Can The Foreclosure Process Be Stopped?

The New York Office of Court Administration recently issued an annual report estimating that there will be a total of 41,675 new foreclosure filings during 2015. This is a slight decrease from 2014 (about 44,000 new filings) and an even greater decrease from 2013 (approximately 47,000 filings). The report also states that, as of October 2015, there were 89,365 foreclosure cases pending in the state judicial system, an indication that there are a significant number of cases from previous years that have not been resolved.

What You Can Do to Stop or Delay the Foreclosure Process

            Once a foreclosure case is opened and the necessary legal documents filed by the lender, it may seem as if the foreclosure process is an unstoppable (albeit sometimes slow) juggernaut that ends with a court judgment against the homeowner, an auction of the home, and the eviction of the homeowner. This is not always the case, however. Because the lender initiates the foreclosure process by filing an action in court, the lender always retains the discretion and ability to voluntarily dismiss the foreclosure action. Not only this, there are other ways that can stop a foreclosure from proceeding further, giving the homeowner precious time to formulate a plan to deal with the underlying issue.

            Some methods by which the foreclosure process can be stopped include:

·      Filing for bankruptcy (either Chapter 7 or Chapter 13): When you file for bankruptcy under any chapter of the Bankruptcy Code, an “automatic stay” goes into effect immediately upon the filing of your bankruptcy petition. This automatic stay prohibits your creditors from taking any further collection action against you for any debt without permission of the court – including proceeding with a foreclosure action. While filing for bankruptcy under Chapter 7 usually delays the foreclosure action for several weeks or months, a Chapter 13 bankruptcy plan may enable to you to make up past due mortgage payments over time and allow you to keep your house (assuming, of course, you continue to make your Chapter 13 bankruptcy payments).

·      Approval of a workout/loan modification: In a loan modification or workout, the lender is essentially agreeing to modify the terms of your mortgage on a permanent or temporary basis to allow you to get back on track with your payments. If you breach the terms of the modification or workout, foreclosure proceedings may be resumed: however, successfully complying with and completing a workout agreement can cause the lender to dismiss the foreclosure action. Even if a lender has initiated a foreclosure proceeding, you may be able to reach an agreement with the lender that will save your home.

·      Temporary deferment or forbearance: This is similar to a modification agreement and essentially involves the lender agreeing to allow you to miss one or two payments due to a temporary but serious financial hardship. The missed payments are added onto the end of your loan, so you will have to pay the missed payments back at some point. A forbearance or deferment may be an ideal solution if you defaulted on your loan because of an unexpected crisis that has since been resolved.

The New York Sate Unified Court System ^[1] also provides several foreclosure defenses that may be appropriate to implement in order to slow down the foreclosure action including:

            -         Lack of Standing

            -         Improper Service of Summons and Complaint

            -         Service of Summons without including “Help for Homeowners in Foreclosure” Notice

-                Partial or Full Payment

-                Homeowner’s Mental Disability or Incompetence

-                Active Service Member

Can a Foreclosure Lawyer Really Help Me Avoid Foreclosure?

            It is easy and tempting to become depressed, complacent, and resigned when a foreclosure proceeding has been initiated against you. But as the Office of the Court Administration’s report shows, you will likely have a few months – perhaps even longer – to explore ways to slow down and/or stop the foreclosure process. The sooner you retain a New York foreclosure lawyer, the sooner he or she can discuss with you the options available to you to help you keep your home and/or avoid foreclosure.

            Ronald D. Weiss and the legal team at Law Office of Ronald D. Weiss, P.C. provide experienced and dedicated legal representation and counsel to homeowners who are facing foreclosure. Call them at (631) 296-0912 to discuss your case today.

References:

[1] https://www.nycourts.gov/CourtHelp/Homes/foreclosureDefenses.shtml

What Is A Foreclosure Action?

There are many reasons why a homeowner is unable or otherwise stops making their monthly mortgage payment:

·      Laid-off from work, fired or unemployed.

·      Unable to work as a result of illness.

·      Unable to work as a result of family difficulties.

·      Job transfer to another state.

·      Excessive debt.

When a homeowner becomes late with their monthly mortgage payments, the lender or mortgage holder may contact them directly indicating that they intend to foreclose.  When a homeowner receives such a communication, it is important to contact a skilled foreclosure attorney, in order to discuss all of the options and possible solutions available to try and avoid foreclosure. 

A foreclosure is a legal process where a mortgage company or lender takes ownership of a home.  This process occurs if a homeowner does not make their required monthly payments.  The New York legislature ^[1] provides a listing of all applicable laws and regulations regarding foreclosure including the New York Real Property Action and Proceedings Law.  These laws can be difficult to understand and complicated to apply to your individual situation.  There are also federal laws ^[2]  that must be taken into consideration which complicates things even further making an attorney a valuable asset and ally to have during this process. 

According to the New York Department of Financial Services ^[3], if the mortgage is attached to a property where the individual lives, the lender must send a pre-foreclosure notice at least 90 days before beginning a foreclosure case.  If you receive such a notice, it is important to contact an attorney who handles foreclosure cases as soon as possible. This 90-day window will provide you and your attorney with time to try and negotiate an agreement with the lender and to look for an alternative to foreclosure. 

If an agreement is not reached with the lender during the 90-day window, the lender may file a Complaint to Foreclose which is a legal action filed against the homeowner.

With the process of foreclosure, the homeowner receives a legal notice and, in most cases, the notice is published in the local newspaper.  It is important to contact a lawyer as soon as you are served with a Complaint to discuss your options and to prepare a Response, where appropriate.  The sooner in this process that you begin to work with an attorney, the more options will be available to you to avoid foreclosure.

It is important to remember that even after a Complaint to Foreclose is filed, almost every state allows for a period of time for redemption where the homeowner can pay all of the missed principal payments, back interest and foreclosure costs in order to take back control of the property.  Further, a lender will always be willing to stop the foreclosure for the reinstatement amount (the full catch up) even after it accelerates and declares the whole loan balance due.  By contacting an attorney who is familiar with both New York and federal laws to discuss the specifics of your case you can best understand and protect both your rights and your home. Call the office of Ronald D. Weiss today at 631-402-5950.

References:

[1] http://public.leginfo.state.ny.us/lawssrch.cgi?NVLWO

[2] http://www.uscourts.gov/services-forms/bankruptcy

[3] http://www.dfs.ny.gov/consumer/hetptimeline.htm