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Foreclosure Attorneys Suffolk & Nassau Counties, Long Island

Foreclosure Solutions are varied and need to be combined and tailored to every client’s specific circumstances to maximize a client’s ability to save their home.

• The Foreclosure Crisis
• Foreclosure Solution Strategies
• Deciding on Which Foreclosure Solution to Pursue
• Stopping Foreclosure Auction Sales on an Emergency Basis
• How Has Covid-19 Affected Foreclosure Law and Practice?
• The Potential Benefits of Foreclosure Solutions and the Role of our Law Office

A New Potential Foreclosure Crisis –

As you must be aware due to the Coronavirus caused recession of 2020, many homeowners are behind with their mortgages. Lenders had initially been tolerant, with most lenders allowing temporary forbearance of the missed payments. But as time has dragged on and the arrears of homeowners have exacerbated, many lenders have started to demand a cure either over time in the form of a reinstatement (usually over 1 year) or through a modification which requires an application by the borrower and approval by the lender. These new potential foreclosure situations are coming when there is still a foreclosure problem remaining from the previous 2008-2014 recession, especially in our Long Island and New York areas, which was caused by overly aggressive mortgage lending and borrowing. The previous recession had caused a foreclosure crisis whose effects are still present in the form of many older foreclosure matters which have taken a long time to resolve and homeowners still struggling with mortgage problems whose origins where in the last recession. In this market which has not yet healed from the last recession, the new turmoil caused by the Covid recession has caused many homeowners to their dismay find themselves in arrears on their mortgages and/or threatened by foreclosure. Some of these problem mortgage situations are new, having been caused by Covid-19 related furloughs, layoffs and lockdowns; while other mortgage issues have been problematic for a long time but have been made much worse due to this new recession. This new potential crisis, is made worse because it is coming before we have fully recovered from foreclosures caused by the previous recession. Yet despite these hardships, programs, policies, court decisions and laws mostly enacted during the last recession, but some new in reaction to this new Covid caused recession, can potentially give homeowners a better chance to save their homes. Because homeowners are frequently confused as to their options, and because the advice of their mortgage holders can be inaccurate and/or misleading, a homeowner threatened by foreclosure or in foreclosure needs to quickly get reliable information from an attorney who concentrates in this area.

Foreclosure Solution Strategies –

Saving homes from foreclosure often involves combining strategies: Defending AND Negotiating. A homeowner in arrears with their mortgage or in actual foreclosure needs to gain both Time AND Leverage in order to best increase their possibilities of successfully saving their home. The different solutions to foreclosure – modification negotiations, foreclosure litigation defense, and bankruptcy – overlap and often reinforce each other. We represent clients in every type of foreclosure solution.

Deciding on Which Foreclosure Solution to Pursue-

Foreclosure Solutions are varied and depend on many factors; they include litigation (answering the Complaint, defending the foreclosure action, and Emergency Orders to Show Cause), negotiations (mortgage modifications, forbearance agreements and short sales), and bankruptcy (chapters 13, 7 or 11). We can advise and represent our clients in all of the possible solutions to the foreclosure process; these potential solutions are reviewed based on the client’s goals and the stage of the foreclosure proceeding. In order to decide which Foreclosure Solution to pursue, we ask our clients several important questions as follows: i) At what stage is the foreclosure?; ii) What is your main goal as to the house?; and iii) What is your main financial difficulty in terms of the mortgage? We explore and offer to our clients the possibility of all Foreclosure Solutions as follows:

1. A Negotiated Modification Agreement with the Mortgage Holder – A modification negotiation can be attempted when the homeowner first falls into arrears and prior to and throughout the foreclosure proceeding. However, it is usually a strong option prior to the initiation of the foreclosure, and in the early/middle part of the foreclosure process, for a client that hopes to keep their home. By obtaining an advantageous change in their mortgage terms (the rate is lowered, the duration of the loan expanded and the arrears are resolved over the modified loan), homeowners end the danger of foreclosure and are in a better position to keep up with their payments which are often lowered. Because modifications are consensual on the part of lenders, the effort to modify is often accompanied by other legal efforts on the part of the borrowers.
2. A Litigated Defense of the Foreclosure Action – A litigated defense of the foreclosure action, initiated by filing an answer or motion to dismiss, needs to take place 20-30 days after a client had been served with the Summons and Complaint in the foreclosure action. Foreclosure Defense also involves discovery, motion practice and attending settlement conferences. If the foreclosure is nearing the end and/or if a foreclosure sale is scheduled, an Emergency Order to Show Cause in the state supreme court may obtain a “stay” of the foreclosure sale. Foreclosure defense focuses on defects in the foreclosure process and is used to slow down the foreclosure to give time and leverage to the client so as to increase the likelihood of a successful resolution through other negotiated means.
3. A Chapter 13 Bankruptcy Case Designed to Allow a Cure Over Time for the Mortgage Arrears – A Chapter 13 case, unlike a mortgage modification, is non-consensual and therefore allows more certainty in stopping the foreclosure action through the “automatic stay” which goes into effect immediately upon the filing of a bankruptcy case. Under Chapter 13 the client needs to catch up on mortgage arrears under a 5 year plan while going back to making regular mortgage payments. Chapter 13 is usually filed later in the foreclosure process by homeowners who have not been able to or who do not want to wait to get a modification, or who need to stop a foreclosure sale. Assuming that a client can make the monthly payments required under the Chapter 13 plan, this is good structured method of saving a home from foreclosure.
4. A Voluntary Sale of the Property, Pursuant to a Contract of Sale – A voluntary sale is often a “Short Sale” since many properties in foreclosure are “upside down” in that the mortgage payoff exceeds the fair market value of the property. A voluntary sale requires a qualified buyer who has entered into a contract with the homeowner in foreclosure. If the sale is a short sale the contract needs to be conditioned on consent by the lender who needs to agree, pursuant to negotiation efforts, to accept such lesser amount as the full payoff.
5. A Refinancing of the Property – If there is still equity in a house and the homeowner is eligible for refinancing or a reverse mortgage, obtaining a refinancing of the property is a potential method of paying off the arrears that may otherwise cause a foreclosure.
6. A Chapter 7 Bankruptcy Case Designed to Eliminate Debt – Often the homeowner in arrears on their mortgage also has considerable other unsecured debt due to their overall financial difficulty. A Chapter 7 case could discharge the client’s credit card, personal loans and other unsecured debt so that the client may have a better likelihood of obtaining a modification, without the burden of a considerable amount of debt that would otherwise diminish from the client’s ability to make payments under a potential modification.

Stopping Foreclosure Auction Sales on an Emergency Basis-

If the client is in a foreclosure action that already has proceeded for a period of time, and is nearing a foreclosure sale, the Law Office of Ronald D. Weiss, P.C. can file an Emergency Order to Show Cause or an emergency Chapter 13 or a chapter 7 bankruptcy case, under appropriate circumstances, to stop a foreclosure sale in an attempt to assert the client’ s rights and to give the client more time to attempt to resolve their situation and/or to cure their arrears.

How Has Covid-19 Affected Foreclosure Law and Practice?

Moratoriums imposed by the New York State governor , the state Court system and FHA had essentially temporarily shut down the ability of lenders to foreclose. In addition the New York State Courts were closed till May 4, 2020 and even when they had reopened, the Courts initially refused to file any foreclosure action documents and treated foreclosures and evictions different than any other actions. Presently, the Courts require a hearing to determine that a defendant is not facing Covid-19 related hardships before allowing a foreclosure action to continue to go forward. These moratoriums and other measures have given reprieve to borrowers unable to make mortgage payments during a period of national crisis and have given households facing mortgage challenges an opportunity to recover. However, the remedy of a moratorium on all foreclosures has been a broad one and by including foreclosures that were not caused by Covid-19, the moratorium has created a backlog of problematic mortgage situations where lenders during more normal times would have been more able to move forward with foreclosure process. This mandated pause in the foreclosure legal process has given an opportunity for borrowers to try to either reinstate, modify or otherwise resolve their mortgage arrears issues. Where a resolution is not forthcoming, the foreclosure moratorium and economic downturn will effectively give foreclosure defendants new litigation options to gain time, catch momentum and settlement opportunities. 

The Potential Benefits of Foreclosure Solutions and the Role of our Law Office –

The experience of the attorney representing the client is a critical factor in the client’s success when attempting to save their home from foreclosure. Since 1993 we have successfully represented numerous Long Island, Nassau County & Suffok County homeowners in foreclosure and have helped many of them permanently save their homes and re-establish their financial stability. When a homeowner is in foreclosure the legal options available to them to resolve and/or stop the foreclosure need to be carefully pursued. Such legal options are limited in terms of the number of times they can be pursued and when and how they can be pursued. Let us help you in your efforts to save your home with experience and expertise that is both affordable and personable.

Our consultations are free, the advice may be invaluable.

Contact us by phone at (631) 271-3737, or e-mail us at weiss@ny-bankruptcy.com for a free consultation to discuss legal options your legal options in terms of stopping or preventing foreclosure.