April 16, 2015

Lawsuit Filed – What’s Next?

Filed under: Florida,Foreclosure

OK, so they filed a lawsuit against you. Perhaps you were served in a Florida foreclosure suit. What happens next?

First, there is a shock of the reality that the lawsuit was filed. A process server was parked in your driveway waiting for you to come home. Then that stranger parked in your driveway asks you if you are so and so and then hands you a stack of papers. Not a very pleasant experience. You have been served and are in a state of shock.

Shortly after, the shock is replaced by the emotion of fear. This is where this article can help. What happens next is your choice. You can stay in this state of fear and worry incessantly. Or you can come up with a game plan – a strategy. If you choose the latter then that fear is replaced with confidence. There is confidence in the knowledge that you have done everything you can or should do to protect your future. After you have taken the steps that your plan has established are necessary, then rest. And that’s the last phase, peace.

March 3, 2015

Florida Foreclosures Moving Quickly Through Courts

Filed under: Florida,Foreclosure

Some changes to F.S. 702 that went into effect in 2013 are resulting in Florida foreclosure cases moving quickly through the courts.  In Pinellas and Hillsborough those cases from filing to judgment have been as quick as four months.  This is in stark contrast to previous Florida foreclosures filed under the previous Florida Foreclosure Law which continued on for years and years in the past.

October 18, 2014

Mortgage Debt Relief Act

An article on Housingwire suggests “extending the tax break through 2015 and making it retroactive to cover all of 2014 would be a good start. Congress should follow the leadership of Sen. Debbie Stabenow, D-Mich., and Sen. Dean Heller, R-Nevada, and move immediately to extend the bipartisan Mortgage Forgiveness Debt Relief Act before more damage is done”.

I like the sound of that but these articles always center around the 1099-C which a short seller can receive on a short sale but never discuss the 1099-A that they get when they do a deed-in-lieu or complete a foreclosure.  On top of that the foreclosing lender can also pursue a deficiency judgment in the state of Florida where a short sale can provide debt forgiveness with no deficiency collection.

Even if the Mortgage Debt Relief Act is not extended, there is always the insolvency exclusion to debt forgiveness, so please be sure to check with your tax advisor.

August 21, 2014

Fannie Mae Florida Deficiency Judgments

It took longer than I had anticipated but it has now officially arrived – a real life nightmare for thousands of homeowners who simply walked away from their upside-down Florida home.  They knew the bank would foreclose but they thought that would be the end of it.  Now they realize this is just the beginning, as the mortgage behemoth Fannie Mae has hired creepy debt collector company Dyck O’Neal to pursue deficiency judgments through the Florida courts.  The Palm Beach Post reports:
“People are getting served with these deficiency suits and are absolutely shocked,” said Paul Baltrun, director of corporate development for the Law Office of Paul A. Krasker in West Palm Beach. “The size of the judgments — we’re not seeing $30,000 — these are at a minimum of $100,000.”
But there is a silver lining for those of you who are presently upside-down and facing foreclosure.  A short sale can provide a full release of liability meaning once it’s closed you no longer owe anything to Fannie Mae or her creepy red headed step-child Dyck O’Neal.

July 4, 2012

Independence From Debt

The Declaration of Independence was the document that announced to the world the American colonies status as free and independent states.  It was adopted in Congress on July 4, 1776.  The final sentence reads: “And for the support of this declaration, with a firm reliance on the protection of Divine Providence, we mutually pledge to each other our lives, our fortunes and our sacred honor”.


I want the best for everyone everywhere and this article won’t travel down a political road, other than to make a comment that we, as a people, have become complacent.  I’m reminded of these words: “But many [that are] first shall be last; and the last first”.  I’ll now turn this article’s steering wheel into the Personal Finance Path.  Woah!  Look out!  It’s a rocky road and for some there’s a roadblock up ahead.  Fortunately, with a little maneuvering, the roadblock can be avoided altogether.  And don’t ask me about the cliff – we’ll get to that later.

The Broken Credit Blog is thankful for the many positive responses from readers who’ve shared true to life experiences of how they’ve triumphed over adversity.  It’s the goal of this site to be a positive voice in the marketplace sharing free information to anyone desiring credit score improvement.  This month marks our eighteenth-month on the internet and we’ve recorded over two million hits in one month.  We are at the same time, amazed and thankful – it keeps us writing and working for you.

In my view, personal finances are similar to personal fitness.  I regularly see people working out at the gym with a personal trainer.  The same trainer may be working out with one person on one day and another on another day.  Regardless of that person’s fitness level, the trainer’s goal is to improve that individual at that time.  It doesn’t matter how out-of-shape or how Olympic-world-champion someone might be – the trainer’s goal is to assist that person with improvement.  Such is the same as the Broken Credit Blog’s role.

So, wherever you are, and whatever your station in life, this trainer wants to see improvement in you.  I hope everyone enjoys their 4th of July and remembers what prompted the celebration in the first place.  Now then, after everyone has finished eating hamburgers and hotdogs, it’s time to start working out.

Hey you with the 672 FICO, give me eight more reps!

April 16, 2012

Sorry Daughter But No Pay No Stay

I hold a private note and deed of trust on a house in Calif.  If I foreclose on that note, does that effect the trustors’ credit(it’s my daughter going thru divorce)?

John (more…)

April 10, 2012

Court Spanks Clandestine Wells Fargo With $3.1M Damages

A federal judge who has fiercely criticized how big banks service home loans is fed up with Wells Fargo.

In a scathing opinion issued last week, Elizabeth Magner, a federal bankruptcy judge in the Eastern District of Louisiana, characterized as “highly reprehensible” Wells Fargo’s behavior over more than five years of litigation with a single homeowner and ordered the bank to pay the New Orleans man a whopping $3.1 million in punitive damages, one of the biggest fines ever for mortgage servicing misconduct.

“Wells Fargo has taken advantage of borrowers who rely on it to accurately apply payments and calculate the amounts owed,” Magner writes. “But perhaps more disturbing is Wells Fargo’s refusal to voluntarily correct its errors. It prefers to rely on the ignorance of borrowers or their inability to fund a challenge to its demands, rather than voluntarily relinquish gains obtained through improper accounting methods.”

The opinion reflects Magner’s disgust with tactics that Wells Fargo used to fight the case — and perhaps frustration with an appeals court ruling in a separate, but similar case, that overturned her order that would have forced Wells Fargo to audit and provide a full accounting for more than 400 home loans in her jurisdiction.

As The Huffington Post previously reported in a story co-published with The Center for Public Integrity, sources familiar with the preliminary findings said that the bank made costly accounting errors in the administration of practically all of those loans. (more…)

March 5, 2012

St Petersburg Florida Process Server

As a Florida licensed real estate agent working short sales in Pinellas, Hillsborough, and Manatee counties, I check the lis pendens filings in each of those counties each day shortly after they are filed.  A couple of weeks ago I saw a foreclosure filing for a property in the subdivision of my own residence in St Petersburg, FL.  Looking a little closer I discovered that it was for the home directly next door to my own.

I do mailouts to folks in St Petersburg, Clearwater, Seminole, Tampa, Bradenton, Sarasota, Palm Harbor, Largo, Pinellas Park, Safety Harbor and basically all areas in and around the Tampa Bay area for those who have recently been named defendant in a foreclosure action.  I get a good response I think partly because my services are free to them and partly because my mailers are chock full of information that can help them get out of this foreclosure mess, containing the harm to their credit report, and getting them a check for $3,000 for relocation – again all of that is free.  You see licensed real estate agents in Florida represent sellers in short sale transactions in a fiduciary relationship yet shorting lenders pay their fee upon closing the transaction.  Banks need Florida real estate agents to get short sales closed and if you are a Florida short seller then you need a real estate agent too.  The idea that there is a short sale expert who can guide them through the process is appealing and perhaps even more so if it is someone that they don’t already know.  My friendly mailer is timely.  But I’m getting sidetracked here, back to my neighbor.

I’m not sure he speaks English.  I waive to him every now and then when I see him in the front yard.  He smiles and waives back.  I’ve tossed a few volleyballs back over the fence that landed in my backyard when the kids were playing – I hear a child say thank you as the ball bounces back into their yard.  The kids speak English but I don’t think the father does.  Anyways, I saw the foreclosure filing and decided not to send my mailer to him.

Why you ask?  I’m not sure but something felt strange about it because I never know how someone might react.  When I send the mailer offering Florida short sale help to strangers in the Tampa Bay area I learn that almost all of them know, are related to, or are friends with another Florida real estate agent yet they choose to work with me, and perhaps the fact that I don’t already know them is what is appealing.  People need to come to grips with the fact that homes are upside down, incomes have been reduced, living expenses have increased, etc. and it is easier to talk with a realtor-stranger who you know is an expert than it is to bear your soul to the local realtor-agent-friend whose kid plays on the same little league team as your own.

A few minutes before writing this article I stepped outside.  It was around 9 pm Monday night.  A creepy pick up truck was parked in front of my neighbor’s house.  I hadn’t seen it before and it was parked in an odd way blocking the driveway.  A few more steps outside and the pick up truck starts its engine and drives away.  The first thought that came to my mind was that my neighbor has just been served his foreclosure complaint by the driver of the creepy pick up truck.  After that I started thinking about how many people are going through this exact situation right now – just served with a Florida foreclosure complaint by a process server.  And finally, I wrote this article.

February 19, 2012

Foreclosure Filed: Should I Hire An Attorney?

I live, breathe, eat, drink and occasionally sleep in what is considered by experts to be the heart of our Nation’s foreclosure crisis.  I am a Florida licensed real estate agent whose practice consists solely of representing sellers in Florida on short sale transactions.  Frequently, I am asked the following question by Florida homeowners: “A foreclosure has been filed against me, should I hire an attorney?”  My answer is always: “You can, that’s up to you.”

I deal with Florida foreclosure defense lawyers every day.  They represent the Florida homeowner in defending the foreclosure action through the courts and then refer their clients to me to handle the short sale.  I deal with the bank on behalf of the homeowner, get the approval of the shorting lender typically as a full release of liability with $3,000 paid to the seller by the bank for relocation costs and we close the file.  As a result of the successful HAFA short sale of the property, the lis pendens is discharged, the foreclosure case is dismissed, and the seller/borrower is forever free of this monstrous mortgage debt.  The Florida attorney in that scenario filed a notice of appearance and an answer to the foreclosure complaint and that’s it – case closed – full settlement.

I received a call after 8 PM on Friday night from a Florida foreclosure defense lawyer working late.  I didn’t get the message until Saturday morning.  It looked like he was playing catch up on his files and was asking about a specific file that we were working on together – he was handling the foreclosure defense for a client in Clearwater, Florida and I was handling the short sale for the same clients.  He wanted to know the status of the short sale.  Below is the email that I sent to his paralegal in reply:

Hey *paralegal name and attorney name redacted*,

*attorney name redacted* left a message for me at 8:17 pm last night asking for the status of *seller name redacted*.  *seller name redcated* was a HAFA short sale that closed on 12-30-2011 in your office.  The HUD1 is attached and there was a $900 attorney fee included for *attorney name redacted* on line # 1304.


Bear in mind that he was asking about the status of this file on 2-17-2012 and he was unaware that the file closed on 12-30-2011.  Some law offices are able to handle real estate closings so I sent the title work back to the law office and also had the shorting lender pick up an extra $900 tab for attorney fees for him.  I had sent him the HAFA short sale approval earlier that month and we had the closing in his office so it was a surprise that he was unaware that the closing took place.

But I’m getting a little sidetracked away from my point.  My point is that there has to be an end game for Florida homeowners in all of this.  Florida homes mortgaged prior to 2009 are in large part underwater and many that I deal with are severely underwater by $50,000 to $100,000 or more.  What is the goal in all of this?  To lengthen the amount of time that the foreclosure will take to complete?  And then what?  Be left with a Florida deficiency judgment and/or continued collection on the mortgage deficiency for up to 20 more years?  Is the goal to modify the loan?  When lenders modify mortgage loans they typically make them temporary and do not modify the principal.  This means that the lender can recall the loan and send you a past due bill at any time whether months or years later.  I have repeatedly encountered Florida homeowners who have been told –by no fault of their own – that the lender decided that they did not qualify for the loan mod over a year after having being given the mod and now the lender demanded all of the past due amounts at once.

The fact is that we are in the throes of a housing crisis and it is going to be a slow crawl out of all of this mess.  The foreclosure programs such as HAFA (the Home Affordable Foreclosure Alternatives) which allow a home to be short sold and require the bank to provide a full release of liability and give $3,000 to the home seller at closing are set to expire at the end of this year.  Also, there are some dire tax consequences written in the IRS code for those who wait until after 2012 to complete a short sale.  This means the time to settle the debt and get out of it without having to repay the deficiency or taxes on the debt forgiveness to the IRS is now, this year.  Those who wait it out may find that these programs no longer exist come 2013.

This article is not to say that hiring an attorney won’t help the homeowner.  Other than the cost, it certainly won’t hurt.  And I don’t know your situation – maybe you have equity?  Maybe you made all of your payments on time and were never late?  Or maybe you came home one night and there was a creepy process server sitting in your driveway who handed you a Florida foreclosure complaint and the first thing that came to mind was: I should hire an attorney.  So, I get asked that question a lot – a foreclosure has been filed against you and you want to know if you should hire an attorney?  My answer: You can, that’s up to you.  I will help you with the short sale.

Do you like what you read, then contact me for help with your Florida Short Sale

September 26, 2011

New Foreclosure Filings Increase

Filed under: Florida,Foreclosure

Banks have stepped up their actions against homeowners who have fallen behind on their mortgage payments, setting the stage for a fresh wave of foreclosures.

The number of U.S. homes that received an initial default notice — the first step in the foreclosure process — jumped 33% in August from July, foreclosure listing firm RealtyTrac said Thursday.

The rise represents a nine-month high and the biggest monthly gain in four years. The spike signals banks are starting to take swifter action against homeowners, nearly a year after processing issues led to a sharp slowdown in foreclosures.

“This is really the first time we’ve seen a significant increase in the number of new foreclosure actions,” said Rick Sharga, a senior vice president at RealtyTrac. “It’s still possible this is a blip, but I think it’s much more likely we’re seeing the beginning of a trend.” Foreclosure activity began to slow last fall after problems surfaced with how many lenders were handling foreclosure paperwork, namely several shortcuts known as robo-signing.

Many of the nation’s largest banks reacted by temporarily ceasing all foreclosures, re-filing previously filed foreclosure cases and revisiting pending cases to prevent errors.

Other factors have also worked to stall the pace of new foreclosures this year. The process has been held up by court delays in states where judges play a role in the foreclosure process, a possible settlement of government probes into the industry’s mortgage-lending practices, and lender reluctance to take back properties amid slowing home sales.

A pickup in foreclosure activity also means a potentially faster turnaround for the U.S. housing market. Experts say a revival isn’t likely as long as a glut of potential foreclosures hovers over the market.

Foreclosures weigh down home values and create uncertainty among would-be buyers who fret that prices may fall as more foreclosures hit the market. There are about 3.7 million more homes in some stage of foreclosure now than in a normal housing market, according to Citi analyst Josh Levin.

“This bloated foreclosure pipeline now presents the greatest obstacle to a housing market recovery,” Levin said in a client note this week.

Banks have been working through a backlog of properties that first entered the foreclosure process months, if not years ago. But the August increase in homes entering that process sets the stage for a host of new properties being targeted for foreclosure.

That’s bad news for homeowners accustomed to missing payments for months without the threat of foreclosure. In states such as New York and Florida, for instance, processing delays have helped some stay in their homes more than two years before banks got around to taking back their properties.

In all, 78,880 properties received a default notice in August. Despite the sharp rise from July, last month was still down 18% versus August last year and 44% below the peak set in April 2009, RealtyTrac said.

Some states, however, saw a much larger increase.

California saw a 55% jump in homes receiving a default notice last month. In Indiana they climbed 46%. In New Jersey, where last month a judged ruled that four major banks could resume uncontested foreclosure actions under court monitoring, homes getting a default notice rose 42%.

Despite the increase in new defaults, the number of homes scheduled for auction and those repossessed by banks slowed in August.

Lenders repossessed 64,813 properties last month, a drop of 4% from July and down 32% from a year earlier. Home repossessions peaked September last year at 102,134.

Banks are now on track to repossess some 800,000 homes this year, down from more than 1 million last year, Sharga said.

In all, 228,098 U.S. homes got a foreclosure-related notice last month, up 7% from July but down nearly 33% from a year ago. That’s one in every 570 U.S. households.

Nevada leads, with one in every 118 households receiving a foreclosure-related notice last month. Rounding out the top 10 states with the highest foreclosure rate in August are California, Arizona, Georgia, Idaho, Michigan, Florida, Illinois, Colorado and Utah.


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