Archive for December 18th, 2010

When is a good time for a Foreclosure Sale?

Apparently, the Broward County courts have realized the holiday season is not an appropriate time to conduct foreclosure sales, as they’ve cancelled all foreclosure sales between now and the end of the year via this Order (hat tip, Matt Weidner and Foreclosure Hamlet). 

For me, this begs two questions.

1.  I’m glad we can agree that foreclosure sales should not be happening over Christmas, but what about Writs of Possession?  A foreclosure sale is horrible, obviously, but it’s the Writ of Possession that forces a homeowner to be removed from his/her home.  Why should those proceed over the holidays?

2.  I’m glad we can all agree that foreclosure sales should not happen over Christmas.  But doesn’t that beg the question – when, exactly, is a good time for foreclosure sales?  Is it really better to foreclose on Florida homeowners in January as opposed to December?  January 3 is somehow a better day to foreclose than December 29? 

The fact that our courts can recognize the inhumanity of foreclosing on homeowners over the holidays, but, all too often, won’t acknowledge the inhumanity of it the rest of the year, disappoints me beyond description. 

Judges, the next time you go to sign a Final Judgment of Foreclosure, think about that feeling in your heart/mind/body that causes you to feel the compassion necessary to not schedule a foreclosure sale over the holidays.  Whatever it is that makes you feel that way – bottle it up and remember it all year long.  After all, if you can realize that foreclosure is traumatic enough that it shouldn’t happen over the holidays, you should realize that foreclosure shouldn’t happen any other time of year, either.

Mark Stopa

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When Strategic Default Makes Sense

I just read a heartbreaking story about a Jacksonville homeowner who has given up everything – literally, everything – to pay his monthly mortgage payments.  You think your life is rough?  This man sold all of his furniture, A/C, tables, stove, refrigerator … now, all he has left are his prepaid cemetary lots. 

Let me get right to the point.  This is sad, but there is a lesson to be learned here.  This is, candily, the best illustration I’ve ever seen of what not to do.  For many months, I’ve tried to explain this to clients, prospective clients, and readers of this blog:

It’s generally not a good idea to deplete your savings or retirement monies to pay your mortgage. 

Let me say that again: 

It’s not a good idea to deplete your savings to pay your mortgage. 

I’ve seen this sort of thing happen sooo many times – a homowner has $50,000 in savings, falls on hard times, and starts dipping into savings to make mortgage payments.  Eventually, $50,000 turns into $25,000, then $10,000, and, using the extreme example above, absolutely nothing. 

I firmly believe, once you find yourself falling down that slope, you must catch yourself and reverse course.  In other words, if you’re slowly depleting your savings to pay your mortgage, then stop paying your mortgage!  If you don’t stop, you may find yourself in the same boat as this homeowner – without any money, without any assets, having paid your last dime to the mortgage company, and still facing foreclosure anyway. 

If that doesn’t make sense, let me ask it this way.  Which is better?  To face a foreclosure lawsuit wih $50,000 in savings, or to face that same foreclosure lawsuit with no savings?  Isn’t it better to have the 50K in your pocket? 

There aren’t many guarantees in the practice of law.  One thing I can guarantee, though, is this.  If you deplete your savings to pay your mortgage, the bank isn’t going to return that savings to you.  Know what they’ll do?  They’ll keep that money and sue you for foreclosure anyway.  So which is better – to get sued for foreclosure with $50,000 in savings, or to get sued for foreclosure with no savings? 

For me, the answer is clear.  So please don’t make this mistake.  Don’t wait until it’s too late.  If you can’t afford your monthly mortgage payments, don’t deplete your savings/retirement to pay.  All you’ll do is leave yourself broke and still facing the same problem, i.e. your inability to make the monthly mortgage payments.

Mark Stopa

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