1 A Florida Homeowner s Guide to Defending their Foreclosure Presented by: Alliance Legal Group. Please note: This guide contains legal information but not legal advice. Unless we have been hired by you, and we understand your case we cannot give you legal advice. Please hire an attorney to help you or do your own research before using any of the information from this guide. This Guide is given by request only.
2 Facing foreclosure is a seriously daunting scenario, but in today s turbulent economy, it s certainly not uncommon. Thousands of Floridians face foreclosure everyday and probably feel there is nowhere to turn and no one on their side. Certainly, your lender has all the legal resources at hand to get what it wants. Not to be outdone, scammers and fraudsters will promise foreclosure rescue or relief -- but don t fall for it. The only sure fire way to save your home from foreclosure is to arm yourself with knowledge precisely what the lender DOESN T want you to have! We hope you find the following information helpful and informative, but more importantly, a powerful and enabling tool -- just the light at the end of the tunnel you need. Take Action Now! The worst thing you can do is nothing. The second worst thing is waiting too long to respond. Homeowners are given only 20 days to respond to a foreclosure notice once it s been served. Over 95% of homeowners who take no action or procrastinate end up losing their homes. Being proactive is your best defense. Do yourself a huge favor and retain the services a licensed foreclosure attorney. Only a knowledgeable and experienced foreclosure attorney like the attorneys at Alliance Legal Group will know all the nuances of the legal process, what your rights are, and how to work with your lender. People often believe it s too expensive to hire an attorney, but it isn t. It will be well worth your investment and with Alliance, we will work out a payment plan that works with your budget.
3 Defending your foreclosure may help alleviate the time pressure you re feeling now. Homeowners who don t defend themselves in this process can lose their homes in as quickly as 45 days in some cases. But if a concerted and legitimate defense is put forth, the foreclosure process can take many months, even sometimes years. The time required to fight your case may be just the time you need to re-finance, negotiate a settlement or attractive loan modification, or sell your home on your own terms. At the very least, launching a formal defense will alleviate immediate time pressures and the stress of losing your home before every angle is exhausted. Know This: Your Lender Doesn t Want Your Home. Banks are in the business of lending, investing, and making money, not owning homes. Foreclosure is simply the lenders way of forcing you to pay them the money they re owed. Being saddled with inventoried homes is not in their best interest, especially in today s sluggish real estate market. If you convince them that they ll get more money by letting you keep the home than foreclosing on it and assuming that expense, chances are good you can keep your home. Also in your favor is the fact that many cases settle out of court. The lender really doesn t want the hassle and expense of foreclosing on your home, especially in today s weak real estate market. They simply want their money, or at least as much of it as they can get. Repossessing your home does nothing to help bolster their bottom line.
4 There are many ways to settle foreclosure cases. For example, you might consider: Negotiating with your lender to give you time to bring your loan up to date Trying to get a loan from another source to pay the lender Selling your home and moving out on your terms Working out some other creative deal that gets the bank some money while keeping you in your home Handled properly, you might be able to remain in your home while paying what you can afford. You ll need to demonstrate your readiness and willingness to repay the loan. Foreclosure does NOT mean Bankruptcy I am sure you ve seen adds or received letters from bankruptcy attorneys who tell you that filing for bankruptcy can stop your foreclosure. Or they say that it will force your bank to the negotiation table. Yes, Bankruptcy does that, but unless you have lots of additional unsecured debt and the debt collectors are hounding you, bankruptcy is not your first solution. Bankruptcy is the big gun. You only pull out the big guns and file bankruptcy if all of your other options have failed. You can file bankruptcy even just a few days before a foreclosure sale. But if we can help you with your foreclosure without having to file bankruptcy you may find that to be a better solution.
5 Strategic Default. The social stigma of foreclosure is now gone in many parts of the country, especially in Florida, because of the sheer number of homeowners who are facing it. Today, the public is actually beginning to see it as a form of liberation from banks and mortgages that have homeowners owing sometimes double what their homes are actually worth. A strategic default means deliberately failing to pay your mortgage despite having the financial means. You must very carefully consider this option because unless you are absolutely certain that a strategic default is the best move for you, it could become a serious financial scar that will negatively affect your future. Alliance Legal Group will perform a no obligation, Free In-Home Audit of Your Loan and Foreclosure Paperwork. Call us now. Lenders Frequently Make Mistakes. Lenders can easily make mistakes during any part of the complicated mortgage transaction. Mortgage lenders are by law, required to adhere to serious rules and regulations that take many forms. Perhaps someone at the bank failed to get the appropriate signature on an important document, or made incorrect term disclosures. Maybe they ve actually lost some paperwork that proves the loan even exists. These types of missteps happen more often that you might think. Any of these types of mistakes or a slew of others can be your foothold to delay or defend against foreclosure or win monetary awards from your lender. Some violations can even rescind the loan.
6 In foreclosure cases, a homeowner will often be able to take advantage of mistakes that a lender makes. After all, 8 out of 10 audited loans show some type of lender violation. Alliance Legal Group will perform a free in-home audit to look for possible violations. There is no obligation! As I just said, depending on the violation, you might be able to win a monetary award to offset whatever amount you owe to them or have the loan rescinded. A few examples of common lender errors include: Truth in Lending (TIL) Discrepancies: The Truth in Lending Disclosure is designed to provide borrowers with adequate loan term information and to compel lenders accurately disclose of the TURE cost of borrowing money. Even if the loan is sold to a servicing company, in many cases, the new loan holder can still be held liable for any violations of the Act. If incorrect or incomplete TIL Disclosures are given you may have the right to "rescind" - or cancel - the loan, and recover attorney's fees for taking the matter to court. If presented with a rescission demand, many lenders would rather negotiate a settlement. Home Ownership and Equity Protection Act (HOEPA) Mistakes HOEPA is an amendment to The Truth in Lending Act and has special protection for high-interest borrowers. It imposes more stringent requirements on lenders if a loan is above a certain interest rate.
7 Whether HOEPA requirements apply to your loan depends on several factors, including: Whether the loan was for an original or second mortgage (refinance) The size of the loan The loan structure, including fees and "points" paid at origination If your original or refinanced mortgage falls under the HOEPA guidelines, your lender had an obligation to provide specific disclosures before closing. Real Estate Settlement Procedures Act (RESPA) Violations RESPA protects homeowners from abusive practices and undisclosed fees associated with closing the sale of a property. Provisions revolve around information that must be disclosed in documents such as Good Faith Estimates (GFEs), HUD disclosures and escrow statements. Losing the Original Note This is sometimes called the "produce the note" strategy. You have the right to challenge your lender or loan servicing company to prove that they legally own the loan. If the note or mortgage deed of trust cannot be produced, they cannot proceed with the foreclosure. Copies of these documents are not sufficient. The owner must produce the original documents to adequately prove they are entitled to the repayment. Inadequately Documenting a Loan Transfer to a Secondary Market Mortgage loans are usually sold to servicers or secondary markets, sometimes more than once during the term of the loan. The lender must retain complete and accurate records of all sales and transfers of the loans it originates, otherwise it might be difficult to prove ownership and ultimately collect on t he balance. It s not uncommon for
8 lenders to make mistakes when selling loans because every transfer in the chain must be properly and legally documented. If not, they may lose their right to foreclose. Charging Hidden Gotcha Fees or Unfair Interest Rates This used to be rare, but unfortunately, it is becoming more and more common for certain lenders to take advantage of homeowners by packing their loans with hidden or illegal fees, or "gotcha" payment schedules. If you see terms such as "balloon payment" or "negative amortization, you should consult with an attorney to determine if your loan is actually illegal. o The state of Florida enforces many legal requirements on mortgage lenders, including the Florida Fair Lending Act, which seeks to limit unfair interest rates known as usury, and eliminates loan fraud and deceptive practices. A critical analysis of your loan origination as well as closing documents to uncover any violations is an important first step in defending your home against foreclosure. Alliance Legal group offers a free mini audit to start this process. There are Several Foreclosure Options When you are facing possible foreclosure, you may feel the weight of the world bearing down on you, with no way out. You can release that burden immediately by retaining the services of a professional foreclosure defense attorney to help advocate the best option available to you. If a mortgage modification is determined to be a viable alternative to foreclosure, you may have the opportunity to get out of debt, pay off your mortgage, and stay in your home. Based on your particular situation, foreclosure avoidance options may include:
9 Mortgage Modification Mortgage modification can ease the burden of mortgage payments by either: Reducing the total mortgage amount with a flat reduction in the mortgage balance. The lender must agree reduce the balance in order to lower your monthly payments Reducing the interest rate on the note. This enables you to pay less over the life of the loan, although the original balance would remain the same. You ll also see a significant drop in your monthly payments as a result of the lower interest rate. Extending the payment term. This gives you more time to pay, which will lower your monthly mortgage payment. A term extension can make the difference between keeping your home and losing it. Short Sale This is that process by which a home is sold for less than the total amount still owed to the bank, including accrued interest, late fees, and the principal balance. Banks are becoming overwhelmed with the amount of inventory from foreclosures, with few people to buy them. Allowing a short sale helps them collect most of the money they would not have collected. Stipulated Foreclosure with No Deficiency, or Deed in Lieu of Foreclosure A deed in lieu of foreclosure is usually considered as the last resort to stop foreclosure; your lender may allow you to voluntarily "give back" your property to them. You would offer the deed to your property instead of going into foreclosure. This won't save your home, but it is less damaging to your credit and will help you in the long run as an alternative to going through the whole foreclosure process. A deed in lieu of foreclosure is only one step better than foreclosure, but should be considered as a last. If you are unable to afford payments, with or without a reasonable reduction in your loan, then rather than face a foreclosure and eviction, a good
10 foreclosure attorney can typically negotiate a foreclosure with no deficiency or a deed in lieu of foreclosure and simultaneously arrange for an extension of time for you to remain in your home. Filing for Personal Bankruptcy Chapter 7 and Chapter 13 are the most common types of bankruptcy. Many different criteria determine which type is best, including whether you are filing as an individual or business, whether your goal is to eliminate or reorganize debt and whether or not you have the ability to repay your creditors. An Alliance bankruptcy attorney will work closely with you to determine with type best meets your situation. Have your foreclosure paperwork scrutinized by us! You should also have us review your foreclosure paperwork for mistakes, fraud and other issues. Many foreclosure filed in Florida have securitization issues or issues with the assignments of the notes and mortgages. We have also seen many cases of fraud committed by the bank s attorneys. (see excerpt below) Many foreclosures filed in Florida are also filed without the original note attached. Here is excerpt from the New York Times dated September 4, 2010 Doctored or dubious records presented in court as proof of a bank s ownership have become such a problem that Bill McCollum, the Florida attorney general, announced last
11 month that his office was investigating the state s three largest foreclosure law firms representing lenders. Thousands of final judgments of foreclosure against Florida homeowners may have been the result of the allegedly improper actions of these law firms, said Mr. McCollum in an interview. We ve had so many complaints that I am confident there is a great deal of fraud here. These law firms appear to be mills, says Mr. McCollum. They submit false documents, fabricate the documents, or the documents actually don t exist. They wanted to speed the process up because the faster they get the foreclosures done the better. You owe it to yourself to have Alliance Legal Group review your documents! You should know your rights.. Where Do You Start? Act NOW! The worst thing you can do is nothing. Homeowners are given only 20 days to respond to a foreclosure notice once it s been served. Retain the services a licensed foreclosure attorney or a law firm. Only a knowledgeable and experienced foreclosure attorney will know all the nuances of the legal process, what your rights are, and how to work with your lender.
12 People often believe it s too expensive to hire an attorney. Not true with ALLIANCE attorneys. We want to help you save your home and are willing work out a payment plan that works with your budget. Foreclosure is a daunting stressful experience you need a legal team that understands your duress and is ready to help ease your burden. You want someone who will aggressively defend your rights, but treat you with the respect you deserve. We are passionate about our mission and you won t find another foreclosure defense firm more steadfastly dedicated to serving as your advocate every step of the way. Our greatest pride comes with helping homeowners every day. Each of our attorneys is committed to creating a tailored solution that works our clients and their families. We will listen to you and develop a suitable plan of action to fight to prevent your home from falling into foreclosure. Our depth of foreclosure experience and expertise will always work in your favor. Your best chance of saving your home comes with choosing the right firm to represent your best interests. That firm is Alliance Legal Group. At Alliance, we offer a free audit of your home loan and a free 30-minute consultation. We will review your case and discuss how we can help you. ALLIANCE Attorneys will start immediately on your case, including: A loan audit to look for loan violations Scrutinizing the foreclosure documents for inconsistencies, mistakes and fraud Thoroughly examining pertinent mortgage documents such as the Terms and Conditions. Communicating with your lender and its legal team. Negotiating with your mortgage lender or servicer to modify your loan terms, if possible.
13 Aggressively exploring all applicable defenses. Negotiating a Deed in Lieu of Foreclosure, if needed. Initiating bankruptcy filing, if necessary Our comprehensive foreclosure defense support includes investigating and explaining all your options and pursuing the best strategy for you.
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