Articles Posted in Modifications

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arkovich_law-narrowHave you received a verbal forbearance of your mortgage payment?  But nothing else?  Mortgage servicers have certain responsibilities by law.  If you have received a verbal approval of your mortgage forbearance, but haven’t received anything in writing confirming this, not to mention advising what terms are, payment restart date etc. you have recourse under various consumer laws.

Reg X 1024.41(c)(2)(iii) requires a servicer to confirm the terms of the forbearance in a written notice sent to the borrower promptly after the forbearance is granted.  A servicer is also required to continue to send periodic statements while you are in forbearance at least until the effective date of any servicing transfer to another party.

If you have questions about your mortgage, and how to catch up or reduce your payments via a forbearance, loan modification or even a Chapter 13 bankruptcy, please consider reaching out to us.  Also, it’s often far cheaper to address problems early if you can and you may have more options the earlier you reach out.

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arkovich_law-narrowWhat to expect if you cannot pay your mortgage – This timeline comes directly from the Department of Housing and Urban Development, in other words, HUD:

  • First month missed payment: The lender will contact the buyer by a letter or phone.
  • Second month missed payment: The lender will begin calling to discuss why payments have been missed. At this point, the buyer might be able to make a payment to prevent further acceleration.
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arkovich_law-narrowOnce you get out of the habit of making a mortgage payment, it’s hard to get back to making that large payment every month.  This is particularly true, with student loans also restarting payments now.

What do we do that can help solve this problem for you?

We litigate mortgage claims, assert consumer defenses when available and defend foreclosures in Florida.  State law relating to foreclosures vary widely and we limit our practice strictly to Florida for mortgage related issues, generally in the counties surrounding Tampa Bay.  We’re a member of a local Tampa Bay foreclosure defense attorney group, and NACA which is a national consumer advocacy group where consumer attorneys share ideas, tips and trends.

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arkovich_law-narrowThe regular FHA HAMP loss mitigation programs will remain in suspension until October 30, 2024 – next year!  All foreclosure sales are to be suspended until the same date.  Same with Deed in Lieu negotiations.

So what does that mean?

All borrowers who are already in default or at risk of imminent default are supposed to be evaluated under the expanded guidelines of the Covid 19 Recovery Option program.  These provisions could be terminated early by Congressional action, executive or agency rules.

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arkovich_law-narrow“When do you need a foreclosure attorney?” was one of our highest performing videos last month.  That has motivated me to prepare a series of blogs, guides and new videos to help consumers learn about their options and what they should be aware of when they are behind in their mortgage payments.  This information is not intended to help someone represent themselves in a foreclosure action.  That can get complicated and most people are not well suited to litigation.  But this information should help a homeowner know what options are available, where to turn, timelines, and likely outcomes.  All of that is necessary whether you are planning to keep a home or letting it go.

So why is this coming up now?

As of August 2023, many covid-19 related moratoriums have expired and have unplugged the pipeline of distressed properties.  We are now at about 100,000 foreclosures nationwide, where in 2008 through early 2010 we had over 900,000 homes in foreclosure nationwide.

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arkovich_law-narrowThe FHA Covid-19 Forbearances allow for reduced or suspended payments without specific terms of repayment, for six months at a time, up to 18 months.  Deadline for applications was May 11, 2023.  The end of the health emergency is now over.  If you’ve lost your income, job change or divorce for instance, you may have qualified for this relief.

A FHA Covid-19 Modification is called Advance Loan Modification.  If a mortgage loan is in forbearance, the review will occur within 30 days of forbearance ending.  For those mortgage loans are not in forbearance, if the loan is 90 plus days delinquent it must be reviewed for a modification offer on or before 10/30/2024.  This is still in effect!

January 2023 new guidelines:  a substantial change is that the guidance now applies for non-occupied borrowers.  Some other notes:

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By now everyone (our attorney friends) has probably watched a CLE on the new DOJ Guidance to discharge federal student loans, but do you really understand how to do the process?
We are on a panel set up by the Bransons in Orlando doing an all-day workshop via Zoom on 4/3/23 for the step-by-step process. Including how to draft complaints, serve summons properly, how to fill out the attestation form, what/when to give the DOJ information, and how to get paid. Most likely this will be a $2,500.00 no look per creditor for student loan adversary or you can file a fee application.
I’ll also have a section on other options that are only good for a short period of time when folks have non-Direct federal student loans and an adversary won’t work. This will include the new one time account adjustment under the IDR Waiver, PSLF, the new Repaye calculations which should make an IDR payment roughly 1/3 of what it used to be, BDTR claims are now processing for full forgiveness, the 10k forgiveness appeal and an update on TPD and the payment pause.
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arkovich_law-narrowSupposed a foreclosure lawsuit is filed against you.  You file an Answer.  The plaintiff files a motion for summary judgment quickly.  New civil procedure rules require a homeowner to file his or her defense 20 days before a hearing.  Most people are unware of that rule and lose.  Even if they show up at the hearing, if they didn’t file their defenses to the MFSJ 20 days prior, they cannot raise any defenses.  This is even if they had already filed an Answer when they were initially served.  This is only one problem a homeowner could face in a foreclosure proceeding.

“I can’t imagine someone going through it without legal help, because I know how it was for me,” said Philip Jackson, a retired Clearwater police detective who has been involved in a long-running legal fight with St. Petersburg stemming from a foreclosure lawsuit the city brought against him in 2019.

Read more at: https://www.miamiherald.com/news/business/real-estate-news/article273093630.html#storylink=cpy

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While it took longer than I and many other consumer advocates thought, the house of cards is starting to slip finally.  Many mortgage companies did not fully disclose exactly what would be required once the CARES Act expired and mortgage payments would resume.  I’m sure many homeowners have claims out there but don’t realize it.  These consumer claims are no small thing and can be leveraged for better mortgage terms than what is being offered.  The CFPB is going after Carrington with a big fine — but a private action will result in actual damages for the homeowner.

CFPB Takes Action Against Carrington Mortgage for Cheating Homeowners out of CARES Act Rights

The Consumer Financial Protection Bureau (CFPB) is taking action against Carrington Mortgage Services for deceptive acts or practices under the Consumer Financial Protection Act in connection with mortgage forbearances, according to a CFPB press release. The CFPB found that Carrington failed to implement many protections, provided to borrowers with federally backed mortgage loans who were experiencing financial hardship, during the COVID-19 public health emergency. The CFPB found that Carrington misled certain homeowners who had sought a forbearance under the CARES Act into paying improper late fees, deceived consumers about forbearance and repayment options, and inaccurately reported the forbearance status of borrowers to the big three credit-reporting companies: Equifax, Experian and TransUnion. The CFPB is ordering Carrington to repay any late fees not already refunded, repair its faulty business practices, and pay a $5.25 million penalty that will be deposited into the CFPB’s victims relief fund.

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