Session 3 - Foreclosure Series

Welcome to another week of this blog series designed to help individuals and families understand and plan for the foreclosure process.  This week's topic - Have a Plan!

We all know that having a plan makes sense but many in the throws of a potential foreclosure tend to lose all sense of control - this is the deer in the headlights scenario that I mentioned in a previous session.  The legal reality is that you are not subject to the whim of your lender and you can take control of this process in order navigate out of it in the most successful way possible.  So here are some initial suggestions:

1.  Communicate with your lender.  First, find out who your lender is - this can be a real challenge.  Look for clues in the documents provided to you.  Legal papers will include the lender's attorney.  Papers from the lender can serve as clues but may only be coming from the loan servicer.  Ask who your lender is - you can respond to any phone calls with a letter indicating to whom you've spoken.  You will fare better by opening the lines of communication rather than adopting a code of silence.  I do qualify this advice by saying that it is not generally beneficial to admit liability for any debt so you should focus your communication to your objective which is most likely to obtain a loan workout, short sale approval or a deed in lieu (three topics to be discussed in future sessions) and refrain from elaborating too much about the hardships in your life (it may be advisable to consult with your attorney concerning any responses to your lender).  Start and maintain a log of contacts.  Find out who is responsible for your loan and who has the authority to negotiate.  Find out who the lender's CEO is, as well as the branch manager of the branch (if applicable), the loan officer who helped you (if they are still around), and record any other person you know in the lender's office. 

2.  Gather your documents.  Find and categorize all of the documents that relate to your property and your loan.  Typically, such documents would include:  copies of your promissory note/s, copies of mortgage/s, copies of documents or letters in escrow, property profile, copies of all letters sent by or received you and/or sent or received by lender, and copies of all foreclosure documents. 

3.  Learn the clock.  Research (or ask your attorney) what the timelines are for the foreclosure process.  In Florida the process will take a estimated minimum of 20 - 30 days from your receipt of service of the foreclosure papers from the lender's attorney (this is in the event you do not respond to the documents).

4.  Decide whether to attempt to keep your home.  This is a topic unto itself and will be discussed in future sessions.

I hope this is helpful.  Until next time . . .

Foreclosure Tips - Second Session

Last week I touched on the basics of the foreclosure process.  This week I want to try to impart some perspective and common sense. 

DON'T PANIC! 

Often times people that are served with foreclosure papers are like a "deer in the headlights".  If you misunderstand the process, you may feel that your property has already been foreclosed upon even though you were just served with legal documents.  Understand that foreclosure is a lengthy process and not a single event.  The process generally takes a minimum of three months and can take a year or more.  So, do not think all is lost and give up without a fight.  You need to be proactive and be willing to learn about the foreclosure procedures and become committed to dealing with your lender - this approach will empower you and will heighten the chance for a more positive outcome for you and your family. Whether you've hired an attorney to help you or not, you need to get comfortable with the idea of communicating with your lender.  You DO NOT have to sound like a lawyer - most of the people you will be dealing with are not lawyers but are simply employees hired to deal with the present crises at hand.    There are a number of strategies available that I will discuss in the upcoming sessions.  For now, just remember not to panic and begin to think about creating a plan for dealing with the foreclosure process.

Tune in to the next session aimed at helping you develop a plan to deal with the foreclosure process.


Until next time.

Tips for Those Facing Foreclosure - A New Series

Clients and Friends,

I speak to many people nowadays who are facing the stress that comes with foreclosure and other financial challenges so I decided to start a series aimed at helping you, whether you are just curious or in the throws of the legal process, to understand this process and deal with it more effectively.  So here goes - the kickoff.

Session 1:

What is foreclosure?

Simply put, foreclosure is a legal remedy (reserved in the mortgage document) which a lender may pursue in the event a borrower does not pay the mortgage payment in a timely fashion.  In order to exercise this legal remedy, a  lender must jump through a number of hoops (non-legalese) in order to obtain the property that is subject to the unpaid debt.  Clear enough?  (remember you can post questions).  The hoops that a lender must jump through will vary based upon the state and local laws of the jurisdiction where the property is located.  Thus, the advice of a local real estate attorney may come in handy.  Here in the great state of Florida, Lee County, the lender must pursue foreclosure through the courts after providing the homeowner with a notice of default and this notice must comply with certain requirements pursuant to the Fair Debt Collection Practices Act.  Typically, the lender files a lis pendens in the Courts and serves upon the borrower a foreclosure summons and complaint which must be answered within a specific time or the answer is waived.  Thereafter, the lender will attempt to obtain a judgment of foreclosure, either through default proceedings (meaning the borrower did not file an answer) or by summary judgment proceedings (another legal proceedings) or potentially by trial (which in my experience doesn't happen often).  The process can take anywhere from several months to a year after being served the initial complaint and the courts as of late (at least here in Lee County) have .  My point in describing this process is that if a borrower is attentive to the necessary process, there is time to take a careful look at the options and alternatives which will be discussed in session to follow next week - so tune in next time.  Have a great week.

I was visiting our local library on Saturday and was met with a not entirely pleasant experience.  Upon arrival at 5:50 p.m., my family and I quickly discovered that the library was closing at 6:00 p.m.  Upon entry into the facility, it was clear that the workers were scurrying to vacate the premises.  Still, my task oriented nature in full tilt, I ventured to the information desk and asked for assistance.  The staff membered eyeballed me impatiently and chirped "the library is closing" to which I responded that it was 5:55.  I proceeded to ask her to look up a book for me and was informed that the computer had been closed out for the day.  Prior to exiting, I noted a sign perched on the desk that said that opening hours are soon to suffer a further cut back to 5:00 p.m. and when I asked the staff member about it, she informed me that it is due to "serious budget issues".    As I exited the drab facility, the thought entered my mind that this encounter vividly displayed the perils of a government operated organization.  Unmotivated workers, drab surroundings and limited services which are totally dependent, not upon happy customers, but rather the whim of whatever bureaucratic entity presides over the purse. 

Our next stop was a highly recognized corporate bookstore chain and upon entry, I was immediately struck with the light and bright dynamic appearance of the store, the staff members who appeared content to work the evening shift and the vast selection of books.  In interesting contrast between the free government option and the "evil" corporate enterprise whose sole objective of course to make obscene profits. 

Note, this little essay contains themes that may be applied to current public policy debates at your choosing.

Until next issue.