Bankruptcy and Foreclosure Attorney Blog

After servicing many Northeast Florida clients in foreclosure defense, one of the many issues I see with foreclosure complaints is the probability that the wrong party is bringing the foreclosure action. Typically, when a borrower purchases or refinances a piece of property, the debt is sold and transferred to either a separate entity or investors. Many times that transfer is not well documented and causes problems when and if there is a default. Many times, the borrower has never even heard of the entity bringing the lawsuit or had no idea that their home loan was affiliated with that entity. A qualified written request (aka "QWR") can help resolve some of those issues. QWRs are basically a loan audit and the borrower is asking for a life of loan history.

The lender must acknowledge receipt of the request and must send the response in a timely manner. Failure to do so could result in federal and state law claims. Many times the QWR response is different than what is actually filed in the case. If a party does not have "standing" to bring an action, then the case should be dismissed. The correct party typically has 5 years to bring a lawsuit to foreclose on the property. The five year date begins to run the day the borrower goes into default. If the entity does not bring the lawsuit in a timely manner (aka within the 5 years from date of default) the party is barred by the statute of limitations. This happens in rare circumstances but quiet titile actions may become more frequent as we move into 2012 and the following years to come. What is a quiet title action? A quiet title action is basically the borrower asking the courts to remove the lien that encumbers the property. Essentially, if there were a balance on the note, the borrower would take title to the property loan free. However, if there is another encumberance on the property such as a Home Equity Line of Credit or a 2nd Mortgage, that debt would not be wiped out (unless the statute of limitations had expired on those claims as well).

With the QWR response, an attorney may be able to use that to his or her advantage in the foreclosure case. Although the case may be dismissed for lack of "standing," it would be dismissed without prejudice. All this really means is the creditor has another chance to file appropriate documents in order to sustain the action. This is where it gets tricky and borrowers should be aware that mortgage fraud could be at play. If a case is ever dismissed with prejudice, that means the party cannot bring that same action against the defendant ever again. It is forever barred. Recovering attorneys fees and costs will probably be available in a case that is dimissed with prejudice. It is almost treated as a sanction.

Continue reading "What is a Qualified Written Request (QWR)? " »

This is a very sensitive subject right now. Unfortunately, most modification programs are voluntary and the banks are only required to "consider" struggling customers for modification programs. Even if you are one of the lucky ones that is able to participate in a trial modification, that is only temporary.

Typically, the payments are lowered for a three month period with the difference rolled to the back of the loan without the length of the loan being extended. Therefore, once the debtor comes out of the modification, the payments are usually higher than the original loan payment! Most struggling homeowners cannot make such a financial turnaround or adjustment within three months!

However, some customers get lucky and are approved for a permanent modification. Even so, you need to read the fine print and make sure you are understandinwhat you are agreeing to. In most situations, "if its too good to be true, it probably is."

Continue reading "Will I be Approved for a Loan Modification?" »

In Florida banks and mortgage companies will soon be requesting more and more pre-foreclosure mediations. While on the face of things, it may appear that Florida banks and mortgage companies are seeking to work with homeowners as to loan revisions, mortgage modifications and other relief. Florida consumer advocates are concerned that homeowners will unknowingly and in advertently waive important legal rights during the mediation process and sign documents that, in turn, make the defense of a subsequent foreclosure action more difficult for the homeowner. While pre-foreclosure mediation can be helpful in some instances, it is important for the homeowner to understand his or her legal rights and have legal representation at such proceedings. Florida Banks and mortgage companies have their own attorney and homeowners should be adequately represented in pre foreclosure mediation matters as well. Homeowners have a right to representation and should protect their rights of homeowership accordingly. For more on this topic see pre-foreclosure mediation.