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Thousands of Detroit-area homeowners try to stop foreclosure

Taxes have been paid in full for about 20,700 of the foreclosed properties, partly through the payment plan, according to Chief Deputy Treasurer David Szymanski.

Of the 38,100 properties still facing foreclosure, only 15,900 are occupied.

“Those are the ones we want to get to,” Szymanski said. The county has to collect property taxes by law.

City and county officials urged state lawmakers to pass foreclosure prevention bills and Gov. Rick Snyder signed the legislation in January to provide homeowners facing financial hardship with the option to sign up for a payment plan to avoid foreclosure. The bills also cut interest rates, reduced down payments and capped past due taxes.

Szymanski said more than 13,000 homeowners have entered into payment assistance plans already.

Bryan Ely, 28, of Detroit, said he owes about $20,000 in back taxes on his home on Detroit’s northwest side.

“I lost my job in 2013 and my taxes were too high to begin with,” he said, added that complacency and not being aware of his options brought him up to the deadline.

Latasha Peoples hopes never to fall into a position where she gets behind again. Peoples, 34, said a “job issue” put her about $900 behind in property taxes on her home. On Tuesday, she agreed to pay $112 down and $50 each month until she is caught up.

“They just offered me the plan and that’s what I took,” she said. “It’s better than losing your house.”

Article source: http://www.washingtontimes.com/news/2015/mar/31/detroit-area-property-owners-seeking-to-avoid-fore/

Foreclosure Attorneys That Sue Lenders for Dual Tracking to Stop Foreclosure

Apr. 23, 2015 / PRZen / LOS ANGELES — There are several ways to stop a foreclosure from moving forward. The swiftest and most effective way is to hire a foreclosure attorney to protect against foreclosure. As soon as a borrower receives a Notice of Trustee Sale or Notice of Default, it is best to hire a foreclosure attorney immediately to protect the property against a foreclosure sale.

The foreclosure attorneys at Consumer Action Law Group have successfully saved hundreds of homes from foreclosure. It doesn’t just stop at that; they have helped many borrowers to do the following:
- Lower mortgage payments
- Get rid of the second mortgage
- Lower their principal balances
- Eliminate past balances due to the lender
- Keep their cars, homes, and other property while eliminating debt
- Save homes from foreclosure within 1 hour of the time of sale
- Stop the foreclosure date altogether with a court order

https://www.youtube.com/watch?v=azwmdHNKXQI

How to Stop Foreclosure
With several years in of experience in this area, Consumer Action Law Group has become the premier law firm for stopping foreclosures and giving consumers free legal advice how to stop foreclosure. Better still, their foreclosure lawyers always move very quickly to ensure that homeowners do not lose their home in foreclosure. When clients inform them about a notice of foreclosure, they act very quickly and immediately seek protection in court. Their foreclosure lawyers stop wrongful foreclosure by filing suit against the lender to protect their client’s property.

The California foreclosure laws are very protective to borrowers. Lauren Rode, a senior attorney with Consumer Action Law Group stated, “No one should lose their home to foreclosure because they defaulted on payments for a temporary hardship. Often times, borrowers fall behind on their mortgage payments because of unforeseen financial difficulties which resulted in getting a foreclosure notice.” Anyone who has missed their mortgage payment due to financial hardship has the opportunity to catch up, call the foreclosure attorney at Consumer Action Law Group for immediate help.

https://www.youtube.com/watch?v=K11Xaq9e_rU

Borrowers can also apply for a loan modification directly with the lender for a more affordable payment. However, in the case of dual tracking – moving forward with the foreclosure process while reviewing documents for a loan modification, this is illegal and a lawsuit can be filed.

Anyone who has experienced foreclosure due to dual tracking should immediately contact the foreclosure attorneys at Consumer Action Law Group. The foreclosure lawyers at Consumer Action Law Group seek immediate protection from the court to stop foreclosure. According to Lauren Rode, one of the foreclosure attorneys of Consumer Action Law Group: “In many cases, as soon as the lender denies the homeowner’s application for the loan modification, they will move forward with the foreclosure, and we can help.”

For immediate foreclosure defense, call (818) 254-8413. Consumer Action Law Group law firm is open from 9.00 AM to 5.30 PM, Monday through Friday. For more information about their services, visit http://ConsumerActionLawGroup.com

Source: Consumer Action Law Group

Press release distributed by PRZen

Article source: http://www.digitaljournal.com/pr/2532950

A Foreclosure Conveyor Belt: The Continuing Depopulation of Detroit

This post first appeared at TomDispatch.

Homeowners sit in a conference room in Detroit's Cobo Center while waiting for their cases to be heard to avoid foreclosure from tax debts in Detroit on Jan. 29, 2015. Hundreds of Detroit homeowners at risk of losing their property are flocking to hearings that offer them a last-ditch chance to avoid foreclosure. (AP Photo/Paul Sancya)

Homeowners sit in a conference room in Detroit’s Cobo Center while waiting for their cases to be heard to avoid foreclosure from tax debts in Detroit Thursday, Jan. 29, 2015. Hundreds of Detroit homeowners at risk of losing their property are flocking to hearings that offer them a last-ditch chance to avoid foreclosure. (AP Photo/Paul Sancya)

Unlike so many industrial innovations, the revolving door was not developed in Detroit. It took its first spin in Philadelphia in 1888, the brainchild of Theophilus Van Kannel, the soon-to-be founder of the Van Kannel Revolving Door Company. Its purpose was twofold: to better insulate buildings from the cold and to allow greater numbers of people easier entry at any given time.

On March 31st at the Wayne Country Treasurer’s Office, that Victorian-era invention was accomplishing neither objective. Then again, no door in the history of architecture — rotating or otherwise — could have accommodated the latest perversity Detroit officials were inflicting on city residents: the potential eviction of tens of thousands, possibly as many as 100,000 people, all at precisely the same time.

Little wonder that it seemed as if everyone was getting stuck in the rotating doors of that Wayne County office building on the last day residents could pay their past-due property taxes or enter a payment plan to do so. Those who didn’t, the city warned, would lose their homes to tax foreclosure, the process by which a local government repossesses a house because of unpaid property taxes.

“Oh, my lord,” exclaimed one bundled-up woman when she first spotted the river of people, their documents in envelopes and folders of every sort, pouring out of cars, hunched over walkers, driving electric scooters, being pushed in wheelchairs, or simply attempting to jam their way on foot into the building. The afternoon was gray and unseasonably cold. The following day, in the middle of a snowless meadow in the Sierra Nevada Mountains, the governor of California would announce the state’s first-ever water restrictions as a result of an unprecedented, climate-change-influenced drought. Here in Michigan, city residents were facing another type of man-made disaster: possibly the largest single tax foreclosure in American history.

“It’s the last day to pay,” one woman heading toward the rotating glass chamber yelled to a pedestrian who had slowed to watch the commotion. Inside, a Wayne County Sheriff’s Department officer-turned-traffic-controller boomed instructions to a snaking line of people. “When you get to the eighth floor, you will get a number. Keep that number! Then go to the fifth floor.’”

The eighth floor, however, turned out to be little more than another human traffic jam, a holding space for thousands of anxious homeowners who faced hours of waiting before reaching the desk of some overworked city representative down on five. Yet, as a post office delivery worker gaping at the fiasco told me, this was less hectic than it had been a only few days earlier, when the treasurer’s office had rented out the Second Baptist Church across the street. There, people waited for the opportunity to enter the revolving doors to take the elevator to the eighth floor before heading for the fifth floor to… you get the gist.

In fact, the whole week had been a god-awful mess. A day earlier, rumors had it, a woman had passed out in the elevator between the eighth and fifth floors en route to “making arrangements,” the euphemism for getting on a payment plan that might save your home. “What happens if you can’t pay?” a slender man asked me as we dodged a new wave of people surging through the glass cylinder.
“Then they sell your house at auction,” I replied.

“For real?” he asked, amazed.

He was waiting for his sister to make those “arrangements.” He didn’t have to worry about all this, he explained, because ever since he’d lost his job, which had provided him with housing, he’d been staying in motels. The Victory Inn over in Dearborn and the Viking across from the Motor City casino were both reasonable enough places, he assured me, but the Royal Inn on Eight Mile was the cheapest of all — $35 a night plus a $10 key deposit. That establishment’s single enigmatic Yelp review read: “This is definitely someplace you want to go where totally normal things happen.”

A Blueprint for Civic Hell

Detroit was once famous for creating the largest, most spectacular versions of whatever its residents set their minds to, be they assembly lines, record labels, or revolutionary workers’ associations. The city is often credited with inventing and mass-producing the 20th century, while its workers simultaneously took the lead in revolting against the injustices of the era. Its factories put the world on wheels and labor laws on the books. Its workers and thinkers sparked and fanned a number of this country’s most influential resistance movements.

Detroit: every article about you should include a love letter, a thank-you note, a history lesson, for without you…

Few care to admit, however, that the city that was the arsenal of the 20th century may also provide the blueprint for a more precarious era. Which brings us to those massive tax foreclosures of the present moment. Just over 60,000 homes, about half of them occupied, are slated for the auction block. As many as 100,000 of the city’s residents — about a seventh of the total number — are now on track for what many are calling an eviction “conveyor belt.”

Such an image easily springs to mind in this city whose auto factories were famous for their oh-so-efficient shop floors. These days, sadly enough, it’s all-too-easy to imagine a 21st-century version of a classic Detroit assembly line dedicated to processing its own residents, workers and retirees — all the ones it claims to no longer need, all those too old, too young, too ill-trained, too inefficient for a post-bankruptcy city. These undesirables, it seems, are to be turned into so many economic refugees on a conveyor belt to nowhere. While everyone loves to hear about legendary industrial Detroit, no one wants to hear about its de-industrialized progeny, and especially not about foreclosures — not again.

Mike Shane, a Detroit resident and organizer with the anti-foreclosure group Moratorium Now!, knows this better than anyone. “We call the press, and they say, give us anything but foreclosures,” he tells me ruefully.

Connecting the Dots

On March 31st, some people did manage to make the necessary “arrangements” to save their homes. That included one woman with a Hillary Clinton-style hairdo who had lived on Winthrop Street since the 1960s, but like so many in the working-class sections of the city had fallen behind on her taxes. “They asked, ‘Why didn’t you pay your property taxes?’” she explained as she rested on one of the first-floor benches. “And I said, ‘Because I had a heart attack.’”

Last year, she recalled, a neighbor’s home fell into tax foreclosure. A man who lived on the same block noticed the familiar address on the auction list. He bought it back for her, she tells me. “He said to the woman, ‘Pay me back when you can, if you can.’”

Detroit is full of similar stories, filled with a stubborn sense of hope. But there are so many more addresses on the foreclosure list than angelic neighbors. By early afternoon that March day, the building still bursting at its seams with thousands of people, the county office conceded its inability to cope and extended the foreclosure deadline another six weeks.

“I don’t know if it’s because they’re so damn overwhelmed,” wondered Mary Crenshaw, a sunken-eyed woman who was relieved by the announcement, as it gave her time to wait for a lump-sum retirement payout from British Airways, her former employer. She had come to save her family home in Highland Park, a small city enclosed by Detroit whose once occupied homes sported oak floors and beveled glass windows. Now, more than half of them are empty, lawns overgrown, windows boarded up, the former homeowners having already ridden earlier foreclosure conveyor belts out of the neighborhood.

After all, this current tax foreclosure crisis comes right on the heels of the city’s last great displacement: the 2008 housing crash, which descended on Detroit like a tidal wave, sweeping nearly a quarter of a million people out of the city and leaving in its wake tens of thousands of vacant properties.

The fact that the city is now threatening to evict a seventh of its remaining inhabitants in a single year, all because of unpaid property taxes, seems like an absurd proposition until you begin to connect the dots: the mass water shutoffs, the shuttering of dozens of public schools, the neglect of fire hydrants in particular neighborhoods, and now this deluge of foreclosures.

Looking at the pattern that emerges, you can see that Detroit is not only a city in the midst of a “revival,” as enterprising investors and the national media often claim. It’s true that redevelopment is taking place in some neighborhoods, and city officials do claim that big changes are coming, often illustrating them with colorful documents that look like they were formatted by a team of graphic design wizards from the back of San Francisco’s Google Bus.

But that’s just one part of the Detroit story. For the city’s low-income, black, and elderly residents, Detroit isn’t a city on the rise, but one under siege.

An Emergency That Never Ends

On a blustery Saturday afternoon just two weeks before the day of the foreclosure deadline, an Emergency People’s Assembly Against Tax Foreclosures was held at Old Christ Church to address this siege. It was one of a set of “people’s assemblies” called to deal with the latest crisis in a city where, in recent years, crises have never been lacking. Before the tax foreclosure assemblies there had been the Emergency People’s Assemblies Against Bank Foreclosures, the Emergency Pack-The-Court Actions to Defend Homeowners from Eviction, the Emergency Town Halls to Defend City Pensions Services, the Emergency Meetings Against the Emergency Financial Manager, and so on.

“Emergency” had, in other words, been the word of the moment for years and years. That invasive sense of never-ending urgency could similarly be seen in the literature of such groups — in the words always screamingly in capital letters, in the typographical equivalents of exclamation points. When I’d first heard about the most recent event, I was in a meeting with Mike Shane and I said to him, “Over the three years I’ve been visiting Detroit, I’ve never arrived at a time you weren’t holding an Emergency People’s Assembly the following Saturday.”

Shane laughed on cue. “Well, yes, that’s right,” he replied. “We’ve been at this since about 2007.”

The Old Christ Church that day was shiveringly cold. From the pew behind me came the sound of rustling coats as two children squirmed. Beside them sat their grandmother and grandfather, Lula and Daryl Burke, who had come to describe how their home had been sold at a tax foreclosure auction last year. With the help of the grassroots community group Detroit Eviction Defense, Lula explained, the Burkes had convinced the home’s buyer to sell it back to the family.

A little bit of gumption on her part helped, too. As she recalled explaining to the investor who had bought her home at auction, he could try to sell the house to someone else. But before he did that, she planned to strip every last thing out of it. “It won’t have a furnace, a toilet, doors, windows, all the way down to the light switch,” she warned him.

On the wall behind the altar three white-robed angels were suspended in mid-frolic, oblivious to the current condition of their once regal city. In front of them stood anti-foreclosure lawyer Jerry Goldberg. “Are we going to allow 62,000 more foreclosures this year?” he thundered, his face growing redder. I later learned that, years ago, Goldberg had sold peanuts down at the old Tigers stadium (now a bulldozed parking lot) and his unrelenting voice had apparently made him very good at it.

“No!” he responded emphatically to his own question. “Are we going to allow them to make our neighborhoods into a bunch of ponds?”

Perhaps I should have led with this information: in some of the city’s latest flashy Adobe InDesign-ed planning documents, certain of Detroit’s more down-and-out neighborhoods have been transformed into ponds. Or, to be more precise, they have been turned into “water retention basins” that planners believe will offer the Detroit of the future superior management of storm water runoff.

Minutes earlier, Alice Jennings, one of the most celebrated social justice lawyers in the city, had explained that, according to Detroit’s planning documents, those retention basins are slated to be built on top of now populated neighborhoods. In other words, ponds are also what we’re talking about when we talk about Detroit’s tax foreclosures.

“No!” Goldberg shouted yet again. “We need to stop these foreclosures with a moratorium, a halt! The idea that this can’t be done is hogwash! The Supreme Court held in 1934 that, during a period of emergency, the people’s need to survive supersedes any financial contract! The governor has a responsibility to declare a state of emergency!”

His sentences all ended in exclamation points, as his torrent of words resounded off the church’s high ceilings. In an upside-down universe, Goldberg would have made a skilled auctioneer rather than a man desperate to save all those homes and their inhabitants.

To be clear, Goldberg isn’t suggesting another of the emergency proclamations that Michigan’s governors have used to impose unelected emergency managers on school districts and municipalities from Detroit to Muskegon Heights. Rather, he’s calling for the governor to declare a state of emergency under Michigan law 10.31, which would allow him to “promulgate reasonable orders, rules, and regulations as he or she considers necessary to protect life and property” — including, of course, halting the tax foreclosures. In 1933, similar actions allowed Michigan’s legislature to pass the Mortgage Moratorium Act, later upheld by the Supreme Court, mandating a five-year halt on property foreclosures.

Winning that moratorium took, among other things, a well-organized national Communist Party, hundreds of worker councils, thousands of eviction blockades, and — I’d be willing to bet, although I don’t have the archival evidence — an incredible number of “emergency meetings.”

Woe to Those Who Plan Iniquities

By late afternoon, Goldberg was resting his vocal chords and about a dozen people from the audience were lining up to take the microphone, including Cheryl West, a tiny, gray-haired woman clutching a thick Bible to her stomach. When it was her turn to speak, she began: “I lost my home of 60 years.” There was no trace of bitterness in her voice, just a touch of awe and disbelief. “It’s been quite a journey. Quite a journey.”

“Let me give you a little background,” she continued. “My entire family is now deceased. My father was the first African-American to teach music in Detroit, possibly in the entire state of Michigan. He worked for the school system. He lived in that very house. He lived there through the 1967 riots and we were right at the hub of where the riots started. My sister was a journalist, and during the riots she was one of the people getting the story out to the media, because she was working for UPI at the time. My sister was on the front page of the London Times, that’s how far her news traveled of the city burning down around us.”

Then, after a few more background comments on her life, she opened up her bible. “Since we’re in a church,” she said by way of explanation and began to read from the Book of Micah. She skipped its beginning.

Woe to those who plan iniquity,
to those who plot evil on their beds!
At morning’s light they carry it out
because it is in their power to do it.
They covet fields and seize them,
and houses, and take them.
They defraud people of their homes,
they rob them of their inheritance…

Undoubtedly, she assumed that everyone in the church was already familiar with such “iniquities” and the biblical lines that went with them. After all, in the previous few years, they had lived through the 2008 foreclosure crisis, the imposition of an emergency manager on their city, mass water shutoffs, and significant pension cuts for retired city workers, not to speak of all the evils that had come before.

Instead, she read the verses she liked best, the ones that, as she said, God led her to just about the time she lost her home.

You strip off the rich robe
from those who pass by without a care,
like men returning from battle.
You drive the women of my people
from their pleasant homes.
You take away my blessing
from their children forever.

She paused, then suddenly, in a surprisingly powerful voice, yelled the next line: “Get up! Go away!”

The church reverberated with her admonishment. And then, with a smile at her own audacity, she added, “The end.”

Shortly afterwards, we filed out of the church. And yet it was not the end. It never is.

There is now, for instance, that new deadline — May 12th — for residents to get on a payment plan to avoid losing their homes to tax foreclosure. That offers more time for people to navigate the revolving doors of the Wayne County Treasurer’s Office, head up to the eighth floor, then down to the fifth, all in an effort to fight their way off of the city’s conveyor belt to nowhere. And, of course, it gives residents more time to host emergency people’s assemblies aimed at throwing a monkey wrench — once and for all — into this assembly line of eviction and displacement.

Even if that happened, however, these gatherings, called for in all capital letters and exclamation points, undoubtedly wouldn’t end. They’ve become as much a fixture of this city as the women and men who organize them, the churches that host them, and the neighborhoods whose survival may depend on them. After all, the worst injustice would not be whatever provokes the next emergency people’s assembly, but the possibility of a future Detroit without such gatherings, one in which all these meetings and people are gone, all the stories have been suppressed. Imagine, then, the worst iniquity of all, the one so many are fighting against: a Detroit where once inhabited streets have been submerged in the silence of water retention ponds, where longtime residents have been scattered and displaced by the foreclosure conveyor belt and no one left in the city knows the history of what’s been drowned.

Laura Gottesdiener

Article source: http://billmoyers.com/2015/04/22/foreclosure-conveyor-belt-continuing-depopulation-detroit/

The Foreclosure Conveyor Belt That Could Remove as Many as 100000 Detroit …

Detroit homeowners wait for foreclosure hearings

Homeowners wait for their cases to be heard to avoid foreclosure from tax debts in Detroit in January 2015. (AP Photo/Paul Sancya)

This article originally appeared at TomDispatch.com. To stay on top of important articles like these, sign up to receive the latest updates from TomDispatch.com.

Unlike so many industrial innovations, the revolving door was not developed in Detroit. It took its first spin in Philadelphia in 1888, the brainchild of Theophilus Van Kannel, the soon-to-be founder of the Van Kannel Revolving Door Company. Its purpose was twofold: to better insulate buildings from the cold and to allow greater numbers of people easier entry at any given time.

On March 31st at the Wayne Country Treasurer’s Office, that Victorian-era invention was accomplishing neither objective. Then again, no door in the history of architecture—rotating or otherwise—could have accommodated the latest perversity Detroit officials were inflicting on city residents: the potential eviction of tens of thousands, possibly as many as 100,000 people, all at precisely the same time.

Little wonder that it seemed as if everyone was getting stuck in the rotating doors of that Wayne County office building on the last day residents could pay their past-due property taxes or enter a payment plan to do so. Those who didn’t, the city warned, would lose their homes to tax foreclosure, the process by which a local government repossesses a house because of unpaid property taxes.

“Oh, my lord,” exclaimed one bundled-up woman when she first spotted the river of people, their documents in envelopes and folders of every sort, pouring out of cars, hunched over walkers, driving electric scooters, being pushed in wheelchairs, or simply attempting to jam their way on foot into the building. The afternoon was gray and unseasonably cold. The following day, in the middle of a snowless meadow in the Sierra Nevada Mountains, the governor of California would announce the state’s first-ever water restrictions as a result of an unprecedented, climate-change-influenced drought. Here in Michigan, city residents were facing another type of man-made disaster: possibly the largest single tax foreclosure in American history.

“It’s the last day to pay,” one woman heading toward the rotating glass chamber yelled to a pedestrian who had slowed to watch the commotion. Inside, a Wayne County Sheriff’s Department officer-turned-traffic-controller boomed instructions to a snaking line of people. “When you get to the eighth floor, you will get a number. Keep that number! Then go to the fifth floor.”

The eighth floor, however, turned out to be little more than another human traffic jam, a holding space for thousands of anxious homeowners who faced hours of waiting before reaching the desk of some overworked city representative down on five. Yet, as a post office delivery worker gaping at the fiasco told me, this was less hectic than it had been a only few days earlier, when the treasurer’s office had rented out the Second Baptist Church across the street. There, people waited for the opportunity to enter the revolving doors to take the elevator to the eighth floor before heading for the fifth floor to… you get the gist.

In fact, the whole week had been a god-awful mess. A day earlier, rumors had it, a woman had passed out in the elevator between the eighth and fifth floors en route to “making arrangements,” the euphemism for getting on a payment plan that might save your home.

“What happens if you can’t pay?” a slender man asked me as we dodged a new wave of people surging through the glass cylinder.

“Then they sell your house at auction,” I replied.

“For real?” he asked, amazed.

He was waiting for his sister to make those “arrangements.” He didn’t have to worry about all this, he explained, because ever since he’d lost his job, which had provided him with housing, he’d been staying in motels. The Victory Inn over in Dearborn and the Viking across from the Motor City casino were both reasonable enough places, he assured me, but the Royal Inn on Eight Mile was the cheapest of all—$35 a night plus a $10 key deposit. That establishment’s single enigmatic Yelp review read: “This is definitely someplace you want to go where totally normal things happen.”

A Blueprint for Civic Hell

Detroit was once famous for creating the largest, most spectacular versions of whatever its residents set their minds to, be they assembly lines, record labels, or revolutionary workers’ associations. The city is often credited with inventing and mass-producing the twentieth century, while its workers simultaneously took the lead in revolting against the injustices of the era. Its factories put the world on wheels and labor laws on the books. Its workers and thinkers sparked and fanned a number of this country’s most influential resistance movements.

Detroit: every article about you should include a love letter, a thank-you note, a history lesson, for without you…

Few care to admit, however, that the city that was the arsenal of the twentieth century may also provide the blueprint for a more precarious era. Which brings us to those massive tax foreclosures of the present moment. Just over 60,000 homes, about half of them occupied, are slated for the auction block. As many as 100,000 of the city’s residents—about a seventh of the total number—are now on track for what many are calling an eviction “conveyor belt.”

Such an image easily springs to mind in this city whose auto factories were famous for their oh-so-efficient shop floors. These days, sadly enough, it’s all-too-easy to imagine a twenty-first-century version of a classic Detroit assembly line dedicated to processing its own residents, workers, and retirees—all the ones it claims to no longer need, all those too old, too young, too ill-trained, too inefficient for a post-bankruptcy city. These undesirables, it seems, are to be turned into so many economic refugees on a conveyor belt to nowhere. While everyone loves to hear about legendary industrial Detroit, no one wants to hear about its de-industrialized progeny, and especially not about foreclosures—not again.

Mike Shane, a Detroit resident and organizer with the anti-foreclosure group Moratorium Now!, knows this better than anyone. “We call the press, and they say, give us anything but foreclosures,” he tells me ruefully.

Connecting the Dots

On March 31st, some people did manage to make the necessary “arrangements” to save their homes. That included one woman with a Hillary Clinton-style hairdo who had lived on Winthrop Street since the 1960s, but like so many in the working-class sections of the city had fallen behind on her taxes. “They asked, ‘Why didn’t you pay your property taxes?’” she explained as she rested on one of the first-floor benches. “And I said, ‘Because I had a heart attack.’”

Last year, she recalled, a neighbor’s home fell into tax foreclosure. A man who lived on the same block noticed the familiar address on the auction list. He bought it back for her, she tells me. “He said to the woman, ‘Pay me back when you can, if you can.’”

Detroit is full of similar stories, filled with a stubborn sense of hope. But there are so many more addresses on the foreclosure list than angelic neighbors. By early afternoon that March day, the building still bursting at its seams with thousands of people, the county office conceded its inability to cope and extended the foreclosure deadline another six weeks.

“I don’t know if it’s because they’re so damn overwhelmed,” wondered Mary Crenshaw, a sunken-eyed woman who was relieved by the announcement, as it gave her time to wait for a lump-sum retirement payout from British Airways, her former employer. She had come to save her family home in Highland Park, a small city enclosed by Detroit whose once occupied homes sported oak floors and beveled glass windows. Now, more than half of them are empty, lawns overgrown, windows boarded up, the former homeowners having already ridden earlier foreclosure conveyor belts out of the neighborhood.

After all, this current tax foreclosure crisis comes right on the heels of the city’s last great displacement: the 2008 housing crash, which descended on Detroit like a tidal wave, sweeping nearly a quarter of a million people out of the city and leaving in its wake tens of thousands of vacant properties.

The fact that the city is now threatening to evict a seventh of its remaining inhabitants in a single year, all because of unpaid property taxes, seems like an absurd proposition until you begin to connect the dots: the mass water shutoffs, the shuttering of dozens of public schools, the neglect of fire hydrants in particular neighborhoods, and now this deluge of foreclosures.

Looking at the pattern that emerges, you can see that Detroit is not only a city in the midst of a “revival,” as enterprising investors and the national media often claim. It’s true that redevelopment is taking place in some neighborhoods, and city officials do claim that big changes are coming, often illustrating them with colorful documents that look like they were formatted by a team of graphic design wizards from the back of San Francisco’s Google Bus.

But that’s just one part of the Detroit story. For the city’s low-income, black, and elderly residents, Detroit isn’t a city on the rise, but one under siege.

An Emergency That Never Ends

On a blustery Saturday afternoon just two weeks before the day of the foreclosure deadline, an Emergency People’s Assembly Against Tax Foreclosures was held at Old Christ Church to address this siege. It was one of a set of “people’s assemblies” called to deal with the latest crisis in a city where, in recent years, crises have never been lacking. Before the tax foreclosure assemblies there had been the Emergency People’s Assemblies Against Bank Foreclosures, the Emergency Pack-The-Court Actions to Defend Homeowners from Eviction, the Emergency Town Halls to Defend City Pensions Services, the Emergency Meetings Against the Emergency Financial Manager, and so on.

“Emergency” had, in other words, been the word of the moment for years and years. That invasive sense of never-ending urgency could similarly be seen in the literature of such groups—in the words always screamingly in capital letters, in the typographical equivalents of exclamation points. When I’d first heard about the most recent event, I was in a meeting with Mike Shane and I said to him, “Over the three years I’ve been visiting Detroit, I’ve never arrived at a time you weren’t holding an Emergency People’s Assembly the following Saturday.”

Shane laughed on cue. “Well, yes, that’s right,” he replied. “We’ve been at this since about 2007.”

The Old Christ Church that day was shiveringly cold. From the pew behind me came the sound of rustling coats as two children squirmed. Beside them sat their grandmother and grandfather, Lula and Daryl Burke, who had come to describe how their home had been sold at a tax foreclosure auction last year. With the help of the grassroots community group Detroit Eviction Defense, Lula explained, the Burkes had convinced the home’s buyer to sell it back to the family.

A little bit of gumption on her part helped, too. As she recalled explaining to the investor who had bought her home at auction, he could try to sell the house to someone else. But before he did that, she planned to strip every last thing out of it. “It won’t have a furnace, a toilet, doors, windows, all the way down to the light switch,” she warned him.

On the wall behind the altar three white-robed angels were suspended in mid-frolic, oblivious to the current condition of their once regal city. In front of them stood anti-foreclosure lawyer Jerry Goldberg. “Are we going to allow 62,000 more foreclosures this year?” he thundered, his face growing redder. I later learned that, years ago, Goldberg had sold peanuts down at the old Tigers stadium (now a bulldozed parking lot) and his unrelenting voice had apparently made him very good at it.

“No!” he responded emphatically to his own question. “Are we going to allow them to make our neighborhoods into a bunch of ponds?”

Perhaps I should have led with this information: in some of the city’s latest flashy Adobe InDesign-ed planning documents, certain of Detroit’s more down-and-out neighborhoods have been transformed into ponds. Or, to be more precise, they have been turned into “water retention basins” that planners believe will offer the Detroit of the future superior management of storm water runoff.

Minutes earlier, Alice Jennings, one of the most celebrated social justice lawyers in the city, had explained that, according to Detroit’s planning documents, those retention basins are slated to be built on top of now populated neighborhoods. In other words, ponds are also what we’re talking about when we talk about Detroit’s tax foreclosures.

“No!” Goldberg shouted yet again. “We need to stop these foreclosures with a moratorium, a halt! The idea that this can’t be done is hogwash! The Supreme Court held in 1934 that, during a period of emergency, the people’s need to survive supersedes any financial contract! The governor has a responsibility to declare a state of emergency!”

His sentences all ended in exclamation points, as his torrent of words resounded off the church’s high ceilings. In an upside-down universe, Goldberg would have made a skilled auctioneer rather than a man desperate to save all those homes and their inhabitants.

To be clear, Goldberg isn’t suggesting another of the emergency proclamations that Michigan’s governors have used to impose unelected emergency managers on school districts and municipalities from Detroit to Muskegon Heights. Rather, he’s calling for the governor to declare a state of emergency under Michigan law 10.31, which would allow him to “promulgate reasonable orders, rules, and regulations as he or she considers necessary to protect life and property”—including, of course, halting the tax foreclosures. In 1933, similar actions allowed Michigan’s legislature to pass the Mortgage Moratorium Act, later upheld by the Supreme Court, mandating a five-year halt on property foreclosures.

Winning that moratorium took, among other things, a well-organized national Communist Party, hundreds of worker councils, thousands of eviction blockades, and—I’d be willing to bet, although I don’t have the archival evidence—an incredible number of “emergency meetings.”

Woe to Those Who Plan Iniquities

By late afternoon, Goldberg was resting his vocal chords and about a dozen people from the audience were lining up to take the microphone, including Cheryl West, a tiny, gray-haired woman clutching a thick Bible to her stomach. When it was her turn to speak, she began: “I lost my home of 60 years.” There was no trace of bitterness in her voice, just a touch of awe and disbelief. “It’s been quite a journey. Quite a journey.”

“Let me give you a little background,” she continued. “My entire family is now deceased. My father was the first African American to teach music in Detroit, possibly in the entire state of Michigan. He worked for the school system. He lived in that very house. He lived there through the 1967 riots and we were right at the hub of where the riots started. My sister was a journalist, and during the riots she was one of the people getting the story out to the media, because she was working for UPI at the time. My sister was on the front page of the London Times, that’s how far her news traveled of the city burning down around us.”

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Then, after a few more background comments on her life, she opened up her bible. “Since we’re in a church,” she said by way of explanation and began to read from the Book of Micah. She skipped its beginning.

“Woe to those who plan iniquity,
to those who plot evil on their beds!
At morning’s light they carry it out
because it is in their power to do it.
They covet fields and seize them,
and houses, and take them.
They defraud people of their homes,
they rob them of their inheritance…”

Undoubtedly, she assumed that everyone in the church was already familiar with such “iniquities” and the biblical lines that went with them. After all, in the previous few years, they had lived through the 2008 foreclosure crisis, the imposition of an emergency manager on their city, mass water shutoffs, and significant pension cuts for retired city workers, not to speak of all the evils that had come before.

Instead, she read the verses she liked best, the ones that, as she said, God led her to just about the time she lost her home.

“You strip off the rich robe
from those who pass by without a care,
like men returning from battle.
You drive the women of my people
from their pleasant homes.
You take away my blessing
from their children forever.”

She paused, then suddenly, in a surprisingly powerful voice, yelled the next line: “Get up! Go away!”

The church reverberated with her admonishment. And then, with a smile at her own audacity, she added, “The end.”

Shortly afterwards, we filed out of the church. And yet it was not the end. It never is.

There is now, for instance, that new deadline—May 12th—for residents to get on a payment plan to avoid losing their homes to tax foreclosure. That offers more time for people to navigate the revolving doors of the Wayne County Treasurer’s Office, head up to the eighth floor, then down to the fifth, all in an effort to fight their way off of the city’s conveyor belt to nowhere. And, of course, it gives residents more time to host emergency people’s assemblies aimed at throwing a monkey wrench —once and for all—into this assembly line of eviction and displacement.

Even if that happened, however, these gatherings, called for in all capital letters and exclamation points, undoubtedly wouldn’t end. They’ve become as much a fixture of this city as the women and men who organize them, the churches that host them, and the neighborhoods whose survival may depend on them. After all, the worst injustice would not be whatever provokes the next emergency people’s assembly, but the possibility of a future Detroit without such gatherings, one in which all these meetings and people are gone, all the stories have been suppressed. Imagine, then, the worst iniquity of all, the one so many are fighting against: a Detroit where once inhabited streets have been submerged in the silence of water retention ponds, where longtime residents have been scattered and displaced by the foreclosure conveyor belt and no one left in the city knows the history of what’s been drowned.

 

Read Next: 2015 could be the start of a green energy revolution.

Article source: http://www.thenation.com/article/204745/foreclosure-conveyor-belt-could-remove-many-100000-detroit-residents-their-homes

Fighting foreclosure: Help harder to find, but still exists

Gregory Cain’s wife had just given birth to their third child when he got laid off from his six-figure IT job.

The family moved here for the job before the recession hit, so they didn’t have family and friends around. Still, Cain was optimistic about landing a new position.

But weeks and months passed, and the phone just wasn’t ringing. Soon they were in danger of losing their home.

“We’re talking late at night and trying to decide when we tell our kids what might happen,” Cain said. “We were within days of having to pack up and go.

“Children can sense these things. They wonder what’s going on. It was really tough.”

Many Alabamians found themselves in Cain’s situation earlier this year. The number of foreclosure notices statewide spiked 66 percent in February after declining for most of the previous year, according to data company RealtyTrac.

Now there’s about to be less help available for those people facing foreclosure.

‘I had to cut them off’

Capell and Howard attorney Jimmy Walter spent the last year helping homeowners keep their houses, or at least find a better alternative than foreclosure. Walter has personally handled 15 cases, and he’s just one of the 40 attorneys across Alabama providing free help as part of a state-funded program.

“I think it’s been a very good program and has helped a lot of people,” Walter said.

It’s not accepting anyone else for now. The program’s funding gets cut off on April 30 despite the fact that there’s still money available.

The state allocated $500,000 to provide a year of free legal help, but program administrator Judith Keegan of the Alabama Center for Dispute Resolution said it took several months of that time to just get the word out to people in need. She suspended sign-ups at the beginning of the month and expects to leave about $150,000 of the money with the state attorney general’s office because she can’t spend it in time.

“I was afraid if I took any more cases, I wouldn’t be able to pay my mediators,” Keegan said. “I had to cut them off.

“I could spend it if I had another six months. It would be gone, I promise you.”

A spokesman with the attorney general’s office said the leftover money will be used for “authorized purposes.”

Meanwhile, a predatory industry is circling those in need.

Scams, misinformation

Two out of every three homeowners who contact the Montgomery Volunteer Lawyers Program for free foreclosure assistance have already been a victim of fraud, the organization said.

Con artists follow foreclosure listings and immediately target homeowners in distress with personalized letters, Internet ads and more — always with big promises, according to the Federal Trade Commission. Some claim to represent a law firm, while others claim to be a part of the homeowner’s mortgage company.

“A lot of times I’ll talk to somebody and they’ve sent $3,000 or $4,000 to some company in California to stop the foreclosure,” said Matt Matthews of the Anderson Law Firm. “They don’t have money to pay me, and they don’t have money to (recover their money).”

Attorneys said many homeowners contact them too late because they don’t know where they are in the foreclosure process and don’t understand how the laws work. It’s made worse by the fact that Alabama is one of 32 states where there’s no judicial process required to foreclose on a home.

The Cains said they’re fortunate because their lender walked them through the process, helped them apply for assistance, and warned them about some of the scams.

“The only things we followed up on were from our lender,” Latasha Cain said. “Anything else, I knew it was trash and that’s what I did with it.”

Help still available

The Cains got help from the federally funded program Hardest Hit Alabama, which helps with mortgage payments and loan modification. Combined with state healthcare and food assistance programs — and a loan from their family — they were able to hold onto their home until they found jobs.

Gregory Cain considers himself lucky, in more ways than one.

Their mortgage lender, Bank of America, agreed last year to pay nearly $10 billion to help struggling homeowners as part of a federal financial fraud settlement.

Keegan hopes that some of that money will be used to restart the free mortgage mediation program in a few months.

Meanwhile, attorneys from the Montgomery Volunteer Lawyers Program will meet with homeowners at a free public legal clinic Tuesday at 3 p.m., 1100 Adams Ave.

Gregory Cain said he knows there are still plenty of people out there who need help even more than he did.

“The numbers don’t lie,” he said.

Where to get help

Hardest Hit Alabama, 1-877-497-8182 or hardesthitalabama.com

Montgomery Volunteer Lawyers Program, 265-0222 or montgomeryVLP.org

Alabama Center For Dispute Resolution, alabamaADR.org

Federal Trade Commission, consumer.ftc.gov

Free legal clinic, 3 p.m. Tuesday, 1100 Adams Ave.

Avoiding scams

It’s illegal for a company to charge you a penny until it has given you a written offer for a loan modification or other relief from your lender and you accept the offer.

Companies are required to disclose that they’re not associated with the government and their services have not been approved by the government or your lender.

If a company tells you to stop paying your mortgage, it also has to warn you that doing so could result in you losing your home and damaging your credit.

Companies can’t tell you to stop talking to your lender. You should always feel free to contact your lender directly to see whether they can offer you additional options. Companies that tell you otherwise are breaking the law.

— Federal Trade Commission

Article source: http://www.montgomeryadvertiser.com/story/money/business/2015/04/19/staring-foreclosure/26022989/

How to Stop Foreclosure Issues in California

For anyone in need of a foreclosure lawyer, Consumer Action Law Group and their team of foreclosure attorneys consistently assists clients in stopping foreclosure and regaining stability in their lives.

This press release was orginally distributed by ReleaseWire

Los Angeles, CA — (ReleaseWire) — 04/17/2015 — Recently, the state of California adopted SB900, The Homeowner Bill of Rights, which is aimed at preventing foreclosures and helping homeowners understand their options. This “HOBR” outlines several options that homeowners have to prevent foreclosure, or put a halt to it. These include loan modification, suing mortgage lenders for violations, forbearance agreements, and even refinancing current loans. A foreclosure attorney helps borrowers understand their rights more clearly and can assist in the process. Here is a brief description of each preventive step borrowers can take to stop foreclosure in California.

Loan Modification

A loan modification, in its simplest form, is a permanent alteration of the terms of a loan. A foreclosure lawyer will usually suggest that homeowners apply for a loan modification as the first and foremost method for stopping foreclosure. This is primarily because loan modification does not involve litigation and is the easiest action the borrowers themselves can take to avoid foreclosure.

Forbearance Agreements

Depending upon the situation, forbearance agreements are the preferable option for borrowers who are experiencing a temporary hardship. Borrowers who will lose income for a short period of time should consider working with their lender to come to an agreement regarding lower monthly payments. This can prevent foreclosure. Communication is vital to this process.

Loan Refinancing

Loan refinancing is an option for individuals who are not yet late on their payments. Borrowers that are struggling with their payments should contact their lender to prevent foreclosure down the road. The government also provides assistance through the Home Affordable Refinance Program (HARP) which is a great refinance program for borrowers with a high interest rate or a high principal loan balance. A foreclosure attorney can assist borrowers in determining the appropriate action for HARP eligibility.

How Consumer Action Law Group can Help

Consumer Action Law Group is staffed with experienced foreclosure attorneys that help individuals in California to stop foreclosure on their property. They have consistently proven that they are the premiere firm when searching for a California foreclosure attorney with a proven track record. Their legal team has helped hundreds of their clients to successfully stop their foreclosure sales by filing lawsuits or taking legal action.

Take, for example, the case of Brandon V. Aurora Loan Services, LLC. The bank had proposed a three payment modification for their client’s loan so that the borrower could retain his property and prevent foreclosure. Despite Mr. Brandon’s fulfillment of these three payments, the loan provider refused to modify the terms of his loan. The foreclosure attorney at Consumer Action Law Group argued the breach of contract resulting in a win for Mr. Brandon.

For anyone in need of a foreclosure lawyer, it is best to pick up the phone and contact Consumer Action Law Group and talk to their foreclosure attorneys immediately. They consistently assist clients in stopping foreclosure and saving homes; helping borrowers to regain stability in their lives.

To learn more about their foreclosure service, contact Consumer Action Law Group at 818-254-8413 or visit http://ConsumerActionLawGroup.com

About Consumer Action Law Group
Consumer Action Law Group is a law firm dedicated to help consumers in consumer-related matters or consumers that experienced fraud and scam. Attorneys in the team are knowledgeable and experienced in the areas of eliminating debt, mortgages fraud, auto fraud, and foreclosures. They have direct experience in consumer fraud matters and helping consumers who are facing financial crisis, foreclosure, issues with employers, and problems with auto dealers.

For Media Contact:
Contact Person: Lauren Rode, Esq.
Telephone: 818-254-8413
Email: Lauren@consumeractionlawgroup.com
Website: http://www.consumeractionlawgroup.com/

For more information on this press release visit: http://www.releasewire.com/press-releases/release-592714.htm

Article source: http://www.digitaljournal.com/pr/2526419

Foreclosure Attorneys That Stop Foreclosure and Fight Notice of Default

Consumer Action Law Group foreclosure attorneys have a successful track record of stopping foreclosure sales. Their foreclosure lawyers frequently stop trustee sales within 24 hours.

This press release was orginally distributed by ReleaseWire

Beverly Hills, CA — (ReleaseWire) — 04/17/2015 — Every day, thousands of homeowners in California face foreclosure. The foreclosure laws in California require lenders to send a notice of foreclosure to a borrower who defaults on a loan. For those home owners who have received a notice of default or notice of trustee sale, it is best to call a foreclosure attorney to find a solution to stop the trustee sale.

There are several ways of stopping a foreclosure. Home owners can apply for a loan modification, short sale, deed in lieu, or a forbearance agreement directly with the lender and that should stop the foreclosure process; at least temporarily. Home owners can also file a bankruptcy to immediately stop a foreclosure sale.

If the lender is not offering any alternative to foreclosure or any type of hardship assistance, Consumer Action Law Group foreclosure lawyers will research the home owner’s case to see if it makes sense to take legal action to save their home. Lenders are required to follow the California foreclosure laws very strictly and to give borrowers the opportunity to pursue alternatives prior to selling a home at auction.

In January 2013, Governor Gerry Brown enacted the Homeowner Bill of Rights [SB 900] to help borrowers in California to avoid foreclosure. The law was designed to stop predatory lending practices that were allowing lenders to foreclose without first trying to help borrowers in distress. Governor Brown himself had this to say – “People should not have to suffer due to the abusive tactics of lenders who would push a foreclosure behind an unsuspecting homeowner’s back”.

Here are the benefits of the California Homeowners Bill of Rights:

1. Prohibits Dual Tracking: Lenders cannot move forward with foreclosure without first contacting a borrower and offering an alternative. Lenders cannot continue with the foreclosure process while simultaneously offering to provide an alternative [such as a loan modification, short sale, deed in lieu, or a forbearance agreement].

2. Requires a single point of contact with homeowners in loan modification negotiations.

3. Expands notice requirements to borrowers prior to taking action or pursuing foreclosure.

4. Allows injunctions against foreclosure violations to be corrected and permits civil penalties against servers who file multiple, inaccurate mortgage documents or engage in willful or reckless procedural violations.

Federal laws are also in place to protect borrowers against unfair lending practices that are associated with residential mortgages:

1. TILA (Truth in Lending Act)
2. HOEPA (Home Ownership Equity Protection Act)

These laws allow borrowers to sue lenders for money damages. That includes a refund on any financing costs that borrowers have paid. These laws also let home owners cancel the mortgage under specific circumstances [although extremely rare].

Filing a lawsuit requires violations of the law that are serious enough to warrant a judge to take action. Inconsequential errors are typically not actionable. To put it simply, if the violation of the lender did no harm to borrower, there may not be any actual damages. An experienced foreclosure attorney will be able to advise on issues that borrowers may not realize give cause for a lawsuit. The foreclosure lawyers at Consumer Action Law Group take the time to research home owners’ claims to see whether they have a case or not. For anyone facing foreclosure, it is best to call Consumer Action Law Group and talk to one of their foreclosure lawyers for free, just to know what options are available.

Consumer Action Law Group can help California residents to stop foreclosure. On the first call, Consumer Action Law Group can stop a foreclosure sale immediately.

About Consumer Action Law Group
Consumer Action Law Group is a law firm dedicated to help consumers in financial-related matters or consumers that experienced fraud or scams. Attorneys on the team are knowledgeable and experienced in the areas of eliminating debt, mortgage fraud, auto fraud, and foreclosures. They have direct experience in consumer fraud matters helping consumers who are facing foreclosure, abuse by employers, and scams by car dealers and lenders.

For Media Contact:
Contact Person: Lauren Rode, Esq.
Telephone: 818-254-8413
Email: Lauren@consumeractionlawgroup.com
Website: http://www.consumeractionlawgroup.com/

For more information on this press release visit: http://www.releasewire.com/press-releases/release-592709.htm

Article source: http://www.digitaljournal.com/pr/2526411

Pro-Foreclosure Bondholders Square Off Against Pro-Loan Mod Ocwen

There is a nasty, public fight going on that pits struggling homeowners, many in low income and minority communities who need mortgage modifications to help them avoid foreclosure, against some big Wall Street investors who own the bonds backed by those mortgages who want speedier foreclosures.

Caught in the middle is Ocwen Financial Corp., the largest servicer of sub-prime mortgage loans and the trustee on the bond issues. Ocwen says granting loan modifications, including principal reductions, to borrowers is the best way to keep families in their homes—and paying their mortgages—as well to the benefit of all of its bondholders. It is also good public policy, it says.

On the other side, some big bondholders—including BlackRock, PIMCO, Kore Advisors, MetLife, Neuberger Berman and others—accuse Ocwen of not doing its job and granting loan modifications at their expense. They want the trustee of these bonds to alter how Ocwen services the loans.

This argument is not new from Larry Fink’s BlackRock. In an October 2010 op-ed in The Wall Street Journal titled, “Why a Foreclosure Moratorium Is a Bad Idea,” BlackRock came out against the Home Affordable Modification Program (HAMP). In June 2012, BlackRock wrote a letter to Shaun Donovan, Secretary of the U.S. Department of Housing Urban Development (HUD), to voice its “concerns with the Home Affordable Modification Program and the AG Settlement and their resultant impact on the availability of private capital in the mortgage-backed securities markets.”

Ocwen maintains that HAMP furthers the U.S. Treasury Department’s public policy to help struggling borrowers remain in their homes by encouraging and guiding servicers to pursue profitable loan modifications rather than rushing to foreclosure.

So many points are ironic about this fight, including that Ocwen has been accused multiple times over the years by regulators, politicians and consumer protection groups of preying on sub-prime borrowers. Now it’s being accused of granting overly liberal terms to those same borrowers in order to help them stay in their homes and communities. And Larry Fink has been “hoping” to be the next U.S. Treasury Secretary if Hillary Clinton wins the presidency in 2016.

In late 2013, Ocwen agreed to a $2.1 billion settlement and fine with federal and state regulators to settle charges of alleged misconduct. Last December it reached a settlement with New York State regulators that required the company to change its practices and provide $150 million to help struggling homeowners in the state.

Now it’s got bondholders angry.

On Jan. 23, 2015, the Houston law firm of Gibbs Bruns LLP, which represents holders of 25 percent of $82 billion of residential mortgage-backed securities (RMBS), alleges Ocwen had “material failures” in complying with the covenants that govern the bond issues.

The letter claims that Ocwen engaged in “imprudent and wholly improper loan modification, advancing, and advance recovery practices.” It accuses Ocwen of improperly using trust funds to pay its borrower relief obligations in the regulatory settlements, essentially “shifting the costs of the settlement to the Trusts and enriching Ocwen unjustly.”

In a January 26 reply, Ocwen’s outside counsel, Orrick, Herrington Sutcliffe (Orrick), said the investors’ “ultimate objective” is “to stop servicers from modifying loans and force them to foreclose on and evict as many struggling homeowners as quickly as possible. While knee-jerk foreclosures may redound to the special economic interests of your clients, they are not in the best interests of the Trusts as a whole, not consistent with industry practice, and therefore prohibited under the servicing agreements.”

Orrick also accused the bondholders of trying to “push foreclosures and stop principal reduction” as “part of their ongoing industry-wide pro-foreclosure campaign, which has been roundly criticized by numerous national housing, consumer protection and civil rights groups as anti-consumer and contrary to good public policy.”

Ocwen, which says it is a leading provider of loan modifications under HAMP, followed that up with a 30-page “rebuttal letter” dated March 23, in which it asserted that it is servicing loans “in the best interest of all investors.” It said “each modification Ocwen performs is designed to yield a higher anticipated recovery to investors than foreclosure.”

The bondholders counter that their tranches have “performed materially worse than Trusts serviced by other servicers” due to Ocwen’s alleged “imprudent and improper servicing practices.”

Ocwen pushed back by stating “these investors’ pro-foreclosure, anti-modification agenda is driven by their desire to increase their own financial returns on their specific tranche-level holdings in RMBS Trusts, at the expense of long-term gains to the Trusts as a whole, through sustainable modifications.”

On Feb. 25, Morgan Stanley issued an independent report on Ocwen’s servicing operations that said the company does a better job of keeping struggling borrowers in their homes and reducing the amount of money they owe on their loans compared to other servicers.

“Since the beginning of 2011, they have been far more likely to give a borrower a principal modification than the market as a whole,” the report said. “Ocwen has been far more generous to borrowers than the overall sub-prime market.”

Morgan Stanley noted that some of Ocwen’s pro-borrower strategies could be “potentially disadvantageous” to bondholders, since they take a loss when borrowers get their principal reduced. However, it says, “there are other forces at play,” such as keeping borrowers in their homes as a matter of public policy.

It advises bondholders to stick with Ocwen. “It doesn’t appear in investors’ best interest to replace Ocwen as servicer,” it concluded.



George Yacik is a special correspondent to National Mortgage Professional Magazine. He has been covering the residential mortgage business for more than 20 years and writes frequently for industry publications. He is a former vice president of SMR Research Corporation, where he was the lead research analyst on residential and sub-prime mortgage loans.

 

Article source: http://nationalmortgageprofessional.com/news/53596/pro-foreclosure-bondholders-square-against-pro-loan-mod-ocwen

Lessons learned from the mortgage crisis

I moved to Glenwood in 2008 intent on establishing an estate planning and probate practice. If I were wedded to that objective, my timing was bad. I hadn’t been here a month when Bear Stearns collapsed, and the average 401(k) began an abrupt descent into 201(k) territory.

Under such economic conditions, hiring a lawyer to draft a will was on the bottom of many priority lists, so I spent several years doing something quite different and unexpected — troubled loan work for lending institutions. This work included loan sales, refinances and foreclosures.

Most of my foreclosure work focused on development and commercial property. We didn’t handle residential foreclosures or represent the national banks where most residential homeowners got their mortgage loans, so when my firm would get a call from a homeowner in foreclosure seeking legal advice in a desperate attempt to save the home, the receptionist would forward the call to me.

I would try to help, but knowing what I knew about the foreclosure process in Colorado, there was often little that could be done. I thought to myself on a number of occasions that I wish I had had the opportunity to counsel this person much earlier. In a few instances, I thought I could have assisted the homeowner in preventing the foreclosure. In others, I thought that I could have at least better prepared the homeowner for what to expect, so that when the foreclosure happened, it wouldn’t come as such a shock.

In any event, here are a few things I would have said had I had the opportunity to speak to a financially distressed homeowner early on. Perhaps this information will be helpful to homeowners who are still struggling financially and to others in preparing for the next economic recession.

First: Colorado has a law that basically provides that in order for a loan agreement (including agreements providing for principal or interest reduction or forbearance) to be legally binding, it must be reduced to writing and signed by both the borrower and the lender. This means that the oral statements of a lender or a loan servicer are generally unenforceable.

To me this is among the most important pieces of information for a financially distressed borrower to know and take to heart.

Getting some kind of mortgage relief from a national lender invariably starts with a phone call to the loan servicer and a lengthy underwriting process involving several follow-up phone calls.

Customer service agents working for loan servicers may have made oral promises (or what may have sounded to the homeowner like a promise) that a loan modification was approved or guaranteed. From a legal perspective, a loan agreement isn’t enforceable until it’s reduced to writing and signed by the lender. This means that until the ink is dry on the loan modification, the borrower should understand that the lender has reserved all rights, including the right to declare default or foreclose, even if a loan servicer gives oral indications to the contrary or a loan modification is seemingly in progress.

Second: The following is a basic, realistic summary of the distressed loan situation: (1) If a loan is performing (i.e., payments are current), a lender has little economic incentive to agree to some form of mortgage relief (i.e., principal or interest reduction, approval of a short sale). (2) If a borrower defaults, it may or may not make economic sense for the lender to provide mortgage relief. (3) It takes a lot of time and money to modify a loan, so if the financial condition of a distressed borrower is sufficiently poor (or not sufficiently good), the most reasonable course of action for the lender may be to foreclose the loan. (4) As a result of the foregoing, a fraction of financially distressed homeowners who enter into the loan modification process get some kind of relief. Others, and probably most, don’t and end up losing their home.

I encountered some borrowers who quit making payments in the hope (and with the mistaken expectation) that they were guaranteed a principal or interest reduction if they defaulted and applied for mortgage relief. Some of these borrowers ultimately failed to qualify for mortgage relief and ended up losing their homes.

When a borrower defaults on a loan, he or she loses a significant degree of power and control. The bank has economic interests to protect, and it may be subject to regulations that dictate its course of action. Meanwhile, from a legal perspective, when the borrower is in default, the law tends to favor the lender, who then has many rights under the loan agreement and under law.

All this is to say that the first and strongest line of defense for a borrower trying to save his or her home from foreclosure is to take every possible action to avoid defaulting on the loan in the first place.

If nothing can be done to avoid default, the borrower should pursue mortgage relief but should also adjust his or her expectations about the likelihood of losing the home and plan accordingly. This is undoubtedly an uncomfortable and unfortunate reality, but it is the reality nonetheless.

Third: Once the loan is in default and the foreclosure has started, it’s difficult from a practical perspective to justify stopping it. A lender will spend hundreds if not thousands of dollars in legal fees to prosecute a typical foreclosure. This does not take into account the overhead costs of managing troubled loans.

Meanwhile, under most circumstances, Colorado law requires that if a foreclosure is not completed within a year of the original date of the foreclosure sale, the lender will have to start over from the beginning to foreclose the loan, which is not something the lender will ordinarily allow. The decision by a lender to foreclose is somewhat of a Rubicon, meaning that it’s a difficult decision to go back on. Each passing day, it becomes more difficult from a practical perspective to stop the foreclosure process, even if simultaneous efforts are being made to modify the loan.

Fourth: In light of the foregoing, the most prudent course of action is to be conservative when getting a home loan and to try to be prepared for difficult economic times. When storm clouds start to form, be proactive: Understand that it will be easier to perform defensive maneuvers (i.e., refinance the loan, sell the house, get a cheaper car or reduce personal overhead, find a renter, or get authorization for a short sale) when the loan is not yet in default. Finally, if you cannot avoid default, work your hardest to get mortgage relief, but prepare yourself mentally to move on at the same time.

Matthew Trinidad is a transactional attorney in Glenwood Springs. He can be reached at (970) 945-2261 or mlt@mountainlawfirm.com.


Article source: http://www.postindependent.com/news/15882175-113/lessons-learned-from-the-mortgage-crisis

ECB sees risks in Greece’s planned home foreclosure law


ATHENS (Reuters) – Greece’s draft law to protect primary residences from foreclosures goes beyond protecting low-income debtors and could encourage strategic defaults, the European Central Bank said in a legal opinion on Saturday in a potential setback to the plan.

Greece’s Economy Ministry had asked for the ECB’s views on the draft legislation, which seeks to protect indebted citizens from losing their primary homes — and fulfills a pledge by the governing Syriza party to deal with a humanitarian crisis brought on by the country’s debt crisis.

The draft law offers protection to primary homes valued up to 300,000 euros and requires that borrowers do not have an annual income of more than 50,000 euros to be eligible.

It also sets an upper limit of 500,000 euros for borrowers’ total wealth, of which bank deposits and other liquid assets cannot exceed 30,000 euros.

The conditions are more generous than under Greece’s previous foreclosure law, which expired last year. It provided protection for homes valued at 200,000 euros or less and required that borrowers had an annual income of 35,000 euros maximum and total wealth of 270,000 euros or less.

“The very broad scope of eligible debtors, which goes beyond the protection of vulnerable and low-income debtors, may create moral hazard and could lead to strategic defaults, undermining the payment culture and future credit growth,” the ECB said.

“The draft law sets out significantly broader eligibility criteria in terms of the value of the protected property, the annual household income, the value of immovable and movable assets and the amount of deposits,” the ECB said, comparing it to the previous law.

It said that broad-based prohibitions on primary home auctions was not a sustainable solution to tackle the high level of non-performing loans at Greek banks.

“It is likely that the prohibitions in the draft law will incentivize debtors who are not in real need of protection to stop meeting their obligations or reduce them significantly, even if they have the means to meet them in full.”

The ECB supervises Greek and other euro zone banks.

Greek banks’ bad loans rose to 34.2 percent of their loan portfolios by the end of the third quarter of last year, from 31.9 percent in December 2013, according to Greek central bank data.

About 28.1 percent of home loans extended by Greek banks, which were worth a combined 69 billion euros, were non-performing or unpaid for more than 90 days, as of September 2014, according to latest Bank of Greece data.

That was up from 26.1 percent in 2013.

Home loans accounted for a third of banks’ total loans as of last September.

(Reporting by George Georgiopoulos; Editing by Susan Fenton)

Article source: http://www.reuters.com/article/2015/04/11/us-ecb-greece-law-idUSKBN0N20BQ20150411