Florida Foreclosure Defense Lawyers Blog

Now that the Law Offices of David J. Stern and Ben-Ezra & Katz are no longer Florida's foreclosure kings, law firms from other states are opening offices in Florida to seize some of Florida's foreclosure business that is now up for grabs. New foreclosure filings slowed significantly last year while foreclosure processing procedures were reconstructed by Fannie Mae and Feddie Mac.

The largest of the new firms, McCalla Raymer, based in Atlanta, GA, has opened four offices in Florida housing 21 attorneys in the last year. Other out-of-state firms include Brock & Scott from North Carolina, Ablitt Scofield from Massachusetts, Mark J. Udren & Associates from New Jersey,; and from Atlanta Aldridge Connors, Pendergast & Associates, and Phelan Hallinan & Schmieg. Most have chosen Fort Lauderdale as their base in South Florida.

Now that Fannie and Freddie have taken necessary steps to ensure all of its foreclosure paperwork is in order, they are now ready to begin filing foreclosures again. In addition to restricting their foreclosure processes, the mortgage giants have also changed the matter in which their hire law firms in Florida to file their foreclosures. This time around, in an attempt to not create another David Stern or Ben -Ezra, they plan to spread out the work among many firms and are even sitting in on attorney interviews. They are taking a more active role to make sure these firms follow proper procedures. Now included in Fannie Mae's contracts with loan servicers, the servicers will be responsible for monitoring and managing the conduct of foreclosure proceedings.

Facing a Florida Foreclosure Lawsuit, can be a very stressful and confusing period. Contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today. A Jacksonville Foreclosure Lawyer may be able to help you navigate through this difficult time and put you in the best financial position possible for your future. The initial consultation is free.

In early March, Freddie Mac cut ties with the Law Offices of Marshall C. Watson, a Fort Lauderdale, Florida based law firm they hired to handle some of their foreclosure files in Florida. The reason given for the firing is "foreclosure processing abuses." Freddie Mac's sister corporation, Fannie Mae has chosen to continue to use the firm, explaining it is just too costly to move their foreclosure files to new firms. After transferring their foreclosure files from the Law Offices of David J. Stern, Fannie Mae is expecting a $5.5 million bill.

The Law Offices of Marshall C. Watson is reported as handling 43% of Fannie Mae's foreclosure cases in Florida, according to a Federal Housing Finance Agency Spector General report. The report also criticized Freddie Mac and Fannie Mae for a lack of communication regarding problems within law firms retained to handle their foreclosure files. The report continues to state, "Freddie Mac has terminated law firms for poor performance, and Fannie Mae has retained the firms."

Fannie Mae first became aware of foreclosure abuses in 2003 from an investor, which were later confirmed in a 2006 report performed by Fannie Mae. The 2006 report found "foreclosure attorneys are routinely filing false pleadings and affidavits," and that "Fannie Mae has not authorized this unlawful conduct."

Following Freddie Mac's firing of the Law Offices of Marshall C. Watson, the firm signed a $2 million settlement agreement that ended a investigation in to the firm's foreclosure practices byFlorida Attorney General's Office. Currently, Freddie Mac has about $109 billion in unpaid home loan balances in Florida. Fannie Mae has an even greater balance of $180 billion.

If you are facing a Florida Foreclosure Lawsuit from Fannie Mae or the Law Offices of Marshall C. Watson, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today for a free initial consultation to determine what foreclosure defense options may be available to you.

In 2006, Fannie Mae hired an outside law firm to investigate allegations of misconduct by the firms it hired to file its foreclosure actions. The outside investigation revealed its foreclosure attorneys in Florida were sacrificing accuracy for speed by filing fraudulent court documents. Fannie Mae was put on notice in 2006 that its foreclosure attorneys working on their behalf were involved in "unlawful" practices, but sat by and did nothing.

Many Florida foreclosure defense attorneys are in agreement that further abuses by attorneys in the so-called foreclosure mills could have been detected and possibly prevented if Fannie Mae would have strengthened its oversight over its retained firms. Last fall's revelations of "robo-signed" documents and the chaos that followed could have been prevented.

The key players were the Plantation-based David J. Stern firm and Ben-Ezra & Katz in Fort Lauderdale. The Law Offices of David J. Stern was Fannie Mae's largest hired firm for Florida foreclosure cases. David J. Stern was fired by Fannie Mae in November 2010, after ex-employees divulged information state investigators that signatures on notarized documents were habitually forged, notary stamps were passed around to non-notaries, assignments of mortgages were created after foreclosure judgments were entered, and flawed files were hidden from federal auditors. David J. Stern, soon-there-after in March, laid off hundreds of employees and shut down its foreclosure practice. Around 100,000 foreclosure cases were left in a state of uncertainty as they waited to be reassigned to different law firms.

In February 2010, Fannie Mae fired Ben-Ezra & Katz. Ben-Ezra & Katz admitted they had found "technical paperwork issues" with is foreclosure files but maintained, "there is no issue of whether the information in the affected files is correct."

If Fannie Mae had practiced better oversight over their foreclosure cases in Florida and across the U.S., the broad reaching negative consequences we are experiencing today potentially could have been prevented. If you are facing a Florida Foreclosure Lawsuit, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Defense Lawyer today to explore what foreclosure options may be available to you.

Even though homeowners facing foreclosure in Florida have had to fight the expedited procedures of rocket docket and giant foreclosure mills trying to push thousands of foreclosures through the courts at a rapid pace, along with foreclosure processing companies creating and "robo-signing" fraudulent foreclosure documents, there are still over 125,000 properties in some stage of the foreclosure process in Florida.

In the first quarter of 2011, 1 in every 152 housing units in Florida were in foreclosure, which constitutes the lowest level the state has seen in the last four years. The drop in foreclosure numbers has done little to alleviate the foreclosure backlog in the courts. Some foreclosure observers point to the demise of the Law Offices of David J. Stern and its subsequent dumping of 100,000 active foreclosure cases into the Florida foreclosure system.

While Florida Foreclosure lawsuits appear to be on the decline, many experts are saying this may be the calm before another storm. If you are facing a Florida Foreclosure Lawsuit now in the near future, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today to see what foreclosure defense options may be available to you.

Courts in Florida cleared greater than 200,000 of the backlogged foreclosure cases that were plaguing the system in 2010. These numbers represent a nearly 43% decline in outstanding foreclosure cases. The $6 million allocated by the Florida Legislature to establish the foreclosure "rocket docket" courts and clear the backlog but the effectiveness of the special courts have been called into question and the 2010 numbers evidence they may not have been as effective as the total number of disposed cases initially leads Floridians to believe.

Almost half of the disposed cases due disposed of due to dismissals by Plaintiff banks. Dismissals can occur for several reasons, ranging from a mutual agreement via mediation to voluntary dismissals on the part of bank. A total of 104,126 were dismissed in this fashion in 2010. Many foreclosure observers are pointing to two primary reasons for the high number of dismissals: 1) the voluntary dismissals on the part of banks due to errors or fraud in the creation of foreclosure related documents and 2) the closing of giant "foreclosure mill" the Law Offices of David J. Stern without officially withdrawing from its cases, which put thousands of cases in limbo.

The unfortunate thing that is hidden by this seeming relief from the foreclosure backlog is that most of the dismissed cases will be refiled. if you are currently facing, or will be facing in the near future, a Florida Foreclosure Lawsuit, contact a St. Augustine Foreclosure Lawyer today for a free consultation to determine what foreclosure defenses may be available to you.

The term "too big to fail" has been used to describe the strength of banks entrenched in the mortgage foreclosure battle with homeowners. Florida has become a sort of poster child in foreclosure cases where more residents enter foreclosure each day. For now, the momentum seems to be shifting in favor of the consumer especially in light of a new development from the Florida Bar charging Florida attorneys with the duty to disclose shoddy foreclosure paperwork to the Court.

This development was reported in a Florida Bar News article which details a meeting of the Bar's Professional Ethics Committee at the Bar's Annual Convention in June. The committee voted 20-6 to uphold a Bar staff opinion advising a lawyer representing a bank that the duty existed.

The lawyer posed this scenario to Bar staff: a bank uses two employees to review and prepare affidavits necessary in a foreclosure. Employee one personally verifies the figures in the affidavit and signs off in the presence of a notary. Employee two uses an assistant to verify figures but signs off as if she personally reviewed them, sometimes not even in the presence of a notary. The lawyer wanted to know if he was required to report this client's activities. He also asked whether that duty remained when the disclosure would not change the outcome of the case, or if the case was closed or pending.

The Ethics Committee responded by saying that it doesn't matter what stage the case is in, but that Florida Rule of Professional Conduct 4-3.3 Candor Toward the Tribunal makes shoddy documents "false evidence", and proper for disclosure without condition. The opinion also cites Rule 4-1.2(d) prohibiting assistance of criminal or fraudulent client conduct, Rule 4-3.4(b) that prohibits fabrication of evidence or assisting a witness in false testimony, Rule 4-8.4(a) prohibiting violation of the Rules of Professional Conduct or assisting another in doing so, Rule 4-8.4(c) barring an attorney from conduct that constitutes dishonesty, fraud, deceit, or misrepresentation and Rule 4-8.4(d) which prohibits a lawyer from conduct prejudicial to the administration of justice as violations for a failure to disclose faulty foreclosure docs.

The Bar's opinion concluded that the attorney should advise the client to correct the affidavits or that he would have to withdraw and disclose the issue to the Court. The attorney also should withdraw from further representing the client in cases where they refuse to disclose the truth, being careful to make minimal disclosures when doing so.

This is just the latest development in the fight against some of the unscrupulous tactics that many banks and their attorney's have been perpetrating for a number of years. A Jacksonville Foreclosure Lawyer hopes this latest measure by the Florida Bar stops many of those actions.

A local Bank of America branch faced an interest conundrum last week: write a check for $2,534 in attorney's fees for a wrongful foreclosure they filed last year or have the furniture in the branch removed and sold at auction to satisfy the debt. The decision stemmed from a foreclosure the bank filed in 2010 against a Collier County couple. The bank alleged that the couple had fallen behind on their mortgage payments and began foreclosure proceedings; but there was a problem, the couple paid cash for the home they bought in 2009!

The case, filed by notorious foreclosure mills the Law Offices of David J. Stern, was dropped two months after it was filed, but the judge entered an order requiring Bank of America to pay the homeowners' attorney's fees. Multiple attempts to get the bank to pay the debt went unacknowledged, so the homeowners' attorney obtained a writ of enforcement, which gave permission to seize Bank of America's assets to satisfy the debt obligation. After an hour of negotiations, the local Bank of America manager wrote a check to satisfy the debt, rather than have the furniture of his branch seized.

While these stories are rare, these apparently are the types of actions that get the banks' attention. If you are facing a Florida Foreclosure Lawsuit, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today to see what foreclosure defense options may be available to you.

The Law Offices of David J. Stern handled more foreclosure cases than any other law firm in the state of Florida. Last Fall, David J. Stern lost all of its foreclosure clients in a 21-day period. On March 31, 2011, Stern ceased all foreclosure operations. On that same day, Stern sent a letter to many of the judges handling his firm's foreclosure cases stating that the judges should handle his withdrawal from his former cases as they deemed best. Stern did not follow the Florida Rules of Civil Procedure and properly withdraw from the firm's cases.

Stern has responded to criticism from judges by claiming that his company went "above and beyond" reasonable expectations in handling his firm's exit from the foreclosure industry. Additionally, Stern claims it would be physically impossible to notify all of the Defendants by mail about his firm's withdrawal and that the firm does not know all of the Defendants' email addresses. Stern also blames the banks for terminating his representation without notice and did not allow him time to create a succession plan. It is hard to feel sympathy for Stern since he would still be handling the cases if he had simply abided by the fairly straightforward Florida foreclosure laws.

If your home is in foreclosure, contact a Florida Foreclosure Defense Lawyer to assist you throughout the foreclosure process.

President of the Florida Bar, Mayane Downs, says that the Bar has seen an increase large increase in the number of complaints and investigations of attorney misconduct as a result of foreclosure fraud and some may pay the ultimate professional price, disbarment. The Florida Bar, the body responsible for monitoring and investigation attorney conduct, has seen the number of fraud cases and the number of attorney's under investigation rise from 28 investigations on 23 attorneys in 2010 to 222 investigations on 157 attorneys open so far in 2011.

The substance of the investigations are not made public but complaints normally range from forged signatures on court documents, forged notarizations on documents and other illegal and unscrupulous activities designed to speed up the foreclosure process. These investigations do not include the wide-ranging investigations into the 8 Florida "foreclosure mills" including the now defunct Law Offices of David J. Stern. Many foreclosure defense attorneys question why no one from any of the "foreclosure mills" has yet to be suspended or face professional sanctions as a result of the investigations.

Many attorneys didn't believe that the media allegations of foreclosure abuses would result in official investigations by the Florida Bar but that appears to not be the case. If you are facing a Florida Foreclosure Lawsuit where one of the 8 "foreclosure mills" is opposing counsel, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today to see what foreclosure defense options may be available to you.

In yet another blow to the Florida Foreclosure Mills, Federal mortgage giant Freddie Mac has announced that it is pulling its cases from the Law Offices of Marshall C. Watson. A statement from the Fort Lauderdale based firm announced that "Freddie Mac and our firm mutually decided to part ways" and that all cases Freddie Mac files will be removed from the firm. Freddie Mac spokesman Brad German stated that "going forward our servicers will be directing business to other counsel" but that the Marshall C. Watson firm will continue to work with Freddie Mac to guarantee that the existing foreclosure files will be transitioned smoothly and quickly.

In November 2010, both Fannie Mae and Freddie Mac announced that they were firing Florida Foreclosure Mill the Law Offices of David J. Stern and this announcement comes roughly one month after Fannie Mae announced that it would no longer be using Fort Lauderdale based Ben-Ezra & Katz. The Law Offices of Marshall C. Watson are still on the list of retained attorneys for Fannie Mae.

The removal of Fannie Mae and Freddie Mac cases from Stern turned out to be the death nail for that firm as it announced last week that it was stopping all foreclosure related business. So far, Ben-Ezra & Katz is still does not appear have been hampered by the withdrawal of Fannie Mae cases, as it continues to maintain its foreclosure operations. If you are facing a Florida Foreclosure Lawsuit from one of the Florida Foreclosure Mills, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today to see what foreclosure defenses may be available to you.

The precipitous rise and subsequent fall of the Law Offices of David J. Stern seems to have reached rock bottom this week. In an SEC filing relating to DJSP Enterprises, the firms non-legal arm that handles real estate work, came the announcement that DJSP does not expect to obtain any future work from the firm, its largest and primary client. The Stern office sent a letter to Florida judges stating that they are stopping all foreclosure related operations in the State of Florida as of March 31, 2011.

The firm and its foreclosure practices have been under investigation since late 2010 and the Stern firm was fired by mortgage giants Fannie Mae and Freddie Mac in February 2011. Jeff Tew, the attorney representing Stern, said the firm is not officially closing but many attorneys point to the loss of Fannie and Freddie business has in effect shut the firm's doors. In his letter to Florida judges, Stern stated that the firm still needed to withdraw from more than 100,000 cases statewide, but "we have been forced to drastically reduce our attorney and paralegal staff to the point where we no longer have the financial or personnel resources to continue to file Motions to Withdraw in tens of thousands of cases that we will remain as counsel of record."

There is no word yet on the effect of the closing on the fraud investigation from the Florida Attorney General's Office. If you are facing a Florida Foreclosure Lawsuit where the Law Offices of David J. Stern is Plaintiff's attorney, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today to see what defenses may be available to you.

To read a copy of the Letter to Judges from the Law Offices of David J. Stern click: Stern Letter.pdf

An interesting account detailing the dramatic rise and abrupt collapse of David J. Stern and the notorious Florida "foreclosure mill" that bears his name was recently published in The Washington Post. The account provides a detailed look into the inner workings of one of the largest foreclosure attorneys in the US and the part it played in the larger foreclosure crisis. If you are facing a Florida Foreclosure Lawsuit from the Law Offices of David J. Stern, contact a Jacksonville Foreclosure Defense Lawyer or an Florida Foreclosure Defense Lawyer today.

To read the full Washing Post article about the Stern Office click here.

In an unexpected announcement, which coincides with the offering of a free continuing legal education seminar aimed at improving the foreclosure processes in Florida, the Florida Bar is now requiring all attorney's to notify foreclosure judges about potential fraud in their cases, including those cases that are closed and the home sold. With 1.2 million foreclosures being filed in the state of Florida since 2007 and countless accusations of fraud from the five Florida "foreclosure mills" no one can accurately estimate the impact on foreclosure cases in the state. This announcement represents the largest step toward preventing fraud the Florida Bar has ever taken.

Attorneys are now instructed to report the fraud to the court, but are instructed not to do so in a public court hearing. Instead, attorneys are instructed to ask for a private, "in camera", hearing with the judge in order to determine whether any fraud was perpetrated. Many foreclosure defense lawyers have bristled at the idea of more, private hearings and point to the fact that foreclosure hearings are civil matters and are, and should be, open to the public. It remains to be seen what judges will do once they are alerted to fraud, as the consequences range from doing nothing to dismissing the action.

A Jacksonville Foreclosure Lawyer hopes that this latest step to prevent fraud has a profound effect on foreclosure courts and Florida homeowners facing foreclosure. If you are facing a Florida Foreclosure Lawsuit, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Lawyer today.

New Florida Attorney General Pam Bondi is expanding the investigation into the foreclosure mess begun by her predecessor beyond the initial allegations of the falsification of court documents and widespread "robo-signing." The Attorney General's office did not give specifics as to which firms are facing allegations and nor did it indicate a timetable for the investigation to be finalized.

The investigation has now been expanded to include allegations of misconduct by attorneys and other staff who worked at the large Florida law firms many are now calling "foreclosure mills." In addition to the allegations of attorney misconduct, the investigation will include: law firms padding their bills in order to obtain higher final judgments for mortgage lenders during the foreclosure process, law firms filing foreclosure lawsuits before the lender or servicer actually shows it has an interest in the mortgage, lawyers and law firms routing business to title companies owned by other attorneys in their law firm, and lawyers presenting blank bills to the court that do not show the actual cost of their services.

A Jacksonville Foreclosure Lawyer is glad that the new Attorney General has continued, and even widened, the investigation into the practices of the notorious Florida "foreclosure mills." If you are facing a Florida Foreclosure Lawsuit and want to see what defenses may be available to you, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Lawyer today.

In yet another horror story about mistakes made by notorious Florida Foreclosure Mill, the Law Offices of David J. Stern, has caused two different people to purchase the same house within one week of each other. One South Florida real estate investor initially thought she had made a good deal when she purchased a foreclosed home at a courthouse auction but when she drove by the home the next day and saw a lawn-care and pool cleaning crew working at the house she knew something wasn't right.

What happened is that the house she purchased at the auction was actually sold to an individual in a short sale the previous week. The law firm handling the foreclosure case, the Law Offices of David J. Stern, mishandled the paperwork and didn't cancel the foreclosure auction. Even after the foreclosure auction sale was vacated, the real estate investor could not contact Stern's office and was fearful that she would never get her money back!

This is just another story about inappropriate handling of cases from the Law Offices of David J. Stern coming out of the foreclosure crisis. If you are facing a Florida Foreclosure Lawsuit, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today.