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NY Unveils Bill of Rights for Borrowers Facing Foreclosure

Posted on December 8, 2016by Admin

The State of New York is taking the next step in its fight against abandoned foreclosures by introducing a consumer bill of rights for borrowers facing foreclosure. The state announced new laws earlier this year designed to reform the foreclosure process and address its issues with abandoned foreclosures, also referred to as zombie homes.

These new laws will help expedite rehabilitation, repair and improvement of these abandoned properties and further assists homeowners facing foreclosure. Currently, New York has one of the longest foreclosure timelines in the nation, averaging 1,070 days to foreclose.

In addition, the new laws impose a pre-foreclosure duty on banks and servicers to maintain zombie homes, create an electronic registry of abandoned properties, and expedite foreclosure for vacant and abandoned properties to get those houses back on the market.

The consumer bill of rights, reminds consumers of the various rights they have before, during, and after the foreclosure process.

The bill of rights tells consumers that they can and should seek the assistance of a lawyer or a housing counselor if they are facing foreclosure.
The bill of rights tells borrowers that they have the right to stay in their home during the foreclosure process, unless or until a court orders them to vacate.
“If you abandon your home, the plaintiff (bank or mortgage servicer) may be able to foreclose on your property through an expedited process in court,” the bill of rights continues.
To prevent this outcome, stay in your home and carefully review and respond to documents you receive from the plaintiff or the court in your foreclosure case.
A failure to respond or appear in court when required to do so could make it easier for the servicer to show that your property is vacant and abandoned, which could put you at risk of an expedited foreclosure.

The bill of rights also walks borrowers through the various steps of the foreclosure process and their rights throughout, including their legal options and their right to seek “loss mitigation” options.

These new reforms help ensure borrowers facing foreclosure know their rights, that banks and service providers are held to their obligations and that neighborhoods are protected from zombie foreclosures as these are known to threaten property values and neighborhood safety.

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Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com

Debt Relief, Foreclosures, Timothy Kingcade Posts

‘Zombie’ foreclosures decline across the country- but not in some states

Posted on September 14, 2016by Admin

As the foreclosure crisis winds down, some consequences of the crash continue to loom in neighborhoods across the country. ‘Zombie foreclosures’- properties that are still in the process of foreclosure but remain vacant- fell in the third quarter, and make up 4.7% of all foreclosures- down 9% from a year ago.

Among the top ten states for zombie foreclosures, there have been some big declines: zombies are down 28% in Florida, 26% in California, and 14% in Illinois compared to a year ago. But they are up 6% in New York and 3% in Massachusetts.

The number of vacant bank-owned properties jumped 67% in the third quarter compared to a year ago, to 46,604, according to Attom Data Solutions.

Coincidentally, the states with the greatest number of properties in foreclosure are the states with the greatest number of zombies. These states are also judicial foreclosure states (states that require foreclosures go through a court process), and include New York, New Jersey, Florida, Illinois, and Indiana.

States that go through the court process provide greater protections to homeowners, but take longer to complete. The lengthy process increases the likelihood that a foreclosure will become a zombie. But the recent turn in the housing market and our nation’s economy has given struggling homeowners more of an incentive to fight to save their homes.

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Foreclosures, Timothy Kingcade Posts

Banks sell off foreclosure remnants, helping eliminate housing ‘zombies’

Posted on September 12, 2016by Admin

Zombie foreclosures remain a big problem in certain parts of the country. Banks are taking action on those vacant, foreclosed homes and selling them at a fast turnover. In fact, vacant homes in the foreclosure process are expected to drop 9 percent in the third quarter from a year ago, but vacant bank-owned properties are expected to jump 67 percent during the period, according to ATTOM Data Solutions.

Currently, there are just over 46,600 vacant bank-owned properties (known as REOs) littering neighborhoods nationally. More low-priced homes would seem to be a bonus for a housing market plagued with a short supply, but that is not the case in this situation. The vast majority of these zombie foreclosures are in the least desirable markets for investors. New York, Philadelphia and Chicago have the highest number of vacant foreclosures, but they are in some of the most impoverished areas. The homes are also in terrible disrepair.

That means the homes that are left, the zombie foreclosures, require thousands of dollars of work to make them either desirable to renters or buyers. Government-backed mortgage entities like Fannie Mae and the FHA have strict lending requirements when it comes to distressed properties.

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Debt Relief, Foreclosures, Timothy Kingcade Posts

Florida Court Upholds City’s Rights to Place Liens on Zombie Foreclosure Homes

Posted on September 2, 2016by Admin

A state appeals court recently ruled that liens placed on foreclosed homes cannot be discharged when the home goes through a judicial sale. The decision comes from the Fourth District Court of Appeal of the State of Florida, which upheld a lower court’s ruling that liens placed on abandoned properties by Florida cities for code violations cannot be terminated once the home is sold through the judicial process.

The decision is meaningful to Florida cities because the state currently has the third highest total of zombie foreclosures, which are homes that have been foreclosed on and abandoned by the homeowner but not yet sold.

Florida has 2,467 zombie foreclosures as of the second quarter of this year, ranking behind New Jersey, which has 4,003 zombie homes, and New York, which has 3,352 zombie homes, according to data from RealtyTrac.

The court’s full decision can be read here.

Related Resources:

http://www.housingwire.com/articles/37891-florida-court-upholds-citys-rights-to-place-liens-on-zombie-homes

Foreclosures, Timothy Kingcade Posts

New Jersey Senator Introduces New Bill to Address Zombie Foreclosure “Crisis”

Posted on July 21, 2016by Admin

Sen. Bob Menendez, D-NJ, recently introduced a bill to the Senate that addresses the nationwide crisis – zombie foreclosures. The bill is called “Preventing Abandoned Foreclosures and Preserving Communities Act of 2016.” This crisis refers to homes that sit vacant, sometimes for years, while in “legal limbo” throughout the process of foreclosure. The zombie foreclosure crisis has negatively impacted economies across the country by lowering property values in neighborhoods. According to Menendez, the vacant homes “scare away new homebuyers and investors,” which eventually impacts surrounding neighborhoods, and so on.

While introducing the new bill, Sen. Menendez stated that New Jersey had the highest foreclosure rate in the country in 2015, with 35,000 foreclosure filings. He went on to say that it also has the highest rate of vacant “zombie foreclosures,” with 4,003, according to RealtyTrac. However, his new bill would address the zombie foreclosure crisis across the country.

According to Menendez, his new bill would:

Require mortgage servicers to tell borrowers at the beginning of the foreclosure process they can remain in the home until state law requires them to leave
Require the servicer to make clear to the borrower that he or she remains responsible for the payment of any taxes, assessments, and other fees during the foreclosure process
Require the mortgage servicer to make prompt notifications to both the borrower and the municipality where the property is located when it walks away from the foreclosure
Prohibit mortgage servicers on loans backed by Fannie Mae and Freddie Mac and insured by the Federal Housing Administration from walking away from an initiated foreclosure unless the servicer releases the lien on the property and provides proper notice to the borrower and municipality
Require the Government Accountability Office and the CFPB to study and report on the prevalence and impact of abandoned foreclosures

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Foreclosures, Timothy Kingcade Posts

Zombie Foreclosures: What Homeowners Need to Know

Posted on June 9, 2016by Admin

If you are facing foreclosure, it’s a good idea to not move out of your home too quickly- you could be haunted by what’s called a “zombie foreclosure.” Some homeowners quickly pack up and leave after receiving a foreclosure notice because they assume the bank will take over the property immediately. However, in some cases, the bank does not always move so fast. While the bank is finishing up the foreclosure process, the home can sit vacant for months while still in the homeowner’s name.

A zombie foreclosure can lead to devastating consequences for the homeowner. Oftentimes, these occur in low-income areas where the lender is not too anxious to assume the responsibility and upkeep of the property, along with paying the taxes. If squatters occupy the property or it falls into severe disrepair, the bank may ultimately wash its hands of the property.

Other times, the property may have been part of the robo-signing scandal and the foreclosure cannot be completed, the sale was never held, the paperwork was lost, or the title was never officially transferred into the new owner’s name. All of these circumstances result in the title remaining in the foreclosed homeowner’s name.

The states with the highest number of zombie properties include Florida, Illinois, New York and New Jersey, according to RealtyTrac. Zombie foreclosures can spell disaster for homeowners. Since the title is never transferred out of the foreclosed homeowner’s name, they are on the hook for certain debts and expenses like property taxes, HOA dues and maintenance fees for upkeep of the property. These debts can go unpaid for years, without the homeowner even knowing they have a legal obligation to pay them, further damaging their credit.

If you leave your property and the title is never transferred out of your name, the following things can happen (among others):

The tax collector can come and collect from you back property taxes;
The HOA may file a lawsuit to recover unpaid dues;
You can incur fines for not complying with housing codes and ordinances;
You can incur bills for yard maintenance, repairs, trash and graffiti removal, etc.

So how can homeowners avoid a zombie foreclosure? Remain in your home for as long as possible during a foreclosure. You will be less likely to become a victim of a zombie foreclosure if you stay through the entire foreclosure process and wait for an official notice to vacate before moving out. Confirm the title has been transferred out of your name. You can do this by going to the county recorder’s office where the property is located to make sure a new deed has been recorded. You can also check your local county recorder’s website. It is important to do this because in some cases the bank is not legally required to inform you that the foreclosure has stopped.

Related Resources:

http://www.nolo.com/legal-encyclopedia/zombie-foreclosures.html

Foreclosures, Timothy Kingcade Posts

High Profile Foreclosure Case moves to Florida Supreme Court

Posted on November 30, 2015by Admin

The Florida Supreme Court is in the final stages of determining when the clock starts ticking on mortgage foreclosure cases. In the case of Bartram v. U.S. Bank, the now defunct law firm of David J. Stern filed a mortgage foreclosure lawsuit against Lewis Bartram of Ponte Vedra Beach back in 2006. Years later, after the law firm shut down, with tens of thousands of foreclosure cases in limbo, U.S. Bank missed a case management conference and its foreclosure case was dismissed.

Thanks to the five-year statute of limitations on mortgage foreclosures, the case was revived and Bartram received another favorable judgment. But U.S. Bank appealed that ruling, and in 2014 Florida’s Fifth District Court ruled in favor of the bank, disregarding Florida’s five-year statute of limitations on mortgage foreclosures.

This was a sad day for struggling homeowners and a victory for the banks in Florida who continue to foreclose on loans that defaulted years ago. Many of those loans are referred to as “zombie mortgages,” or a foreclosure that has been started but not completed.

The issue in this case comes down to mortgage acceleration. Most mortgage contracts carry an acceleration clause, which allows the lender to sue for the entire loan amount immediately, starting a five-year clock on the foreclosure process. But the Fifth District ruled that the court’s dismissal of U.S. Bank’s lawsuit in 2011 negated the loan’s original acceleration date that had been set in 2006, effectively resetting the acceleration date to 2011.

Two other Florida courts have issued similar rulings that uphold the Fifth District decision, but a court in Miami recently ruled against it, leaving it up to Florida’s Supreme Court to decide. We will keep you posted – A ruling on this case is expected in the next couple of months.

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