. Once the order to foreclose has been approved, the property can then be sold at an auction to the highest bidder.

A notice of sale must be published in the newspaper once a week for 3 consecutive weeks to inform the public about the upcoming sale. The last ad should be published no later than 7 days, and not more than 14 days before the sale. Also, another notice must also be sent to the borrower 5 days after the first ad has been published.

The auction will be held at the county courthouse where the property is located. The winning bidder shall receive a certificate of purchase, as well as a sheriff’s deed which will certify that he will be the owner of the property once the borrower forfeits on his right of redemption, which usually lasts up to 1 year.

A deficiency judgement may be sued by the lender, but only for the difference between the foreclosure sale price and the original mortgage price.

Finding Foreclosure Help in Iowa

2010-09-08T03:08:00.000-07:00

Finding Foreclosure Help in Iowa

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Des Moines Field Office

210 Walnut Street
Room 239
Des Moines, IA 50309-2155

Phone: (515) 284-4512
Fax: (515) 284-4743

TTY: (515) 284-4728

Jurisdiction: State of Iowa

Bruce Ray
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Iowa Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, which typically takes 150 days.
The borrower has no rights of redemption.
The lender may not sue for deficiency judgements.
Lenders in Iowa may use the judicial or alternative to non-judicial foreclosure process to foreclose on mortgages in default.

Judicial Foreclosure
A complaint must be filed by the lender to obtain a decree of sale for a foreclosure process to start. When the court finds the borrower in default, he will give the borrower some time to settle all of his debts. If he is unable to cure the default, the foreclosure sale will then be continued.

A notice of sale must be put up in public places around the county, with one being posted in the courthouse. Two weekly ads must also be published in the county newspaper, with the first ad published at least 4 weeks before the sale. Another notice must also be sent to the borrower at least 20 days before the sale.

The sale will be by public auction, which will be presided over by the sheriff anytime between 9am-4pm. Before the sale, written bids may be given to the sheriff, together with the payment for the property. The written bids are sealed until the day of the auction comes where the bids will be opened and announced by the sheriff. Losing bidders will have their money returned to them.

A sale can postponed up to 3 days only, and the announcement of the postponement should be done during the originally scheduled date.

Alternative Non-Judicial Foreclosure
The whole filing of a suit to foreclose may be avoided if the borrower willingly gives up the property and transfers all his rights to the property over to the lender. When the lender accepts, he will automatically become the new owner of the property but he will lose the right to sue for a deficiency judgement.

For this process to be official, both the borrower and the lender must sign a “disclosure of notice and cancellation” which says that the borrower willingly gave up his rights to the property, and that the lender has accepted this as payment.

Finding Foreclosure Help in Indiana

2010-09-08T03:05:00.001-07:00

Finding Foreclosure Help in Indiana

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Indianapolis Field Office

Indianapolis Office
151 North Delaware Street, Suite 1200
Indianapolis, IN 46204-2526

Phone: (317) 226-6303
Fax: (317) 226-6317

TTY: (800) 743-3333

Jurisdiction: State of Indiana

John Hall,

Field Office Director
email: John_R._Hall@hud.gov

Office Hours: 8:00 a.m. to 4:45 p.m.
Monday through Friday

Indiana Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, which typically takes 150 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
Lenders in Indiana may foreclose on mortgages in default through a judicial process.

Judicial Foreclosure

The judicial foreclosure process is used when there is no power of sale clause present in a mortgage deal. The lender must first file a lawsuit and obtain a court order to foreclose. Once this has been approved, the property can then be sold to the highest bidder at an auction.

Once a mortgage has been signed, the lender typically has to wait 3-12 months before a suit can be filed to foreclose. The borrower may waive this time period so that the sale can occur at anytime. But in this case, the lender loses his right to file for a deficiency judgement.

For a sale to take place, a notice of the sale must first be published in the county newspaper 30 days prior to the date of sale, once a week for 4 consecutive weeks. The notice must also be sent to the parties involved informing them about the upcoming foreclosure sale. The owners may still reside in the property, but must leave once the foreclosure sale has been completed.

Finding Foreclosure Help in Illinois

2010-09-08T03:02:00.000-07:00

Finding Foreclosure Help in Illinois

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

In Chicago

Call: (312) 353-5680
Fax: (312) 886-2729
TTY: (312) 353-7143

Ralph Metcalfe Federal Building
77 West Jackson Boulevard
Chicago, Illinois 60604

Office Hours: 8:30 a.m. to 5:00 p.m.
Monday through Friday

In Springfield

Call: (217) 492-4120
Fax: (217) 492-4154
TTY: (217) 492-4101

John W. Meyers,
Field Office Director
email: john.w.meyers@hud.gov

500 West Monroe, 1SW
Springfield, IL 62704

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Illinois Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, which typically takes 210 days.
The borrower has no rights of redemption.
The lender may sue for deficiency judgements.
There are a number of options available to foreclose on mortgages in default in Illinois.

Judicial Foreclosure
At least 30 days before the court’s judgement to foreclose, a notice of sale must be sent to the borrower and other parties involved informing them about the intent to foreclose. When the court approves the foreclosure, the specifics of the sale that are indicated in the notice of sale must be followed as long as it follows the minimum standards set by the Illinois Statutes.

The sheriff or a judge may conduct the sale at the property itself, and the borrower loses his rights of redemption as soon as the sale is completed.

Deed of Lieu Foreclosure
When a borrower defaults on a mortgage, he has the option of giving the deed of the property to the lender and surrendering any rights that he has over the property. If the lender accepts, he forfeits the right to obtain a deficiency judgement.

Consent Foreclosure
This type of foreclosure is similar to the Deed of Lieu foreclosure, but in this case, the court orders the title of the property to be given to the lender in the event of a default. The borrower has no rights of redemption and the lender cannot file for a deficiency judgement.

The state of Illinois does not allow the non-judicial foreclosure process, but the common law strict foreclosure method may be used by lenders.

Finding Foreclosure Help in Idaho

2010-09-08T03:01:00.000-07:00

Finding Foreclosure Help in Idaho

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Boise Field Office

800 Park Blvd, Suite 220
Boise, ID 83712

Phone: (208) 334-1990

Email: ID_Webmanager@hud.gov

Fax: (208) 334-9648
TTY: (208) 334-9094

Jurisdiction: State of Idaho

William B. Jolley

Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.,
Monday through Friday

Idaho Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is not available.
Non-judicial foreclosure process is available.
The primary security instruments are deeds of trust.
The timeline can vary by process, which typically takes 150 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
Lenders in Idaho may foreclose on mortgages in default through a non-judicial process.

Non-Judicial Foreclosure
When a power of sale clause is present in a deed of trust, this means that the borrower has pre-authorized the sale of the property to pay off any debts in the event of their default. The power to sell the property is in the hands of the lender or a representative, usually referred to as the trustee. The sale must be done following the guidelines outlined below.

Power of Sale Foreclosure Guidelines
If there are no terms of sale stated in the power of sale clause, the foreclosure process must be done as follows:

A notice of sale must be sent to the borrower at least 120 days prior to the date of sale. This notice must also be recorded in the county where the property is located. The same notice must also be published in the county newspaper once a week for 4 consecutive weeks, with the last ad published at least 30 days before the date of sale.

The notice must contain information about the sale such as a description of the property, where it is located, the names of the parties involved, time and place of sale, as well as the person to contact when inquiring about the sale.

The sale must be conducted on the date indicated on the notice of sale. If it must be postponed, it can only be rescheduled at least 30 days before the originally scheduled date.

For properties greater than 20 acres, the borrower has until 1 year to reclaim the property. For properties smaller than 20 acres, the time period is reduced to 6 months.

Finding Foreclosure Help in Georgia

2010-09-08T02:59:00.000-07:00

Finding Foreclosure Help in Georgia

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Atlanta Regional Office

Five Points Plaza Building

40 Marietta Street
Atlanta, GA 30303

Phone: (404) 331-5136
Email: GA_Webmanager@hud.gov

Fax: (404) 730-2392
TDD: (404) 730-2654

Jurisdiction: State of Georgia

Ed Jennings, Jr.

Regional Administrator

Office Hours : 8:00 a.m. to 4:30 p.m.,

Monday through Friday

Georgia Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is available.
The primary security instruments are mortgages and deeds of trust.
The timeline can vary by process, which typically takes 90 days.
The borrower’s has rights of redemption varies by process.
The lender may sue for deficiency judgements but varies by process.
Lenders may use the judicial or non-judicial process to foreclose on mortgages in default in Georgia.

Judicial Foreclosure
The judicial foreclosure process is used when there is no power of sale clause in a mortgage deal. The lender files a lawsuit to obtain a court order to foreclose. Once this is approved, the property can be auctioned off to the highest bidder.

Non-Judicial Foreclosure
When a power of sale clause is present in a mortgage deal, the non-judicial foreclosure process is used. This clause just means that the borrower has pre-authorized the sale of the property in the event of his default. The power to sell the property goes to the lender or a representative, usually referred to as a trustee.

Power of Sale Foreclosure Guidelines
Unless the power of sale clause specifies the time, date and terms of sale, the non-judicial foreclosure process must be carried out as follows:

A notice of sale must be sent to the borrower at least 15 days before the date of sale. Waiver or release rights cannot be considered valid if the dates are the same as the original documents. The counting starts from the day that the letter is postmarked.

A notice of sale must also be published in the county newspaper where the property is located, once a week for 4 consecutive weeks. The sale must take place on the first Tuesday of the month, and anytime between 10am-4pm in front of the county courthouse.

Deficiency suits may be filed in Georgia.

Finding Foreclosure Help in Florida

2010-09-08T02:56:00.000-07:00

Finding Foreclosure Help in Florida

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.

Jacksonville Office

Charles E. Bennett Federal Building
400 W. Bay Street, Suite 1015
Jacksonville, FL 32202

Phone: (904) 232-2627
Email: FL_Webmanager@hud.gov

Fax: (904) 232-3759

Jurisdiction: The following 36 counties in North Florida: Alachua, Baker, Bay, Bradford, Calhoun, Columbia, Clay, Dixie, Duval, Escambia, Flagler, Franklin, Gadsden, Gilchrist, Gulf, Hamilton, Holmes, Jackson, Jefferson, Lafayette, Leon, Levy, Liberty, Madison, Marion, Nassau, Okaloosa, Putnam, St. Johns, Santa Rosa, Suwannee, Taylor, Union, Wakulla, Walton, and Washington.

Earl Cox
Acting Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Miami Office

Brickell Plaza Federal Building
909 SE First Avenue,
Room 500

Miami, FL 33131-3028

Phone: (305) 536-5678
Email: FL_Webmanager@hud.gov
Fax: (305) 536-5765

TTY: (305) 536-4743

Jurisdiction: The following 10 counties in South Florida: Broward, Charlotte, Collier, Dade, Glades, Hendry, Lee, Martin, Monroe, and Palm Beach.

Armando Fana
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.

Monday through Friday

Orlando Office

3751 Maguire Blvd.,
Suite 270
Orlando, FL 32803

Phone: (407) 648-6441

Email: FL_Webmanager@hud.gov
Fax: (407) 648-6310

Jurisdiction: The following 9 counties in East Central Florida: Brevard, Indian River, Lake, Okeechobee, Orange, Osceola, St. Lucie, Seminole, and Volusia.

Paul C. Ausley, Jr.

Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday

Tampa Office

Timberlake Federal Building
500 E. Zack Street,

Suite 402
Tampa, FL 33602-2945

Phone: (813) 228-2026
Email: FL_Webmanager@hud.gov
Fax: (813) 228-2431

TTY: Dial 711 to use Florida Relay

Jurisdiction: The following 12 counties in West Central Florida: Citrus, De Soto, Hardee, Hernando, Highlands, Hillsborough, Manatee, Pasco, Pinellas, Polk, Sarasota, and Sumter.

KAREN JACKSON SIMS
Field Office Director

Office Hours: 8:00 a.m. to 4:30 p.m.

Monday through Friday

Florida Foreclosure Laws Summary

Quick Facts:

Judicial foreclosure process is available.
Non-judicial foreclosure process is not available.
The primary security instruments are mortgages.
The timeline can vary by process, which typically takes 180 days.
The borrower has rights of redemption.
The lender may sue for deficiency judgements.
In Florida, mortgages are impartially foreclosed and a foreclosure action is separated from any counterclaims against the lender. A jury is also not needed during a trial for a foreclosure process.

Upon approval, the court states the time and place where the foreclosure sale is to be held. It is the lender’s responsibility to place an ad in the newspaper announcing the upcoming sale to the public.

The borrower’s Equitable Right of Redemption ends as soon as the foreclosure sale is completed. A 10 day period is allotted for the court to review the sale to make sure that the property has been sold for a fair price, and all procedures have been properly followed. Once this is approved, a Certificate of Sale is filed. If something wrong has been discovered, a new sale must be held.

Deficiency suits may be filed in Florida.

How to Stop Foreclosure in Hawaii

2010-09-05T12:09:00.000-07:00

How to Stop Foreclosure in Hawaii
For many residents of Hawaii, foreclosure is fast becoming a reality to most of them. They choose to foreclose the house and auction it so as to cut back on their losses. There are tons of reasons why a house or property is foreclosed ranging from corporate downsizing to divorce up to rising interest rates. Regardless of the reason, you can do something to keep your house intact.

Step 1
The thought of just letting your house just be auctioned so as to be done with it is tempting. However, letting your house be auctioned off can severely damage you credit rating and would later on affect your capability to buy other items in the future such as a car or another house. A bad credit rating would even prevent the electric company from turning on your power without some sort of deposit. This will stay in your record for up to seven years.
Step 2
Seek advice carefully. Make sure that the person you are getting advice from is someone who is knowledgeable and understands the process of foreclosures. Some may advise you to declare bankruptcy while other may opt to talk with your lender or house realtor. Regardless of the advice, it would be better to consult with a professional that knows foreclosure.
Step 3
Banks lend money, not sell houses. Simply put, they lose income whenever a house is foreclosed. This means that as much as possible, they would like you to keep you house as well so that you will pay them the proper mortgage. This being the case, most banks and lenders are open to the suggestion of adjusting your mortgage. There are a couple of means to do this but regardless of what method it is, talking with your lender to arrive at a compromise should be your priority if you think you are having a hard time paying your dues.
Synopsis of Hawaii Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Typically 60 days

Right of Redemption: None

Deficiency Judgments Allowed: Yes

In Hawaii, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, the property will be auctioned off to the highest bidder.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:

The notice of intent to foreclose must be published once a week for three (3) successive weeks, the last publication to be not less than fourteen (14) days before the day of sale, in a newspaper having a general circulation in the county in which the mortgaged property is located.Copies of the notice must be mailed or delivered to the mortgagor, the borrower, any prior or junior creditors, the state director of taxation and any other person entitled to receive notice. Additionally, the notice must be posted on the premises not less than twenty-one (21) days before the day of sale.
Said notice must state: 1) The date, time, and place of the public sale; 2) The dates and times of the two (2) open houses of the mortgaged property, or if there will not to be any open houses, the public notice shall so state; 3) The unpaid balance of the moneys owed to the mortgagee under the mortgage agreement; 4) A description of the mortgaged property, including the address or description of the location of the mortgaged property, and the tax map key number of the mortgaged property; 5) The name of the mortgagor and the borrower; 6) the name of the lender; 7) The name of any prior or junior creditors having a recorded lien on the mortgaged property before the recordation of the notice of default; 8 ) The name, the address in the State, and the telephone number in the State of the person in the State conducting the public sale; and 9) The terms and conditions of the public sale.

Additional wording, as required by the State of Hawaii, may be found here.

Up until three (3) days before the sale, the borrower may cure the default and stop the sale by paying the lien debt, costs and reasonable attorney’s fees, unless otherwise agreed to between the lender and the borrower.
The sale, which may be held no earlier than fourteen (14) days after the last ad is published, is to be made at auction to the highest bidder.
Any sale, in which notice has been given, may be postponed from time to time by public announcement made by the lender or their representative.

How to Stop Foreclosure in Delaware

2010-09-05T12:08:00.001-07:00

How to Stop Foreclosure in Delaware
Foreclosure is one of the most dreadful things you can be faced with when it comes to matters of owning a home because this is a process that actually revokes all your rights to a home that you have been living in or have been paying for some time now. This means that if you have already shelled out a certain amount of money, you wouldn’t want your investment to be put to waste.

Foreclosure is tricky because it can happen to anyone faced with a situation wherein you find yourself unable to pay for your dues and mortgages. This simply means that you would no longer have to pay for anything but would also mean that you no longer have a property or investment under your name.

Basically, foreclosure takes place after you’ve missed out on your payment dues after a couple of days. Worse, it happens and happens quite rapidly for people who avoid contacting their lenders or banks to discuss their current financial situation. This is basically why even if you feel that you can no longer pay your debt and feel ashamed about it, you would still have to face your lender and explain so that other payment and settlement options can be offered to you.

Usually, the notice of default or during the pre-foreclosure stage is sent by email. There, certain information are stated and that which you have to reply to as soon as possible. When you reply and state certain reasons, there would be assistance ready to guide you. Otherwise, you would be alone in your problem.

In the end, it is greatly advisable to first see if you truly have the money to check your needs and claims before investing in something that would require you to spend much. This way, you can be certain that you have enough money to spare to pay for your dream home.

Synopsis of Delaware Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: No

Primary Security Instruments: Mortgage

Timeline: Typically 90 days

Right of Redemption: No

Deficiency Judgments Allowed: No

In Delaware, lenders may foreclose on a mortgage in default by using the judicial foreclosure process.

Judicial Foreclosure

Lenders in Delaware are given a number of options in which they may pursue judicial foreclosure, but the most commonly used procedure is the Scire Facias.

This proceeding is quite different from other judicial foreclosures because instead of the lender having to prove the borrower is in default of the mortgage, the borrower has to prove he isn’t. Although the suit to obtain an order for foreclosure is filed by the lender, the borrower must appear in court within twenty (20) days of being served a writ to provide evidence as to why the foreclosure should not take place. Unless the court is satisfied with the borrowers explanation and evidence, they will authorize a foreclosure sale.

Said sale must be conducted by the sheriff and held either at the courthouse or at the property itself at least fourteen (14) days after the notice of sale is posted on the property and in other public places throughout the county in which it is located.

The buyer has no right of redemption once the court has confirmed the sale.

How to Stop Foreclosure in Connecticut

2010-09-05T12:07:00.001-07:00

How to Stop Foreclosure in Connecticut
There are different types of loans and mortgages that you can apply for but the most futuristic of all would be the ones that you apply for in order to own a home. This is because everybody wants to have their own place where they can build their families and call it their own. For this very reason, it gets a little bit frustrating when you are faced with the fact that you can no longer own your home because you can no longer pay for it.

By definition, foreclosure is a legal process that lifts a person’s ownership of his or her property because of inconsistency when it comes to payment or inability to pay at that. There are many reasons why foreclosure can take place such as divorce, loss of job, reduction in wages and so on. But whatever the case is, what is important is to have a budget that would allow you to pay for your loans and mortgages even when all these factors set in already.

There are different types of foreclosure and each one is different from the others. The only thing with it is that you are given a notice and then this notice is provided to you considering the ample time you have to once again consider to pay up your debts.

The process of foreclosure for the home is pretty simple. After a notice from the bank is sent to you, you are required to pay for your dues. Otherwise, your home will be auctioned and you will lose ownership.

To avoid foreclosure in Connecticut, the most important thing you have to bear in mind would be budgeting. This means that you have enough money and have the capability to prioritize your spending. Also remember that it is important to have good relationships and ties with the agent at all times.

Synopsis of Connecticut Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: No

Primary Security Instruments: Mortgage

Timeline: Typically 60 days

Right of Redemption: No

Deficiency Judgments Allowed: Yes

In Connecticut, lenders may foreclose on a mortgage in default by using the judicial foreclosure process.

Judicial Foreclosure

The judicial foreclosure process in Connecticut is carried out by either strict foreclosure or a decree of sale.

With strict foreclosure, no actual foreclosure sale is held. Instead, the lender goes to court to try and obtain a court order demonstrating the borrower is in default of the mortgage. If successful, the title transfers to the lender immediately.

However, the court sets an established amount of time in which the borrower may redeem the property, but if they fail to do so, the title becomes absolute to the lender and the borrower has no longer has any claim to the property. The lender then has thirty (30) days to record a certificate of foreclosure, which must contain a description of the property, the foreclosure proceedings, the mortgage and the date the title became absolute.

With a decree of sale, the court: 1) establishes the time and manner of the sale; 2) appoints a committee to sell the property; and 3) appoints three appraisers to determine the value of the property.

The borrower may stop the foreclosure proceedings at any time before the sale by paying the balance due on the mortgage. If no such payment is made, the committee will go forward with the sale.

The lender may sue to obtain a deficiency judgment in Connecticut.

How to Stop Foreclosure in Colorado

2010-09-05T12:05:00.001-07:00

How to Stop Foreclosure in Colorado
Each state has a different process when it comes to foreclosure even if we know for a fact that it is basically a process that prevents you from owning your home simply because you can no longer pay for it. There are several different types of foreclosures.

First is judicial and non judicial foreclosure. In Colorado, this type of foreclosure can take place when there is no power of sale on your investment. If in case you cannot pay for your home any longer, a lawsuit can be filed on your name to grant it the power to foreclose your home. The idea behind is that, the borrower or the purchaser, with his or her inability to pay the home, would be authorized to foreclose it in certain conditions.

When there is inability to pay on the part of the lender, then a public trustee can be appointed. A lawyer or the lender can file a dispute at the Office of the Public Trustee in the area where the home is situated and where the debtor currently resides in. Once this is filed, and the debtor is informed but still no payment is made, then the public trustee can file a notice of election and demand. This notice is advertised on the newspapers for about 5 weeks and states that the property may be available on the market in the coming weeks.

A copy of the letter should be mailed to the public trustee within 10 days of issuance. The homeowner should be contacted too within 21 days otherwise it would no longer be feasible for the home owner to still own the same home.

In the end, the idea is to pay your dues on time to be able to avoid such problems in the future and still own a home.

Synopsis of Colorado Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Typically 60 days

Right of Redemption: Yes

Deficiency Judgments Allowed: Yes

In Colorado, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

The foreclosure process in Colorado is quite a bit different than in other states because here, the governor appoints a “Public Trustee” for each county in the state. The trustee must act as an impartial party when handling a power of sale foreclosure. In Colorado, the non-judicial power of sale foreclosure is carried out as follows:

The process begins when the attorney representing the lender files the required documents with the Office of the Public Trustee of the county where the property is located. The Public Trustee then files a “Notice of Election and Demand” with the county clerk and recorder of the county. Once recorded, the notice must be published in a newspaper of general circulation within the county where the property is located for a period of five (5) consecutive weeks.

The Public Trustee must also mail, within ten (10) days after the publication of the notice of election and demand for sale, a copy of the same and a notice of sale as published in the newspaper, to the borrower and any owner or claimant of record, at the address given in the recorded instrument. The Public Trustee must also mail, at lease twenty-one (21) days before the foreclosure sale, a notice to the borrower describing how to redeem the property.

The owner of the property may stop the foreclosure proceedings by filing an “Intent to Cure” with the Public Trustee’s office at least fifteen (15) days prior to the foreclosure sale and then paying the necessary amount to bring the loan current by noon the day before the foreclosure sale is scheduled.

The foreclosure sale must take place between forty-five (45) and sixty (60) days after the recording of the election and demand for sale with the county clerk and recorder. The Public Trustee may hold the sale at any entrance to the courthouse, unless other provisions were made in the deed of trust.

The lender has the option to file a suit for deficiency in Colorado and the borrower has up to seventy five (75) days after the sale to redeem the property by paying the foreclosure sale amount, plus interest.

How to Stop Foreclosure in Arkansas

2010-09-05T12:04:00.001-07:00

How to Stop Foreclosure in Arkansas
When it comes to owning a home and paying your debts based on the terms you have previously agreed upon, remember that one of the most important things you can take into consideration would be calling your lender.

Most people disregard the importance of doing this and resort to avoiding making any contact with their lender whenever they realize that they can no longer pay for your dues. In fact, it would be good for you to know that when you try to contact your lender, chances are, you would be lucky enough to have your debt problems resolved.

You can easily find your lender because chances are he or she will try to contact you the moment he or she realizes that you have a lapse in your payment. If in case you find it hard to contact your lender, then you can simply research on some of the information that you can find readily available online.

Once you have created a link to your lender once again, make sure that the information that you are supposed to disclosed has already been prepared. This way it will be a lot of easier for you to answer questions consistently and would likewise find it easier to make a personal appointment if need be necessary.

Some of the information that you can disclose should include your factual salary, and what other sources of income you might possibly have. Remember to only disclose truthful information so that nothing will be taken against you.

To avoid such problems, it would then be advisable for you to simply pay your dues on time. Do not resort to buying a home if you know for a fact that you cannot really sustain the payment terms. This way in the end you wouldn’t have problems settling your dues.

Synopsis of Arkansas Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Typically 120 days

Right of Redemption: Varies

Deficiency Judgments Allowed: Varies

In Arkansas, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process. However, an appraisal of the property must be made prior to the schedule date of foreclosure.

In any foreclosure under a mortgage or deed of trust in Arkansas, the property must sell for not less than two-thirds of the appraised value. If it does not, then it may be offered for sale again within twelve (12) months. The second sale may be to the highest bidder without reference to the previous appraisal.

Judicial Foreclosure

In judicial foreclosure, a court decrees the amount of the borrowers debt and gives him or her a short time to pay. If the borrower fails to pay within that time, then the clerk of the court, as commissioner, advertises the property for sale.

Sales of real property under court order will be on a credit of not less than three (3) months, but not more than six (6) months, or on installments to not more than four (4) months credit overall. To secure payment, a lien will be retained on the property for its price and the purchaser must also give a bond with surety for the amount of the purchase price.

The lender may bid at the sale by crediting a portion (or all) of the amount the court found was owed to the lender against the sales price of the property purchased at the foreclosure sale. If the real estate does not sell for an amount equal to what’s due on the mortgage loan, then the lender may seize other property from the borrower as in an ordinary judgment.

The borrower has one (1) year from the date of the sale to redeem the property by paying the amount for which the property was sold, plus interest.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:

The trustee must record a notice of sale in the office of the recorder of the county where the property is located. The mortgagee’s or trustee’s notice of default and intention to sell shall be mailed within thirty (30) days of the recording of the notice by certified mail to the borrower. This includes any borrower of record or of whom the lender has actual notice. The notice must also be mailed to anyone who records a Request for Notice that specifically described the mortgagee including its recording information.

Within five (5) days after the notice is recorded, the trustee must mail, by certified mail, a copy of the notice of sale to each of the people who are parties to the trust deed, except for himself. Additionally, the notice of default and intention to sell must appear in a newspaper in the county where the property is located once a week for four (4) consecutive weeks, with the last notice being published not less than ten (10) days prior to the date of the sale.

Said notice of default and intention to sell must contain the names of the parties to the mortgage or deed of trust, a legal description of the trust property and, if applicable, the street address of the property, the book and page numbers where the mortgage or deed of trust is recorded or the recorder’s document number, the default for which foreclosure is made, the mortgagee’s or trustee’s intention to sell the trust property to satisfy the obligation, including, in conspicuous type, a warning as follows: “YOU MAY LOSE YOUR PROPERTY IF YOU DO NOT TAKE IMMEDIATE ACTION” and the time, date, and place of sale.

Any person including the mortgagee (lender) may bid at the sale, except the trustee, who may bid on the behalf of the beneficiary (lender) but not for himself or herself in deed of trust sales. The high bidder must pay the price bid at the time of sale, or within ten (10) days. The lender may bid by canceling out what it is owed on the loan, including unpaid taxes, insurance, costs or sale and maintenance, but for cash for any higher price.

The trustee may postpone the sale by public proclamation at the time, place and date last appointed for sale, up to seven (7) days past the original date, but if for a longer time, then the whole notice procedure must be performed a second time, including the sixty (60) day wait.

Once the sale is complete, the proceeds will go to the pay for the expenses of the foreclosure sale, then toward the obligations secured by the trust deed that was foreclosed and then to junior lien holders in order of their priority. The original borrower is entitled to receive any remaining funds. The successful bidder receives a trustee’s deed.

The lender may sue the borrower for a deficiency within twelve (12) months of a power of sale clause foreclosure. The lender may sue for (1) the difference between the foreclosure sale price and the balance due on the loan, or (2) the balance due on the loan minus the fair market value of the property, whichever is less.

Stop Foreclosure in Arizona

2010-09-05T12:02:00.000-07:00

Stop Foreclosure in Arizona
More and more homes in the US are faced with the problems of foreclosure because of the current economic crisis. This is because more and more people find themselves in debt because of their low income and cannot anymore sustain the money that they use to spend for paying the home that they have been investing in. One of the states that have been experiencing this kind of problem is Arizona.

There are several ways on how Judicial foreclosure can be prevented in Arizona. For one, it is best to consider checking out the Home Protection Pilot Program. This program has taken into effect since 2004 that is aimed at helping owners prevent themselves from experiencing foreclosure due to job loss. This program offers 0% interest rate and loans up to $20,000. The repayment of the loan can be deferred to up to 15 years too.

The next thing you can do is to contact legal aid. There are free legal aids to seek advice from on how to handle foreclosure. There are probono attorneys that can give good and sufficient advices as to what can be done when experiencing foreclosure.

The other thing you can do is to call the HOPE hotline. Financial volunteers here are very much available to help and answer questions when it comes to foreclosure and other related matters free of charge.

You can find a Defense Project that you can coordinate with. They on the one hand can connect you with people in your area or state that may be able and willing to help you in this kind of situation.

In the end, these options are made readily available to you so that you would be able to make the most out of your purchases and in the end would allow you to simply live in the home that you have been paying for.

Synopsis of Arizona Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Typically 90 days

Right of Redemption: None

Deficiency Judgments Allowed: Varies

In Arizona, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:

The trustee must record a notice of sale in the office of the recorder of the county where the property is located. Within five (5) days after the notice is recorded, the trustee must mail, by certified mail, a copy of the notice of sale to each of the people who are parties to the trust deed, except for himself. Additionally, the notice must appear in a newspaper in the county where the property is located once a week for four (4) consecutive weeks, with the last notice being published not less than ten (10) days prior to the date of the sale.

Optionally, if it can be done without a breach of the peace, the trustee can post the notice at least twenty (20) days prior to the date of the sale, in some conspicuous place on the property to be sold and/or he or she can post the notice at the courthouse or at a specified place at the place of business of the trustee in the county in which the property is located.

The trustee or the trustee’s agent must conduct the sale. The sale is for cash to the highest bidder, except that the lender can make a “credit bid,” which means to cancel out some part (or all) of the money the borrower owed the lender on the lean, instead of paying cash. A successful high bidder must pay the bid price by 5 pm of the day after the bid, other than a Saturday or legal holiday. Every bid is an irrevocable offer until the sale is completed, which happens when the bidder pays the bid price to the trustee’s satisfaction. If the high bidder fails to make the payment by 5:00 pm, the day after being notified of the option to buy, then the trustee may postpone the sale.

The trustee may postpone the sale to another time, or another place, by giving notice of the new date, time and place by public declaration at the last place and time the property was offered for sale. No other notice is required. A trustee may also, by written agreement, extend the time for a buyer to come up with the payment.

Once the sale is complete, the proceeds will go to the payment of the obligations secured by the deed of trust that was foreclosed, then to junior lien holders in order of their priority. The successful bidder gets a trustee’s deed, which provides conclusive evidence that the trustee conducted the foreclosure sale property.

A note regarding Deficiency Suits: A lender may not bring a deficiency suit against a person who lost a property that is 2.5 acres or less at a foreclosure, provided the property was a single one-family or a single two-family dwelling. This is so even if the high bid at foreclosure was less that the balance due on the loan. However, in foreclosures against other types of property, a deficiency suit is allowed, but is limited to the difference between the balance owed and the fair market value of the property, and then only if the suit is brought within ninety (90) days of the power of sale foreclosure.

How to Stop Foreclosure in Alaska

2010-09-05T12:01:00.001-07:00

How to Stop Foreclosure in Alaska
One of the things that you should avoid when it comes to owning a home would be foreclosure. This process takes place when you are faced with the inability to pay for your dues and settle them on time. But of course, this kind of situation is highly avoidable.

For one, you can delay foreclosure in so many ways. In fact, delaying foreclosure is very easy to do. Chances, you don’t have to worry about what you’ll need, where to go and who to talk to because you can have everything covered instantly. One of the things that you will need at first would be the internet. You should also have the leisure of time to do extensive research. If you can afford an attorney, then that would work to your advantage. When you are able to do these things then you can say that you are on the right track already.

First of all, it would be best that you research on the laws that apply to foreclosure so that you’ll know which ones applies to do and which one is applicable to your current situation. When you know the laws and regulations, you wouldn’t have to worry as to whether or not your are being abused or your rights are violated.

You can also hire the services of an attorney that can help you understand certain terms that may be a little difficult to decipher. If you do not have the budget to spare to hire the services of an attorney, then you can simply search again on some of the relevant information that you can find online.

In the end, remember that whatever you do, you should be able to work it towards being able to settle your dues and avoiding foreclosure. This way, you can still have your home and see to it that you will have it for the rest of your life for your whole family to live in.

Synopsis of Alaska Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Varies by Process; Typically 90 days

Right of Redemption: Varies by Process

Deficiency Judgments Allowed: Varies by Process

In Alaska, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, has been instituted more since the late 1980′s, when lenders found that they were foreclosing on residential property worth substantially less than the amount owed. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder. In the case of judicial foreclosure, the process is carried out according to the rules of equity, deficiency suits are permitted and the borrower has no rights of redemption.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed, provided it meets the minimum protection laws set forth by the State of Alaska. Otherwise, the non-judicial power of sale foreclosure is carried out in the following three phases:

The trustee must record a notice of default in the office of the recorder of the recording district in which the property is located not less than thirty (30) days after the default and not less than three (3) months before the sale.

Said notice of default must state the name of the borrower, the book and page where the deed is recorded and it must describe the property, the borrower’s default, the amount the borrower owes, and the trustee’s desire to sell. It must also state the date, time and place of the sale.

Within ten (10) days after recording the notice of default, the trustee must mail a copy of the same by certified mail to the last know address of (1) the borrower, and (2) any person whose claim or lien on the property appears of record or is known to the lender of trustee and (3) any occupant. The trustee may have the notice delivered personally instead of sending it by certified mail.

Any time before the sale, the borrower may cure the default and stop the sale by paying a sum equal to the missed payments plus attorney’s fees. The lender may not require the borrower to pay off the entire remaining principal balance of the loan to cure the default, just the missed payments and attorney’s fees. If the lender has recorded a notice of default two or more times, then the Alaska statutes provide that the lender can refuse to accept the borrower’s monies for the missed payments and attorney’s fees and proceed with the foreclosure sale instead.

The sale must be made at a public auction held at the front door of a courthouse of the superior court in the judicial district where the property is located. The trustee must sell to the highest and best bidder and the lender may bid at auction.

The trustee may postpone sale of all or any portion of the property by delivering to the person conducting the sale a written and signed request for the postponement to a stated date and hour. The person conducting the sale shall publicly announce the postponement to the stated date and hour at the time and place originally fixed for the sale. This procedure shall be followed in any succeeding postponement.

When this type of foreclosure process is used, the borrower has a right to redeem the property and deficiency suits are not allowed.

How to Stop Foreclosure in Alabama

2010-09-05T12:00:00.001-07:00

How to Stop Foreclosure in Alabama
Mortgages can be done out of court in the state of Alabama. This is termed as having the power of sale clause. This is done by an attorney and is a non-judicial foreclosure method whenever default occurs. Fortunately, residents and homeowners in the state have a few alternatives so as to avoid getting their houses foreclosed.

The Things You Will Need:
Your original mortgage papers

Step 1Contact your mortgage company; it is never too late to call your mortgage company no matter how late delayed you are. They are always willing to help since they also will lose money every time they foreclose a house; thus they certainly would like to work with homeowners to avoid this. Just be honest about your situation and inquire about the alternatives that are open to you.
Step 2Always be available. Your mortgage company will usually contact you via mail meaning not opening these letters will mean no correspondence between you and the company. This is specially important since they will sometimes mail you about assistance options. Keep in mind that in the state of Alabama, court proceedings are not required to foreclose a home making them faster. They will also need a shorter time span to totally foreclose your home so make sure you are corresponding well with your mortgage company.
Step 3Be Educated. Find your original copy of the mortgage and study it well. Know your rights and use them well. If you need an attorney or any other professional help to discuss these with, contact them at once.
Step 4Prioritize your finances. Pay your mortgages first and fore-go other unnecessary bills such as cell phones, eating out, memberships, and cable television. Until your mortgage is up to date, delay you other payment options as long as you can. Even if these things are also regular expenses, cable payments will not give you your house back.
Step 5Get extra means of income. Sell other assets such as life insurances, jewelry, or extra cars if needed. Use the money from these to settle your mortgage. And even if a second job is not enough to make ends meet; the fact that you are looking for one or have already gotten one will prove to your mortgage company that you are serious in paying your mortgage and will do anything just to keep your house.
Step 6Read the newspaper. When the attorney files a notice of sale for a house, the company is expected to publish a foreclosure sale notice in the newspapers for three weeks. If there is none available, they may opt to use a newspaper from the nearby county.
Tips & Warnings
Even though filing for bankruptcy will stop foreclosure, it must only be done as a last resort.
Do not pay third party people to stop your foreclosure and never sign any paper works except from those that come from your mortgage company. A lot of people have been tricked to sign over their homes to somebody else because of this.
II. Synopsis of Alabama Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Varies by Process; Typically 30 – 60 days

Right of Redemption: 12 months

Deficiency Judgments Allowed: Yes

In Alabama, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. However, when no power of sale is present, lenders may, at their option, choose to forego a lawsuit and foreclose by selling the property, as outlined below in the “No Power of Sale Foreclosure Guidelines”.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative.

Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. However, if the deed of trust or mortgage contains a power of sale clause, but does not specify the time, place and terms of sale, then a foreclosure sale may take place at the front or main door of the courthouse of the county where the property located, after default of the deed of trust or mortgage, for cash to the highest bidder. The sale may not take place until thirty (30) days after the last notice of sale is published.

Said notice of sale must be given by publication once a week for four (4) successive weeks in a newspaper published in the county or counties in which the property is located. If the property is under mortgage in more than one county, the publication is to be made in all counties where it is located. The notice of sale must give the time, place and terms of said sale, together with a description of the property. If no newspaper is published in the county where the lands are located, the notice shall be placed in a newspaper published in an adjoining county for four (4) successive weeks.

No Power of Sale Foreclosure Guidelines

If no power of sale is contained in a mortgage or deed of trust, the lender, or any assignees thereof, may, after default of the mortgage or deed of trust, either file a lawsuit to foreclose or foreclose by selling the property to the highest bidder for cash at the

courthouse door of the county where the property is situated. Said sale may not take place until after notice of the time, place, terms and purpose of the sale has been published for four (4) consecutive weeks in a newspaper published in the county wherein said lands, or a portion thereof are situated.

How to Stop Foreclosure in California

2010-09-05T11:58:00.001-07:00

How to Stop Foreclosure in California
Foreclosure can be a difficult battle to beat in the state of California. Unlike most states, California does not offer much flexibility in negating the terms and conditions of a foreclosure proceeding, and a lender can easily seize control of your home in as little as four months. The best approach to killing a foreclosure is to act as soon as you receive the initial notice and negate the foreclosure before it actually happens.

Gaining an audience and setting up a settlement conference with your lender is the smartest approach in the event of receiving an initial notice to sell. You can easily setup and renegotiate the terms of your existing mortgage with various options available such as a loan adjustment agreement or a remortgage. You can dialogue with your lender about delaying the foreclosure to allow you time to bring your payments up to date or agree to newly adjusted interest rates. The best way to go about a foreclosure is to show lenders your enthusiasm and diligence in working with them to save your home.

You should contact an organization called Hope Now. This non-profit guides home owners through foreclosure proceedings and provides counseling to help negate foreclosure. They will also provide you with contact numbers and referrals to various legal organizations, including civil legal aid that can help you expedite or setup proceedings with your lender and save your mortgage.

Emergency loans can also help you stop foreclosure proceedings by paying your mortgage up to speed. A Loan Now, is a company that provides financial assistance to homeowners who are on foreclosure, by paying their mortgage payments up to date and settling the notice of foreclosure. Loans vary from $40,000 to $75,000 with a minimum requirement of 400 credit score and in default with mortgage payments.

Synopsis of California Foreclosure Laws
Judicial Foreclosure Available: Yes

Non-Judicial Foreclosure Available: Yes

Primary Security Instruments: Deed of Trust, Mortgage

Timeline: Typically 120 days

Right of Redemption: Varies

Deficiency Judgments Allowed: Varies

In California, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.

Using this type of foreclosure process, lenders may seek a deficiency judgment and under certain circumstances, the borrower may have up to one (1) year to redeem the property.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A “power of sale” clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the “Power of Sale Foreclosure Guidelines”.

Power of Sale Foreclosure Guidelines

If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:

A notice of sale must be: 1) recorded in the county where the property is located at least fourteen (14) days prior to the sale; 2) mailed by certified, return receipt requested, to the borrower at least twenty (20) days before the sale; 3) posted on the property itself at least twenty (20) days before the sale; and 4) posted in one (1) public place in the county where the property is to be sold.

The notice of sale must contain the time and location of the foreclosure sale, as well as the property address, the trustee’s name, address and phone number and a statement that the property will be sold at auction.

The borrower has up until five days before the foreclosure sale to cure the default and stop the process.

The sale may be held on any business day between the hours of 9:00 am and 5:00 pm and must take place at the location specified in the notice of sale. The trustee may require proof of the bidders ability to pay their full bid amount. Anyone may bid at the sale, which must be made at public auction to the highest bidder. If necessary, the sale may be postponed by announcement at the time and location of the original foreclosure sale.

Lenders may not seek a deficiency judgment after a non-judicial foreclosure sale and the borrower has no rights of redemption.

Forensic Loan Audit FAQ

2010-09-05T11:55:00.001-07:00

Forensic Loan Audit FAQ
This is a sampling of questions we are commonly asked. If you have a question which is not in this section, please contact us.
Q. How do I know if I have been the victim of Predatory Lending?
A. The best way to determine if you have been the victim of Predatory Lending is through a Forensic Loan Audit not Just a RESPA/ TILA Audit. This is a complex process that involves “Rebuilding” your loan. Document by Document document, page by page. Each page is reviewed for any violations that may be found. The final report can be used by your attorney for the purpose of your defense. (Approximately 95% of the documents we examine have had some form of predatory lending, misleading disclosures, or other violations of State and Federal regulations.)
There are hundreds of checkpoints involved in the forensic examination of loan documents. Many discoveries are found that can lead to either legal actions against the lender or a Demand Letter from an attorney ordering that the loan be modified into something you can actually afford.
Q. What if there are no discrepancies found in my paperwork ? Can you still help us?
A. Based on our intake criteria, It is rather rare that we do not find some kind of error in your loan origination documents since over 85% of loans between 2002-2006 have errors, remember we only need a $35.00 mistake . If our loan audit does not find any errors, we still can try to refer you to a competent attorney who “gets it”
Q. Should I file for bankruptcy to save my house?
A. That is only for you and an attorney decide.
Q.My lender told me “they just want all their money”. Can you still help me?
A. This kind of attitude and inflexibility from their lenders is not rare. The attitude usually changes when evidence of loan fraud, predatory lending, or servicing violations is discovered, especially if you have an attorney contacting them on your behalf!
Then there is the issue that the company you make payments to may have NO Authority to Modify Your Loan!. They do not own the Note and have to Follow the Guidelines of the Pooling and Servicing Agreement you loan is tied up in.
Q. What Is loss mitigation ?
A. The purpose of loss mitigation is to work out an agreement between the homeowner and the lender that will stop foreclosure proceedings permanently. Lenders are more likely to respond favorably when there are violations of State or Federal regulations discovered in your loan package, or current servicing violations. The last thing they want is a law suit. If enough violations in your documents, or servicing history, the lender will have little choice but to modify the loan or face judicial litigation
Q. I’m currently in bankruptcy. Can you still help?
A. On the advice of your attorney It may be advisable to go ahead with the document examination. You never know, maybe the violator in your loan is the same entity that caused your Bankruptcy
Q. Do I have enough time to stop my foreclosure?
A. Until you home goes into a foreclosure sale,there is still reason to fight. If a sale date for your house has been set, you need to act fast. In these cases, you can get emergency action by the courts . If need be, we can hopefully find an attorney that could get involved to stop the foreclosure sale. Again, time is not your friend so you better act fast.
Even after the Trustee Sale has occurred, it may still be possible to get it set aside.
Q. How long does it take for you to complete the audit once you receive all of the paperwork?
A. Depending on the Type of Audit and the amount of audits we are currently performing for our clients, it can take several days to several months. Normally, an audit takes about a week to complete the examination of all your documensts,
Keep in mind, what you see is just a whole lot of papers packed full of numbers and probably words you’ve never heard of. Our document examination includes detailed research and investigation of all that transpired on and before the day you closed your loan. What was the par interest rate on that day, what was the index of the one of four indexes the lender could have used on your last rate adjustment. Essentially, every word or figure on every page has to be examined for it’sthe final detaild results. One of the biggest issues is to investigate the servicing of the loan to insure compliance with State and Federal regulations and relationship to the original intent of the Note. There is a lot of attention to detail in the Forensic Auditing of Loan Documents.
Q. How long do we have to act?
A. When you are behind on house payments time is of the essence as every day that goes by makes it that much harder to get a work out agreement with your lender that you can live with. When we point out evidence of loan fraud, or Predatory Lending, your attorney should contact the lenders, who will usually stop the foreclosure in order to give their legal department time to review the case. Pending on their case load, the foreclosure could be put off for up to six months or longer.

WHO HAS YOUR MORTGAGE NOTE?

2010-09-05T11:53:00.001-07:00

WHO HAS YOUR MORTGAGE NOTE?
This Fight Against Home Foreclosure….
Is Constantly Getting more interesting (If I can Use the word “interesting” ) Here is a recent article from our friend in Southern California.
INTRODUCTION
In an era where a very large portion of mortgage obligations have been securitized, by assignment to a trust indenture trustee, with the resulting pool of assets being then sold as mortgage backed securities, foreclosure becomes an interesting exercise, particularly where judicial process is involved. We are all familiar with the securitization process. The steps, if not the process, is simple.
A borrower goes to a mortgage lender. The lender finances the purchase of real estate. The borrower signs a note and mortgage or deed of trust. The original lender sells the note and assigns the mortgage to an entity that securitizes the note by combining the note with hundreds or thousands of similar obligation to create a package of mortgage backed securities, which are then sold to investors.
Unfortunately, unless you represent borrowers, the vast flow of notes into the maw of the securitization industry meant that a lot of mistakes were made. When the borrower defaults, the party seeking to enforce the obligation and foreclose on the underlying collateral sometimes cannot find the note. A lawyer sophisticated in this area has speculated to one of the authors that perhaps a third of the notes “securitized” have been lost or destroyed. The cases we are going to look at reflect the stark fact that the unnamed source’s speculation may be well-founded.
UCC SECTION 3-309
If the issue were as simple as a missing note, UCC §3-309 would provide a simple solution. A person entitled to enforce an instrument which has been lost, destroyed or stolen may enforce the instrument. If the court is concerned that some third party may show up and attempt to enforce the instrument against the payee, it may order adequate protection. But, and however, a person seeking to enforce a missing instrument must be a person entitled to enforce the instrument, and that person must prove the instrument’s terms and that person’s right to enforce the instrument. §3-309 (a)(1) & (b).
WHO’S THE HOLDER
Enforcement of a note always requires that the person seeking to collect show that it is the holder. A holder is an entity that has acquired the note either as the original payor or transfer by endorsement of order paper or physical possession of bearer paper. These requirements are set out in Article 3 of the Uniform Commercial Code, which has been adopted in every state, including Louisiana, and in the District of Columbia. Even in bankruptcy proceedings, State substantive law controls the rights of note and lien holders, as the Supreme Court pointed out almost forty (40) years ago in United States v. Butner, 440 U.S. 48, 54-55 (1979).
However, as Judge Bufford has recently illustrated, in one of the cases discussed below, in the bankruptcy and other federal courts, procedure is governed by the Federal Rules of Bankruptcy and Civil Procedure. And, procedure may just have an impact on the issue of “who,” because, if the holder is unknown, pleading and standing issues arise.
BRIEF REVIEW OF UCC PROVISIONS
Article 3 governs negotiable instruments – it defines what a negotiable instrument is and defines how ownership of those pieces of paper is transferred. For the precise definition, see § 3-104(a) (“an unconditional promise or order to pay a fixed amount of money, with or without interest . . . .”) The instrument may be either payable to order or bearer and payable on demand or at a definite time, with or without interest.
Ordinary negotiable instruments include notes and drafts (a check is a draft drawn on a bank). See § 3-104(e).
Negotiable paper is transferred from the original payor by negotiation. §3-301. “Order paper” must be endorsed; bearer paper need only be delivered. §3-305. However, in either case, for the note to be enforced, the person who asserts the status of the holder must be in possession of the instrument. See UCC § 1-201 (20) and comments.
The original and subsequent transferees are referred to as holders. Holders who take with no notice of defect or default are called “holders in due course,” and take free of many defenses. See §§ 3-305(b).
The UCC says that a payment to a party “entitled to enforce the instrument” is sufficient to extinguish the obligation of the person obligated on the instrument. Clearly, then, only a holder – a person in possession of a note endorsed to it or a holder of bearer paper – may seek satisfaction or enforce rights in collateral such as real estate.
NOTE: Those of us who went through the bank and savings and loan collapse of the 1980’s are familiar with these problems. The FDIC/FSLIC/RTC sold millions of notes secured and unsecured, in bulk transactions. Some notes could not be found and enforcement sometimes became a problem. Of course, sometimes we are forced to repeat history. For a recent FDIC case, see Liberty Savings Bank v. Redus, 2009 WL 41857 (Ohio App. 8 Dist.), January 8, 2009.
THE RULES
Judge Bufford addressed the rules issue this past year. See In re Hwang, 396 B.R. 757 (Bankr. C. D. Cal. 2008). First, there are the pleading problems that arise when the holder of the note is unknown. Typically, the issue will arise in a motion for relief from stay in a bankruptcy proceeding.
According F.R.Civ. Pro. 17, “[a]n action must be prosecuted in the name of the real party in interest.” This rule is incorporated into the rules governing bankruptcy procedure in several ways. As Judge Bufford has pointed out, for example, in a motion for relief from stay, filed under F.R.Bankr.Pro. 4001 is a contested matter, governed by F. R. Bankr. P. 9014, which makes F.R. Bankr. Pro. 7017 applicable to such motions. F.R. Bankr. P. 7017 is, of course, a restatement of F.R. Civ. P. 17. In re Hwang, 396 B.R. at 766. The real party in interest in a federal action to enforce a note, whether in bankruptcy court or federal district court, is the owner of a note. (In securitization transactions, this would be the trustee for the “certificate holders.”) When the actual holder of the note is unknown, it is impossible – not difficult but impossible – to plead a cause of action in a federal court (unless the movant simply lies about the ownership of the note). Unless the name of the actual note holder can be stated, the very pleadings are defective.
STANDING
Often, the servicing agent for the loan will appear to enforce the note. Assume that the servicing agent states that it is the authorized agent of the note holder, which is “Trust Number 99.” The servicing agent is certainly a party in interest, since a party in interest in a bankruptcy court is a very broad term or concept. See, e.g., Greer v. O’Dell, 305 F.3d 1297, 1302-03 (11th Cir. 2002). However, the servicing agent may not have standing: “Federal Courts have only the power authorized by Article III of the Constitutions and the statutes enacted by Congress pursuant thereto. … [A] plaintiff must have Constitutional standing in order for a federal court to have jurisdiction.” In re Foreclosure Cases, 521 F.Supp. 3d 650, 653 (S.D. Ohio, 2007) (citations omitted).
But, the servicing agent does not have standing, for only a person who is the holder of the note has standing to enforce the note. See, e.g., In re Hwang, 2008 WL 4899273 at 8.
The servicing agent may have standing if acting as an agent for the holder, assuming that the agent can both show agency status and that the principle is the holder. See, e.g., In re Vargas, 396 B.R. 511 (Bankr. C.D. Cal. 2008) at 520.
A BRIEF ASIDE: WHO IS MERS?
For those of you who are not familiar with the entity known as MERS, a frequent participant in these foreclosure proceedings:
MERS is the “Mortgage Electronic Registration System, Inc. “MERS is a mortgage banking ‘utility’ that registers mortgage loans in a book entry system so that … real estate loans can be bought, sold and securitized, just like Wall Street’s book entry utility for stocks and bonds is the Depository Trust and Clearinghouse.” Bastian, “Foreclosure Forms”, State. Bar of Texas 17th Annual Advanced Real Estate Drafting Course, March 9-10, 2007, Dallas, Texas. MERS is enormous. It originates thousands of loans daily and is the mortgagee of record for at least 40 million mortgages and other security documents. Id.
MERS acts as agent for the owner of the note. Its authority to act should be shown by an agency agreement. Of course, if the owner is unknown, MERS cannot show that it is an authorized agent of the owner.
RULES OF EVIDENCE – A PRACTICAL PROBLEM
This structure also possesses practical evidentiary problems where the party asserting a right to foreclose must be able to show a default. Once again, Judge Bufford has addressed this issue. At In re Vargas, 396 B.R. at 517-19. Judge Bufford made a finding that the witness called to testify as to debt and default was incompetent. All the witness could testify was that he had looked at the MERS computerized records. The witness was unable to satisfy the requirements of the Federal Rules of Evidence, particularly Rule 803, as applied to computerized records in the Ninth Circuit. See id. at 517-20. The low level employee could really only testify that the MERS screen shot he reviewed reflected a default. That really is not much in the way of evidence, and not nearly enough to get around the hearsay rule.

FORECLOSURE OR RELIEF FROM STAY
In a foreclosure proceeding in a judicial foreclosure state, or a request for injunctive relief in a non-judicial foreclosure state, or in a motion for relief proceeding in a bankruptcy court, the courts are dealing with and writing about the problems very frequently.
In many if not almost all cases, the party seeking to exercise the rights of the creditor will be a servicing company. Servicing companies will be asserting the rights of their alleged principal, the note holder, which is, again, often going to be a trustee for a securitization package. The mortgage holder or beneficiary under the deed of trust will, again, very often be MERS.
Even before reaching the practical problem of debt and default, mentioned above, the moving party must show that it holds the note or (1) that it is an agent of the holder and that (2) the holder remains the holder. In addition, the owner of the note, if different from the holder, must join in the motion.
Some states, like Texas, have passed statutes that allow servicing companies to act in foreclosure proceedings as a statutorily recognized agent of the noteholder. See, e.g., Tex. Prop. Code §51.0001. However, that statute refers to the servicer as the last entity to whom the debtor has been instructed to make payments. This status is certainly open to challenge. The statute certainly provides nothing more than prima facie evidence of the ability of the servicer to act. If challenged, the servicing agent must show that the last entity to communicate instructions to the debtor is still the holder of the note. See, e.g., HSBC Bank, N.A. v. Valentin, 2l N.Y. Misc. 3d 1123(A), 2008 WL 4764816 (Table) (N.Y. Sup.), Nov. 3, 2008. In addition, such a statute does not control in federal court where Fed. R. Civ. P. 17 and 19 (and Fed. R. Bankr. P. 7017 and 7019) apply.

SOME RECENT CASE LAW
These cases are arranged by state, for no particular reason.
Massachusetts
In re Schwartz, 366 B.R.265 (Bankr. D. Mass. 2007)
Schwartz concerns a Motion for Relief to pursue an eviction. Movant asserted that the property had been foreclosed upon prior to the date of the bankruptcy petition. The pro se debtor asserted that the Movant was required to show that it had authority to conduct the sale. Movant, and “the party which appears to be the current mortgagee…” provided documents for the court to review, but did not ask for an evidentiary hearing. Judge Rosenthal sifted through the documents and found that the Movant and the current mortgagee had failed to prove that the foreclosure was properly conducted.
Specifically, Judge Rosenthal found that there was no evidence of a proper assignment of the mortgage prior to foreclosure. However, at footnote 5, Id. at 268, the Court also finds that there is no evidence that the note itself was assigned and no evidence as to who the current holder might be.
Nosek v. Ameriquest Mortgage Company (In re Nosek), 286 Br. 374 (Bankr D Mass. 2008).
Almost a year to the day after Schwartz was signed, Judge Rosenthal issued a second opinion. This is an opinion on an order to show cause. Judge Rosenthal specifically found that, although the note and mortgage involved in the case had been transferred from the originator to another party within five days of closing, during the five years in which the chapter 13 proceeding was pending, the note and mortgage and associated claims had been prosecuted by Ameriquest which has represented itself to be the holder of the note and the mortgage. Not until September of 2007 did Ameriquest notify the Court that it was merely the servicer. In fact, only after the chapter 13 bankruptcy had been pending for about three years was there even an assignment of the servicing rights. Id. at 378.
Because these misrepresentations were not simple mistakes: as the Court has noted on more than one occasion, those parties who do not hold the note of mortgage do not service the mortgage do not have standing to pursue motions for leave or other actions arising form the mortgage obligation. Id at 380.
As a result, the Court sanctioned the local law firm that had been prosecuting the claim $25,000. It sanctioned a partner at that firm an additional $25,000. Then the Court sanctioned the national law firm involved $100,000 and ultimately sanctioned Wells Fargo $250,000. Id. at 382-386.
In re Hayes, 393 B.R. 259 (Bankr. D. Mass. 2008).
Like Judge Rosenthal, Judge Feeney has attacked the problem of standing and authority head on. She has also held that standing must be established before either a claim can be allowed or a motion for relief be granted.
Ohio
In re Foreclosure Cases, 521 F.Supp. 2d (S.D. Ohio 2007).
Perhaps the District Court’s orders in the foreclosure cases in Ohio have received the most press of any of these opinions. Relying almost exclusively on standing, the Judge Rose has determined that a foreclosing party must show standing. “[I]n a foreclosure action, the plaintiff must show that it is the holder of the note and the mortgage at the time that the complaint was filed.” Id. at 653.
Judge Rose instructed the parties involved that the willful failure of the movants to comply with the general orders of the Court would in the future result in immediate dismissal of foreclosure actions.
Deutsche Bank Nat’l Trust Co. v. Steele, 2008 WL 111227 (S.D. Ohio) January 8, 2008.
In Steele, Judge Abel followed the lead of Judge Rose and found that Deutsche Bank had filed evidence in support of its motion for default judgment indicating that MERS was the mortgage holder. There was not sufficient evidence to support the claim that Deutsche Bank was the owner and holder of the note as of that date. Following In re Foreclosure Cases, 2007 WL 456586, the Court held that summary judgment would be denied “until such time as Deutsche Bank was able to offer evidence showing, by a preponderance of evidence, that it owned the note and mortgage when the complaint was filed.” 2008 WL 111227 at 2. Deutsche Bank was given twenty-one days to comply. Id.
Illinois
U.S. Bank, N.A. v. Cook, 2009 WL 35286 (N.D. Ill. January 6, 2009).
Not all federal district judges are as concerned with the issues surrounding the transfer of notes and mortgages. Cook is a very pro lender case and, in an order granting a motion for summary judgment, the Court found that Cook had shown no “countervailing evidence to create a genuine issue of facts.” Id. at 3. In fact, a review of the evidence submitted by U.S. Bank showed only that it was the alleged trustee of the securitization pool. U.S. Bank relied exclusively on the “pooling and serving agreement” to show that it was the holder of the note. Id.
Under UCC Article 3, the evidence presented in Cook was clearly insufficient.
New York
HSBC Bank USA, N.A. v. Valentin, 21 Misc. 3D 1124(A), 2008 WL 4764816 (Table) (N.Y. Sup.) November 3, 2008. In Valentin, the New York court found that, even though given an opportunity to, HSBC did not show the ownership of debt and mortgage. The complaint was dismissed with prejudice and the “notice of pendency” against the property was cancelled.
Note that the Valentin case does not involve some sort of ambush. The Court gave every HSBC every opportunity to cure the defects the Court perceived in the pleadings.
California
In re Vargas, 396 B.R. 511 (Bankr. C.D. Cal. 2008)
and
In re Hwang, 396 B.R. 757 (Bankr. C.D. Cal. 2008)
These two opinions by Judge Bufford have been discussed above. Judge Bufford carefully explores the related issues of standing and ownership under both federal and California law.
Texas
In re Parsley, 384 B.R. 138 (Bankr. S.D. Tex. 2008)
and
In re Gilbreath, 395 B.R. 356 (Bankr. S.D. Tex. 2008)
These two recent opinions by Judge Jeff Bohm are not really on point, but illustrate another thread of cases running through the issues of motions for relief from stay in bankruptcy court and the sloppiness of loan servicing agencies. Both of these cases involve motions for relief that were not based upon fact but upon mistakes by servicing agencies. Both opinions deal with the issue of sanctions and, put simply, both cases illustrate that Judge Bohm (and perhaps other members of the bankruptcy bench in the Southern District of Texas) are going to be very strict about motions for relief in consumer cases.
SUMMARY
The cases cited illustrate enormous problems in the loan servicing industry. These problems arise in the context of securitization and illustrate the difficulty of determining the name of the holder, the assignee of the mortgage, and the parties with both the legal right under Article 3 and the standing under the Constitution to enforce notes, whether in state court or federal court.
Interestingly, with the exception of Judge Bufford and a few other judges, there has been less than adequate focus upon the UCC title issues. The next round of cases may and should focus upon the title to debt instrument. The person seeking to enforce the note must show that:
(1) It is the holder of this note original by transfer, with all necessary rounds;
(2) It had possession of the note before it was lost;
(3) If it can show that title to the note runs to it, but the original is lost or destroyed, the holder must be prepared to post a bond;
(4) If the person seeking to enforce is an agent, it must show its agency status and that its principal is the holder of the note (and meets the above requirements).
Then, and only then, do the issues of evidence of debt and default and assignment of mortgage rights become relevant.
Thanks,
Mortgage Audits

How Can I Stop Foreclosure?

2010-09-05T11:51:00.001-07:00

How Can I Stop Foreclosure?

Here are some Ideas: American homeowners need to come together and scream out loud, “We’re not gonna take it!” through filing predatory lawsuits alleging fraud and demanding quiet title actions.
While there is quite a self-serving underground movement aimed at suppression, (think Deep, Deep Throat, the sequel), we still have, on our side, a little document called the United States Constitution which assures us that “Citizens of the United States shall not be deprived of life, liberty or property without due process of law.”
This is the biggest question we hear from Loan Audit Clients

So how do you find your own due process?
If you are a victim of the Loan Fraud and part of their conspiracy, follow my ten step war plan of engagement
(Specia lThanks to Iris Martin, Autor of Mortgage Wars For this)
1. Get out those dusty closing documents and peruse them; they actually make for fascinating reading. You will learn all sorts of facts that your mortgage broker and lender did not want you to know, as in how they committed mortgage fraud.
2. Check your credit rating. If you have fallen to the bottom of the class and your loan is fraudulent, there is hell to pay. Your lender has violated the Fair Credit Reporting Act.
3. Compare the current value of your home to the stated appraised value at your closing. If your value has dropped significantly, it may have been fraudulently inflated to increase the loan amount, so your broker and lender could reap higher fees. Again, a major no no.
4. Is your debt to income ratio was over 35%? Oops, they did it again. It is against the law to put borrowers into loans that they cannot pay back.
5. Does your income reported to the IRS match the income on your loan application? If not, check to see if your data was fudged and your signature was forged. This was a common practice which also happens to be a crime.
6. Go online and Google your lender’s 10K and 8K filings for the year that you signed your loan documents. See how your lender has gleefully bragged to its investors about how efficiently it securitized loans such as your own. Most lenders even go as far as to claim that no loans sold into pools were predatory in any way! (Think investor fraud.) And don’t get me started on the accounting firms who certified these blatant lies. Or the credit rating agencies who stepped up to the plate with inflated ratings and outstretched palms.
7. Get a Forensic Loan Audit. It is the first step in building a winning lawsuit. We provide State of the art, comprehensive Forensic Loan Audits
8. Get a qualified attorney to file your “Qualified Written Requests” and your legal complaint. We have access to some of the best ones in the country who will not rip you off. No point in jumping from predatory lending to predatory lawyer.
9. Demand your loan be extinguished or Rescinded. After you have been defrauded, it is your legal right to demand that the predators be held accountable. Toward that end, don’t waste time attempting to modify a securitized loan. Go right for the jugular, just as your lender has.
10. Break out the champagne. You have tamed the wolf. Maybe in time, you can transform him into a lovable canine companion, maybe a Wall Street born-again Marley.
Stand up for yourself. Don’t fall for the media’s pre-emptive attacks on your character. An examination of recent history paints an entirely different picture of a conspiracy of politicians, regulators, investment bankers, mortgage brokers and nominal lenders that would do anything — including bankrupting the country and the globe — to profit from the derivatives explosion.
Get your Loan Audit, Get Informed Know your homeowner legal rights, and Get Help. It’s time for this karmic cycle to reverse and for homeowners to take back their American dream, one lawsuit at a time. It’s time to Stop Illegal Foreclosures

Supreme Court Helps The Foreclosure Fight

2010-09-05T11:49:00.000-07:00

Supreme Court Helps The Foreclosure Fight

The Fight Against Foreclosure, Illegal Foreclosure Filings and the Ongoing Discovery into Mortgage Lender Violations has a friend in the Supreme Court

Here is something that you probably did not read in your local newspaper or saw on the news… In a surprising 5-4 vote, the Supreme Court ruled that national banks are still subject to the laws of the states they operate in. What made the ruling unusual is that Justice Scalia wrote the opinion and the other four conservative judges were in dissent (Roberts, Thomas, Alito and the normal swing vote Kennedy).
The ruling overturned an appeals court ruling that said that state attorneys general cannot investigate banks if they operate in more than one state.
The case in question involved the enforcement of fair lending laws in N.Y. State, specifically allegations that some banks were charging minorities higher interest rates. Instead, even though these are state laws, the appeals court had said that only the Office of the Comptroller of the Currency (OCC) had the power to investigate. In practice, this means that the laws were null and void, since the OCC has a lousy track record on such issues. Here is The Summary of the Case
“This is a huge win for consumers across the nation,” said Andrew Cuomo, the attorney general for the state of New York, in a statement.
The case began in 2005 when Cuomo’s predecessor, Eliot Spitzer, asked banks for information about their lending practices. The banks sued to block the probe, and lower courts agreed with the banks. Spitzer had threatened to issue subpoenas to get the data.
The Supreme Court ruled that Spitzer could not have issued subpoenas, but was allowed to bring an enforcement action if violations were uncovered. States are free to pursue investigations of banks for consumer protection issues in courts, the ruling said.
The Clearing House, the banking group that brought the suit, said it was “disappointed” with the decision. Another bank group, the Financial Services Round-table, went even further, saying that the decision “will create a patchwork of 50 state laws that destroys the efficiencies of the national market.” Sounds Like Sour Grapes to Me!
The Key Problem has been that Enforcing state laws is simply not a priority for a division of the Treasury Department. And has caused jurisdictional problems for foreclosure defense. While clearly there can be a problem if multiple agencies have jurisdiction in regulation, allowing things to slip through the cracks, there can also be problems when there is only one regulator and that regulator is in the pocket of the regulated. It is harder to capture all 50 state attorneys general and the OCC, than it is just the OCC alone. Make no mistake, the head of the OCC, John Dugan, a holdover from the last administration, is very much a creature of the big banks he is supposed to be overseeing. The OCC ranks just behind the OTS in being an ineffectual regulator during the bubble.
While the state attorneys general will not be able to issue subpoenas on their own authority (they need approval from a state judge), it does mean that they do not have to sit on their hands if they think the banks are breaking the law. It also will mean a more fair application of the law and your legal rights.
If the appeals court ruling had been allowed to stand, then the state attorneys general would have been free to go after a little community bank that only operated in their state, but unable to go after the big banks like J.P. Morgan , Bank of America , Citigroupand Wells Fargo that dominate the banking business. Sort of like telling them, yeah, it’s okay for the state to go after the street level drug traffickers, but not allowed to go after the kingpins.
This is a major win for consumer protection, and a loss for the banks. It is also a big win for states in the ongoing struggle between state and federal jurisdiction. I guess the Supreme Court is not as susceptible to campaign contribution influence as the Congress is. Thanks to Dirk van Dijk and Greg Robb, MarketWatch For First Making this Important issue Available !…

The fight against foreclosure is only beginning, stay tuned for more about the mortgage mess and lender violations. Together we will Stop Illegal Foreclosures and give ourselves equal access to the law regarding predatory lending as it should be!

An Amazing Case of Loan and Mortgage Fraud

2010-09-05T11:48:00.001-07:00

An Amazing Case of Loan and Mortgage Fraud

Loan and mortgage fraud is becoming big business across the country and crooks continue to find new ways to take advantage of almost anyone and steal any identity. The reality is…Loan and mortgage fraud is becoming big business across the country and crooks continue to find new ways to take advantage of almost anyone and steal any identity. Eyewitness News has uncovered an amazing case that involves a victimized grandmother in San Diego, a failing Los Angeles loan company and a Las Vegas man who doesn’t care who he hurts.
This is why it is so important for Homeowners to get a Forensic Mortgage Loan Audit, A qualified audit such as the Audit Reports Axis Financial performs will identify everything that transpired in your loan closing. As we have previously have written, there has been a HUGH amount of Mortgage Lender Fraud in the last handful of years (2002-2008) and if you have an adjustable mortgage, chances are there are mistakes and deception involved. Your mortgage loan audit will give you a way to proceed with your lender.
If you are in or facing foreclosure, experts have recommended you get a loan audit FIRST.
If you are trying to modify your loan, chances are you will not have much success as the majority of loans were pooled into securities and the Security agreement Does Not allow for any changes… that is unless you have the proof of TILA, RESPA, HOEPA violations to use as leverage.
In our quest to help you Fight Foreclosure, and Stop Illegal lender activities we offer you the Peace of Mind in knowing you have the correct information on your mortgage and a direction to take. Don’t loose sleep over things YOU CAN CONTROL! Get Your Mortgage Loan Audit and Get Informed on your true options

It’s Time to Stop Mortgage Fraud

Foreclosure Fix|Produce The Note There is More To IT|Fighting Foreclosure

2010-09-05T11:46:00.001-07:00

Foreclosure Fix|Produce The Note There is More To IT|Fighting Foreclosure

If you are in foreclosure or possibly facing home foreclosure you are probably thinking “is there a foreclosure fix?”
As you probably know, the foreclosure process involves you, your home and a lender or party trying to foreclose on your home. This is where fighting foreclosure becomes tricky as most of us KNOW NOTHING or very little about the foreclosure process and the process of the law. The media briefly promoted the “Produce the Note” as a defense. While in it’s appearance, the Produce the Note is very credible, what do you do if the lender while in the foreclosure process, does produce the note?
The real issue regarding the legality of the foreclosure processes happening against you is this…
Does the entity or lender foreclosing on your home have the Legal right to even take this action against you? Do they really own the right to foreclose, are the the TRUE Holder in Due Course?
The majority of foreclosures being filed are on mortgages that have been reduced to securities, meaning that possibly a Thousand or more people and companies own a small piece of your Mortgage! And that YOUR home and mortgage is now in a Trust and the trustee is trying to take possession of your home during this foreclosure process!
Here is a potential Foreclosure Fix…The questions pertaining to case law on Trusts/Remic standing as legal entities is no different than most “standing” related cases. It has been said many times, by many brilliant legal minds, that it is the Pension Hedge Funds who are the true “holders” in due course and they WILL NOT come forward.
So in fighting foreclosure, most of your (or your attorneys) questions regarding detailed case law about securitization cannot be addressed. They will try to fool the courts and manipulate the foreclosure process simply won’t be compelled to produce real evidence if they don’t implicate themselves by attaching to the lawsuit as a party in interest.
When you ask the Judge to grant standing using the Note and Assignments, you need to be more clear.
1. Is the Note in the name of the same party acting as Plaintiff?
2. Was the Mortgage properly assigned and before the file went to foreclosure?
3. Was Power of Attorney filed allowing Plaintiff to act on behalf of your Pretender Lender?
4. Was the Note properly negotiated according to UCC Code? (Owning the Note is different than holding and vice versa)
5. An assignment of Mortgage is not an assignment of the Note regardless of what the Plaintiff states in their Material Statements and Admissions.
Raise all these questions to get a hearing to avoid Summary Judgment. In the foreclosure process,Summary Judgment must only occur when no issue of material fact exists. If they can not prove that they are the true “holder” of the mortgage note, how then, can the legally foreclose on your home?
So if you are fighting foreclosure, or possibly facing a foreclosure fight, this is a potential foreclosure fix by creating a problem for the pretender lender by challenging their standing, their actual right to even start the foreclosure process at all!

Loan Modification VS Foreclosure Fight

2010-09-05T11:44:00.000-07:00

Loan Modification VS Foreclosure Fight

Daily, in the newspapers, radio, television and the internet, articles are written about the difficulty that borrowers face in getting loan modifications. These reports come not just from reporters, but from loan modification companies and also attorneys who are attempting to do the loan modifications. These reports fly in the face of what the US government is saying about getting loan modifications. (Usually, the government says that lenders are doing loan modifications, and that a homeowner should not pay to have one done.) The question becomes, “what is the truth”?
The problem is that most people, including loan modification companies and attorneys do not understand what they are fighting against. Nor are they helped to understand the fight because of incompetent “audit” companies who do not understand this either. LFI will attempt to shed light on this subject.
The Servicers/lenders of these loans have no vested interest in doing loan modifications. They are simply acting as “collection agencies” most of the time.
The loans were usually sold in the process known as securitization. Loans were “bundled together”, placed into Trusts and then “sliced and diced” into “tranches”, a pretty word for slice. The tranches were then sold to investors and securities dealers who then sliced and diced them again into smaller pieces. This process continued until it reached the point where the actual owners of the loans cannot easily be determined.
Who Controls The Loan?

To control the payment process, the Trust named a Trustee to see that different parties were paid monthly. The Trustees included US Bank, Citibank, Chase, Deutsche Bank, Lasalle Bank, Lehman, and others.
All factors related to the loan process is governed by the Pooling and Servicing Agreements for each trust. This Agreement covers all aspects of the transaction from the origination of the loan, to the final disbursements. This Agreement is where the problem in negotiating loan modifications and principal reductions occur.
The Agreements all have similar language regarding loan modifications. Paraphrased, the Agreements authorize the Master Service to do loan modifications when the default of a particular loan is inevitable or likely. It is this phrase that “prevents” servicers from modifying a loan that the borrower is up to date on payments.
To make matters worse, the Servicer is bound by the Agreement to determine what will be in the best interests of the Trust. If more money can be made by foreclosing and liquidating the property instead of doing a loan modification, then the Servicer must foreclose. The process for doing the calculations to determine what is in the best interest is subjective at best, and each Servicer is likely to approach it differently.
It Only Gets Worse!

To further complicate the issue, when reading the Pooling and Servicing Agreement, there is a section entitled “Advances”. Simply put, this section states that for any homeowner who missed a payment, the Master Servicer must make that payment to the Trust from its own money. The homeowner keeps missing payments, the Master Servicer keeps making the payments to the Trust. This process continues until one of several events can occur:
The homeowner brings the loan up to date, re-institution, by paying the back-owed money.
The Master Servicer determines that the chances of repayment are nil, so foreclosure is initiated and accomplished.
A Loan modification is worked out.
Swapping out the bad loan by replacing it with a “good loan”.
The problem with these solutions is that the only way that the Master Servicer can be “refunded” the Advannces, is by the loan being brought up to date, or the foreclosure completed.
Now, imagine the number of homeowners behind in payments. The Master Servicer has put money out on each of these loans, and they are now severely strapped for cash. The easiest method for the Master Servicer to get back the Advances is to…………..FORECLOSE.
There, we have thee problem. The Master Servicer has its own interests in mind. By foreclosing, they no longer make the Payment Advances, and the Advanced Money is returned to them.
Where Did The TARP Funds Go?

An aside to this scenario…….it now becomes evident what the TARP funds issued to the banks by the US Government is for. It allows the banks, actually the Master Servicers to have the funds to keep operating. As more foreclosures occur, the TARP funds keep the bank leveraged so that the doors remain open.

Strategy To Dismiss Every Foreclosure In Florida

2010-09-05T11:42:00.000-07:00

Strategy To Dismiss Every Foreclosure In Florida

Courts Are Overwhelmed With Foreclosures

Across the country, circuit court judges and their staff are becoming overwhelmed and frustrated by the total avalanche of foreclosure cases that have been dumped in their courtrooms. In Pinellas County, Circuit Court judges who used to handle like 400 foreclosure cases are now handling something like 3,000.These judges still have one judicial assistant and the same limited resources the had before the crisis. When the judge’s loan JA sits down to start the day, they are bombarded with phone calls and mail and people in their face every single second….it’s chaos, its a burden and it is completely untenable for the long run.
Things have gotten so bad for the judges that I’m told at least two Circuit Court Judges in Pinellas County (Linda Allan and Douglas Baird) have announced they were no longer going to hear Motions to Dismiss filed by Defendants in foreclosure cases, but were going to start just denying them across the board without even having a hearing on the matter. Now that’s one way to deal with the crisis. It’s an unconstitutional, unfair and totally biased approach that completely ignores the law and the rights of the citizens these judges took an oath to serve, but it is one way to deal with the crisis. (Look for Appeals To Come If This Practice Really Begins to Take Hold.)
I know, Let’s Throw All The Rules Out The Window
Many of the Plaintiff’s attorneys that are working so hard to throw borrowers out of their home cannot rely on good, solid, honest legal work to accomplish their job. As an attorney who sees the work of these firms every day, I am just astonished that the Courts continue to allow such horrendous practice to continue unchecked, but there seems to be little desire to try and force a correction of the behavior. Just in case you think I’m overstating the problem, here is an excerpt from the Florida Supreme Court’s Task Force Report on Residential Mortgage Foreclosures
Finally, it is critical that these firms be candid, clear, and truthful and accurate in connection with pleadings and affidavits filed with the Courts. A leading plaintiff’s lawyer and a major plaintiff’s law firm have been the subject of a public reprimand and sanctions due to untruthful filings with the courts. Judges continue to see affidavits of amounts due and owing signed by law firm employees, and cost affidavits charging very high service of process fees for process serving firms owned by the law firm principals. To some extent, it is fair to be concerned whether the press of the case load is interfering with a judge’s ability to police the conduct of the firms before them in these usually uncontested, unopposed foreclosure cases.
The full report can be found here but the bottom line is this, the lenders and their law firms are lying, lying, lying. They’re committing fraud on the courts on an unprecedented scale. The report of the Supreme Court is a bit sanitized, but the firms are whipping out foreclosure cases so quickly that they’re not even bothering to get the proper documents that prove they have a correct basis to file a suit from the outset. Some firms have ownership interests in the process servers who are supposed to personally hand the lawsuit to a defendant and they’re both charging exorbitant fees for this service and lying about whether proper service has been obtained or even attempted. And finally, the biggie….they’re lying, lying, lying about the evidence they’re submitting to the court, these come primarily in the forms of Affidavits and Assignments submitted to support Summary Judgments of Foreclosure.
Affidavits and Assignments in Foreclosure, Liars Re-Telling Lies Re-created From Fiction
There are several areas where the lying is reduced to black and white and submitted to the court.
Assignment of Mortgage
First, when the foreclosing Plaintiff is not the original lender, there must be a formal Assignment of Mortgage executed which says, “The Original Lender Assigns This Mortgage to the Plaintiff in This Case.” This document is needed to give the Plaintiff the proper legal basis to be suing the Defendant. Many of the originating lenders are no longer operating so getting a real assignment from a dissolved corporation would be difficult. In other cases, the Plaintiff introduces an Assignment of Mortgage executed by “MERS” a shadowy, shifty, shady backroom dealer of mortgages. The Assignment of Mortgage issue is problematic even when a mortgage was only assigned from an originating lender to the foreclosing Plaintiff, but in cases where a mortgage has changed hands many times, there should be an unbroken chain of properly executed assignments from originating lender straight through to foreclosing Plaintiff. (In fact, this requirement of an unbroken chain of assignments was originally part of the foreclosure procedures in Pinellas County, but this requirement was stripped.) The problem is these assignments are frequently fraudulent. The lenders know this, their attorneys know this and the courts know this, but they’re all just going ahead and pretending like it’s not an issue. IT IS AN ISSUE!
Affidavit of Amounts Due and Owing
The second area of Affidavit Fraud is the Affidavit of Amounts Due and Owing which states, “Your Undersigned Affiant is an employee of the Plaintiff and I SWEAR Based on my PERSONAL KNOWLEDGE that the Plaintiff is Owed, $150,000?. In a case where the original lender is the foreclosing Plaintiff, an employee of that lender could sign such an affidavit based on their review of the company’s accounting records. In most of the foreclosure cases currently pending in courts around the country, the mortgages have changed hands many times and there is simply no basis whatsoever for any person to sign an affidavit stating that they have any knowledge whatsoever of who is owed any money whatsoever. These affidavits are legally insufficient, they’re false and fraudulent.
Affidavit of Lost Note
The third area of Affidavit Fraud is the Affidavit of Lost Note which states, “Your Undersigned Affiant is an employee of the Plaintiff who had posession of the note when it was lost and while we looked long and hard to find the note, it’s just plain disappeared and we just will never find it.” In cases where the Plaintiff cannot locate the original note, this Affidavit is required in order to “Re-establish The Lost Note”, a technical process which must be followed in order to successfully and honestly proceed with a foreclosure case. There are two problems here. First, in many cases, the Affidavit does not include the correct language wherein the Plaintiff asserts that it was in possession of the note when it was lost. The affidavit states, “the note was in possession of someone (we don’t know who) when it was lost”. The other variation of this is when the Plaintiff is in possession of the note but they don’t bother disclosing this to the court.
Laws and Rules Just Don’t Matter Anymore, Everyone Hop On Board The Fraud Train!
So if the Plaintiffs and their attorneys are engaging in massive and systemic fraud and the courts are totally aware of this and yet it’s going totally unpunished and unanswered why doesn’t everyone just get on the fraud train? I mean why not? Well here’s one way that consumers and anarchists could engage in fraud that would totally throw the system into chaos. If rebels and anarchists and people who just don’t care executed and recorded Satisfactions of Mortgages across the country, it would send the entire foreclosure system into collapse. A Satisfaction of Mortgage is a one page document that costs $8.50 to record. It can be produced on a home computer, filled out correctly then sent in along with a money order or cashier’s check. The Clerk of Court is required to record it and there would be no way of ever knowing where these fraudulently produced satisfactions were coming from. While the lenders were trying to figure out how to deal with this massive problem, they would have no choice but to stop the pursuit of the foreclosure cases.
Anarchy Is a Crime- Revolution is a Crime.
Make no mistake, doing this is wrong. It is a crime. A serious crime. I would not do it and I’m not seriously suggesting anyone should, especially for their own mortgage. But what if? I mean what if some modern day Robin Hood or Paul Revere set out with a few hundred bucks and a few hours on a computer and started just sending in satisfactions? And what if, at the same time these same band of anarchist Robin Hoods also filed with the courts “Notice of Voluntary Dismissal and Release of Lis Pendens”? I mean when the law firms that are prosecuting these cases are so out of touch that they have no idea what’s happening with their files and they have no contact whatsoever with the lenders they claim to represent, it would take them months to figure out if their law office or their client really did dismiss the case or whether this was another one of those Anarchist Dismissals.

Fight Foreclosure |Foreclosure Fraud |HAMP|Loan Modification

2010-09-05T11:40:00.000-07:00

Fight Foreclosure |Foreclosure Fraud |HAMP|Loan Modification

In the Foreclosure Fight there are several “Tip of the Spear” Law Practitioners. The reason for posting this article is to open your eyes regarding foreclosure fraud and how you can fight foreclosure based on the mortgage note the mortgage and the fraudulent foreclosure practices of the “foreclosure Mill Law firms, the Servicers and the courts who are allowing wrongful foreclosures simply to clear their dockets!

Thank you Florida Foreclosure Defense Law Offices of Carol C. Asbury

This article addresses some of the traps that have engulfed my clients, causing the loss, or near loss of their homes. Later I will explain why it is more advantageous to litigate rather than seek a loan modification or walking away from your home…
Trap 1: Not hiring a mortgage defense attorney who believes in winning.
Truth: You will lose your home.
Trap 2: Trusting the bank is delaying your foreclosure lawsuit while “considering” your loan modification application.
Truth: That’s a LIE. The Bank’s game is to keep you from defending the foreclosure until the Court orders your house sold and you lose your home.
Trap 3: Paying a Loan Modification Company or Loan Modification Attorney for a loan modification. THERE ARE NO loan modifications.
Truth: The Home Affordable Mortgage Program (HAMP) is not guaranteed loan modification; it’s free, if your lender is participating; and, if you agree to a HAMP loan modification, you become worse off than a renter. The truth is, loan modification is not available because the Banks DO NOT own your Note. The Note was sold to a Trust, whose investors often won’t agree to a loan modification.
Trap4: Trusting the Loan Modification Company or Loan Modification Attorney handling your foreclosure suit.
Truth: No one is DEFENDING your foreclosure suit. Result: You lose your home.
Trap 5: Signing an answer handed to you by a non-attorney or Loan Modification Attorney as a “Pro Se” defendant.
Truth: “Pro Se” means you are representing yourself and you may be admitting to something you do not want to admit. Result: you lose your home.
Trap 6: Ignoring the foreclosure complaint.
Truth: Big Mistake! Result: You lose your home.
Trap 7: Thinking Bankruptcy will solve the foreclosure.
Truth: Bankruptcy may be an option but in most cases it only stalls the foreclosure. You need to seek an attorney who will explain the difference as well as your options.
Trap8: Mortgage Defense Attorneys are expensive.
Truth: Not True! It’s more cost effective and adventitious to defend the foreclosure than to seek a Loan Modification or walk away. Fighting is the ONLY way you will win. And you CAN win!
Trap 9: There are no defenses against foreclosure.
Truth: NOT True! Foreclosure defenses are available because of the securitization of the Notes to Trusts, who sold unregulated securities to investors for three times the value of your Note. Like any Ponzi Scheme, it has holes.
You CAN win!
There are Forged notes, lost notes, intentional destruction of notes, unauthorized people signing mortgage assignments or endorsing notes, missing documentation, fraudulently fabricated documents, and different plaintiffs foreclosing on the same property, plaintiffs who do not exist and the inability or refusal to provide proof of purchase and/or ownership of the promissory notes.
These are some of the situations I have encountered in my practice of over 24 years.
In addition, there are more and more claims arising from predatory lending practices of the Plaintiffs bank; including, violations of state and federal law, deceptive trade practices, and unfair or abusive dept collection.
Fighting the bank is advantageous to you. The goal of any good litigation attorney is to utilize all defenses/strategies in order to obtain the best possible outcome for the borrower. Depending on the evidence, litigation may even lead to a home free and clear of any mortgage. It is all about giving you options and creating leverage against the banks.
You need to have a plan of action, a direction, and understanding of why that plan is good for you

Fed Reserve is a Ponsi Scheme

2010-09-05T01:23:00.003-07:00

Fed Reserve is a Ponsi Scheme

The Fed Reserve is a Ponzi scheme, an inside job. It is outrageous. It is time for the Congress to say Enough of this!
This fro Elliott Spitzer. Ratigan later added: “I feel as if the American has suffered the greatest theft and cover-up ever.”
The future of our country is contained in a garbage bag. Or, rather, that’s the metaphor chosen by MSNBC’s Dylan Ratigan, who hosted former New York State Governor Eliot Spitzer and Toure on his show earlier today.
If it sounds a bit oblique, well, it’s actually a pretty good description of the bank bailout and the Federal Reserve’s much-maligned secrecy. To aid the viewer, Ratigan dons a hat that says BANK, and Toure wears a FED hat.
Where does the garbage bag come in? The mystery bag is an analogy for the trillions in bad financial assets purchased by the Fed during the bailout. Ratigan argues the Fed has fought to conceal exactly which assets it purchased from banks. The central bank has become “a Goodwill store for the banks,” Ratigan says, and kept the details of the bank rescue private.
Later in the piece. Spitzer offered some pointed critique of the Fed:Let me tell you a dirty secret, the Fed has done a disastrous job since Paul Volcker left…They’ve created multiple bubbles without permitting the economy underneath it to grow.

Fed Reserve is a Ponsi Scheme

2010-09-05T01:23:00.001-07:00

PROGRAM FOR STRUGGLING HOMEOWNERS JUST TO A PLOY TO ENRICH BANKS

2010-09-05T01:20:00.000-07:00

PROGRAM FOR STRUGGLING HOMEOWNERS JUST TO A PLOY TO ENRICH BANKS

The Treasury Dept.’s mortgage relief program isn’t just failing, it’s actively funneling money from homeowners to bankers, and Treasury likes it that way.
The Treasury Department’s plan to help struggling homeowners has been failing miserably for months. The program is poorly designed, has been poorly implemented and only a tiny percentage of borrowers eligible for help have actually received any meaningful assistance. The initiative lowers monthly payments for borrowers, but fails to reduce their overall debt burden, often increasing that burden, funneling money to banks that borrowers could have saved by simply renting a different home. But according to recent startling admissions from top Treasury officials, the mortgage plan was actually not really about helping borrowers at all. Instead, it was simply one element of a broader effort to pump money into big banks and shield them from losses on bad loans. That’s right: Treasury openly admitted that its only serious program purporting to help ordinary citizens was actually a cynical move to help Wall Street megabanks.
Treasury Secretary Timothy Geithner has long made it clear his financial repair plan was based on allowing large banks to “earn” their way back to health. By creating conditions where banks could make easy profits, Getithner and top officials at the Federal Reserve hoped to limit the amount of money taxpayers would have to directly inject into the banks. This was never the best strategy for fixing the financial sector, but it wasn’t outright predation, either. But now the Treasury Department is making explicit that it was—and remains—willing to let those so-called “earnings” come directly at the expense of people hit hardest by the recession: struggling borrowers trying to stay in their homes.
This account comes secondhand from a cadre of bloggers who were invited to speak on “deep background” with a handful of Treasury officials—meaning that bloggers would get to speak frankly with top-level folks, but not quote them directly, or attribute views to specific people. But the accounts are all generally distressing, particularly this one from economics whiz Steve Waldman:
The program was successful in the sense that it kept the patient alive until it had begun to heal. And the patient of this metaphor was not a struggling homeowner, but the financial system, a.k.a. the banks. Policymakers openly judged HAMP to be a qualified success because it helped banks muddle through what might have been a fatal shock. I believe these policymakers conflate, in full sincerity, incumbent financial institutions with “the system,” “the economy,” and “ordinary Americans.”
Mike Konczal confirms Waldman’s observation, and Felix Salmon also says the program has done little more than delay foreclosures, as does Shahien Nasiripour.
Here’s how Geithner’s Home Affordability Modification Program (HAMP) works, or rather, doesn’t work. Troubled borrowers can apply to their banks for relief on monthly mortgage payments. Banks who agree to participate in HAMP also agree to do a bunch of things to reduce the monthly payments for borrowers, from lowering interest rates to extending the term of the loan. This is good for the bank, because they get to keep accepting payments from borrowers without taking a big loss on the loan.
But the deal is not so good for homeowners. Banks don’t actually have to reduce how much borrowers actually owe them—only how much they have to pay out every month. For borrowers who owe tens of thousands of dollars more than their home is worth, the deal just means that they’ll be pissing away their money to the bank more slowly than they were before. If a homeowner spends $3,000 a month on her mortgage, HAMP might help her get that payment down to $2,500. But if she still owes $200,000 on a house that is worth $150,000, the plan hasn’t actually helped her. Even if the borrower gets through HAMP’s three-month trial period, the plan has done nothing but convince her to funnel another $7,500 to a bank that doesn’t deserve it.
Most borrowers go into the program expecting real relief. After the trial period, most realize that it doesn’t actually help them, and end up walking away from the mortgage anyway. These borrowers would have been much better off simply finding a new place to rent without going through the HAMP rigamarole. This example is a good case, one where the bank doesn’t jack up the borrower’s long-term debt burden in exchange for lowering monthly payments
But the benefit to banks goes much deeper. On any given mortgage, it’s almost always in a bank’s best interest to cut a deal with borrowers. Losses from foreclosure are very high, and if a bank agrees to reduce a borrower’s debt burden, it will take an upfront hit, but one much lower than what it would ultimately take from foreclosure.
That logic changes dramatically when millions of loans are defaulting at once. Under those circumstances, bank balance sheets are so fragile they literally cannot afford to absorb lots of losses all at once. But if those foreclosures unravel slowly, over time, the bank can still stay afloat, even if it has to bear greater costs further down the line. As former Deutsche Bank executive Raj Date told me all the way back in July 2009:
If management is only seeking to maximize value for their existing shareholders, it’s possible that maybe they’re doing the right thing. If you’re able to let things bleed out slowly over time but still generate some earnings, if it bleeds slow enough, it doesn’t matter how long it takes, because you never have to issue more stock and dilute your shareholders. You could make an argument from the point of view of any bank management team that not taking a day-one hit is actually a smart idea.
Date, it should be emphasized, does not condone this strategy. He now heads the Cambridge Winter Center for Financial Institutions Policy, and is a staunch advocate of financial reform.
If, say, Wells Fargo had taken a $20 billion hit on its mortgage book in February 2009, it very well could have failed. But losing a few billion dollars here and there over the course of three or four years means that Wells Fargo can stay in business and keep paying out bonuses, even if it ultimately sees losses of $25 or $30 billion on its bad loans.
So HAMP is doing a great job if all you care about is the solvency of Wall Street banks. But if borrowers know from the get-go they’re not going to get a decent deal, they have no incentive to keep paying their mortgage. Instead of tapping out their savings and hitting up relatives for help with monthly payments, borrowers could have saved their money, walked away from the mortgage and found more sensible rental housing. The administration’s plan has effectively helped funnel more money to Wall Street at the expense of homeowners. And now the Treasury Department is going around and telling bloggers this is actually a positive feature of the program, since it meant that big banks didn’t go out of business.
There were always other options for dealing with the banks and preventing foreclosures. Putting big, faltering banks into receivership—also known as “nationalization”—has been a powerful policy tool used by every administration from Franklin Delano Roosevelt to Ronald Reagan. When the government takes over a bank, it forces it to take those big losses upfront, wiping out shareholders in the process. Investors lose a lot of money (and they should, since they made a lousy investment), but the bank is cleaned up quickly and can start lending again. No silly games with borrowers, and no funky accounting gimmicks.
Most of the blame for the refusal to nationalize failing Wall Street titans lies with the Bush administration, although Obama had the opportunity to make a move early in his tenure, and Obama’s Treasury Secretary, Geithner, was a major bailout decision-maker on the Bush team as president of the New York Fed.
But Bush cannot be blamed for the HAMP nightmare, and plenty of other options were available for coping with foreclosure when Obama took office. One of the best solutions was just endorsed by the Cleveland Federal Reserve, in the face of prolonged and fervent opposition from the bank lobby. Unlike every other form of consumer debt, mortgages are immune from renegotiation in bankruptcy. If you file for bankruptcy, a judge literally cannot reduce how much you owe on your mortgage. The only way out of the debt is foreclosure, giving banks tremendous power in negotiations with borrowers.
This exemption is arbitrary and unfair, but the bank lobby contends it keeps mortgage rates lower. It’s just not true, as a new paper by Cleveland Fed economists Thomas J. Fitzpatrick IV and James B. Thomson makes clear. Family farms were exempted from bankruptcy until 1986, and bankers bloviated about the same imminent risk of unaffordable farm loans when Congress considered ending that status to prevent farm foreclosures.
When Congress did repeal the exemption, farm loans didn’t get any more expensive, and bankruptcy filings didn’t even increase very much. Instead, a flood of farmers entered into negotiations with banks to have their debt burden reduced. Banks took losses, but foreclosures were avoided. Society was better off, even if bank investors had to take a hit.
ut instead, Treasury is actively encouraging troubled homeowners to subsidize giant banks. What’s worse, as Mike Konczal notes, they’re hoping to expand the program significantly.
There is a flip-side to the current HAMP nightmare, one that borrowers faced with mortgage problems should attend to closely and discuss with financial planners. In many cases, banks don’t actually want to foreclose quickly, because doing so entails taking losses right away, and most of them would rather drag those losses out over time. The accounting rules are so loose that banks can actually book phantom “income” on monthly payments that borrowers do not actually make. Some borrowers have been able to benefit from this situation by simply refusing to pay their mortgages. Since banks often want to delay repossessing the house in order to benefit from tricky accounting, borrowers can live rent-free in their homes for a year or more before the bank finally has to lower the hatchet. Of course, you won’t hear Treasury encouraging people to stop paying their mortgages. If too many people just stop paying, then banks are out a lot of money fast, sparking big, quick losses for banks — the exact situation HAMP is trying to avoid.
Borrowers who choose not to pay their mortgages don’t even have to feel guilty about it. Refusing to pay is actually modestly good for the economy, since instead of wasting their money on bank payments, borrowers have more cash to spend at other businesses, creating demand and encouraging job growth. By contrast, top-level Treasury officials who have enriched bankers on the backs of troubled borrowers should be looking for other lines of work.
Zach Carter is AlterNet’s economics editor. He is a fellow at Campaign for America’s Future, writes a weekly blog on the economy for the Media Consortium and is a frequent contributor to The Nation magazine.

Avoid California Foreclosure - Quick Facts

2010-09-02T16:49:00.000-07:00

Avoid California Foreclosure - Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Typically 120 days
- Right of Redemption: Varies
- Deficiency Judgments Allowed: Varies
In California, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.
Using this type of foreclosure process, lenders may seek a deficiency judgment and under certain circumstances, the borrower may have up to one (1) year to redeem the property.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:
A notice of sale must be:
recorded in the county where the property is located at least fourteen (14) days prior to the sale;
mailed by certified, return receipt requested, to the borrower at least twenty (20) days before the sale;
posted on the property itself at least twenty (20) days before the sale; and
posted in one (1) public place in the county where the property is to be sold.
The notice of sale must contain the time and location of the foreclosure sale, as well as the property address, the trustee's name, address and phone number and a statement that the property will be sold at auction.
The borrower has up until five days before the foreclosure sale to cure the default and stop the process.
The sale may be held on any business day between the hours of 9:00 am and 5:00 pm and must take place at the location specified in the notice of sale. The trustee may require proof of the bidders ability to pay their full bid amount. Anyone may bid at the sale, which must be made at public auction to the highest bidder. If necessary, the sale may be postponed by announcement at the time and location of the original foreclosure sale.
Lenders may not seek a deficiency judgment after a non-judicial foreclosure sale and the borrower has no rights of redemption. How to stop foreclosure in California.

Avoid Arkansas Foreclosure - Quick Facts

2010-09-02T16:48:00.001-07:00

Avoid Arkansas Foreclosure - Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Typically 120 days
- Right of Redemption: Varies
- Deficiency Judgments Allowed: Varies
In Arkansas, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process. However, an appraisal of the property must be made prior to the schedule date of foreclosure.
In any foreclosure under a mortgage or deed of trust in Arkansas, the property must sell for not less than two-thirds of the appraised value. If it does not, then it may be offered for sale again within twelve (12) months. The second sale may be to the highest bidder without reference to the previous appraisal.
Judicial Foreclosure
In judicial foreclosure, a court decrees the amount of the borrowers debt and gives him or her a short time to pay. If the borrower fails to pay within that time, then the clerk of the court, as commissioner, advertises the property for sale.
Sales of real property under court order will be on a credit of not less than three (3) months, but not more than six (6) months, or on installments to not more than four (4) months credit overall. To secure payment, a lien will be retained on the property for its price and the purchaser must also give a bond with surety for the amount of the purchase price.
The lender may bid at the sale by crediting a portion (or all) of the amount the court found was owed to the lender against the sales price of the property purchased at the foreclosure sale. If the real estate does not sell for an amount equal to what’s due on the mortgage loan, then the lender may seize other property from the borrower as in an ordinary judgment.
The borrower has one (1) year from the date of the sale to redeem the property by paying the amount for which the property was sold, plus interest.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:
The trustee must record a notice of sale in the office of the recorder of the county where the property is located. The mortgagee's or trustee's notice of default and intention to sell shall be mailed within thirty (30) days of the recording of the notice by certified mail to the borrower. This includes any borrower of record or of whom the lender has actual notice. The notice must also be mailed to anyone who records a Request for Notice that specifically described the mortgagee including its recording information.
Within five (5) days after the notice is recorded, the trustee must mail, by certified mail, a copy of the notice of sale to each of the people who are parties to the trust deed, except for himself. Additionally, the notice of default and intention to sell must appear in a newspaper in the county where the property is located once a week for four (4) consecutive weeks, with the last notice being published not less than ten (10) days prior to the date of the sale.
Said notice of default and intention to sell must contain the names of the parties to the mortgage or deed of trust, a legal description of the trust property and, if applicable, the street address of the property, the book and page numbers where the mortgage or deed of trust is recorded or the recorder's document number, the default for which foreclosure is made, the mortgagee's or trustee's intention to sell the trust property to satisfy the obligation, including, in conspicuous type, a warning as follows: "YOU MAY LOSE YOUR PROPERTY IF YOU DO NOT TAKE IMMEDIATE ACTION" and the time, date, and place of sale.
Any person including the mortgagee (lender) may bid at the sale, except the trustee, who may bid on the behalf of the beneficiary (lender) but not for himself or herself in deed of trust sales. The high bidder must pay the price bid at the time of sale, or within ten (10) days. The lender may bid by canceling out what it is owed on the loan, including unpaid taxes, insurance, costs or sale and maintenance, but for cash for any higher price.
The trustee may postpone the sale by public proclamation at the time, place and date last appointed for sale, up to seven (7) days past the original date, but if for a longer time, then the whole notice procedure must be performed a second time, including the sixty (60) day wait.
Once the sale is complete, the proceeds will go to the pay for the expenses of the foreclosure sale, then toward the obligations secured by the trust deed that was foreclosed and then to junior lien holders in order of their priority. The original borrower is entitled to receive any remaining funds. The successful bidder receives a trustee’s deed.
The lender may sue the borrower for a deficiency within twelve (12) months of a power of sale clause foreclosure. The lender may sue for (1) the difference between the foreclosure sale price and the balance due on the loan, or (2) the balance due on the loan minus the fair market value of the property, whichever is less.
More information on Arkansas foreclosure laws
Stop foreclosure and get foreclosure help in Arkansas and cities of Bella Vista, Benton, Bentonville, Blytheville, Cabot, Conway, El Dorado, Fayetteville, Forrest City, Fort Smith Hot Springs, Jacksonville, Jonesboro, Littlerock, North Little Rock, Paragould, Pine Bluff, Rogers, Russellville, Searcy, Sherwood, Springdale, Texarkana, Van Buren, West Memphis and in the surrounding cities in Arkansas.

Avoid Arizona Foreclosure - Quick Facts

2010-09-02T16:46:00.000-07:00

Avoid Arizona Foreclosure - Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Typically 90 days
- Right of Redemption: None
- Deficiency Judgments Allowed: Varies
In Arizona, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Otherwise, the non-judicial power of sale foreclosure is carried out as follows:
The trustee must record a notice of sale in the office of the recorder of the county where the property is located. Within five (5) days after the notice is recorded, the trustee must mail, by certified mail, a copy of the notice of sale to each of the people who are parties to the trust deed, except for himself. Additionally, the notice must appear in a newspaper in the county where the property is located once a week for four (4) consecutive weeks, with the last notice being published not less than ten (10) days prior to the date of the sale.
Optionally, if it can be done without a breach of the peace, the trustee can post the notice at least twenty (20) days prior to the date of the sale, in some conspicuous place on the property to be sold and/or he or she can post the notice at the courthouse or at a specified place at the place of business of the trustee in the county in which the property is located.
The trustee or the trustee’s agent must conduct the sale. The sale is for cash to the highest bidder, except that the lender can make a "credit bid," which means to cancel out some part (or all) of the money the borrower owed the lender on the lean, instead of paying cash. A successful high bidder must pay the bid price by 5 pm of the day after the bid, other than a Saturday or legal holiday. Every bid is an irrevocable offer until the sale is completed, which happens when the bidder pays the bid price to the trustee’s satisfaction. If the high bidder fails to make the payment by 5:00 pm, the day after being notified of the option to buy, then the trustee may postpone the sale.
The trustee may postpone the sale to another time, or another place, by giving notice of the new date, time and place by public declaration at the last place and time the property was offered for sale. No other notice is required. A trustee may also, by written agreement, extend the time for a buyer to come up with the payment.
Once the sale is complete, the proceeds will go to the payment of the obligations secured by the deed of trust that was foreclosed, then to junior lien holders in order of their priority. The successful bidder gets a trustee’s deed, which provides conclusive evidence that the trustee conducted the foreclosure sale property.
A note regarding Deficiency Suits: A lender may not bring a deficiency suit against a person who lost a property that is 2.5 acres or less at a foreclosure, provided the property was a single one-family or a single two-family dwelling. This is so even if the high bid at foreclosure was less that the balance due on the loan. However, in foreclosures against other types of property, a deficiency suit is allowed, but is limited to the difference between the balance owed and the fair market value of the property, and then only if the suit is brought within ninety (90) days of the power of sale foreclosure. How to stop foreclosure in Arizona.
More information on Arizona foreclosure laws.
Stop foreclosure and get foreclosure help in the Arizona cities of
Phoenix, Tucson, Mesa, Glendale, Chandler, Scottsdale, Gilbert, Tempe, Peoria, Yuma, Casas Adobes, Catalina Foothills, Avondale, Surprise, Flagstaff, Lake Havasu City, Goodyear, Sierra Vista, Prescott, Bullhead City, Oro Valley, Drexel Heights, Apache Junction, Sun City West and surrounding cities in Arizona.

Avoid Alaska Foreclosure - Quick Facts

2010-09-02T16:40:00.000-07:00

Avoid Alaska Foreclosure - Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Varies by Process; Typically 90 days
- Right of Redemption: Varies by Process
- Deficiency Judgments Allowed: Varies by Process
In Alaska, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, has been instituted more since the late 1980's, when lenders found that they were foreclosing on residential property worth substantially less than the amount owed. Generally, after the court declares a foreclosure, your home will be auctioned off to the highest bidder.
In the case of judicial foreclosure, the process is carried out according to the rules of equity, deficiency suits are permitted and the borrower has no rights of redemption.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed, provided it meets the minimum protection laws set forth by the State of Alaska. Otherwise, the non-judicial power of sale foreclosure is carried out in the following three phases:
The trustee must record a notice of default in the office of the recorder of the recording district in which the property is located not less than thirty (30) days after the default and not less than three (3) months before the sale.
Said notice of default must state the name of the borrower, the book and page where the deed is recorded and it must describe the property, the borrower’s default, the amount the borrower owes, and the trustee’s desire to sell. It must also state the date, time and place of the sale.
Within ten (10) days after recording the notice of default, the trustee must mail a copy of the same by certified mail to the last know address of (1) the borrower, and (2) any person whose claim or lien on the property appears of record or is known to the lender of trustee and (3) any occupant. The trustee may have the notice delivered personally instead of sending it by certified mail.
Any time before the sale, the borrower may cure the default and stop the sale by paying a sum equal to the missed payments plus attorney’s fees. The lender may not require the borrower to pay off the entire remaining principal balance of the loan to cure the default, just the missed payments and attorney’s fees. If the lender has recorded a notice of default two or more times, then the Alaska statutes provide that the lender can refuse to accept the borrower’s monies for the missed payments and attorney’s fees and proceed with the foreclosure sale instead.
The sale must be made at a public auction held at the front door of a courthouse of the superior court in the judicial district where the property is located. The trustee must sell to the highest and best bidder and the lender may bid at auction.
The trustee may postpone sale of all or any portion of the property by delivering to the person conducting the sale a written and signed request for the postponement to a stated date and hour. The person conducting the sale shall publicly announce the postponement to the stated date and hour at the time and place originally fixed for the sale. This procedure shall be followed in any succeeding postponement.
When this type of foreclosure process is used, the borrower has a right to redeem the property and deficiency suits are not allowed.

Avoid Alabama Foreclosure - Quick Facts

2010-09-02T16:38:00.000-07:00

Avoid Alabama Foreclosure - Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Varies by Process; Typically 30 - 60 days
- Right of Redemption: 12 months
- Deficiency Judgments Allowed: Yes
In Alabama, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. However, when no power of sale is present, lenders may, at their option, choose to forego a lawsuit and foreclose by selling the property, as outlined below in the "No Power of Sale Foreclosure Guidelines".
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of the their default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. However, if the deed of trust or mortgage contains a power of sale clause, but does not specify the time, place and terms of sale, then a foreclosure sale may take place at the front or main door of the courthouse of the county where the property located, after default of the deed of trust or mortgage, for cash to the highest bidder. The sale may not take place until thirty (30) days after the last notice of sale is published.
Said notice of sale must be given by publication once a week for four (4) successive weeks in a newspaper published in the county or counties in which the property is located. If the property is under mortgage in more than one county, the publication is to be made in all counties where it is located. The notice of sale must give the time, place and terms of said sale, together with a description of the property. If no newspaper is published in the county where the lands are located, the notice shall be placed in a newspaper published in an adjoining county for four (4) successive weeks.
No Power of Sale Foreclosure Guidelines
If no power of sale is contained in a mortgage or deed of trust, the lender, or any assignee thereof, may, after default of the mortgage or deed of trust, either file a lawsuit to foreclose or foreclose by selling the property to the highest bidder for cash at the courthouse door of the county where the property is situated. Said sale may not take place until after notice of the time, place, terms and purpose of the sale has been published for four (4) consecutive weeks in a newspaper published in the county wherein said lands, or a portion thereof are situated. How to stop foreclosure in Alabama.
More information on Alabama foreclosure laws.
Stop foreclosure and get foreclosure help in Alabama and cities of
Birmingham, Montgomery, Mobile, Huntsville, Tuscaloosa, Hoover, Dothan, Decatur, Auburn, Vestavia Hills, Madison, Gadsden, Florence, Bessemer, Phenix City, Prattville, Prichard, Alabaster, Homewood, Opelika, Anniston, Enterprise, Northport, Athens, Mountain Brook and the surrounding cities in Alabama.

Foreclosure Help to Stop Foreclosure

2010-09-02T16:34:00.000-07:00

Foreclosure Help to Stop Foreclosure

When you realize that you can no longer pay for your monthly loan payment, your home can be repossessed or placed into reselling status by your lender to regain the cost of the loan. This unfortunate repossession of property is referred to as foreclosure. No one appears as the winner or loser in this situation because both parties, the lender and the borrower, suffer from. But no matter how unfortunate and rigorous the process of foreclosure is, there are always some things that you can do in order to save your home if you are caught in this situation.

As the real estate market surged in the United State, foreclosure rates also increased. From the year 2001 to 2005, the housing market observed an unparalleled growth. Even those people who never imagined that they can have a house of their own can already buy a house. This was made possible because of the Adjustable Rate Mortgages (ARMs) and subprime loans. Subprime loans cater to people who have a bad credit or low credit score and allow them to secure financing at high rates. ARMs, on the other hand, offer lower initial rates that increase gradually after the first year or two. These methods are utilized by mortgage brokers to secure loans. But after a short period of time, borrowers already find that they can no longer afford paying their monthly dues. To get the real picture, here are some foreclosure statistics in the U.S. over the past years.

In 2006, up to 1.3 millions homes were foreclosed
In Colorado, one out of 376 houses undergo foreclosure, the highest rate on record
From 2005, the total number of filing is up 43 percent
Real Estate experts predict a greater increase in foreclosure in 2007
In addition to these, according to a recent poll, more than 6 out of 10 homeowners wish that they understood better the terms and policies of their loan. Moreover, 60% of borrowers who are in trouble of their mortgage are not aware of the many services that can assist them in avoiding foreclosure.

ForeclosureHelp.Org aims to keep you informed of the various types of foreclosure, the processes involved in each type and its effects on you and your community. More importantly, we will provide you information regarding the steps that you can take in order to avoid such situation.

A Look At The Foreclosure Process

The processes involved in foreclosure differs per state. Therefore, it is imperative for you to research on your state laws and practices when you are in dealing with the threat of foreclosure. But to help you have a glimpse of what is happening in this situation, here are the general steps that are involved in foreclosure.

Basically, the proceedings of foreclosure start after you miss a single payment. The banks and lenders give a grace period, usually 30 days, for the borrower to pay his monthly loan due in addition to an added fee. After missing a monthly payment for the second time, you will begin to receive some phone calls from lenders asking you to pay your monthly fee. Most of the time, lenders refuse partial payments and only accept both late payments to make the loan current.

Once you miss three months of payment, everything gets serious. The lenders will begin the formal foreclosure process wherein they can choose one of two routes namely judicial sale and power of sale. Judicial sale lets the foreclosure process proceed through the court system while the Power of Sale is carried out entirely by the holder of the mortgage.

Judicial sale is allowed in all states but the power of sale can only be carried out in 29 states. If your state permits the power of sale, your loan papers will contain a clause saying that this method will be utilized. Most of the time, power of sale is faster than judicial sale. To help you understand better, here are the processes involved in both methods.

Judicial sale:

The mortgage lender will file suit with the court system.
You will receive a letter from the court, demanding you to pay.
You will have 30 days to respond with your payment to prevent foreclosure of your home.
At the end of the payment period, a judgment will be issued and the lender can already request sale of the property through auction.
The auction is carried out by the office of the sheriff, usually a few months after the issuance of judgment.
Once the property is sold, you will be served with an eviction notice by the sheriff’s office, and you must vacate your former home immediately.
Power of sale:

The mortgage lender will serve you with papers demanding your payment.
After a certain waiting period, a deed of trust is drawn up that temporarily conveys the property to a trustee.
After a certain waiting period, a deed of trust is drawn up that temporarily conveys the property to a trustee.
The trustee will sell the house through a public auction for the lender.
To make sure that these foreclosures are carried out legally, these are subject to judicial review.
The lender is required to post a public notice of sale for the auction of the property.
Both of these foreclosure routes require that all the involved parties be notified of all the proceedings. For example, if the homeowner took out another loan against the house with a third party, that lender should be notified immediately and the amount of loan should be paid from the proceeds of the auction. If the third-party lender is not paid, it will be able to apply the mortgage to the new property owner. For a lot of times, the lender will in fact buy the property back and he will attempt to sell it through the real estate market at a later time.

Deficiency judgments can also be served against the borrower if the sale of the property is not in compliance with the amount of the loan. Most of the time, the entire difference of the two is required. However, there are some states that only oblige the difference between the property’s fair value and the amount of loan to be paid.

Another type of foreclosure is called strict foreclosure wherein once the judgment is made on the lawsuit, the property on hold is automatically assumed by the mortgage holder. This type of foreclosure is almost obsolete since only Vermont and Connecticut still allows this procedure.

Avoiding the Inevitable

Foreclosure is bad for both the borrower and the lender. While the homeowner loses his house, the lender loses about 20 to 60 cents per dollar. This is a very important note to remember once you fall behind on your loan. The single is most effective step to prevent foreclosure is to communicate with your lender. Many people are scared or embarrassed to do so that they even avoid the letters and incoming calls from their lenders. This is understandable, however if you want to hang on to your home, avoid doing these.

Many lenders will cooperate with you in order to prevent the foreclosure of your home. They will even deal your situation on a personal level so as to solve your circumstance. If you are only one or two payments behind, the mortgage holder will provide you a workout package through mail. This package will help you cope up with your loan. It contains the necessary information, instructions and forms pertaining to your ability to make payments.

If your situation is just temporary, there are other options that you can do to save your home from foreclosure.

You can contact the Federal Housing Authority (FHA) for help. If your loan is FHA-approved, you can get in touch with a housing counsellor from FHA. The counsellor will be able to provide you possible solutions and will also negotiate with the lender. Your counsellor will also be able to work out a monthly budget plan to make it easier for you.
If the federal government declares a natural disaster on the area where you live or work and you are facing foreclosure, the FHA can assist you through relief plans. In most cases, you can get up to three months’ relief from your monthly loan payments while working out your current situation.
Forbearance is when your lender suspends your monthly payments temporarily if you agree to another option to satisfy the amount of your loan. The option is usually reinstatement wherein you are to pay the outstanding amount in one lump sum. This is a good way to prevent foreclosure if you are expecting a large amount of money to come your way soon.
Mortgage modification is when your lender agrees to change your mortgage terms to make it more affordable for you.
If you are able to pay your monthly loan dues but are not able to bring your account current, you may be eligible for a partial claim. Your lender will assist you in acquiring an interest-free loan that will bring your account current and then you can resume payments. Payment on this loan can be delayed for a certain period of time.
If you are not able to keep your home, you can sell it in order to pay off your loan. If this is the case, contact your lender and request for a suspension of your loan payments until you sell your house. Who knows, your lender may even accept less than the loan amount if you are able to sell it quickly. Your last and final option is to surrender your deed-in-lieu of foreclosure. This is when you basically just hand your property back to your lender.
The Impact of Foreclosures

The most obvious effect of foreclosure is that you no longer have a home. Most people rely on their families and relatives in order to get through the following months. Some people move into apartments while working out their finances. Unfortunately, there are also some people who get totally homeless after facing foreclosure. Luckily, most state provide homeless prevention programs that aid people who are in need. If you faced foreclosure and does not have any housing option, you can go to your state and local department of human services and ask for assistance.

Another effect of foreclosure is that it pulls down your credit rating however it is not damaged beyond repair. Credit scores are based on your credit history and do not only depend on one factor. If you had a good credit rating prior to your foreclosure, you might be surprised on how high your score will still be.

The most important thing to do after undergoing foreclosure is to repair your credit. Make sure that all of your other accounts are current and well managed. You may want to apply for a smaller loan because paying for some loan will also boost your credit. You may also be able to secure another home mortgage at a lower rate by paying a large down payment.

If you have no job after foreclosure, you may be hard up in being employed. This is because most employers require a good credit score to be hired and foreclosure can even be ground for termination of employment.

Other effects of foreclosure pertaining to the personal and emotional level include stress and depression. Lack of self-esteem and self-worth are also linked with people who have lost their homes.

The effect of foreclosure in the community is rather high because it can bring up as much as $34,000 in local government agency bills. Some of the things included in the cost are unpaid utilities, trash removal, sheriff and police costs, inspections and even demolition of the property. Property value also decreases when near foreclosed properties. In some real estate or housing markets, as much as $220,000 value of property can be reduced.

Deed In Lieu Of Foreclosure FAQ

2010-09-02T16:32:00.000-07:00

Deed In Lieu Of Foreclosure FAQ

Definition of Deed in Lieu of Foreclosure and why you would want it.

Q. Can you provide the definition of a deed in lieu of foreclosure?

A. In technical terms, you exchange the ownership interest in your home, represented by a deed,
back to the secured lien holder for consideration of avoiding mortgage foreclosure and in some cases
forgiveness of a mortgage deficiency.

Q. Great, now can you give me the definition of a deed in lieu of foreclosure using words I can
understand?

A. You give the bank the keys to your home and you walk away, they agree not to hold a
foreclosure sale or ever ask you for any more money. Everyone rebuilds their lives from that point
forward and leaves the other one alone.

Q. Why would anyone want to do a deed in lieu of foreclosure?

A. Many reasons exist that make a deed in lieu of foreclosure preferable over a mortgage
foreclosure auction. Both sides can potentially benefit from a deed in lieu of a foreclosure;
otherwise the concept would never work.

Q. Start with the homeowner, why would someone just give up their house and walk away?

A. At this point we need to examine how the homeowner arrives at a desire for a deed in lieu of
foreclosure. Two groups of people pursue a deed in lieu of foreclosure as a solution for mortgage
trouble. First those who do not want to keep their home under any circumstances and second those
who, despite a desire to keep their home, reached the conclusion that no foreclosure prevention
options will allow them to retain their house.

Q. Who would not want to keep their home?

A. The best example comes from an actual case of mine from years ago. As I discussed with the
clients their many options to avoid the pending foreclosure I casually said "You do want to keep
the house, right?"They responded something like this "You mean we don't have to live here
anymore? You know a way to move out of this rat infested sink hole? We don't have to endure
the caustic neighbors or smell the backed up septic system anymore? We can move to a place
closer to our jobs where the roof doesn't leak and foundation isn't crumbling?" With great
excitement in their voices they asked "Can we really do that?" From that conversation forward I
never again discussed mortgage foreclosure options without examining a deed in lieu of foreclosure
or short sale.

Q. How often did you see cases where people did not want to keep their home?

A. More often than you might imagine, most cases came about for other reasons.

Q. Ok, why would someone want to give up their home as a first choice?

A. Review this list for ideas:

Don't like the house itself.
Perhaps you liked it when you moved in and changed your mind, maybe when you lived there
for a while and learned the quirks of the home you didn't like it anymore. How about if you never
liked it but it was the only thing you could afford at the time.

No longer right location.
Many people buy a house near their job, but they change jobs. Some folks buy a home near the
playground and the kids grow up.

No longer right size or type.
Maybe you bought a two bedroom home and now you have 8 children, or you own a 6 bedroom
house and now everyone is grown and gone. Your business may have necessitated that you get
a place in a business district with a store downstairs and an apartment where you lived above
but the business no longer exists. Many farmers find themselves living on farms after they
decided to stop farming.

Neighborhood or zoning degradation.
It's easy to imagine a neighborhood that changed for the worst to the point you no longer want
to live there. Drugs, crime or every other house on the block foreclosed on and boarded up
could be the root cause. Some people bought multi family buildings so they could live in one unit
and rent the others only to find they could no longer rent anything.

Repair and structural issues.
It does not take too many major roof or foundation problems to make you want to walk away
from a house you might not get to keep under any circumstances.

No need for home at all anymore.
At some point people may downsize to an apartment or just move in with their children. If this
happens at the same time as a foreclosure it may be just the right time to walk away.

So over mortgaged its better to start over.
This concept requires some extra consideration because many homeowners need to at least
walk through the thought processes on over-mortgaged property.

Painful memories.
Aside from all potential financial issues, after a major personal setback such as a divorce or
death of a spouse you may want to give up the house simply because every moment inside it
brings anxiety or grief.
Q. Even with all of those reasons, don't most people want to keep their homes?
A. Absolutely, the majority of people want to keep their homes if given the option, but many need to
face the cold hard fact that losing their home emerges as inevitable and the only real choice becomes
the course of events that ends in their moving out of the house.

Q. How does a homeowner end up at the conclusion that they must give up the house?

A. Review this list for ideas:
Mathematically Beyond Hope
Some people read the writing on the wall and know they will lose the house just based on the
math. Calculating a chapter 13 bankruptcy payment just takes a calculator, and at a minimum
you need make the former regular mortgage payment. While loan modification might lower your
old payment, bringing the amount lower than 50% of the previous level never happens. For folks
who have lost income so dramatically they can't even make half of their former first mortgage
can figure they simply do not have the income to keep their home.

No Applicable Methods To Stop Foreclosure
In some situations none of the many options to stop a foreclosure remain available either because
of time or that they do not fit the individual's circumstances. People who recently filed bankruptcy may not file again, most mobile home loans do not qualify for modification, neither do most private mortgages for example.

Exhausting All Options
It might amaze you to see how far some people go to save their home, but at some point they
must endure the sight of their own foreclosure sale. Homeowners might get a repayment plan and
fail then arrange a modification that does not work, followed by a second try at modification and
file bankruptcy when that crashes and file yet another that fails to save the house. In the end
the only options left involve exactly how they lose the property.
Q. If I tried a repayment plan or mortgage modification with my bank and they turned me down or I could not keep up with the program does that mean all hope is gone and I should be looking at a deed in lieu of foreclosure?

A. No, often a professional mortgage negotiator or lawyer can get a better payment or achieve a plan where a homeowner could not. In many cases someone with extensive experience can put together a second chance plan too. Don’t think these extra opportunities come automatically, or by right or that they come easily or free, but they do happen every day.

Short sale of homes provides a way for property to sell

2010-09-02T16:31:00.001-07:00

Short sale of homes provides a way for property to sell even when the value of a house dropped below debt from its outstanding mortgages. Read the information in our three part online help site for an instant short sale education. Good luck with your Short Sale!

Short sale provides a great option for both the homeowner and bank when the debtors no longer wish to keep the house or retaining the property becomes a financial impossibility.

We present for you here just about everything you might want to learn about a short sale from understanding what a short sale is to grasping the details the short sale process and how a potential mortgage deficiency plays into the short sale picture. For those with no idea about a short sale who want need to start with a sentence: A short sale on a home occurs when the owner sells their property to a third party for less than the mortgage due.

To put this short sale page in context, we would hope that before looking into a short sale you explored many ways to prevent foreclosure and come here well educated in terms of how to stop foreclosure. As for information on the short sale option specifically, we intended for readers to start with the definition of a short sale than proceed to understand what is a mortgage deficiency and how that becomes an integral part of a short sale. Finally with that background information you finish with the FAQ on the short sale process. Those coming from a failed short sale can proceed to the deed in lieu of foreclosure FAQ or look at questions on bankruptcy. Enjoy our short sale website and good luck!

Doing Nothing Allowing a Foreclosure to Take Place Foreclosure vs. Bankruptcy

2010-09-02T16:29:00.000-07:00

Doing Nothing
Allowing a Foreclosure to Take Place
Foreclosure vs. Bankruptcy

When would a person choose to allow a foreclosure to happen and just walk away from their home?

A. Sometimes personal circumstances dictate that when compared to all other options foreclosure may rank as best. In other cases people may no longer possess any options except watching the foreclosure.

Q. How about a deed in lieu of foreclosure or short sale rather than bankruptcy or foreclosure?

A. In most cases a deed in lieu of foreclosure or short sale would be better than a foreclosure or bankruptcy. This FAQ deals with situations where a deed in lieu of foreclosure or a short sale either offers no advantage or they became unattainable. If you think you might still have a chance for a deed in lieu or a short sale your should call a foreclosure mitigation professional.

Q. When would a foreclosure or bankruptcy emerge as good as a deed in lieu of foreclosure or a short sale?

A. If because of unsecured debt or deficiencies you knew you a bankruptcy filing must occur no matter what; unless the bank allows you to walk away with money from a short sale you get little benefit from a short sale in this case.

Q. When might a deed in lieu of foreclosure or short sale not be choices.

A. Basically whenever the bank does not want to offer them. No law says they have to allow them. Yet, most of these instances happen because of poor timing or bad planning by the homeowner. With enough time and effort far in advance of an auction most banks would rather avoid foreclosure or bankruptcy too and participate in short sale or deed in lieu negotiations.

Q. I thought I read elsewhere on this site that people always have the option of filing bankruptcy to stop a foreclosure?

A. Almost always. One of our topics here now will examine foreclosure vs. bankruptcy and a bit of foreclosure vs. mitigation or bankruptcy vs. mitigation.

Q. What exceptions would stop a person from filing a bankruptcy to avoid foreclosure?

A. Most commonly bankruptcy rules regarding multiple bankruptcy filings stop subsequent bankruptcy filings before they even get started.

Q. What specific laws exist dealing with multiple bankruptcy filings?

A. For a Chapter 7, a debtor may only obtain a discharge from debt by filing a Chapter 7 bankruptcy once each 8 years. A chapter 13 may only be filed every 6 months under the most commonly seen circumstances. If you already filed a previous bankruptcy you need to talk to a bankruptcy lawyer about your own situation. Debtor's rights to discharge of debt and rights to an automatic stay, which stops a foreclosure, may vary greatly based on the details of the previous bankruptcy cases.

Q. Why would this even come up? Once you file a bankruptcy doesn't that fix everything and your problems would go away?

A. Not at all, while bankruptcy stops a foreclosure, you have to look carefully at how long it stops it and your responsibilities to make sure it never re-starts. Chapter 7 bankruptcy filings rarely offer permanent foreclosure solutions and chapter 13 bankruptcies provide long term solutions only if the debtor makes all payments required under the bankruptcy re-organization plan. Read more in our chapter 13 bankruptcy FAQ.

Q. Let's imagine bankruptcy remains unavailable, what can a person do to halt the foreclosure?

A. They can still try other foreclosure avoidance methods either on their own or with the help of a foreclosure mitigation professional, but if you have already filed a chapter 13 bankruptcy that failed the chances for a successful mitigation plan allowing you to keep the home remain small. Debtors always have the right to pay their arrearage in full to stop the foreclosure, but if they have that kind of money they would likely have stopped the foreclosure long before.

Q. When both bankruptcy and allowing the foreclosure remain as choices how does one decide on foreclosure vs. bankruptcy?

A. First answer some key preliminary questions. Do you want to walk away from the home? Do you want to keep the property? And if you do, would a bankruptcy provide the means to retain the house in the long run?

Q. I don't understand the keeping the property question, I didn't know there was a choice, I thought I had to keep the property if I could, and besides who wouldn't?

A. Look at these one at a time. No law or contract forces you to keep the house if you don't want to. There may be consequences, but you do not have to keep the house.

Q. Can you give examples to illustrate such cases?

A. I once had a client on the phone going over foreclosure prevention options. After talking about all of the ways to save the home I asked "Just to be sure, you do want to stay in the house, don't you?" The question surprised the client and they asked "You mean we don't HAVE TO stay in this hell hole?" They had sewage running into the basement, a swamp for a backyard, bad neighbors and structural problems. We settled the foreclosure in a way that allowed them to leave. I recently spoke to someone who moved because of a job reassignment. They rented their old house for a while, but with the market eroding, the balance on the mortgage far more than the value, no tenant, and no ties to the area, the person had no desire to keep the property.

Q. I see, but most people do want to keep their home, how do you know if you can?

A. Between bankruptcy and foreclosure mitigation as long as you can come close to making payments going forward you have a chance.

Q. What about all of the arrearage and bad history? Why do you only talk about going forward?

A. In terms of answering questions about people's ability to keep a house, filing bankruptcy or entering a foreclosure workout plan address the past problems. Keeping the house in the long run becomes almost all about what you can pay going forward.

Q. How much do I need to spend to keep my house?

A. That really depends on your personal circumstances, but I would say that if you can pay a minimum of 75% of your regular mortgage payment and you want to keep your house you should at least explore options to keep it. You may not end up with the house, but you should expend the time and effort to try. If you can not afford even that much or do not want to keep the house, examine the best way to walk away from it.

Q. So that's the first answer, if you want to keep the house and might be able to keep the house, you never allow the foreclosure to happen, right.

A. Yes, in that situation take action to stop the foreclosure and the sooner you start the better.

Q. If you don't want to keep the house or can not keep the house and deed in lieu of foreclosure or short sale timeframes expired, how do you select foreclosure vs. bankruptcy?

A. I would start by looking to see if there might be any special advantages for selecting a foreclosure in your situation.

Q. I never imagined there were advantages to a foreclosure?

A. Take a situation where the first mortgage holder scheduled the foreclosure. You could not save the home prior to foreclosure because you could not reach terms with the 2nd mortgage or perhaps your home became subject to judicial liens for law suits you lost. A foreclosure by the first mortgage holder wipes out the other secure positions. Using this to your advantage to keep the house and wipe out the other liens requires professional legal help. Even though it may not be through a bankruptcy filing, a bankruptcy lawyer would be most likely to have the expertise to assist you. While this situation demonstrates an exception, it illustrates how one may use a foreclosure to their advantage.

Q. But that gets back to keeping the house, how could a foreclosure work to your advantage if you want to walk away from the property?

A. While I don't like even discussing this option, the fact of the matter remains if you have no hope of keeping the house and no money, letting the foreclosure process unfold gives you the most time to regroup before you have to vacate without spending anything. Filing bankruptcy costs money, which you likely have little of it this situation, think of a bankruptcy as an investment and be sure it makes sense. Foreclosures cost you nothing out of pocket, and moving fees remain the same no matter when or why you move.

Q. How would that situation play out?

A. I have an entire FAQ about the foreclosure process and subsequent eviction, but think of it like this: You stopped paying the mortgage, and they likely would not accept a payment even if you offered one (assuming middle of the foreclosure process). You understand the inevitable outcome that a foreclosure and eviction will force you out of the home at some point in the future. Finding a new place to live takes money for deposits and moving. While you wait for that day, and it takes many months in most states, you essentially live in the house rent free. If you use this opportunity to save everything you can as money required for the post foreclosure move, it works to your advantage to let the foreclosure happen.

Q. Wouldn't the time it takes to file a bankruptcy, letting it fail, and the delay in the foreclosure keep you in the house even longer.

A. Indeed it would, but if you filed a bankruptcy with no hope for success in a chapter 13 or no good reason in a chapter 7 just for the delay, not only would the lawyer face sanctions from the court for a frivolous filing, but the case might be thrown out anyway, you might get in some trouble too and you would have wasted all the money for legal fees and court costs. Do not file a bankruptcy unless it has a chance of helping in the way the legislature intended. Keep a bankruptcy's effect on your credit in mind too, but more on that later.

Q. How else does a foreclosure help the person being foreclosed on?

A. Unless you might be an ailing pop star thinking bad publicity could rejuvenate your career, it did get M.C. Hammer a job in a Nationwide Insurance commercial, I can not think of too many more advantages to foreclosure besides those above. Let's not glorify it, going through a foreclosure comes with few upsides and in most cases and should be avoided.

Q. How about using bankruptcy to stop the foreclosure?

A. You can read more on bankruptcy compared to other ways to deal with debt in my Bankruptcy FAQ and using bankruptcy to save your home in the Chapter 13 Bankruptcy FAQ. For this FAQ I will compare foreclosure vs. bankruptcy in situations where you can not save the home.

Q. Then why would a bankruptcy help if you will lose the house anyway?

A. Mostly when dealing with unsecured debt.

Q. Unsecured debt like credit card debt?

A. That stands out as the first type of unsecured debt to examine, but in foreclosure situations many people face deficiencies.

Q. Explain a foreclosure deficiency?

A. Figure you owe $200,000 on a mortgage. At the foreclosure auction the home sells for $150,000. You owe the bank a "deficiency" in most states for the remaining $50,000.

Q. They take your house, evict you and still come after you for more money?

A. Only time will tell if the bank pursues you, but they have that right if you let the house go all the way through the foreclosure process and it sells for less than you owed on the mortgage plus legal fees.

Q. Does a bankruptcy discharge the deficiency debt?

A. Any deficiency debt gets treated as unsecured debt by the bankruptcy court, deciding on its discharge depends on the type of bankruptcy you filed and decision of the judge. In most chapter 7 bankruptcy cases the answer would be yes and in most chapter 13 cases the answer would be you would pay a fraction of the debt over a term of years. A bankruptcy lawyer could tell you what to expect in your own situation.

Q. What if I have no credit card debt, other unsecured debt and no deficiency, either because the house sold for the same or more than the mortgage or the foreclosure took place in a state that does not have laws allowing deficiency judgments and keeping the house no longer exists as an option?

A. I would not suggest filing any type of bankruptcy given that set of facts.

Q. How about bankruptcy if I have significant credit card debt but will not face a foreclosure deficiency?

A. Make the decision based on the best way to approach the credit card debt and your overall financial situation. Do not let how a bankruptcy might affect the foreclosure in the short run influence the choice to file a bankruptcy or not in cases where you know you can not stop from losing the house to foreclosure in the long run.

Q. Imagine I have no credit card debt, but I know I face a foreclosure with a large deficiency in a state when I could be sued for it?

A. This question never seems to come with a black or white answer. You have to look at all sides and make your own decision. It would be best to discuss this with a bankruptcy attorney, but keep in the back of your mind that a bankruptcy attorney may lean toward suggesting you file bankruptcy.

Q. Why would someone file bankruptcy prior to the foreclosure in that case?

A. Filing bankruptcy before the foreclosure accomplishes two things. You get the power of the bankruptcy to deal with the deficiency, in the case of most chapter 7 bankruptcy cases that means you discharge the debt it full, and you end up with a delay in the foreclosure auction.

Q. What happens if you wait until after the foreclosure auction?

A. Before the foreclosure auction you make a guess as to what the deficiency might be. After the foreclosure auction you know for sure. Perhaps you get a pleasant surprise and you do not end up with a deficiency at all.

Q. What happens if I do not end up with a foreclosure deficiency?

A. It's your lucky day, for this example we started with the concept that you had no other unsecured debt. If you have no deficiency either you have no need to file a bankruptcy at all.

Q. Suppose I was right and I end up with a big foreclosure deficiency?

A. You have many choices, and in this case no time pressure. You can file bankruptcy to discharge some or all of the deficiency, negotiate a settlement on the deficiency or just wait.

Q. Why would you wait?

A. In some cases the bank may never chase you for the deficiency. On the down side you may have the foreclosure deficiency just hanging out there for 3-6 years, but you may never hear about it ever again. You always have the option to negotiate or file bankruptcy if they start an action against you. On the other hand you may be filing bankruptcy when you do not need to.

Q. Well, what should I do about filing bankruptcy?

A. You need to make an individual decision in conjunction with your bankruptcy lawyer.

Q. What kinds of things might influence the answer?

A. 1. What is your banks specific history in chasing people for the foreclosure deficiency?

2. How much is the deficiency, the more you owe the more likely they will try to get it.

3. How likely is it they could collect now or in the future? If you have no money and will not have money in the future they may not bother. If you have other assets or might be able to pay them out of future income you might want to wipe out the debt while you have the chance.

4. How would you feel psychologically living for 3-6 years not knowing each day if the bank might come out of the woodwork?

5. How do you personally feel about filing bankruptcy?

6. Do you have the means to reach a settlement with the bank for the foreclosure deficiency?

7. Look at the timing for rebuilding your credit. If you rebuild for a few years and have to file a bankruptcy later you will setback your initial efforts.

Q. How is bankruptcy vs. foreclosure when is comes to your immediate credit score?

A. Make no mistake, bankruptcy and foreclosure represent some of the very worst things you could ever do to your credit. Compare this question to asking "Which is worse, being trampled by 100 stampeding elephants or writing a story about a towering inferno by experiencing it as a victim?" Some people would say they hate writing and choose a trampling; some dislike animals and elect a burning. The point remains both options rank as so horrible and nasty that compared to not experiencing either, they both represent events so bad attempting to identify one as better than the other becomes useless.

Q. Aside from your short term credit score do other reasons exist to choose bankruptcy vs. foreclosure?

A. Yes, even in our example, some people do possess a serious psychological fear of fire. Some people maintain a similar strong emotional objection to filing bankruptcy. In a case with no other debt issues besides the home foreclosure we need not discuss if such feelings come with financial justification or not. If the decision comes to a toss up and you would feel like a failure the rest of your life by filing bankruptcy than choose the foreclosure.

Q. What about when a deficiency or other unsecured debts do exist but you hate the thought of a bankruptcy filing.

A. You must look at the entire situation including one's feelings about bankruptcy, but you can not allow emotions take you in the wrong financial direction either. I once had a consultation where a caller had amassed $300,000 in unsecured debt. He came from a very well to do family and felt bankruptcy posed such a shameful and horrible option he refused to consider it. He hoped his family, even though they had already paid many thousands of dollars to support him financially, would give him up to $150,000 to help him settle the debts. From a dollars and cents point of view his case screamed "bankruptcy". I argued that both he and his family would be better served if he filed bankruptcy and used the family's money to start life over again. I also suggested that the family might feel that their money would be put to better use in that way. He refused to even think of bankruptcy and I refused to take the case.

Q. What about the long term effects of foreclosure vs. bankruptcy on your credit report score?

A. In either case you start rebuilding credit from a deep hole. A foreclosure or chapter 7 bankruptcy allows you to start the rebuilding process full force after the foreclosure auction or the closing of the bankruptcy case, usually in a matter of months. A chapter 13 plan can go on for 3-5 years and while you can rebuild a bit, so many options remain unavailable during the bankruptcy that reestablishing good credit can be more challenging. Chapter 7 bankruptcy stays on your credit for 10 years, a chapter 13 or a foreclosure falls off in 7. An easy answer might come out indicating foreclosure looks better than bankruptcy. For a more relevant and realistic answer figure bankruptcy or foreclosure both destroy your credit so completely that what you do to rebuild credit and the effort you put into improving your credit score afterwards emerges as much more important than where you started from or if a bankruptcy or foreclosure put you there.

Foreclosure Myths

2010-09-02T16:26:00.000-07:00

Foreclosure Myths

Myth: The bank wants your house
Truth: The bank almost never wants your house, they want the money they lent you paid back with interest. In fact, banks usually hate going through the foreclosure process and will bend over backwards to work with homeowners in avoiding a foreclosure. Often the bank’s flexibility still doesn’t go far enough in stopping the home foreclosure. Never confuse that with the bank “wanting” your house. Treating the bank with contempt or completely avoiding them because you think they “want” your house may only serve to hasten the result that neither of you want, that they “get” your house.

Myth: The bank will not take my payments, I can do nothing else
Truth: At some point many banks say if you do not pay all of your arrears in full they will not accept a partial payment. Maybe a month later you get that figure together only to find the bank sends it back because another month has gone by and now the “all or nothing” requirement has grown. Do not fear! If you and the bank can not get together on a solution for stopping foreclosure a mortgage negotiation professional can set up a plan for you to pay just a portion of the arrears now if along with the partial mortgage arrears payments you set a plan to pay future current payments and catch up on the remaining arrears over time, sometimes months, sometimes the life of the balance of the loan or extending the loan. The foreclosure process stops and as long as you stick to the plan you keep the home. Don’t miss a payment under the new plan or the foreclosure process can pick up where it left off and banks rarely give second chances with this type of plan for avoiding foreclosure. If this fails you may still have the option of a Chapter 13 bankruptcy to save the house from foreclosure. Don’t forget when the bank stops accepting your mortgage payments do not spend all your money elsewhere, you will need it to save the house. Read more on this at "Who to pay when you can’t pay everyone".

Myth: I received a foreclosure notice; I have to move out now
Truth: Most states have a very long foreclosure process, even after failure avoiding foreclosure you do not have to move. Following a foreclosure you must go through an eviction hearing. Eventually you will be physically removed. I’m not suggesting you hold out until the end, but making sure you know you get to stay and fight if you want. Time can be on your side if you take action early and don’t waste the opportunities for stopping the house foreclosure.

Myth: I'm in foreclosure, no bank will refinance me out of this foreclosure
Truth: If you have enough equity in your home, typically 60%-70%, specialty lenders will refinance the house to pay off the old bank and stop the foreclosure.

Myth: If I go through a foreclosure I can never buy a house again
Truth: From a banking point of view foreclosures can be viewed as one of the worst things ever on a credit report. Even so, some banks will make you a loan very soon after a foreclosure. Be prepared for very large down payments and high interest rates. Most often the terms of these loans prevent people from buying another house not that funding does not exist. In time provided you work hard to rebuild your credit you can go to a bank almost as if the foreclosure never happened, although expect that may take 4-7 years. Click here for an article about bad credit mortgages or applications for loans after foreclosure.

Myth: On the foreclosure auction day everyone in the world is going to invade my house
Truth: While some foreclosure sales may be held “at” the property no one will come inside unless you invite them.

Myth: A chapter 7 bankruptcy will stop my foreclosure and save the house
Truth: A chapter 7 bankruptcy will stop the home foreclosure on a temporary basis only. Eventually you need to do something else to keep the house in the long run if you are facing foreclosure.

Myth: Homeowners can come up with all sorts of creative ideas for stopping home foreclosure and the bank will go along with the smart plans
Truth: Bank’s organizations in most cases involve complex bureaucracies and specific procedures. Most times the smartest plans remain destined for rejection. Stick to a plan within formats and parameters the bank works with everyday for avoiding foreclosure, get a foreclosure prevention professional to help you if needed.

Who to pay when you can't pay everyone.

2010-09-02T16:22:00.000-07:00

Who to pay when you can't pay everyone.

Who gets money when everyone can't be paid must be a decision you make based on your own situation, not who calls you the most or who you owe what to. In most cases the creditor receiving top priority will be the first mortgage holder on your home. This obligation likely represents a debtor's largest payment. Human tendency evidences payments to smaller creditors when money gets tight. Often credit cards and second mortgages may be paid in full once first mortgage payments cease. This results in a short sighted solution. Soon your credit becomes blemished anyway and foreclosure on your home follows. Negotiating with first mortgage holders can be more difficult than with other creditors. Stop and think of this: If faced with the options of losing a credit card or losing your home which would you choose? Either one may be a valid answer depending on personal circumstances. Your response to these and other questions should dictate your actions.

To properly evaluate your situation try the following steps:

Figure out how much you saved or spent from savings to live last month. This number should be a hard fact. Either you added to an account or needed to borrow from savings, friends or relatives to make ends meet. Write this number down put it aside.
Make a list of all available income for the month.
Use the regular net income of both spouses.
Do not include inconsistent items such as occasional overtime, tax refunds, or gift proceeds.
Are working children or other adults living in the home who could contribute funds? This comment always meets with a lot of resistance, but when the other option may be losing the house, it must be examined!
Make a list of extra income available.
What savings can be used?
Do you have available credit lines or available cash advances from credit cards?
Can you borrow money from friends or relatives?
Look under the sofa cushions (or any others sources which may be unique for you - a 401K plan or whole life insurance policy perhaps).
Make a list of all monthly expenses. (We prepared a monthly expense interactive-form to help clients having us evaluate their debt track expenses they may not have thought of. You are welcome to go to the interactive budget form.)
Essential Expenses - Food, that's it for this category.
Very Important Expenses
First Mortgage (or rent)
Other Mortgages
Utilities
Transportation for work
Important Expenses
Clothes
Taxes
Transportation - other
Credit Card Payments (if credit remains good)
Regular Expenses
Most daily expenses
Household goods
Credit card payments (if credit is already tarnished)
Luxury Expenses
Entertainment
Vacations
Jewelry
Wasteful Expenses
Gambling or Playing the lottery
Falling victim to scams
Obtain your credit report. If you can wait a week or two or if you have recently been turned down for credit or you suspect fraudulent items on your report you may be able to get a free report. New laws allow everyone to see their report free once a year now in any case, you can learn how in the credit guide. If you don't want to wait or would not qualify for a free report you may obtain one here instantly for about $16, follow the links for the credit report. You may want to spent a few dollars more to learn your credit score as well. I have another article just on credit repair and rebuilding for more information on that subject or you can enroll for the free credit improvement guide I built. For more information about your credit you can read an FAQ to understand credit scores or an article explaining what is bad credit.
Complete a personal financial statement.
Prioritize assets. Which do you need to keep, would like to keep, wouldn't mind keeping, and which would you just as soon get rid of?
Which liabilities are reported to credit bureaus?
Does the net monthly figure on the form match the number you put aside back at item #1? Probably not, this time include everything you spend. Make up categories or call items miscellaneous. Go over the expense section again and again. Self employed debtors may need to revisit the income entries. When you have a net figure matches what really occurred proceed. Click here to do this budget analysis online.
Honestly evaluate your problem. Is it long term or short term? Has it been solved or is there a date certain when it will be? Will it reoccur? Is it permanent?
This would be where I reveal the magic formula, but unfortunately none exists. If the answer to each question above were a simple yes or no there would still be thousands of combinations. So which is the best path from here? Contact a debt professional to help you. An attorney who concentrates in debt workouts would be my first choice. Be careful, finding this type of lawyer can be very difficult. Surprisingly few attorneys have any expertise in this field. You will most likely discover firms who advertise themselves under a bankruptcy heading. While most bankruptcy attorneys can complete the paperwork to file a chapter 7 or chapter 13 for you, they won't be inclined to discuss other options. Many have never done these negotiations, some don't even know settlements exist. Others claim to understand this concept but prove to be inexperienced or inept. Filing bankruptcies in volume can be quick easy money for the law firm. Do not fall into this trap.

If you can not afford a lawyer look for a non-profit organization such as Consumer Credit Counseling Service. Be wary of individuals or for profit agencies offering these services. Some don't possess the knowledge to complete the task, others are out right thieves. Many just take your money and put you in touch with a lawyer they have selected based on fee arrangements between themselves and the attorney, not on the attorney's qualifications.

Sometimes people who have never been late on a payment in their whole life think they have a financial crisis when find themselves making payments a few days late. Often if your credit has not gone bad yet and you still have a strong income a debt consolidation loan or a credit card balance transfer may be all you need. Be wary that these choices in the wrong circustances escalate the problems and deepen the issues. Be even more careful about using emergency savings and most cautious of all about accessing retirement funds.

No matter what you do take an active role. Educate yourself, learn about the various debt options and be a part of both the professional selection and decision making process. Lawyers may try to push you toward a bankruptcy filing, consumer agencies lean against it. This does not mean you should do your own negotiations any more than you should take out your own appendix. Saying you can't afford a lawyer is like being too sick to go to the doctor. Lets take this analogy one step further. If most bankruptcy attorneys were doctors they would operate on every patient who came in with a slight stomach ache. Some consumer agencies would tend to keep a patient on antibiotics and not operate even if it meant the patient would live in the hospital for the next ten years. Many debtors ignore their credit card debt or mortgage foreclosure problem so long they need one or the other or something inbetween. Don't let any talk you into a debt help solution just because they say so.

Below I have included guidelines to follow. Use them to better understand your situation so you may take a more active and informed role in your future. These should not be used as a "do it yourself" program, get professional help whenever possible. The guide may also be used to help weed out incompetents in this area. If someone's advice sounds contrary to most of what I'm saying you may have an unusual situation or you may be talking to a quack. If you sense you're in a duck marsh get a second opinion. If you think you're not being properly represented and you verify this don't be afraid to switch lawyers or hurt their feelings. Losing a client they never should have advised in the first place won't change their life. Losing your house or filing an unnecessary bankruptcy will surely change yours. To find out more about debt options, click here.
If you want to save your home, pay your mortgage first. If you are already behind formulate a way to catch up, then call the bank, tell them your plan and why it will work. Do the same for all mortgages or rent.
Communicate with your creditors. Don't wait until you get in trouble. Before you miss a payment give them a call and let them know you need help and why.
Never waste money. No lottery, no gambling, no get rich quick schemes. Be very wary of scam artists, they will be out to find you.
If your credit has already turned sour don't try to rebuild credit until the current problems have been resolved.
Paying more than the minimum payments on credit cards does not give you a better credit rating.
Don't become emotionally attached to any asset. Re-evaluate all of your possessions and don't be afraid to give them up. Should you be driving that Lexus or would you be better off in an Escort for a while? Maybe necessity dictates moving to a smaller house or a less affluent neighborhood. Evaluate your assets and property without emotional attachments.
Identify the cash drains and plug them up. This may mean closing a business or losing an income property.
If you are not making mortgage payments or they won't accept your checks save the money. Don't spend it on other bills. You may need it to save the house. The one ranks as one of the worst mistakes people make when facing foreclsoure.
Don't make arrangements you won't be able to keep. Tell creditors what you can really do, not what you think they want you to say. Often professional foreclosure negotiators or unsecured debt negotiators can get a better deal for you.
Do not spend money on house repairs if you may be losing the house.
Explore all options but be ready for the worst, including an exploration of the rental market.
Formulate a plan as soon as you see the first sign of trouble do not wait!
If home foreclosure looms above you ignore the collection agencies from the unsecured creditors. You have more important things to worry about. Don't let them bully you into giving them anything. You may need every cent to save your home.
Don't waste money or flaunt your spending. I once heard the story of a debtor who had almost completed negotiations with a bank for a deeply discounted settlement. When the loan officer called to finalize the plan she was told the debtor was vacationing in the Caribbean. She figured if he could afford the trip he could afford to pay her in full and the deal was off.
Don't file for bankruptcy unless it's really the right thing to do. It's not the only option many alternatives to bankruptcy await your exploration. If your attorney doesn't explain the other options find a new bankruptcy attorney. If the bankruptcy option works the best for your situation don't be afraid or ashamed to do it. Use this site to get a free second opinion before filing bankruptcy.
Find the time to deal with this problem. If your house matters to you, this is more important than almost anything else. If you hate the house anyway, don't pour money in to save it, explore other residence options.
You will not be put in jail for falling behind on your payments. You will not be shunned by the whole community. Most people will never know about your situation unless you tell them. Yes, this even goes for small towns with legal notices in the paper. Those who do find out will soon forget. Personal issues always interlace with your debt issues, but you can not chart your course based on your emotion alone.
Don't pour money into black holes. If your situation has taken a permanent downturn to the point that an asset will ultimately be lost stop wasting savings or current income just to delay the inevitable. You will need that money for other things, such as finding a rental after a foreclosure.
If you have bad consumer spending habits including but not limited to shopping addiction or compulsive spending change the way you budget money even if it means seeing a mental health profesional for help.
Don't spend money on big gifts or celebrations. Your daughter would surely rather have a smaller wedding than homeless parents.
If you have been able to save some money don't leave it at a bank you owe money to. They might be able to take it from you without notice.
Once in the foreclosure process call a lawyer before paying anything. When you've reached this stage little time remains. You'll need someone familiar with all legal options.
If you really want to keep the house be prepared to work for it. This may mean cutting items you thought were essential like cable TV; or getting a second job.
Think twice before not paying income taxes or your employees withholding or FICA match. These will probably not be dischargeable in bankruptcy.
Once you know you will be filing a bankruptcy do not run up a bill or credit card subject to discharge. This would be fraud, not to mention non-dischargeable.
Perhaps the most important, don't lose hope and don't give up.

Lifestyle FAQ - Debt And Depression

2010-09-02T16:19:00.000-07:00

Lifestyle FAQ - Debt And Depression

Q. Lifestyle!? I have no life anymore. What are you talking about?
A. That's exactly what I'm talking about. Becoming a debtor and dealing with the depression, psychological problems and lifestyle changes associated with it, is an important topic. You may need to deal with your debt emotionally before examining the various methods for eliminating the debt.

Q. You mean other people feel the same way I do?
A. Sure, that's the first thing to understand. You aren't the first person to get in debt and you won't be the last. As a debtor you join all of the others in financial trouble who may get upset or depressed about it.

Q. While that may be comforting to know, how does it help me?
A. I'm going to go through some of the stages a debtor experiences. It may be refreshing to see where you've been, helpful to see whats ahead and important to beware of certain pitfalls before you get there.

Q. These stages make it sound like dealing with death or something.
A. Exactly! Think of it as the death of your financial well being. I've included below an exerpt dealing with reactions to loss from a University of Illinois page entitled "Grief and Loss" written to help students deal with the death of a loved one. I'm sure you will find many, if not all, of these feelings familiar:

1. Denial, shock, numbness -- reactions which distance the grieving person from the loss, thereby protecting him/her from being over- whelmed by emotions.
2. Emotional releases -- these reactions accompany realizations of different aspects of the loss, they frequently involve much crying and they are often important to the healing process.
3. Reactive depression -- natural feelings beyond sadness (e.g., feelings of loneliness, isolation, hopelessness, self-pity) which occur as the person more clearly recognizes the extent of the loss. For many, reactive depression is part of the necessary internal processing of the loss which the grieving person must go through before reorganizing his/her life.
4. Panic -- feeling overwhelmed, confused, fearful, unable to cope, and even believing something is wrong with oneself.
5. Remorse -- following a loss (whether through death, relationship breakup or disability) a grieving person sometimes becomes pre- occupied with thoughts of what he/she might have done differently to have prevented the loss or to have made things better. This can be helpful as the person tries to make sense out of his or her situation, but can also lead to unrealistic feelings of remorse or guilt.
6. Anger -- this is a frequent response to a perception of injustice and powerlessness. A significant loss can threaten the grieving person's basic beliefs about himself or herself or about life in general. As a result (often to the grieving person's bewilderment), he or she can feel anger not only at a person perceived as responsible for the loss, or at God or life in general for the injustice of the loss, but also -- in cases of loss through death -- at the deceased for dying.
7. Need to talk -- in order to recognize and come to terms with the impact of the loss, the grieving person may express feelings, tell stories and share memories, sometimes over and over with many different people.
8. Physical ailments -- in response to the emotional stress of grief, many people are more vulnerable to a variety of physical ailments over the six to eighteen months following loss (e.g., colds, nausea, hypertension, etc.).

Q. Wow, I've experienced all of those, what else can I expect?
A. Just about every debtor I have spoken to has had some trouble sleeping.

Q. Do most debtors feel so torn apart?
A. I'd say yes, in particular those who trying to avoid foreclosure of their home. I've written down some reasons foreclosure can be more devestating than a natural disaster to prove the point.

Q. What should I watch out for?
A. Beware of letting your financial troubles destroy personal relationships, especially with your spouse. Few things in life cause more tension then resolving a debt crisis. I've read that over 75% of divorces involve financial problems. Don't blame each other or lash out at each other. During these days you will need each other more than ever. Avoid finger pointing, couples need to draw even closer during times like these and move forward as a team no matter how hard it may be.

Q. Does it get better?
A. Yes, in time there will be acceptance of your situation. When this occurs you will find less stress and more sleep.

Q. How long will that take?
A. Most often many weeks or months, it depends on the person, the depth of the problem, the level of depression and how the situation becomes resolved.

Q. Can I do anything to help speed up the process?
A. Mostly it just takes time, but there are things you must do. First you may have to change your attitude about debt.

Q. I owe the creditors money and I must pay them back, how can I change that attitude?
A. It's certainly honorable to pay creditors every dime you owe them. It's true that most people do and that if everyone defaulted on obligations the economy would collapse. It's true that most people go to work each day, but some do not, some lie in the hospital. When they get better they go back to work. When you have gotten past your current financial problems you will go back to paying creditors in full. For now you probably can not. Many options exist to fix your debt problems with easier terms or without payment in full.

Q. I could pay them back over many, many years. Isn't that what I should do?
A. In the hospital the doctor tells you a terrible infection rages through your leg. Either you can become a cripple and limp the rest of your life or have a painful operation which will have you back on your feet in a matter of months, fully recovered in a few years. What would you do? I'll assume you'd take the operation.

Q. What about the guilt I'm feeling by not living up to my obligations?
A. When banks make loans they expect some to end up in default, that's a part of the interest rate you pay. Believe me, the fact that your note goes unpaid doesn't mean your loan officer worries about a roof over his head or that the bank president can't sleep at night or the teller started meeting with a counselor for depression. Your actions will not affect the way they live their lives or the financial stability of the bank or the lives of any of it's shareholders or employees. They will not feel guilty about taking your home if you fail to stop a foreclosure or demanding money so your children go hungry. Do not feel badly for them, think about you and your family first and foremost.

Q. What about my reputation in the community?
A. Other than creditors most people won't know about your situation unless you tell them. Your reputation may end up tarnished among those who know, accounts may have to be paid COD, some businesses may not want to deal with you at all. You will find that with very little effort any vendor who does not want to deal with you can be replaced.

Q. What other changes in lifestyle should I expect.
A. In the short to intermediate term most debtors find they must change their spending habbits. Until you get back on your feet you should establish a new budget that you can live with even if it means no more nights out, a cheaper apartment, making adult children pay rent or their own tuition, changing eating habits to lower the food bill, dropping cable TV, not giving gifts, driving a less expensive car, and the list goes on.

Q. That's a tough list to start with, do I have to do all that?
A. You have to do what it will take for your own situation, it may be worse than that list. By the way, this doesn't represent the "start" list, this list comes into play only after you have solved your initial problem.

Q. What initial problem?
A. Why are you in debt? This question must be answered and steps taken so it does not happen again before any workout, debt settlement or bankruptcy begins. If you lost your job get another, if your business drove you down close it, if you have chronic credit or spending problems get counseling, if you have drug or gambling problems quit. These may be tough demands but without this step solving the root of the problem, the current financial crisis may just be the introduction to the next money melt down resulting in an even deeper depression.

Q. Is there ever a light at the end of the tunnel?
A. Yes, as hard as it seems to imagine now, the goal here is to be able to look back years from now at the events of today and say it was a blessing in disguise, maybe even the best thing that has ever happened to you.

Q. How can that possibly be?
A. Unlike human death as discussed above, think of the debtor as a Phoenix or Firebird. From your financial ashes you will be reborn. When you rebuild a new financial base old debts will be gone. Your spending habits will be smarter. In a short time you can become richer and stronger than before. You may become a six million dollar man! In the long run you will see that addressing debt issues head on, even if you need a chapter 7 bankruptcy or chapter 13 bankruptcy can really give the debtor a new lease on life.

A Consumer's Debt Consolidation Loan FAQ

2010-09-02T16:17:00.000-07:00

A Consumer's Debt Consolidation Loan FAQ

The commercials on television make it sound like a debt consolidation loan will solve all my financial problems. Are these loans really the perfect way to solve my debt issues?
For some people debt consolidation loans can work very well. For others they may come with disastrous side effects.
How can I determine if a debt consolidation loan is right for me?
Start by understanding what a debt consolidation loan is and how it fits into solving your personal debt situation.
Isn't a debt consolidation loan just a loan where you get money to pay off your bills?
No. In almost all cases a debt consolidation loan is structured as a second mortgage on your primary residence. Sometimes poeple with excellent credit can get an unsecured personal loan for their debt consolidation needs. For people with good fair or poor credit, unsecured personal debt consolidation loans may be harder to get and the maximum loan available hovers around $5,000-$15,000 depending on your exact credit and employment situation. In somes cases these loans do the trick, but for many debtors an unsecured debt consolidation loan of $15,000 or less does not address enough of their bills.
What difference does that make?
Most debtors attempting to obtain a debt consolidation loan face issues with unsecured debt, such as credit card bills. A second mortgage represents a secured debt. This becomes of critical importance if things go from bad to worse. With unsecured debt a chapter 7 bankruptcy can discharge the debt, completely relieving the individual of the obligation. In the case of secured debt, such as a second mortgage, even in a bankruptcy situation, the creditor has the right to seize the collateral if the loan cannot be repaid. When speaking about a second mortgage that would mean foreclosure on the property.
I intend to make all my payments, why is this an issue?
You may have taken the credit cards with the intention of paying off the balance each month as well. Good intentions are fine, but unexpected things happen in life. One of the most critical issues to analyze before taking on a debt consolidation loan will be the borrowers ability to weather a financial down turn. I recommend that anyone taking on a debt consolidation loan be very comfortable that should they have a health issue, loss of job or other unfortunate financial surprise that they would remain able to make the payment for some time on the new debt consolidation loan. To be even more clear, a debt consolidation loan means you "bet the house" that you can repay your credit card debt.
My monthly payment with a debt consolidation loan will be much more affordable, what is wrong with that?
There is nothing wrong with lower payments as long as you understand the mathematical reasons why the payments will be lower. Take a hard look at your current debt including the payments and the interest rates. How long would it take to pay off the debt in full? Then look at the terms of the debt consolidation loan. In some cases lower payments result from a significantly reduced interest rate, in other cases the reduced payment can come entirely from extending the payoff time to as long as 30 years.
Aren't the rates of these debt consolidation loans always low?
Absolutely not. In some cases, where the borrower has good credit and a fair amount of equity in the home, rates can indeed be close to rates expected for a first mortgage. In other cases, particularly those with individuals with poor credit or in case of 125% LTV debt consolidation loans, rates can soar to over 18%. Depending on your current debt, rates for these debt consolidation loans can be higher than the interest rate on the pre-existing debt.
What is 125% LTV loan all about?
125% LTV (Loan To Value) loans allow the individual to borrow monies beyond the value of their home. For example if a home is worth $100,000.00 and the mortgage debt on the house is also $100,000.00, a 125% LTV loan would allow the debtor to borrow an additional $25,000.00 with the result being the total debt secured by the house after the loan would be 125% of the value of the home. While this type of loan opens the door for some individuals who may otherwise have no access to money it comes with a price. The interest rates for these loans typically run much higher that other mortgage loans and origination fees to set the loan up can be as much as 10% of the loan balance.
Can anyone get a 125% loan if they need it?
No. Only those with good to excellent credit will be eligible.
What if a debt consolidation loan would really cure all my problems? Are there any other dangers?
Yes. The debtor must examine how the trouble began. One of the most common pitfalls and recipes for the worst of disasters happens when people take on a debt consolidation loan without rectifying the true cause of the debt. A typical situation would play out like this: Individuals get into debt trouble because they are living beyond their means and supporting their spending habits with credit cards. A debt consolidation loan seems to solve things by paying off the debts. Unfortunately, if the spending habits continue, the individuals find in another year or two they have run their credit cards up to the same levels or higher than they were before the debt consolidation loan. Only this time the equity in their house has all been used up by the debt consolidation loan. They are unable to pay either the new bills or the debt consolidation loan and bankruptcy and foreclosure becomes await them.
What is the best way to avoid this scenario?
Find out why the debt has truly accumulated. In a case of irresponsible use of credit cards, after paying off the credit cards with a debt consolidation loan, cut the credit cards up. If you need to have credit cards for rental cars, business trips or on-line purchases consider secured credit cards or debit cards. Spending on secured credit cards cannot exceed a limit based on the value of an accompanying savings account. Use of debit cards require you have money in an account in order to use the card.
Is there a way to get a debt consolidation loan that does not require pledging your house as collateral or a way to get a debt consolidation loan if you do not own a house?
No. You may be able to get an unsecured personal loan, but unsecured personal loans will always require good to excellent credit and come with interest rates even higher than debt consolidation loans. Some people may refer to an unsecured loan as a debt consolidation loan, but the typical advertising you see on television or in the newspaper for a debt consolidation loan refers to one secured by a second mortgage.
Is there any legal difference between a debt consolidation loan and a home equity loan?
Not in most cases. A debt consolidation loan in legal structure generally does not differ in any way from what one might call a home equity loan or a second mortgage loan.
Ok, Mr. Doom and Gloom, are there any good points to a debt consolidation loan?
Yes. When debt consolidation loans carry a low enough interest rate payments can be significantly reduced. Many people find making one payment can be much more convenient that making five or ten smaller payments. Even if not the best long term plan, in the short run longer amortizations available with debt consolidation loans can help with cash flow.
I have very bad credit and no collateral, like a house or a car, what kind of debt consolidation loan is available for me.
Other than borrowing from friends or family, if you have very bad credit and no collateral I know of no legitimate financial entity anywhere that will make you a loan. This is an important point to stress for two reasons. If you have very bad credit and no collateral don't bother spending a lot of time and effort trying to find a loan. I have been trying to find unsecured personal loans for clients with very bad credit for 10 years, only to find none. If anyone reading this knows of a legitimate loan I would be excited to hear about it. Based on my knowledge of financial institutions, their requirements and the default rate that would exists on such loans, I don't believe that anyone who did endeavor to make such loans would stay in business long. With that said, the second point to keep in mind is not to expend any money to anyone telling you they can obtain an unsecured loan for anyone with very bad credit. I have seen ads where people are attempting to sell lists or in some way taking an up front fee for find such a loan. In other related cases credit cards are offered enabling a credit line even with very bad credit, where in reality the application fees, annual fees and other miscellaneous fees result with the borrower essentially paying $250.00 for a $250.00 line of credit. A new trick gaining popularity are "payday loans" or auto "title loans" avoid them like the plague. The hidden interest rates on these loans can be 500% per year! If you have very bad credit and need money don't make things worse by falling prey to a scam.
In this context what constitutes very bad credit.
While each account and loan request may be judged on it's own circumstances, a bankruptcy within 2 years or a number of accounts over 120 days late would probably be viewed very negatively by someone examining a request for an unsecured personal loan.
Are there cases where it's not a bad idea to pledge the house as collateral for a debt consolidation loan?
Yes, I can envision some situations, particularly in state that offers very little in way of homestead exemptions for homeowners in bankruptcy. In some places the equity in ones home is significantly at risk whether a debt consolidation loan is taken out or not. When the writing is on the wall that a debtor will lose their home unless they can clean up some of their financial mess, a debt consolidation loan can be the tool to save a home.
I heard that debt consolidation loans are tax deductible, is this true?
In some cases depending on the cost basis of your home the interest portions may be tax deductible. Potential borrowers should check with their tax advisors to explore what portion, if any, would be tax deductible for them.
If things get better can I pay off a debt consolidation loan early?
In most cases there is no prepayment penalty with these loans, but read your documents carefully. Some loans will indeed penalize you an extra-prepayment penalty fee if you pay the loan early.

Frequently Asked Questions - Chapter 13 Debtors

2010-09-02T16:15:00.000-07:00

Frequently Asked Questions - Chapter 13 Debtors

Q. I decided I am a person who should file Chapter 13 bankruptcy, what happens now?
A. These three things first:

The petition. This is simply the document which asks the court to bring you relief under chapter 13 of the United States Bankruptcy Code. It is a simple two page form, which will be signed by all debtors and the attorney. Once this form is filed along with the filing fee you will be given a docket number. It is at this initial stage that you have officially "filed" a chapter 13 bankruptcy. From this point on all actions by creditors are stayed, except those which might be allowed by motion in the bankruptcy court. This means creditors may no longer demand money from you, bring you to court to collect debt or even to proceed with foreclosure or repossession of your property. Getting this docket number to the creditor quickly as they need it to stop foreclosure proceedings. While most debtors file chapter 13 bankruptcy to avoid foreclosure the filing allows you to stop collection actions and reorganize credit card debt too.
Several days after you file your petition you need to submit a list of all your creditors including their names and addresses to the bankruptcy court. This document will be referred to as the Matrix. The bulk of bankruptcy forms required by the debtor in a chapter 13 case must be submitted to the court about a week after the matrix. This paperwork is quite lengthy it includes many schedules of your assets, liabilities, income, expenses, past financial history as well as your plan outlining exactly how you propose to reorganize under chapter 13 and evidence that you are capable of completing the plan.
Following this initial submission of the Chapter 13 reorganization plan you will have the opportunity, if needed, to file amendments as necessary. This may be needed to add creditors, change the class of a creditor or modify the schedules or plan given information which comes to light after the initial filing. Keep in mind that amendments may require an additional fee for your lawyer as well as for the bankruptcy court.
Q. When do I see the Judge?
A. Unless your case has contested issues which must be heard before a Judge chances are you will never personally appear before a Judge. You will, however, meet with a Chapter 13 Trustee.

Q. When does this happen and how many meetings will there be?
A. In most cases you will meet with the Chapter 13 Trustee only once. Expect that the meeting will take place one to three months after you have filed the bankruptcy petition.

Q. Who else will be at the meeting and what will happen there.
A. The title of the gathering will be a 341 Creditors meeting. Everyone you owe money to, who you have listed on your schedules, will be invited to attend. At the meeting they will be given an opportunity to ask any questions regarding your financial situation which may effect the plan you have proposed. In reality few if any of these creditors attend. The most likely guests will include large creditors, the holder of your mortgage or someone you might owe an unusually large sum of money to another creditor almost sure to accept an invitation to this party will be Sears insisting any hard goods you have purchased, such as refrigerators or stoves should be treated as secured merchandise to be either redeemed or reaffirmed. I have even seen them to go so far as to make this claim for car batteries and tires. Once you understand secured vs. unsecured assets you can figure the secured creditors stand as those most likey to appear at a Chapter 13 bankruptcy 341 meeting.

Q. Will anyone other than creditors be at the meeting?
A. Yes. Your attorney or someone from their firm will be there to represent you and speak on your behalf as needed, although many of the questions will be asked of you directly. The person asking the questions and meeting coordinator will be the Chapter 13 Trustee. Their job is to make sure that the plan meets all the specifications as required by the Bankruptcy Court and that the unsecured creditors are protected and allocated as high of a return as might be possible. If all goes well there will be only one meeting. Following the meeting, if there are no objections raised, all that there will be left to do is make all payments outlined in the plan in a timely manner.

Q. Who should I be paying and when?
A. Now that you have filed a Chapter 13 bankruptcy the payments will fall into three categories:
Secured creditors will be paid "outside" the plan. This will include fully secured first mortgages and possibly second or third mortgages as well, consult with your bankruptcy attorney and be very clear on who should be included in this category. Payments to this group should be made regularly directly to the creditor, just as they were supposed to have been made before you got into trouble or filed bankruptcy. In other words, if your payments were due on the first of the month the next time the first rolls around you should make a payment. Failure to make these payments will be grounds for these creditors to ask for relief from the automatic stay and proceed with foreclosure on your property.
The next group will consist of unsecured creditors who had accrued debt before your bankruptcy petition was filed, as well as certain unsecured portions of secured creditors and any other debt you proposed to pay "inside" the plan. All of these people will be paid through the Chapter 13 Trustee, you will write one check each month to the Chapter 13 Trustee, the Trustee will distribute funds from there. I would recommend that you not under any circumstances speak with or directly pay any creditor in this class any money that was owed directly prior to the bankruptcy filing. Any negotiations, which may involve reaffirmation of debt or payments outside the plan, should be strictly negotiated by your attorney. Creditors will likely try to contact you personally in attempt to have you reaffirm old debt or pay them money. Your only contact with them should be an instruction that they must speak with your attorney. Do not give them any money, do not sign any papers they may send you, do not speak with them other than telling them to contact your attorney. Checks to the Chapter 13 Trustee must be in the form of cashiers check, bank check or money order. Personal checks will not be accepted all checks must include a case number or docket number clearly written on in order to be properly credited to your account. Bring your first check with you to the 341 meeting if you haven't been making them prior to the meeting. If the 341 meeting is two months or more after you filed it is not a bad idea to send a check for your projected initial plan payment or a check for $150.00 to the Trustee each month prior to the 341 meeting.
Third group includes creditors who are owed money post-petition or after you have filed for bankruptcy. Debts incurred after filing for bankruptcy receive no protection from the Bankruptcy Court whatsoever. Whether it be utility bills, credit card bills or mortgage payments due after you have filed for bankruptcy, all of these must be paid in a timely fashion. Let me take a moment to mention you should understand the causes of bankruptcyand if you need to change bad consumer spending habits to avoid trouble again.
Q. How long will I have to continue to pay the Trustee?
A. This depends upon your income and size of the debt. By bankruptcy law statute all plans should be between 36 and 60 months.

Q. What if I have enough income that I may pay in less than 36 months?
A. If this is the case the Trustee will likely demand that the plan be 36 months and that a larger percentage of funds go to the unsecured creditors.

Q. What if I have extra money to pay more to the trustee one month?

A. I don't recommend this. I you have a bit of extra money save it. If a time comes later where a problem means you will have to miss a payment you may not be given credit for previous early payments and there could be trouble. Keep in mind that if your income changes you are supposed to tell the Chapter 13 bankruptcy court and have your payments adjusted.

Q. What percent do the unsecured creditors usually receive?
A. In most cases unsecured creditors receive 10 percent of their claim. In other words if a credit card had a $1000.00 balance before you filed they would receive $100.00 over the course of the Chapter 13 reorganization plan. This $100.00 would then be spread over the 36 or 60 months of the repayment plan so that you are only paying a few dollars every month to satisfy this creditor.

Q. What if I have so many creditors that I need more than 60 months to complete the plan?
A. If you can not complete your plan in 60 months it is likely one or more of the creditors or the Trustee will object to the plan and your case will be dismissed or converted to a Chapter 7. If the creditors are willing to work with you some creative options may emerge.

Q. Can they still foreclose on my house after I have filed?
A. If the court gives them permission to they may. If you are making all your payments in a timely fashion the court will not likely grant such a motion. This is why it is very, very, very important that all payments be made to the secured creditors after you have filed. Since you are already in a bankruptcy if you fail behind on these payments and a creditor receives a Relief from Stay, in other words permission to proceed with a foreclosure, there will be nothing you can do to stop them and you will lose your home.

Q. What happens if I fail to pay the Trustee?
A. The Trustee can move to dismiss your Chapter 13 bankruptcy case. If this happens you will lose the protection of the bankruptcy court both in terms of reducing the debt owed to your creditors as well as protective relief granted by the court.

Q. What happens if I have trouble making a payment in any given month?
A. Communication is very important. Let your attorney know this information that he or she may alert the Trustee or creditors involved. If it is a temporary one or two month situation it may be possible to work out a solution far less drastic than dismissing the case or allowing a Motion for Relief from Stay.

Q. What if my inability to make payments becomes an on going problem or I realize something I am incapable of completing the plan?
A. If you realize this before the court takes action on its own you will have the choice of allowing the Chapter 13 case to be dismissed or trying to convert the case to a Chapter 7. The correct option will depend on your debt, assets, several other personal considerations. If looking at these questions you should learn the differences of Chapter 7 vs. Chapter 13 bankruptcy.

Q. I changed my mind and want to dismiss my Chapter 13 bankruptcy, can I just cancel it and make it like I never filed Chapter 13 bankruptcy in the first place?
A. While you certaily maintain the right to ask for dismissal for your own Chapter 13 case as well as the right to ask for conversion to Chapter 7, the court will count your filing in terms of restictions on the number of bankruptcies you may file within a given number of years and the bankruptcy will still end up on your credit report and score even though you dismissed it.

Q. Are there any other legal fees beside what I may have paid before filing?
A. If all goes well there will not be. If, on the other hand, there are amendments required, motions from Relief from Stay which must be defended other adversarial proceedings, motions and especially a conversion to Chapter 7, they will all require additional legal fees.

Q. I filed my Chapter 13 pro se because I needed an emergency petition to stop foreclosure on my home, can I get help from a lawyer or am I locked into finishing the Chapter 13 bankruptcy on my own?
A. Just because you filed pro se (or by yourself without an attorney) does not mean it's too late to find a bankruptcy lawyer or hire a bankruptcy attorney to help you complete your Chapter 13.