Miami Foreclosure Lawyer Blog

While countless, everyday Americans continue to struggle with impending foreclosure in South Florida, one bank is again facing allegations of wrong doing at the highest level.

As our South Florida foreclosure defense attorneys understand it, Bank of America is being accused of preventing homeowners from obtaining lowered mortgage payments from a federal program, even though it was reaping the financial rewards of participation.

The allegations were reported by the media earlier this month, when a whistleblower complaint was unsealed in federal court. The complaint is part of the $1 billion settlement reached between the New York U.S. Attorney's Office and Bank of America in February. Specifically, the settlement has to do with allegations that the bank violated the federal False Claims Act, which is outlined in 31 U.S.C. 3729. This act essentially allows the government to collect punitive and compensatory damages for anyone who files a false or fraudulent claim to the government - as the banks have become notorious for doing.

All of this too comes after another settlement for $25 billion that was reached between five major banks and attorneys general from 49 states, addressing widespread mortgage fraud over the last several years.

What this newest revelation essentially comes down to is this: That the bank actively worked to defraud the Federal Housing Administration by exaggerating appraisals and inflating claims that involved the Home Affordable Modification Program (HAMP). The whistleblower said he was working closely with bank executives when they reportedly set out to intentionally stop countless homeowners from receiving HAMP benefits, which would have significantly lowered their mortgage payments and likely allowed scores to remain in their homes.

The complaint alleges that as a matter of routine practice, agents for the bank would act as if it had lost important documents, they would fail to mark payments that had been made and they would intentionally mislead homeowners about whether they qualified for the program. They let only enough people into the program to avoid garnering the suspicion of the federal government. That way, they could continue to collect government rewards for their participation in HAMP.

It's cliche to say the bank was having its cake and eating it too - but that's exactly what was happening.

This is unsurprising to our Miami foreclosure defense attorneys, who know that banks are capable of almost anything, especially if it's in their own interest - regardless of whether it's legal or going to have a negative impact on those who are struggling.

The whole scenario illustrates why it is so crucial for people who are considering a Miami foreclosure to contact a skilled attorney who is familiar with the banks' tactics, and can help you avoid some of the common pitfalls that have ensnared so many others.

Continue reading "Whistleblower: Bank Defrauded Taxpayers" »

With nearly half of all Miami homeowners underwater on their mortgages, it's no wonder Floridians remain among the most skeptical of a recent $25 billion settlement between the banks and U.S. government.

The goal of the settlement was to help address some of the most egregious abuses by banks, and particularly those that led to the housing burst that has so many struggling with a foreclosure in Miami. As we have written about previously in our Miami foreclosure blog, the settlement is supposed to ease the burden on some of the hardest-hit Americans, as well as serve as a penalty for banks whose greed knew no depths, ultimately resulting in a global recession.

Miami foreclosure attorneys have already labeled this settlement a "sweetheart deal," which is of little benefit to consumers. Now, we have discovered there is even more reason to be suspicious.

According to Reporter David Reilly of The Wall Street Journal, the actual details of the settlement have so far been held up from public release, with banking and government officials saying the deal should be filed in court within the next several weeks.

Government officials came out strong in their announcement of the deal a few weeks ago. They played up the fact that attorneys general from 49 states had signed off on the deal. They heralded the fact that mortgage rates will be reduced for about 1 million homeowners, who scramble to make monthly payments that are more than the home is worth. They even touted the fact that about 750,000 heads of households that were improperly foreclosed on will receive a $2,000 restitution payment.

Never mind that the latter won't cover the cost of first month's rent and security deposit for a homeowner who was forced to downsize.

Never mind that having your mortgage reduced now isn't going to suddenly spring these people from the debt they have been accruing for years, while bankers lined their fat pockets.

And never mind that while $25 billion may seem like a decent chunk of change, it is little more than a drop in the bucket to these banks, meaning there is little incentive for them to halt the practices that led to these massive issues in the first place.

Now, the government and the banks are dragging their feet on releasing an actual copy of the deal. As Reilly put it: "The devil will be very much in the deal's details."

We'll give them this: It is a very complex situation that involves a great many parties. But without the ability to pore through the actual documents, neither taxpayers nor investors are going to have a real handle on what the banks received or what the various government agencies doled out, in return for this $25 billion.

According to Reilly, one of the most crucial aspects of the deal will be to what extent the banks are going to be able to skirt any future litigation resulting from these mountains of abuses. Officials may have talked up the fact that this deal will prevent any future abuses, we don't know how firm those promises are unless we can see the exact terms of the settlement.

Make no mistake about it, struggling homeowners are still best served by turning to a Miami foreclosure defense attorney for help.

Continue reading "Miami Foreclosure Suits Hinge on Disclosure of $25 Billion Bank Deal" »

An audit of several hundred foreclosures in Northern California uncovered a host of legal and ethical violations, mirroring the situation with foreclosures in Miami and across the country.

Our Miami foreclosure defense attorneys know how difficult it can be to trudge through the foreclosure process. Many people, not wanting to lose their homes or damage their credit, continue to pay on homes they'll likely never be able to afford and are ultimately going to lose. Their money, essentially, is wasted.

It is even more infuriating when information like this emerges, showing that the banks, who aren't playing by the rules, continue to profit from the housing crisis that has plagued homeowners across the country, and particularly in South Florida, since 2008.
In these cases, officials in San Francisco analyzed data from about 400 foreclosures that had happened between January 2009 and November 2011 in that region. They found that nearly every single one involved at least some illegal or suspicious action, the New York Times reported.

The negligible actions ranged from infractions like failing to let borrowers know when they had gone into default, as the law requires, to seizing and selling houses that the banks had never proven ownership of.

In fact, in 84 percent of those cases, researchers said they found what appear to be very clear violations of law on the part of the lenders. And in two-thirds of the cases, there were at least four irregularities or violations. A Miami real estate attorney can turn the tables on the banks, using these discrepancies to defend the homeowner.

A Suffolk University Law School professor, Kathleen Engel, was quoted by the Times as saying that if there had been any doubt before about whether the quandary with foreclosure loan documents was confined to a few instances, this information should blow that theory out of the water.

The report emerges just days after the federal government signed a $26 billion settlement among five major banks attorneys general in 49 different states, including Florida. The settlement is supposed to cover the banks' blunders (intentional or otherwise) over the foreclosure process. The settlement outlines a number of conciliatory measures the banks have to take, and those include paying $1.5 billion to former homeowners who were unfairly taken out of their homes. That breaks down to about $2,000 for each homeowner - hardly a drop in the bucket for someone who may have spent far more than that trying to hang onto their homes, their credit and some sense of stability.

Moreover, there are already reports of states taking the vast majority of this settlement money and dumping it into the gaping holes in their budgets. In other words, states took a payday and joined the growing group of those who have profited on the backs of homeowners.

What the study suggests is not necessarily that each of these homes shouldn't have been foreclosed upon or that every single bank has committed wrongdoing. However, it does seem to illustrate the growing trend - as our Miami foreclosure attorneys have seen - of instances in which banks acted improperly and even illegally interacted with homeowners. This is why having an experienced lawyer on your side is so important in these cases, because we are familiar with the trends - and the tricks that are pulled by these financial institutions to maximize their profits.

Researchers in California rightfully noted that just because the banks have settled over these issues does not grant them immunity to continue to commit these illegal acts. In fact, city officials in San Francisco intend to forward their report not only to the state's attorney general's office, but also to federal authorities, who we hope would look into the possibility of filing criminal charges against these financial institutions.

And individual homeowners can still hire an experienced Miami foreclosure defense law firm -- and Negotiate from Strength!

Continue reading "Miami Foreclosures Subject to Bank Abuses, California Audit Suggests" »

Financial experts believe that many homeowners may be considering a strategic default as they have incurred big loans, have little equity and are "upside down" on their mortgages. It appears they would rather walk away than wait for the real estate market to turn around in a decade or longer.

Fighting a foreclosure in Miami is one way to stop the banks from taking your home away. But many others are considering a strategic default in Miami as a way to fight back.

Strategic default means the homeowner simply mails the keys to the bank and walks away from the loan. Typically the reason for this is the mortgage is under water, meaning the homeowner owes more than what the house is worth. What has become a reality more recently for homeowners is that the real estate market in Miami won't be turning around for years or decades.

However, considering one of these exit strategies does have consequences. And a deficiency judgment in Miami is one of them. As Miami foreclosure defense lawyers have seen, banks have become more aggressive when it comes to deficiency judgments.

That is when the bank comes after the borrower for the difference between what is owed on the mortgage and what the house is sold for at auction. Given how much prices have dropped, banks have gotten more and more aggressive in pursuing borrowers who walk away.

According to a Washington Post article, experts believe that those with jumbo mortgages may be the next in line to default, as banks are anticipating that happening. Those with big mortgages, good credit scores, but little equity fit the criteria.

Moody's, the ratings agency, recently put out a study that found homeowners with jumbo mortgages are now at a "greater strategic default risk" than any other type of borrower. Because many are stuck with persistent negative equity, they are likely to walk away rather than be stuck in a market hit by real estate deflation.

FICO, the credit score agency, estimates that 30 percent of all defaults are strategic. Considering there are 12 million or more mortgages underwater, people simply stopping making payments even though they can afford them is a "growing problem."

While people likely understand what's going on in their local real estate market, the article opines that many may not know the consequences -- including triple digit credit score hits, which can make getting another loan difficult for several years. But a deficiency judgment is typically the bigger issue at hand.

Especially in markets with larger fluctuation in prices in the last five years, of which Miami is at the top of the list, a deficiency judgment can be crippling. If a person took out a loan for $450,000 for a house that is now worth $250,000 and the family walked away and is now renting, how could they be expected to pay back $200,000?

That is something that requires legal counsel to help you understand the risks and prepare a strategy for fending off the banks when they start calling and sending threatening letters and e-mails. If you are considering strategic default in Miami, consult with an experienced foreclosure defense lawyer first.

Continue reading "Experts: Jumbo Mortgages May Be Next to Strategic Default in Miami Foreclosures" »

Well, they have been wrong about just about everything else, so it should come as no surprise that Daily Finance reports banks may well be wrong about how much you owe. It just doesn't get any more basic than that -- another excellent reason why hiring a Miami foreclosure lawyer is the best course of action to protect your rights and the future financial well-being of you and your family.

Help for Miami homeowners should start with a well-qualified attorney. Whether mortgage modification, strategic default, fighting a deficiency judgment or negotiating a short-sale, banks are coming out on top in cases in which a homeowner does not fight for their rights. And, since the government has thus-far given banks a complete pass (even in the case of criminal allegations involving forged ownership documents used in court), hiring an experienced law firm to fight for your rights is the best course of action.

As far back as 2004, there was Congressional testimony that mortgage companies were messing up payment amounts and incorrectly applying payments to mortgage accounts. Now, sworn testimony in a New Jersey mortgage fraud case has revealed that employees for Lender Processing Services were given logins and passwords so that they could access bank records to justify account balances and files.

Testimony revealed the passwords for employees and supervisors were not safeguarded and were commonly used by multiple employees. "Crunch times" also frequently led employees to cut corners, which has led to numerous billing irregularities. In many cases in which homeowners don't challenge the billing, the errors may never be known since the vast majority of homeowners never pay off their entire mortgage.

Meanwhile, the company's system of rewarding bonuses to employees based on speed virtually assures that the problems will continue to occur. Like the rest of Wall Street, bonuses are paid based on volume, without regard to performance, which may lead an employee to "make something up" to get their job done.

LPS is an enormous default servicer, doing more than $1 billion in business last year. It's clients include Bank of America, Wachovia, Key Bank, Wells Fargo and HSBC. Meanwhile, the company does not even charge banks for its work -- it charges the network of lawyers who are hired to foreclose on the bank's mortgages.

So the banks get the service for free.

Continue reading "Banks may be incorrect about how much Miami homeowners owe on their mortgages " »

As we continue to fight to provide help for Miami homeowners, we are seeing more and more problems for homeowners who have sought mortgage loan modifications. The Florida-Times Union recently reported on the case of Edward Rukab, who sought help from Bank of America through HAMP, the Home Affordable Modification Program sponsored by the federal government.

As our Miami foreclosure defense attorneys reported recently on our Miami Foreclosure Lawyer Blog, fewer than 500,000 homeowners have received permanent modification through the program -- millions have applied. What has happened with increasing regularity is banks have offered temporary modification, only to reject an application and initiate foreclosure actions on those who cannot pay the resulting mortgage arrears.

Bank of America is just one of the banks that have faced persistent complaints about changing rules, losing paperwork and dragging out the application process for months. Rukab reported his credit rating took a dive as we waited more than a year for an answer. He ultimately signed off on a permanent modification agreement program, only to get a letter from the bank the following month saying he had withdrawn from the program. The Time-Union reports that Bank of America accused the couple of failing to return the paperwork.

This despite the fact that a Bank of America notary witnessed the signing and took the paperwork with him.

The newspaper reports that the bank changed Rukab's status after calls from the media. It sent him new paperwork to sign. Meanwhile, the emotional experience has taken a heavy toll. While he initially applied to the government program thinking it might help reduce the stress of dealing with an underwater mortgage (largely the result of the banks making billions by handing out bad loans to anyone who asked for one during the boom), he is now left shaking every time he gets off the phone with Bank of America.

His credit score has dropped from 790 to 626. This despite the fact that he says he has never missed a mortgage payment. The couple bought their townhouse for $143,500 in 2005 and still owe $121,000. The Duval County Property Appraiser lists the home at $99,000. HAMP is designed to reduce mortgage payments to 31 percent of a homeowner's income -- the loan balance may also be reduced by $5,000 if they make on-time payments for five years.

Upon applying in September 2009, he expected to enter a four-month trial period, in which his payments would be reduced from about $1,040 to $642 a month. What followed was a 17-month nightmare. Nine months later he got a letter saying he was approved for a three-month trial period at $775 a month. In November they said he'd been approved for permanent modification in the amount of $884. After a year of hassle, he had to accept the modification, which amounted to a savings of only about $100 a month, or face a bill for $6,000 in arrears.

Two months later he got the letter saying he was no longer in the program.

If you are facing foreclosure or problems with a mortgage in Miami, hire a lawyer. Negotiate from Strength.

Continue reading "HAMP Problems Abound - Struggling Miami Homeowners need an Attorney to Deal with Mortgage Foreclosure, Loan Modifications" »

Another major investigative piece -- this time by NBC 13 in Indianapolis -- has found that banks continue to play devastating games with homeowners, in some cases approving mortgage-loan modification only to use the arrears that result as a reason to foreclose.

In all seriousness, we implore those seeking to stop mortgage foreclosure in Miami-Dade or Broward counties to consult with an experienced and aggressive Miami foreclosure defense lawyer to help ensure a family's rights are protected throughout the process. Criminal investigations into the acts of banks and mortgage companies have been opened in all 50 states and it is long past the time where a homeowner can expect reasonable treatment in dealing with their bank -- if such a time ever existed.

Our Miami Foreclosure Lawyer Blog reported on a similar case recently -- where a homeowner had an agreement from the bank -- at least twice -- only to have the bank go back on its promise or sell the loan to a third party that then refused to honor the deal. If you don't believe us, believe Rolling Stone, which, in reporting on the foreclosure crisis in Miami and elsewhere, said: "Everything is fuc$ed up and nobody goes to jail."

In the Indianapolis report, the $50 billion government modification program (HAMP), has done little more than provide banks with another avenue to make a profit at the expense of homeowners. One mother, raising a son with significant medical issues, sought a modification to lower their monthly payments. After three months of complying with paperwork requirements, the bank lowered the family's payments from $1,500 a month to $900.

After a "trial period," the bank rejected them and told the couple they had to pay $5,000 in arrears or face foreclosure. They used money from their 401(k) only to have the payment rejected by Wells Fargo, according to the report. The couple was told to pay an extra $100 a month for the rest of the year and then a balloon payment of $19,000 or face losing their home.

Unfortunately, this is NOT an uncommon story. A government review of the program shows just 466,000 had received modifications of the millions who have applied.

Hire an attorney. Negotiate from Strength.

Continue reading " Mortgage Modifications Continue to Lead to Foreclosure in Miami and elsewhere as Banks Renege " »

A small Reston, Virginia company -- the MERS Corporation -- claims to hold title to about half of the nation's mortgages -- roughly 60 million loans, according to The New York Times. For those looking to stop foreclosure in Miami, hiring an attorney who understands how the system works -- and who knows proving who owns your bank loan may no longer even be possible -- is a critical step to protecting your rights and the financial well-being of you and your family.

Our Miami foreclosure defense attorneys know the system is broken. But more importantly, we know how and why the system is broken and we put that knowledge to work for our clients. As we reported recently on our Miami Foreclosure Lawyer Blog, MERS is the electronic mortgage tracking system, which was instituted so that banks and mortgage companies could package and sell mortgages as Wall Street investments.

However, many of the safeguards originally conceived as part of the system were either never instituted or are no longer utilized. For example, a vault or central clearing house for the original loan documents does not exist -- consequently, most of those documents have been lost or destroyed.

And then there is MERs, the company, which employs just 45 people despite its responsibility for tracking 67 million mortgages.

Many in the banking industry would prefer that struggling homeowners never hear of MERS, as judges, lawmakers and foreclosure defense lawyers continue to raise critical questions.

-How can this company, without a single dollar invested, and without a single shred of paperwork, claim title to millions of homes?

-And given that these loans have been packaged, sold, and resold, and that corners have been cut and the original paperwork no longer exists, can anyone prove anyone owns anything anymore? Let alone the title to your home and the right to foreclose.

In Arkansas, the Supreme Court has forbid MERS from filing foreclosure proceedings. In Utah, a judge allowed a homeowner to rip up his mortgage and walk away debt-free after the court refused to recognize MERS' legal standing. And on Long Island, a bankruptcy judge ruled the company could no longer act as an agent for the owners of mortgage notes.

The issues and court rulings surrounding the company strike at the very heart of the mortgage industry in the United States. Under fire for the way the company does business, the CEO since its founding resigned earlier this year. Finding a foreclosure defense lawyer in Miami who understands the issues is vital to protecting your rights.

MERS was formed 16 years ago by Fannie Mae, Freddie Mac and a number of big banks like JPMorgan Chase and Bank of America. The system cut out the county clerks and became the owner of record, no matter how many times a mortgage was sold and resold. The paper trail disappeared. Consequently, until and unless MERS can prove ownership of your mortgage and the right to foreclose, it's unlikely that ownership can be proven at all.

The industry violated common-sense; concrete proof of ownership was forsaken; everything was sacrificed for speed, convenience and economics. Never was a meltdown like what we are dealing with foreseen. And the system is incapable of handling it.

Nor was it a secret: County officials began petitioning Congress in the 1990s, arguing MERS was questionable from a legal standpoint. But the same deregulation, the same big-business mentality, and the same inert politicians that caused the meltdown reacted in the same old predictable fashion: They did nothing.

Don't let your family pay the price to clean up the mess. Consult an attorney today and Negotiate from Strength.

Continue reading "Struggle Miami Homeowners: Proof of who owns your mortgage may not exist -- consult an experienced attorney " »

As South Florida homeowners continue to struggle, the Obama Administration's foreclosure prevention program has been hobbled by lax oversight and a propensity to cooperate with banks rather than stand up for property owners, MSNBC reported.

Our Miami foreclosure defense lawyers understand the legal landscape and can assist homeowners in fighting to prevent foreclosure in Miami and throughout South Florida. As we have reported on our Miami Foreclosure Lawyer Blog, recent legal developments give homeowners a real shot at stopping foreclosure, nullifying a deficiency judgment or even successfully arguing for a monetary settlement or the return of their property.

The federal program has resulted in no penalties against banks or mortgage servicers, despite criminal investigation into the conduct of banks in all 50 states. Despite spending a year issuing warnings about such penalties, the Treasury Department recently said it lacks the power to do so. Meanwhile, it has actually loosened program restrictions in the wake of heavy lobbying from the banking industry.

The program was launched in early 2009, saying it would help 3 to 4 million homeowners. Fewer than 800,000 have received lasting mortgage modifications amid widespread complaints that banks have wrongly rejected homeowners, lost paperwork and ignored program rules. In many cases, homeowners were quickly allowed into the program on a "trial basis" but banks failed to make decisions, missed deadlines or inappropriately rejected applicants.

In some cases, payment reductions during trial modifications were then counted as delinquent and foreclosure proceedings were initiated.

Under contracts drawn up by the government, banks were to receive $1,000 for a completed modification and up to $4,000 if the loans continue to perform. Now the government is claiming those same contracts only permit the government to withhold or "claw back" a payment under very narrow circumstances; specifically when a lender incorrectly grants a modification.

To highlight the absurdity: Banks have not done nearly enough to modify home loans and the government's own contract only permits sanctions for banks that incorrectly grant modifications.

In other words, banks continue to make a mockery of the entire system. You deal with them at your own peril. Consulting an attorney is the best course of action when it comes to fighting for your rights and holding your bank accountable.

Negotiate from Strength.

Continue reading "Federal mortgage modification program little help to Miami homeowners facing foreclosure" »

As our Miami foreclosure attorneys reported recently on our Miami Foreclosure Lawyer Blog, banks are largely responsible for the foreclosure crisis and are being taken to task by foreclosure defense lawyers and criminal investigations in all 50 states.

The tide is turning in favor of homeowners in 2011. Those looking for help stopping foreclosure in Miami can negotiate from a position of strength by contacting an experienced law firm to protect their rights.

By 2006 and 2007, banks knew they were making bad loans. They did so anyway because they were making money. And because they were not going to hold the loans. Instead, they made even more money by packaging and selling them as investments. Ratings agencies looked the other way in granting AAA ratings so get the business. One hand washed the other. Everybody made money. Hundreds of thousands of mortgages were doomed before the ink dried.

Never content with big profits when huge profits were possible, banks then cut corners in keeping track of mortgage documents, many of which were lost or destroyed as the notes were sold and resold on the investment market. Those sales resulted in the servicing rights to the notes, or assignments, moving from one bank to another with each sale.

When the music stopped and the foreclosures started, banks frequently lacked the paperwork to prove ownership. So they created it. Forged documents. Forged signatures. Fake notarization.

Hundreds of thousands of times they simply made it up, according to a report by the Florida Attorney General's Office and other law enforcement agencies. Investigations are now ongoing in all 50 states.

As Daily Finance reported, when the tide turned, banks simply shifted gears and began making money on foreclosures. They made money to foreclosure, not to modify loans, so homeowners found little help whether they were coming or going. Even when modifications made sense, they often were not offered out of shear incompetence; many banks were too short-staffed to assist homeowners.

Anyone who has been to the bank lately and waited in line at the teller knows banks are making money by short-staffing. And when is the last time you saw a loan officer at your local bank?

Incredibly, when foreclosure defense lawyers began fighting back, banks pushed lawmakers to move foreclosures outside the court system as a way of clearing the backlog jamming local dockets. Fortunately, at least in Florida, they have not yet been successful in passing that measure.

As the crisis continues, banks are looking worse and worse. Even when homeowners have tried to satisfy the debt, poor record-keeping on the part of banks often leads to confusion over how much is owed. Multiple banks are trying to foreclose on the same property. Banks that no longer exist -- such as IndyMac or Lehman Brothers -- are listed in court documents.

In contested cases, banks are often backpedaling -- and withdrawing paperwork they falsified and submitted in the first place.

If you are facing foreclosure in South Florida in 2011, consult a Miami real estate law firm today and negotiate from a position of strength.

Continue reading "Banks facing court scrutiny in 2011: Homeowners should seek help to stop foreclosure in Miami" »

An article published in Daily Finance puts the blame for the foreclosure crisis squarely on the shoulders of banks, not homeowners.

As our Miami foreclosure defense attorneys have reported on our Miami Foreclosure Lawyer Blog, homeowners looking to prevent foreclosure in South Florida stand a solid chance in 2011 now that the illegal and unethical behavior of banks is being brought to light by criminal investigations and the work of foreclosure defense attorneys in all 50 states.

Forged affidavits, false documentation, fake witnesses and invalid notarization are just a few of the tactics banks used in an attempt to prove ownership of homes they may have never had the right to foreclose on in the first place.

This article pins 90 percent of the blame on banks and just 10 percent on the backs of troubled homeowners. In every case the bank made the loan. And usually it and several other banks or Wall Street institutions profited from securitizing the loans and selling them as investments. Other banks profited from servicing the loan.

-Banks knowingly made millions on loans doomed for foreclosure from the start.

-Banks deliberately, or through shear incompetence, failed to modify mortgages for many homeowners who could have saved their home with a little help.

-And banks were so careless with paperwork that they have improperly foreclosed on thousands of homes, tied up the court system, and turned the foreclosure process into a disaster that has choked the real estate market and caused significant harm to the overall economy.

It began with lax underwriting standards, making mortgages almost as easy to get as using a debit card at the ATM. Underwriting is one of the most basic tenants of banking. The advent of the so-called "liar loan," which required little or no documentation, drastically increased the income of those writing mortgages (who typically received commission-based compensation), which virtually assured the foreclosure crisis. In 2006 and 2007, more than half of all new subprime loans were liar loans. Keep in mind subprime loans are loans made to people with subpar credit -- the loans, in other words, that should have received the most scrutiny.

In many cases, the banks knew the loans were no good -- they made them anyway because they were not going to hold them. Instead, they made even more money by selling them as investments.

Ratings agencies were complicit in that they gave AAA ratings to inferior packages of securitized loans. Banks shopped for the best rating. Rating the loans had become really profitable for the rating agencies, which looked the other way in order to get the business.

These problems were exacerbated by the fact the servicers of loans got paid to foreclose not modify. So banks did so in record numbers, despite having to forge documents and engage in other illegal and unethical behavior in order to do so. We will explore that end of the equation in an upcoming post to our Miami Foreclosure Lawyer Blog.

And remember, if you are a Miami homeowner facing foreclosure in 2011, seek the advice of a qualified real estate attorney and negotiate from a position of strength.

Continue reading "Banks responsible for mortgage mess: Miami homeowners facing foreclosure have options in 2011" »

The conclusions of the Florida Attorney General's report regarding abuses by banks and law firms in foreclosure cases make it clear that consulting an experienced Miami foreclosure defense attorney is vital to protecting your rights.

As we have reported on our Miami Foreclosure Lawyer Blog, the advent of electronic mortgages was a way for banks to make even more money by packaging and selling them as investments. Never satisfied, banks made even more by cutting corners, which in many cases included the loss or destruction of original mortgage documents. Mortgages were sold and resold on the investment market with only the electronic system to assign a bank servicing and foreclosure rights.

The hundreds of thousands of foreclosures that resulted from the collapsing real estate market led banks and law firms to forge tens of thousands of mortgage documents, providing banks with proof of the proper assignment necessary to carryout a foreclosure action. Homeowners looking to help stop foreclosure in Miami have a number of options. In some cases, a homeowner may negotiate away a deficiency judgment. In other cases, a homeowner may even be able to fight for a cash settlement or the return of their property.

Regarding the misuse of falsified assignments, the Florida Attorney General's Office found:

-Improper assignments were recorded in county land offices and submitted to the court in support of foreclosure actions.

-Improper assignments were accepted by the court as valid.

-Homeowners were foreclosed upon based on falsified assignments by banks that did not hold the note.

-If a foreclosure judgment is obtained by a bank that does not hold the note, then the homeowner risks a second lawsuit by the true note holder.

Possible solutions mentioned by the Florida Attorney General

-Banks and their law firms must submit true and accurate paperwork. (You would think this would be a given, unfortunately it's just another reason why it's critical to have an experienced foreclosure defense attorney by your side).

-Homeowners must be given due process. Substantive review of paperwork prior to foreclosure (this flies in the face of the request of banks to expedite the foreclosure process by taking it outside the court system).

-The foreclosure crisis in South Florida will continue. With many more foreclosures in 2011. But they must be done within the law.

With new scrutiny of banks and their law firms, homeowners should fight for their rights if faced with foreclosure in 2011. Seeking the help of an experienced Miami real estate law firm can help you negotiate from a position of strength.

Continue reading "Miami homeowners fighting foreclosure in 2011 should negotiate from position of strength" »

This is the third blog published by our Miami foreclosure defense attorneys in the wake of a scathing report on the foreclosure industry by the Florida Attorney General's Office.

As we reported on our Miami Foreclosure Lawyer Blog, a bank's right to foreclose is tied to whether it has been assigned the mortgage. As banks and mortgage companies cut corners during the boom, the electronic assignment of mortgages relied less and less on the original paperwork, which was often lost or destroyed. The robosigning scandal involves the signing of tens of thousands of documents assuring the courts that a bank had the proper assignments. Those signing the documents often had no knowledge of whether that was really the case.

In short, the bank foreclosing on your home may be without proof of ownership and without the right to do so. Preventing foreclosure in Miami may be possible for those willing to fight for their rights. In Florida, thousands of foreclosures have come under fire, including those involving the Law Offices of David J. Stern, Law office of Marshall Watson, Shapiro & Fishman, JP Morgan Chase, Bank of America and GMAC.

Other tactics the banks and their law firms are accused of using include fake witnesses, fake notaries, fake documents and false affidavits. In fact, one woman, Linda Green, has dozens of different signatures that appear on hundreds of thousands of mortgage assignments. She is also listed as an officer of dozens of banks and mortgage companies.

And Scott Anderson. And Tywanna Thomas. And Jessica Ohde.

Several companies, including Lender Processing Services, GMAC and Nationwide Title Clearing in Tampa, produced thousands of assignments every day.

In still other cases, the paperwork was rushed through in such a hurry that it is riddled with errors, including bogus effective dates like 9/9/9999.

The end result is criminal investigations into bank conduct in all 50 states. And solid ground upon which a homeowner can stand while fighting for their rights. You may be able to stop a foreclosure, negate a deficiency judgment, or even argue for a monetary settlement or the return of your property.

Continue reading "Mortgage assignment questions could help stop foreclosure in Miami" »

The Miami Herald is reporting that the Treasury Department's foreclosure prevention program has failed to live up to expectations -- helping just 20 percent of the anticipated number of homeowners.

Those looking to stop foreclosure in South Florida are best served by contacting a Foreclosure Defense Attorney in Miami. Recent developments, including criminal investigations into the actions of banks and their attorneys, could permit homeowners to negotiate from a position of strength. Whether you are seeking to avoid a deficiency judgment, repair your credit, or seek monetary damages or the return of your property, consulting an experienced attorney is a good first step to begin restoring your finances and the financial security of you and your family in the New Year.

The government's Home Affordable Modification Program, or HAMP, could prevent as many as 800,000 foreclosures, a pace that would help far fewer than the 4 million struggling homeowners the government had hoped would benefit.

"This has turned out to be a lot more complicated and a lot harder," than expected, said the panel's chairman, Sen. Ted Kaufman (D-Delaware). "I think the program has just turned out to be smaller and has had a lot less impact" than anticipated.

The panel cites conflicting incentives within the mortgage industry. For instance, some companies that service the loans stand to make more through foreclosures and through modifying existing mortgages. The Treasury was also unsuccessful in encouraging adequate participation because mortgage companies were not required to participate in the program.

In other cases, a homeowner may have held a second mortgage, which gave some lenders incentive to block the modification of a first mortgage.

The Treasury was also criticized for not collecting more meaningful data about the program, not setting meaningful goals by which to measure progress or success and for failing to hold mortgage companies accountable. Many companies repeatedly lost paperwork or resisted participating in mortgage modification.

"An untold number of borrowers may go without help - all because Treasury failed to acknowledge HAMP's shortcomings in time." the panel concluded.

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