Legal Advice During Challenging Times

Effectively Advocating For You In Foreclosure Defense Cases

If you are in need of a foreclosure defense in New Jersey, you need to contact a law firm with experience in the areas for real estate, bankruptcy and loan modifications. The Law Offices of Franklin S. Montero in Clifton will work with you to find out the best options in your case.

In the past seven years or so, foreclosure in New Jersey has become part of everyday life. Prior to 2008, a person facing a foreclosure on their home had few options other than to catch up with their payments or surrender the premises. However, due to the incredible meltdown of the housing market and the accompanying foreclosures in record numbers, many new options have emerged. The following are some options you might consider if you are facing foreclosure or even if you have been served with a foreclosure complaint.

Short Sale

The borrower obtains approval from the bank to sell the house for less than it is worth. This should not be attempted without the services of an attorney. Only if you are being released from any and all liability at closing, there is no reason to help the bank that is foreclosing on your home to sell it for them.

Do Nothing

Doing nothing is an option and for some people who see no reason to engage in the process of trying to save their home. They have decided to just walk away. Many bought at the height of the boom in 2005 or 2006, and almost immediately, their mortgages were underwater. This is not advisable as you will certainly be plagued by a deficiency judgment in the future, and any attempt to obtain a mortgage in the future will be seriously hampered.

Recent Developments

The most significant recent development has been suggestions that there may be principal reduction for loans underwater for Fannie Mae and Freddie Mac loans. Finally, some U.S. Congress members have listened to the argument that it is not fair to force people out of their homes so investors can buy them and then rent them to other people who have just lost their homes. Why not just let those already in possession of the property refinance at the new current market value?

Strategic Foreclosures

Some people have determined it is better to buy something else and walk away. After the dramatic drop in home values in 2008, deliberately not paying your mortgage even though you are able is known as a “strategic foreclosure.” These people have decided to save the payments they would have made to their existing mortgage so that they could then buy another home at a greatly reduced rate.

Cash For Keys

In cases where borrowers give up the house to the bank, they may sometimes negotiate its surrender in exchange for $5,000 to $10,000 or more. This should be done before the judgment of foreclosure and warrant of removal have been obtained by the bank. In essence, you are making the turnover of your house easier for the bank and in return you are receiving some funds that you may well need to move and obtain a rental.

Deed In Lieu

This term is short for deed in lieu of foreclosure. As in cash for keys, you are making it easier for the bank to obtain title to your property, but there is no cash being paid to you. Instead, you are merely hoping to receive a release from your mortgage obligation in exchange for signing over the deed to the bank. You would naturally be insisting on a release from any further obligation under your mortgage and note.

Chapter 7 Bankruptcy

The automatic stay of a bankruptcy will stop the foreclosure process immediately. Eventually, the bank will file for relief from the stay, but in the interim, you may be able to work out a resolution. If you cannot, at least you will be eliminating any deficiency judgment that might otherwise be obtained by the bank.

Chapter 13 Bankruptcy

The majority of Chapter 13 bankruptcy petitions are filed by people with equity in their homes. They can propose a plan whereby any missed payments will be made up over the course of a 36- to 60-month plan while staying current with their payments.

Foreclosure Mediation

A recent phenomenon, foreclosure mediation is required in many states, including New Jersey and New York. These are court-supervised procedures aimed at resolving disputes over loan defaults and claims by borrowers of improprieties by the lender and their agents. Borrowers are required to request mediation and submit worksheets containing their current financial information. The borrower and bank representative will meet at the courthouse with a mediator who will attempt to have the parties reach an agreement. This is not as successful as it should be, mostly due to the bank’s reluctance to lower interest and/or principal. Nevertheless, it is a process that should be taken advantage of in most cases.

Loan Modification

This is the area with the most change and growth since the mortgage crisis began. Virtually unheard of in the home mortgage context until recently, banks have been forced by the government to engage in some form of loan modification process with HARP and HAMP. Although many banks remain reluctant and recalcitrant in this area, there are success stories. Usually, this involves a reduction in the interest rate, a lowered payment and past due balances tacked onto the end of the loan.

Answer To Complaint

This area of legal practice has grown in response to the revelations of many bad practices by the banks including but not limited to predatory lending, robo-signing and failure to deal in good faith in the loan modification process. The simple act of filing an answer to the complaint will extend the foreclosure process which is what many homeowners are seeking. If you have been served with a foreclosure complaint you should seek the advice of an experienced foreclosure defense firm.

Contact A Qualified Attorney

When seeking legal advice regarding foreclosure defense, The Law Offices of Franklin S. Montero in Clifton, New Jersey, will help you get results. We understand real estate law and have helped many clients. Please contact us through this online form or call 973-869-5556 . Se habla español.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.