New Jersey Resident Wins Damages Against Predatory Lending Practices

May 1, 2014 By

The average homeowner does in fact have recourse against the big banks when it comes to mortgage fraud and foreclosure defense. Goods news comes this past January from a ruling by New Jersey Chancery Judge Peter Doyne that says Wells Fargo committed actionable fraud and predatory lending.

The case involves Oscar Montesdeoca, of New Jersey. Evidently, Montesdeoca was persuaded to borrow $600,000 pus dollars for a three-bedroom home at interest rates that ranged from 7.75 percent to 14.35 percent.

The ruling is considered a significant victory in the battle against predatory lending practices in New Jersey, where another home foreclosure occurs every eight minutes! In the case in question, the mortgage for the home was $4800 a month. However, Montesdeoca earned between $500 and $600 a week, with his wife working for $7.00 per hour. They could not possibly have covered the mortgage, which ended up being $5700 a month, including insurance.

It was determined that the loan officer who worked with Montesdeoca had promised that “if he paid the loan and maintained good credit (for two years) he would receive refinancing” to reduce the high interest rates.

The couple couldn’t read the paperwork, which was in English, and learned only later that the bank listed their income as over $10,000 a month, when it was far from that amount. When the couple’s son requested that the bank refinance the mortgage in order to lower the high interest rate, as the officer had promised, the bank officer never responded.

The good outcome is that the bank was made to refinance the loans, and pay all the couple’s legal fees, as well as three times his damages, as required by New Jersey’s Consumer Fraud Act.

Contact Shaffer & Gaier: Protecting Homeowner Rights

The law firm of Shaffer & Gaier protects the rights of those who are facing foreclosure or seeking mortgage modifications in New Jersey and Pennsylvania. To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Source: http://www.responsiblelending.org/tools-resources/headlines/opinion-nj-court-resurrects-american-dream-from-foreclosure-nightmare.html

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Fraud, Mortgage Modification Tagged With: , , , , , , , , , ,

Foreclosure Defense in PA and NJ

March 26, 2014 By

If you have encountered financial problems and fallen behind on your mortgage, you may believe that your only option is to move out and allow your lender to foreclose on the property. To the contrary, there are many good reasons to fight foreclosure. Fighting foreclosure could give you an affordable place to live until you get your financial situation turned around. You may even be able to renegotiate your loan to make it affordable. The attorneys at Shaffer & Gaier, can help protect your rights.

Contact Us

To schedule a private meeting with an experienced foreclosure defense attorney, call our foreclosure hotline at 855-289-1660 or contact us online. Evening and weekend meetings can be arranged upon request. We will travel to your home if necessary to meet with you.

Filed Under: Foreclosure, Foreclosure Defense Tagged With: , , , , ,

Despite Housing Market Turnaround, Foreclosures High

March 3, 2014 By

Data released in late January notes that New Jersey may become the nation’s leader in the number of foreclosed homes by summer 2014. Mark Fleming, a chief economist for the online analytic firm CoreLogic.

Since the real estate bust in fall 2008, Florida had the highest percent of foreclosed homes, with New Jersey coming in second. By 2013, slightly over 10 percent of Florida homes with mortgages had undergone foreclosure. In contrast, New Jersey’s rate was slightly over 7 percent. It seems that New Jersey is going through the process much slower than Florida.

In fact, in the past year, while Florida competed 119,000 foreclosures, New Jersey’s completed just 5,138. It evidently takes about 1,002 days to resolve foreclosures in the Garden State, while the Sunshine State completes them in 883 days.

Foreclosure Backlogs in New Jersey

New Jersey’s struggles escalated when the state Supreme Court ordered the six largest banks to review their procedures for lending money. Filings at that time fell from 58,000 in 2010 to 6,000 in July 2011, creating a significant backlog.

It will be just a matter of time before New Jersey gets to the top of the list. The good news is that home sales have reached their highest levels since 2005, up about 18 percent in 2013.

Contact Shaffer & Gaier: Protecting Homeowner Rights

The law firm of Shaffer & Gaier protects the rights of those who are facing foreclosure or seeking mortgage modifications in New Jersey and Pennsylvania. To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Abuses, Foreclosure Defense Tagged With: , , , , , ,

COMPLICATED LITIGATION RESULTS IN FAVORABLE SETTLEMENT

February 10, 2014 By

On June 30, 2005, my client took out a $104,000 loan and mortgage on his family’s home in Southwest Philadelphia. The original lender was Indy Mac Bank, a sub-prime lender, whose operations were essentially taken over by the FDIC for what many believed were shoddy lending practices. The loan carried a low interest rate for the first two months, and then increased to an exorbitant interest rate for the next 29 years and 10 months. The mortgage broker, however, told my client at closing that he would be able to refinance the loan within a matter of months. This false promise never materialized, leaving my client with a deceptive, unfair and unreasonably high interest rate for the life of the loan.

One West Bank acquired the mortgage loan, which was later serviced by Ocwen Loan Servicing. One West filed a foreclosure lawsuit, and we filed a counterclaim and cross-claim against other lenders. The bank’s attorneys and I engaged in written discovery and multiple depositions, and in the fall of 2013, the Court scheduled a series of settlement conferences. The case was scheduled for trial in March, 2014.

By the time the case would be presented for trial, however, the balance on the loan was going to be approximately $187,000, almost twice as much as the original mortgage loan. The parties, however, reached a settlement, which lowered the principal balance by nearly $100,000, to $93,000. The settlement also called for an interest rate of 2% for the first 5 years, and for the remaining 5 years at 4.35%. While the case took almost 3 years to wind its way through the court, we were able to reach a favorable result.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense, Predatory Mortgage Practices, Sub - Prime Lending Tagged With: , , , , , , , , , , , ,

Mortgage Modification Push Helps New Jersey Homeowners

December 18, 2013 By

Mortgage delinquencies are falling as home prices rise and the foreclosure pipeline is clearing. Many speculate that this is the result of the mortgage modification push by the Obama Administration.  The Obama Administration has used various programs like HARP, the Home Affordable Refinance Program, and HAMP, the Home Affordable Modification Program, to allow distressed borrowers to refinance or modify their mortgages into something more affordable.  These programs have been particularly effective in New Jersey, as under New Jersey law, a judge must approve foreclosures, and they often press the borrower and lender to find a way to keep the borrower in their home.  Full article.

Mortgage modification is a process where the terms of a mortgage are modified outside the original terms of the contract agreed to by the lender and borrower.  At Shaffer & Gaier, we aggressively protect the rights of property owners in Pennsylvania, New Jersey and Florida. Our lawyers bring more than 45 years of combined legal experience to every case we handle. While we recognize that your case is unique, our commitment remains the same — to use our skill, knowledge, experience and resources to help you get the best outcome possible in a timely and cost-effective manner.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , , ,

CHESTER COUNTY TRIAL RESULTS IN SETTLEMENT

December 11, 2013 By

I was on trial today in Chester County, PA, for our client who was a custodian employed by West Chester University. She was a victim of a high interest rate mortgage refinance, and was placed into a loan that required a monthly payment of almost 2/3rds of her monthly income. Since her income was not nearly enough to support the mortgage, she became delinquent and eventually defaulted in 2009.

After being sued in 2011 for foreclosure by Bayview Loan Servicing in the Chester County Court of Common Pleas, I filed an answer and undertook discovery. During the discovery process, I received documents from the lender which, in my view, raised grounds for a counterclaim (a lawsuit back against the Lender for wrongful conduct). The banks will not agree to let me add a counterclaim, so I had to file a motion to add the counterclaim; it was granted by the court in 2012.

The case was called to trial, and on December 9, 2013, the lender presented its witness on the stand for testimony. After direct and cross examination of the bank’s witness, the lender and I negotiated a settlement agreement, which enables our client to reside in the property for at least 7 more months, obtained a confidential cash payment and eliminated all past and future payments to the lender (an amount in excess of $110,000) – which I call “waiver of deficiency”.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , , , ,

Favorable Settlement During Trial in Philadelphia

November 28, 2013 By

Our client had been sued by HSBC, one of the world’s largest banks (its initials stand for Hong Kong Shanghai Banking Corporation). In 2010, my client’s employer cut back on his overtime hours, and this caused a decrease in take-home pay. During the build-up to the housing bubble, HSBC acquired hundreds of thousands of U.S. mortgages from smaller lenders. Many banks got bailed out, but HSBC did not, and now claims that since it did not take any federal bailout money, it does not have to adhere to federal guidelines to modify mortgage loans, or engage in what I call reasonable settlement/resolution practices.

HSBC, therefore, demanded that the only way to reinstate my client’s delinquent loan was for the him to come up with 40% of the arrears. For homeowners that have been in foreclosure for a year or more, this often means that HSBC will not modify the mortgage unless the homeowners has tens of thousands of dollars to put down towards the new loan. In my client’s case, as in the case of most homeowners, this was not possible.

This scenario causes, in my view, more trials than are necessary since it is so difficult to settle by a loan modification. In this trial which started on November 27, 2013, the results ended favorably for my client. In this Philadelphia County case, HSBC was demanding that my client come up with over $60,000 in order to reinstate his mortgage loan (which already contained a 10.9% interest rate). My client rejected the offer, and the case proceeded to trial. Midway through the trial, HSBC made an offer to let our client remain in the home for almost another 12 months, and to waive the entire unpaid loan amount of $177,000. The case has been in litigation for nearly 3 years so this was a fantastic result for my client. The terms of the settlement were put on the record in front of the judge.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Abuses, Foreclosure Defense, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , , , , ,

Foreclosure Fraud Against Deutsche Bank Yields $30,000

July 29, 2013 By

Shaffer & Gaier’s client agreed to a $30,000 cash settlement with Deutsche Bank in an action filed by the banking giant to foreclose on his New Jersey investment property. When purchased in 2006, the property was worth approximately $110,000, but at the time of the trial the value had fallen to $65,000. Shaffer & Gaier’s review of the loan documents uncovered fraud committed by the Lender in the underwriting process.

After Deutsche Bank filed its foreclosure action, Shaffer & Gaier filed a counterclaim based on fraud and misrepresentation (the lender grossly inflated our client’s federal tax return income when qualifying him for the loan and failed to disclose that to the client). During pretrial discovery and trial preparation, Shaffer & Gaier proved that the bank’s assignment documents (which give the Lender the right to bring the foreclosure lawsuit) were defective and therefore it did not have the right to foreclose.

Along with the counterclaim, this allowed the client to successfully settle the claim on the third day of trial. As part of the terms of the settlement, our client was entitled to retain the property and collect the rental income for an expected period of 18 months, free of mortgage payment obligations.

Filed Under: Foreclosure, Foreclosure Defense Tagged With: , , , , ,

Interest – Only Loan Settlement

July 19, 2013 By

Shaffer & Gaier’s clients owned a vacation home on the Jersey Shore since 1989, and in 2007 a mortgage broker qualified them to refinance into an “interest-only, negative amortization loan”. While our clients’ loan allowed them to make “interest-only” payments that were lower than a traditional monthly mortgage payment, the loan was misleading because the balance of the loan increased each month, even though a payment was being made. This is often because the Truth in Lending document does not appear consistent with the true terms of the loan.

These loans are so deceptive for the homeowner that they have been outlawed in many states while many of the big banks have even stopped offering the loans to prospective homeowners. Shaffer & Gaier filed a lawsuit in Cape May County, NJ against the lender and secured a confidential settlement in July, 2012 for money damages which allowed our clients to recoup the amount of interest they had paid since the loan’s inception.

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Modification Tagged With: , , , , , , , , ,

Options After Act 91 Notice

July 3, 2013 By

There are generally three options for a homeowner after the bank sends its pre-foreclosure notices:

1. Cure The Default – Within 30 days from the date of the ACT 91 Notice, the borrower may cure the default by bringing the mortgage current. The borrower must pay the total amount past due plus late fees. There also may be associated attorney or legal fees.

A. If the default is cured before the lender refers the account to their attorney, the borrower will not incur any legal fees.

B. If the default is cured after the lender has referred the account to his attorney but prior to commencement of legal proceedings, the homeowner will be responsible for legal fees up to and not in excess of $50.00.

C. If the default is cured after the lender’s attorney has begun legal proceedings, the homeowner will be responsible for ALL legal fees (even those in excess of $50.00).

2. Meet With A Consumer Credit Counselor – Within 30 days from the date of the ACT 91 notice, the borrower may meet with a consumer credit counselor located in the county where the mortgaged property is located.

Borrower has 30 days from the date of this meeting to file a HEMAP application. The consumer credit counselor will supply the application and assist the borrower in completing it. They are the only agency approved for submission of the application.
HEMAP may take up to 60 days to make a decision. During this time, no foreclosure proceedings may be brought against the borrower.

3. Homeowner Takes No Action – If the homeowner takes no action within 30 days from the date of the Act 91 Notice, the lender will exercise her right to accelerate the mortgage debt. The entire outstanding balance becomes due immediately and the borrower loses the right to pay the mortgage in monthly installments. The lender refers the account to her foreclosure attorney who begins the legal process of foreclosing on the mortgaged property. A lawsuit can then be filed in the county where the property is located. An answer must be filed with the court within thirty days or else the bank may secure a default judgment against the homeowner.

Filed Under: Foreclosure, Foreclosure Defense Tagged With: , , , , ,
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