FORECLOSURE
Behind
in your mortgage? Even though you may be
months behind and facing possible foreclosure, there are
often viable defenses to keep you in your home for
months or even up to a year while litigation is pending.
Depending on your circumstances, one of the following
defenses and counterclaims to mortgage foreclosure could
apply:
·
Lender failed to make
required disclosures prior to closing on the loan;
·
Lender violated Federal or
Florida Law;
·
Plaintiff lost the Promissory
Note or Mortgage;
·
Plaintiff does not own the
Promissory Note or Mortgage;
·
Lender engaged in predatory
lending practices;
·
Lender fraud;
·
Breach of contract.
IF YOU ARE FACING FORECLOSURE
Few events are as devastating as the loss of
the family home to foreclosure. If you are faced
with a foreclosure action we strongly recommend that you
consult an experienced consumer protection attorney.
One of the most effective methods of protecting
an owner-occupied home from foreclosure is usually a
Chapter 13 bankruptcy. Chapter 13 allows debtors to
catch up on their homes over a period ranging between
three to five years.
Many debtors have defenses to foreclosure that
allow them to delay foreclosure and gain negotiating
power with their lenders both within and outside
bankruptcy (see above). Often, the lenders
correct these problems and beginning the foreclosure
anew. Unfortunately, the arrearages and size of
the eventual judgment against the borrower continues to
grow as the borrower fails to make monthly payments – or
if the lender refused to accept payments because of the
foreclosure Some of the legal defenses described
above postpone foreclosure or reduce the amount owed
after foreclosure.
Fighting the foreclosure is often the best
strategy for homeowners needing additional time to
arrange a workout, refinancing, or a private sale.
Because after a foreclosure sale, the sale is final and
the former homeowner loses all rights to the home.
In Florida, lenders must file a foreclosure
action in court. Homeowners typically have twenty
(20) days to answer the complaint. It is extremely
important that homeowners comply with this deadline if
they intend to defend against the foreclosure. If
the homeowner fails to file an Answer to the Foreclosure
Complaint before the deadline on the Summons, the lender
will move for a default judgment from the clerk's
office.
Often times, lenders fail to comply with
procedural requirements including lack of joinder of
necessary parties or insufficiency of service of
process. In other instances, lenders' complaints
are pleaded improperly because they lack the orignal
promissory note and/or mortgage or by misrepresenting
the principal balance. Homeowner can also raise
defenses such as fraud, usury, tender of payments due,
invalidity of the mortgage, and the Truth-In-Lending Act
violations.
A borrower's failure to pay any payment on the
date it is due constitutes a default which entitles the
lender to accelerate -- demand -- the entire balance of
the mortgage. Lenders rarely forget to accelerate
prior to instituting foreclosure actions, but if the
lender did fail to accelerate, the borrower can cure
the mortgage by paying the reinstatement amount.
Attorneys who represent mortgage lenders often
handle a very high volume of cases. As a
result, these firms often make mistakes which can create
the basis for defenses to the foreclosure or inability
to immediately prove the lender's case.
Sometimes, lenders fail to introduce the
original promissory note in the foreclosure proceeding
or properly perfect their security interest before
initiating the foreclosure. For many lenders, the note
is not "lost" and a fraud is being perpetuated on the
courts, the borrowers, and investors.
Some lenders attempt to extort additional
profits by systematically demanding late fees
which are not due or which arise from the lender's
policy of deliberately delaying the processing of
payments until after they are due.
Among the most outrageous of these practices
are lenders or service agents that impose late fees
prior to the date the payment is due. Such illegal
demands for late payments may spiral into a default,
acceleration and foreclosure.
Many borrowers have conventional mortgages
providing little protection from valid acceleration.
Some of these borrowers may have defenses to the
foreclosure; most do not. But, borrowers
with mortgages that are insured by federal agencies
often have valuable rights allowing them the opportunity
to enter into loan workouts which sometimes provide
borrowers sufficient time to bring their payments
current and avoiding a bankruptcy situation
You should know that defendants in a
foreclosure suit have many rights and various options,
which we can explore.
NEGOTIATE PAYMENT
ARRANGEMENT: My office may be able to
negotiate a payment arrangement with a bank or mortgage
company to obtain a forbearance or modification of your
loan.
LITIGATE: You
have the right to try to litigate the foreclosure.
A foreclosure defense attorney can review the facts of
your case and make a determination if the lender has
made a legal mistake or violated certain Federal laws.
WORK OUT PROGRAM: You
may decide that a Chapter 13 Bankruptcy is in your best
interest. The Chapter 13 Bankruptcy, which you may
qualify for under certain circumstances, can offer a
Court-ordered workout program. Under the Chapter
13 Bankruptcy you often can pay the back payments in
installments. I must warn you that a Chapter 13
Bankruptcy will affect your credit but might be the
solution to save your home.
CHOOSE TO SELL: My
office may be able to extend the time available before a
foreclosure so you can protect your equity if you choose
to sell your home.
Don ’t delay! Once
you are served with papers, you have twenty (20) days to
prepare a legal response. The longer you wait in
trying to find a solution could give the lender the
right to sell your home. Call today for a
free consultation. We
will gladly explain the process in greater detail.
Broward County - Miami-Dade County - Palm Beach County