Posts Tagged ‘Florida foreclosure defense attorney’

Wells Fargo admits more mistakes in foreclosure affidavits

As if we needed more proof that the banks’ foreclosure procedures are fundamentally flawed, Wells Fargo just announced it is re-doing affidavits in 55,000 foreclosure cases, as the original affidavits, executed by robo-signers, were flawed.  Lest you think 55,000 improper foreclosure filings is not a big deal, bear in mind – that’s just what Wells Fargo is admitting, based on its own, internal investigation.  If Wells Fargo is admitting to 55,000, you can bet the problem is far more widespread.

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Rush to Judgment – Why?

I’m seeing an increasing number of reports that banks are cancelling foreclosure sales, and, candidly, I’m as perturbed about it as the judges, but for different reasons. 

Judges are upset because they want to keep “pushing through” foreclosure cases so as to reduce their caseloads.  I’m perturbed because these cancellations show that the entire foreclosure process is senseless. 

When a foreclosure case gets to the stage that the bank is cancelling a foreclosure sale, that means the bank has convinced a judge to grant a Final Judgment of Foreclosure, and caused the homeowner to vacate possession (presumably), but won’t take title to the property.  I suppose I could sort of understand, maybe, a little bit, sort of, if the property was going on the market.  But if it’s just going to sit, abandoned, then what’s the point?   

Judges, why rush to enter judgments, and foreclose on Florida homeowners, when banks are leaving the houses vacant (and aren’t even taking title)? 

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Defending a Foreclosure Case – Re-Visiting the Basics

With foreclosure-related stories dominating national headlines on a daily basis, many lawyers, judges, and reporters have gotten knee-deep, if not neck-deep, in the foreclosure crisis.  Sometimes, we’re so immersed in the battle, so deep in the forest, it’s easy to forget that many Floridians are unaware of the basics when it comes to foreclosure defense.  Let’s take a step back, dispel some myths, and re-visit the basics:

1.  As a Florida homeowner, you don’t need to leave your home unless and until the bank *wins* a foreclosure lawsuit.  As such, even if you’re hopelessly behind on your mortgage, you don’t have to leave your home.  Even if the bank writes you a default letter and sends it by certified mail, files suit against you, and threatens you on the phone, you don’t have to leave your home.  You don’t need to leave your home unless and until the bank wins a foreclosure lawsuit against you

To put it differently, there’s a reason I chose the name of this website –   

Repeat after me:  “I have the right to ‘stay in my home’ unless and until the bank wins a foreclosure lawsuit against me.”

2.  As a Florida homeowner, you are entitled to have a foreclosure defense attorney represent you until the conclusion of your foreclosure lawsuit.  In my view, my job as a foreclosure defense attorney is quite simple – to do whatever I can, within the law and consistent with my ethical obligations as an attorney, to try to prevent banks from winning foreclosure lawsuits against my clients.  In any given case, my hope is that I can do a good enough job that the bank will offer my client a reasonable settlement offer and/or loan modifications that it otherwise would not offer.  I’ve said this when I started practicing foreclosure defense and I still believe it – if you give up, you’re going to get foreclosed, but if you fight your foreclosure case, you at least give yourself a chance to avoid foreclosure

3.  Many non-lawyers think it’s easy for a bank to win a foreclosure lawsuit.  That’s not necessarily so.  When foreclosure defense attorneys such as myself force lawyers to prove their entitlement to foreclose in court, banks sometimes struggle to meet their burden of proof.  Every case is different, and there’s no way to know for sure how any particular case will play out in court.  That said, it’s possible the bank’s lawsuit will get dismissed.  It’s possible, once you retain a competent and reputable foreclosure defense attorney, that the bank will be hesitant to go to court altogether.  It’s possible the court will deny the bank’s motion for summary judgment and force the bank to prove its entitlement to foreclosure at trial (which would extend the duration of the foreclosure lawsuit and, hence, your time in your home).  The court process, candidly, can be a bit uncertain.  In my view, though, uncertainty is better than giving up and accepting foreclosure on your home. 

As we’ve seen with the huge, national stories in recent weeks, nobody knows for sure what the future will bring.  If you give up, foreclosure is all but set in stone.  But if you defend your foreclosure lawsuit, you just may be able to stay in your home, perhaps for a long time, or even avoid foreclosure altogether.

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Real stories of foreclosure victims

Just as I was finishing my last blog about loan modifications, I received a comment on this blog from a homeowner.  The homeowner’s story moved me, so much so that I felt compelled to post it (with her permission), below.  As you read it, ask yourself “Does this sound like a deadbeat?  Or does this sound like an honest, honorable, hard-working American who is trying to do right for her family and meet her financial obligations?” 

What particularly irks me about this situation is that she was induced to default by a scam operation out of California that promised a loan modification but never delivered.   

Dear Sir, I am writing to you as my last hope to save my home. My husband lost his job here in Tampa Fl. and had to move to Houston in order to keep his job at a lower rate. On March 8, 2010, we paid $2,500, up front, to a California company called National Relief Group to get a loan modification.  They told us it would take 120 days to complete, not to contact our lender, and to stop paying our mortgage in order to get our home modified. Its been now 8 months and still no answer and we are now $14,000.00 behind including late fees and penalties. Since then my husband was cheating on me and left me right after life support and took off. I filed for divorce and got granted the house. However I was to refinance the house in my name and the kids. Since my divorce, my credit was ruined being so lengthy almost 18 months and costly.  As the months went by I got a letter from the Attorneys for Bank of America.  They filed a suit for foreclosure, I panic because that was not our intention. I want to keep my home – I just needed assistance to lower the modification in order to keep paying the house. I called the company that was supposed to modify the loan and for months they kept saying it was in negotiation process, and we kept getting deeper in the hole with no promises it would go through. So I called Bank of America. I was told that if I wanted to keep my house, I would have to come up with $14,000. I told them to please work with me by doing a repayment plan for the back paid fees and penalties, or to put the back pay towards the end of the loan and I would continue to pay the mortgage, as I do not want to lose my house. The lady I spoke to from BOA was rude, obnoxious and uncaring to my plea. She said to ask my family, friends, etc. to help bring my mortgage up to date in order to keep it from foreclosure. She also informed me that I would have to come up with $10,000 and they would do a six month plan which would take me from $1234 a month to $2700 a month. I told her I could not afford that payment and she told me that was the only way I could keep my house from foreclosure and she also said I would have to come up with the money soon because they move fast on foreclosures, within 30 to 60 days. I cried to her, I pleaded to her that this was not my fault, why I was in this position and it would be a win-win situation to keep the house out of foreclosure if I’m willing to pay my mortgage every month but I could not come up with the back payments thru no fault of my own, all we were trying to do was to get help by modifying the loan to make it affordable to us since my now ex had lost his job in Tampa.

Needless to say that I sat there in shock and confused as to how a person wants to keep their home and can find noone to help them. I recently got another letter from the court advising that the attorneys for BOA are also not only doing the foreclosure but also seeking attorney’s fees as well. This is insane. I am a disabled woman on a fixed income now receiving alimony, my sons have moved back into my home and between the 3 of us we can pay the mortgage. However, I am so disgusted that the banks will not work with me, I can’t refinance, I can’t seem to get any help from anyone in keeping my home. Its all I have left. I am turning to you for help, guidance and direction as to what I can do so I don’t lose my home. I am able to make my monthly mortgage payments, however I cannot cough up, nor do I have family left and/or friends who can help me with this kind of back pay.  Something has to be done as I am not one to walk away from my responsibilities without giving my all. I am not a loser or a low life as people are calling us that now, just a disabled woman trying to keep a roof over her head.

Anything you can do to help us would be greatly appreciated as I feel you are my last hope. If you have any questions, please feel free to contact me at 727-XXX-XXXX.

Sadly, this story is not unusual.  In fact, I hear stories like this every single day.  Contrary to what many Americans think, most homeowners aren’t “deadbeats.”  Most of my clients aren’t “taking advantage of the system.”  These homeowners are good people who are trying to do the right thing.  Can the banks say the same?

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Loan Modifications – How Banks Dupe Homeowners

I’ve repeatedly expressed my frustrations with the loan modification process, or lack thereof, on this blog.  Honest, well-intentioned homeowners cannot get a bank representative to communicate with them.  Many such homeowners were actively induced to default, purportedly to become eligible for a modification that, in my experience, never arrives.  Even in those rare instances where a loan modification is offered, it’s typically not a meaningful modification – the homeowner is essentially making the same monthly payment that he/she was paying all along.  What does that accomplish?  What’s the point? 

Unfortunately, it’s even worse than that.  As this article illustrates, banks often want homeowners to enter a modification just so a subsequent foreclosure will be easier for them!  I’ve seen this often enough that I feel comfortable opining:

Banks aren’t offering modifications to help homeowners – they’re offering modifications to help themselves!

Lest you disagree, consider the loan modification agreement that just came across my desk.  Like most modifications I’ve seen, three aspects of this agreement are just brutal for homeowners:

1)  All foreclosure defenses are waived.  Under most loan modification agreements, if a homeowner signs, then defaults on the modification agreement, the homeowner agrees that all defenses to foreclosure are waived.  Essentially, if the homeowner defaults on the modification agreement, the bank can dribble up to the basket and slam-dunk a foreclosure without opposition. 

“But the bank doesn’t own and hold the Note,” you argue.  Maybe so, but since the homeowner warrants otherwise in the modification agreement, the homeowner is barred from challenging the bank’s standing after defaulting on the modification agreement (or that’s what the bank will argue, anyway). 

What does this mean?  Essentially, the homeowner takes what may be a very defensible foreclosure case – one where the bank may be unable to prove it owns and holds the Note and Mortgage – and turns it into an easy case for the bank by signing a modification agreement.  In my view, the banks are offering modifications to make it easier for themselves to foreclose!  It’s a one-sided agreement – for the banks! 


With this in mind, if the modification agreement doesn’t entail a significant reduction in payments, what’s the point?  In my view, modification agreements generally aren’t a good idea (the way they’re currently set up) unless the homeowner is absolutely certain that he/she can make the requisite payments indefinitely into the future.  After all, once you default on a modification agreement, chances are it’s “game over.” 

2)  The foreclosure lawsuit remains pending.  In most lawsuits, when the parties enter a settlement agreement, the lawsuit is dismissed.  Sometimes, the suit is dismissed with a court order that reserves jurisdiction to enforce the parties’ settlement agreement, but this is standard fare – lawsuits are dismissed when the parties settle.  Unfortunately, that’s not how it works with loan modification agreements in foreclosure cases.  To illustrate, the modification agreement in my hands says “The Lender agrees to suspend all foreclosure activities so long as I comply with the terms of the Loan Documents.”  Hence, if the homeowner defaults – or if the Bank asserts the homeowner defaults – all the Bank has to do is resume prosecution of the existing foreclosure lawsuit, which remains pending.  It doesn’t matter if the default occurred six months after the modification or two years – all the bank has to do is resume the existing foreclosure case.  And since the homeowner has waived all defenses, obtaining a foreclosure judgment truly is the equivalent of Shaq dunking the ball on an 8-foot basket without any defense. 

(Judges, I respectfully submit you should do something about this.  How many pending cases are on your dockets where nothing has happened because the parties agreed to a loan modification but the bank refuses to dismiss?  I’d suggest an Administrative Order that requires dismissals of foreclosure lawsuits where the parties enter a Loan Modification Agreement.  There is no reason for cases to remain pending for months or even years when the parties have amicably resolved their dispute.) 

3.  The bank makes no representations whatsoever.  You know what scares the heck out of me with these modification agreements, more than anything else?  The bank that is receiving the money does not make any warranties or representations whatsoever – not even a representation that it is the rightful owner and holder of the Note and Mortgage!  Lest you think that’s “no big deal,” consider this.

We all know that most Notes and Mortgages have been transferred or assigned from one bank to another, many times over.  Often the banks don’t know who owns/holds the Note and Mortgage, much less prove it.  If the Bank you’re entering a loan modification with does not represent, in writing, that it owns and holds your Note and Mortgage, then what’s to stop another bank from emerging, months down the road, and suing you for foreclosure on that same Note and Mortgage?  Unfortunately, absolutely nothing.  That’s why, if it were my client, I’d require the bank to sign the loan modification with a written representation that it owns and holds the Note and Mortgage and is the party entitled to collect mortgage payments.  I’d also demand to see the original Note.  Without these precautions, my clients may be handing out money to an absolute stranger – one with no right to collect – and with what I know, that’s not a risk I’d feel comfortable recommending. 

But even that’s not good enough.  In addition to this representation, I’d want the bank to indemnify my clients from any losses they incur as a result of another bank making a successful claim on that Note and Mortgage.  In other words, if another bank sues my client for foreclosure, after the modification agreement, the bank that modified with us should bear the losses, not my clients.  To ensure the bank would be able to foot this bill, I’d also want some financial disclosures, especially if the bank was one I’m not familiar with. 

In sum, if you’re a homeowner facing foreclosure and the bank is offering you a loan modification, I’d be very careful about what you’re getting.  Read the fine print closely.  If your payments aren’t going down significantly, you’re waiving defenses, the foreclosure lawsuit remains pending, and the bank isn’t making any written representations, chances are the modification agreement is designed to help the bank, not the homeowner. 

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Bank-induced foreclosure

In the past few years, I’ve spoken to hundreds if not thousands of homeowners who were not behind in their mortgage payments but wanted a modification.  When these homeowners inquired with their banks, you know what the banks told them: 

“Stop paying.  Only then will you be eligible for a loan modification.”

Guess what invariably happened next?  The homeowners stopped paying, as instructed, but instead of giving them a loan modification, the banks gave these homeowners a foreclosure lawsuit.  

As I see it, banks who did this should not be permitted to foreclose.  In my view, this fact pattern gives rise to a legal defense called unclean hands.  My argument, essentially, is this – the bank cannot come into a court of equity and seek foreclosure when the bank induced that homeowner to go into default. 

Apparently, I’m not the only one who feels this way.  The National Mortgage Complaint Center is seeking homeowners who fit this description.  If this is what happened to you, call them.  And call me, too.  888-450-1549.  I strongly believe you should not be foreclosed if you were induced to go into default by your bank. 

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More affidavits from Stern employees

David Stern’s lawyer tried to explain away the eye-opening testimony of Tammie Lou Kapusta as that of a former, disgruntled employee.  I wonder what he’d say now that two more individuals have testified similarly.  If you haven’t seen the transcripts yet, check them out.  Be forewarned – you’re going to read uncomfortable facts proving assignment fraud, notary fraud, forged signatures, ex parte Orders, prosecuting foreclosures knowing it was the wrong plaintiff, lying to Fannie and Freddie about the status of existing cases, etc., etc. 

Kelly Scott – Stern Employee – Depo Transcript 

Mary Cordova – G&Z Employee – Depo Transcript

Tammie Lou Kapusta – Stern Employee – Depo Transcript

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Problems with foreclosure sales – the impact is pervasive

The Associated Press just wrote a terrific story that highlights the extent of the foreclosure problems we’re facing, but from a  little different perspective.   

So You Bought a Foreclosed Home – Now What?

If you’re facing foreclosure, you may think this issue doesn’t pertain to you, as you’re in no position to go out and buy a foreclosed property.  I totally disagree.  This issue impacts all of us.  As the article reflects, and as I’ve been saying for months:

purchasers of properties at a foreclosure sale have legitimate reasons to be concerned about the legitimacy of the title they’re obtaining. 

Everyone is realizing this, and it’s undoubtedly causing would-be purchasers not to go to courthouse auctions and buy.  Well, guess what?  If people aren’t buying properties at a foreclosure sale, what’s the point of the sale?  Essentially, there is none – and there’s the rub.  A sale is supposed to be more than just a rubber-stamp on a title to a bank.  A sale is supposed to be a way to gauge the fair market value of a property, so as to: (1) ensure the homeowner collects the surplus (the difference between the sale price and the amount of the final judgment; or (2) ensure the extent of the homeowner’s deficiency (the difference between the amount of the final judgment and the sale price) is minimized. 

The more I think about it, the more I’m convinced that all of these sales that are being conducted where there are title problems, the homeowners have legitimate grounds to object to the sale.  After all, their chances of having anyone bid fair market value for a home (and getting a surplus or minimizing their exposure for a deficiency judgment) are reduced when everyone questions the legitimacy of title acquired by a foreclosure sale.

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Real Change Requires Action from the Judiciary

As a foreclosure defense attorney for hundreds of homeowners throughout Florida, I’m constantly being asked:

“What do recent reports of a ‘foreclosure moratorium’ mean for my case?”

This is a perfectly legitimate question.  After all, with the flood of media attention on foreclosure fraud in recent days, and the ever-increasing number of banks halting their foreclosure proceedings, you’d think there would be a drastic impact on foreclosure cases.  Unfortunately, that’s simply not the case.  Generally speaking, it’s “business as usual” in Florida courtrooms. 

It seems hard to believe, I know.  Numerous high-ranking politicians, Congressman, and Attorney Generals (not to mention many of the best reporters in the country) have voiced their displeasure at the foreclosure fraud that is permeating our courtrooms.  Mainstream America is getting more and more angry at the manner in which banks have fraudulently “pushed through” foreclosure cases.  So what’s the problem? 

Amidst it all, the judiciary remains silent.

I’ve seen no changes in procedures, no announcements about taking a closer look at files, no elimination of “rocket dockets” – essentially, it’s business as usual for judges in Florida courtrooms.  Respectfully, I find this bitterly disappointing.  Some of the highest-ranking officials in the country are crying for change, banks have admitted pervasive fraud throughout our courts, yet our judges remain silent.  With all of the outcry from Congress, AGs, and the media:

The silence from the judiciary is deafening.


Here’s the sad reality, folks.  The media, Congressman, AGs, foreclosure defense attorneys – we can all agree that widespread change is necessary.  But until judges start to act differently in our courtrooms, nothing will change. 

You may think the banks have changed, as evidenced by their self-imposed moratoriums.  I couldn’t disagree more.  All the banks are doing is giving lip service to Congressman and title insurance companies.  Soon, they’ll all be saying “See?  We changed our procedures.  Everything is fine now.”   

Eliminating the foreclosure fraud that has become commonplace in our courts requires our judges to acknowledge the fraud and take appropriate action.  At this point, that hasn’t happened (certainly not on a widspread level).  That makes it all the more important that homeowners facing foreclosure retain a competent foreclosure defense attorney to defend their foreclosure case.  After all, from what I’ve seen so far, unless a lawyer is pointing out the flaws in the bank’s paperwork, nobody else involved in the case seems to care. 

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More proof of errors in the foreclosure process

Yesterday, I had a hearing before a local judge who, prior to his time on the bench, practiced real estate law.  The hearing parlayed into a discussion about title problems, which the judge acknowledged he started thinking about because of the recent articles in the media about it.  (Consider that all the more reason to keep getting these issues into the media – they prompt thought-provoking questions).  Anyway, during the conversation, the judge made a compelling point:

In the years that he’s been adjudicating foreclosure cases – tens of thousands of foreclosure cases – he can’t ever recall seeing a case where the plaintiff’s firm moved for leave to amend to add an additional defendant after the case was filed.  As the judge noted, there will be no need for this in every case, but in a certain percentage of cases, something happens, after the foreclosure lawsuit is filed, that prompts the need for additional defendants.  Maybe the homeowner got his A/C repaired and could not pay the bill, prompting a mechanic’s lien.  Maybe the homeowner couldn’t pay the homeowner’s association fees, prompting an association lien.  Mechanics’ liens, association liens, code enforcement liens – these things happen, even after a suit is filed (in the judge’s estimation from his time as a lawyer, about 10% of the time), and if the bank wants to foreclose, and get clear title, these parties must be added to the case.  After all,

 even if the bank wins a foreclosure judgment, if the company that has the mechanic’s lien, condo association lien, or the like, is not joined as a defendant and foreclosed, then the purchaser at the foreclosure sale does not have clear title – the purchaser would own the property “subject to” that lien.

As a result, in a significant percentage of the cases being “pushed through” our courts, a second foreclosure lawsuit, or a suit to quiet title, will be necessary to remove the lien. 

In sum, if the foreclosure mills were prosecuting these cases correctly, then some percentage of the time, we’d be seeing requests to amend their pleadings to include these additional parties.  It won’t happen every case, but it should happen every so often.  But guess what?  We’re not seeing it.  Ever.  The judge I spoke with said he’s never seen it.  In all of my cases, I’ve never seen it.  If you’re a lawyer handling such issues, please chime in:

Have you ever seen an instance where a foreclosure mill amended its complaint to include an additional defendant because of a lien that arose after the foreclosure complaint was filed?

Based on my practice, and this judge’s observations, I strongly suspect the answer is “no.”  Consider this yet another illustration of the problems we’ll be facing in coming years as a result of the abuses by the banks and their foreclosure mills.

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