What you need to know about your Foreclosure Rights
by Lane Houk
May 5, 2009
Did you know that over 98% of all people who are served with a foreclosure suit or notice of default do NOTHING to defend themself in the process? That’s a fact.
If you were sued today by someone for $150,00 would you just ignore the lawsuit? No way! You’d run out, talk to an attorney and defend yourself against the allegations. But this is exactly what most people do when they get sued in foreclosure…NOTHING!
I think this happens because most people just don’t know they have legal rights, foreclosure rights. Yes they owe the money and they know that; and, a legal defense isn’t about denying that the money was borrowed. By now, the “Produce the Note” strategy has become more common knowledge; and, by all measures that’s a great piece of the puzzle but is by no means the entire enchilada in a comprehensive legal defense to foreclosure.
So let me simplify the message… you have Legal Rights in Foreclosure! Claim them! In Florida, if you don’t claim these rights in the first twenty (20) days, you automatically waive them. Ouch! Don’t do that. You also don’t want to waive them by pretending you know what you’re doing and writing your own defense. Pro Se foreclosure defense isn’t what it’s all cracked up to be. What are you going to say to a judge in a Summary Judgment hearing? What answer will you have for the first piece of foreclosure case law opposing counsel throws at you. Hire an expert foreclosure defense attorney. Trust me, it won’t cost you money, it will save you money – if you hire the right one.
Next, hire an expert to complete a forensic loan audit. You’re foreclosure rights are extended when violations of the Truth in Lending Act (TILA), the Real Estate Settlement Procedures Act (RESPA), the Home Ownership & Equity Protection Act (HOEPA) and state law violations can be found and quantified in a well structured Forensic Audit Report. Beware of all the folks popping up on the radar doing this. Most of them are only software driven and thus, aren’t “forensic” in any kind of way. Remember a age-old golden rule… “don’t believe everything you hear” and “cheaper isn’t usually better.” A true forensic auditor takes a couple hundred documents and forensically analyzes them, looks for the idiosyncracies, the story if you will, and pieces the violations together to make a case. One a real, practicing attorney can use as evidence in court.
Your foreclosure rights are there… you just have to know what to do, where to go, who to see and why. Trust me, it will save you money, save your home and mitigate your liability.
If you have further questions, contact me.
New foreclosure defense: Prove I owe you Homeowners demand lenders produce original documents – some can’t
The Associated Press updated 3:59 p.m. ET, Tues., Feb. 17, 2009
ZEPHYRHILLS, Fla. – Kathy Lovelace lost her job and was about to lose her house, too. But then she made a seemingly simple request of the bank: Show me the original mortgage paperwork.
And just like that, the foreclosure proceedings came to a standstill.
Lovelace and other homeowners around the country are managing to stave off foreclosure by employing a strategy that goes to the heart of the whole nationwide mess.
During the real estate frenzy of the past decade, mortgages were sold and resold, bundled into securities and peddled to investors. In many cases, the original note signed by the homeowner was lost, stored away in a distant warehouse or destroyed.
Persuading a judge to compel production of hard-to-find or nonexistent documents can, at the very least, delay foreclosure, buying the homeowner some time and turning up the pressure on the lender to renegotiate the mortgage.
“I’m going to hang on for dear life until they can prove to me it belongs to them,” said Lovelace, a 50-year-old divorced mother who owns a $200,000 home in Zephyrhills, near Tampa. “I’ll try everything I can because it’s all I have left.”
In interviews with The Associated Press, lawyers, homeowners and advocates outlined the produce-the-note strategy. Exactly how many homeowners have employed it is unknown. Nor is it clear how successful it has been; some judges are more sympathetic than others.
More than 2.3 million homeowners faced foreclosure proceedings last year and millions more are in danger of losing their homes. On Wednesday, President Obama will unveil a plan to spend at least $50 billion to help homeowners fend off foreclosure.
Chris Hoyer, a Tampa lawyer whose Consumer Warning Network Web site offers the free court documents Lovelace used to file her request, has played a major role in promoting the produce-the-note strategy.
“We knew early on that the only relief that would ever come to people would be to the people who were in their houses,” Hoyer said. “Nobody was going to fashion any relief for people who have already lost their houses. So your only hope was to hang on any way you could.”
Tom Deutsch, deputy executive director of the American Securitization Forum, a group that represents banks, law firms and investors, dismissed the strategy as merely a stalling tactic, saying homeowners are “making lawyers jump through procedural hoops to delay what’s likely to be inevitable.”
Deutsch said the original note is almost always electronically retained and can eventually be found.
Judges are often willing to accept electronic documentation. And lenders are sometimes allowed to produce other paperwork to establish they are the holder of a loan. Still, assembling such documents to a judge’s satisfaction takes time, which to homeowners is the point.
Lovelace filed her produce-the-note demand last fall after the bank acknowledged that her original mortgage document had been lost or destroyed. Since then, there has been no activity on the foreclosure – no letters from the lender, no court filings.
The law firm handling the foreclosure for the lender refused to comment.
A University of Iowa study last year suggested that companies servicing mortgages are often negligent when it comes to producing the documentation to support foreclosure. In the study of more than 1,700 bankruptcy cases stemming from home foreclosures, the original note was missing more than 40 percent of the time, and other pieces of required documentation also were routinely left out.
The first big success of the produce-the-note movement came in 2007 when a federal judge in Cleveland threw out 14 foreclosures by Deutsche Bank National Trust Co. because the bank failed to produce the original notes.
Michael Silver, a lawyer for two of the families in that case, said at least one eventually lost their home. Still, he considers that a success.
“From the perspective of the person who’s in the home, you may have kept them in the house another 10 or 12 months,” he said. “If I can get a result with economic benefits to a client, then I think I won.”
Democratic Rep. Marcy Kaptur of Ohio endorsed the strategy in a fiery speech on the House floor during debate on the federal bank bailout last month.
“Don’t leave your home,” she said. “Because you know what? When those companies say they have your mortgage, unless you have a lawyer that can put his or her finger on that mortgage, you don’t have that mortgage, and you are going to find they can’t find the paper up there on Wall Street.”
April Charney, head of foreclosure defense for Jacksonville Area Legal Aid in Florida, said the strategy has been so successful for her that she now travels around the country to train other lawyers in how to use it. She said she has gotten cases delayed for years by demanding that lenders produce paperwork they cannot find.
“This is an army of lawyers getting out there to stop foreclosures so we can get to the serious business of creating solutions,” Charney said. “Nothing good is going to happen as long as we continue to bleed homeowners.”
© Lane A. Houk – 2009– All Rights Reserved