Florida Foreclosure Defense Lawyers Blog

Townhome and condo prices in Jacksonville, Florida have fallen far quicker than prices for single family homes. According to the Northeast Florida Association of Realtors, townhomes and condos are currently selling for a median price of $67,000. That is 63% below the peak in July 2006 of $182,500. Compared to a current median price of $135,000 for single family homes which has only dropped 35% from the August 2006 peak of $210,000.

The dramatic difference in the drops of townhomes and condos compared to the drop of single family homes can be explained by the large amount of townhomes and condos built during the past decade and how quickly those prices increased, followed by a huge amount of foreclosures filed on them that put too many on the market at the same time. The problem gets worst with how difficult townhomes and condos are to sell. Many cannot be bought with a FHA mortgage or even a conventional loan. Since banks will not approve a loan in complexes with 50% percent renters, or associations fees not being paid on 15% of the units, most must be bought with cash. Buying with cash means even more renters because cash buyers are usually investors whom have excessive cash who buy the units with the intention of renting them out.

Prime examples are:
• A condo on Old Kings Road recently sold for $30,000. Four years ago it sold for $141,000.
• Off Southside on Belle Rive Blvd., a condo that sold for $165,000 five years ago went for less than $30,000.
• Two condos sold for 1/3 of what they were bought for a few years ago in the downtown Berkman Plaza.

This is just more bad news for some Jacksonville Homeowners, but there are alternatives to being "upside down." If you are currently "upside down" in your home, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Defense Lawyer today to see what options may be available to you.

Through April of this year servicers reported 1,666 short sales and deeds-in-lieu of foreclosure under the Home Affordable Foreclosure Alternative program, which constitutes a 74 percent jump from the number reported in March (959). The program has accounted for 7,113 short sales and deeds-in-lieu since its inception in April 2010.

The latest Treasury data shows that the 10 largest servicers participating in federal foreclosure prevention programs have completed a short sale or deed-in-lieu for nearly 83,000 borrowers who did not qualify for the Home Affordable Modification Program and over 31,000 borrowers who had HAMP trials cancelled. Low payout to servicers, other investors and lien holders was cited as the reason lenders have sought their own method of short sale.

As a borrower, competent representation by an attorney can make the difference between what may be good or bad deal in a short sale or loan modification. To have your deed-in-lieu or short sale contact reviewed by a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Lawyer today.

The U.S. Treasury has just released the latest numbers on short sales and deeds-in-lieu completed through the Home Affordable Foreclosure Alternatives program. Through the end of February 2011, 4,488 homeowners completed a short sale or deed-in-lieu under the HAFA program. In addition to the completed short sales and deeds-in-lieu, the report shows that 10,177 homeowners have tentative agreements in place with their servicers to complete the transactions under HAFA.

Under the HAFA program, eligible homeowners who are unable to afford their current monthly mortgage payment and are "interested in transitioning to more affordable housing" receive a one-time, $3,000, payment to aid the homeowner in relocating in exchange for completing a short sale or deed-in-lieu. The Treasury report also includes the newest statistics on the much-maligned Home Affordable Modification Program. Since the program began in 2009, over there have been over 1.5 million trial modifications started but more then 746,000 of those modifications have been cancelled.

If you are facing a Florida Foreclosure Lawsuit and one of the foreclosure alternative programs has failed you, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today for a complimentary case review.

To view the entire Treasure report click here.

The House Financial Services Committee voted last week to end two federal mortgage programs, both managed by the Department of Housing and Urban Development, citing disappointing results as the primary reason for their ouster. The programs, one intended to deliver emergency funds to homeowners who have lost their jobs and another to lower monthly mortgage payments to "underwater" homeowners, have been labeled as massive disappointments by many. House Financial Services Committee Chairman Spencer Bachus, whose committee voted to eliminate the programs, stated "Congress needs to stop funding programs that don't work."

The Federal Housing Short Refi Option program, designed to force lenders to write down at least 10 percent of the mortgage principle on homes whose values have fallen dramatically, has been available since September 2010 but has only received 245 applications and modified 44 loans. House Republicans remain adamant that they will end the often-criticized Home Affordable Modification Program (HAMP) which has fallen far short of initial expectations. HAMP was originally intended to benefit 3-4 million homeowners but to date, only 600,000 borrowers have received permanent mortgage modifications under the program.

While most of the federal foreclosure prevention programs fell short of what many would call even modest success, they have provided at least some benefits for struggling U.S. homeowners. If you are one of the thousands of Floridians facing a Florida Foreclosure Lawsuit, contact a Jacksonville Foreclosure Defense Lawyer or a Florida Foreclosure Defense Lawyer today to see what foreclosure alternative options may be available to you.

The California law firm of Harwood Feffer, LLP has announced that it has filed a class action lawsuit against Wells Fargo and its mortgage servicer America's Servicing Company (ASC) for inducing homeowners into defaulting on the mortgages by telling them they would not be eligible for a mortgage modification while they were current on their payments. The lawsuit, filed in the United States District Court for the Northern District of California, claims that when borrowers who were current on their mortgages inquired about the possibility of the mortgage modification, they were told that they must be several months behind on their payments before their mortgage could be reviewed for a modification!

A statement issued by the firm explained the underlying reasons they believe servicers have committed these frauds, "as a loan servicer, ASC generates a significant portion of its revenue from fees, penalties, and interest collected on non-performing loans it servicers...it is in ASC's financial interest to avoid, delay, and deny loan modifications and to pursue foreclosures because doing to will lead to increased revenue." The HAMP guidelines clearly set out that borrowers who are not in default but are in distressed are eligible if they can demonstrate a financial hardship.

If you are facing a Florida Foreclosure Lawsuit or have experienced circumstances similar to those described above, contact a Florida Foreclosure Lawyer or a Jacksonville Foreclosure Lawyer today to have your case reviewed.

The "cash for keys" program is an incentive compensation program associated with the Treasury's Making Homes Affordable Program's Home Affordable Foreclosure Alternatives (HAFA) arm, wherein struggling homeowners are given a one-time incentive payment of $3000 to assist homeowners with relocation expenses. In order to be considered for HAFA a homeowner must first be considered for a HAMP modification. Those borrowers that do meet the eligibility for a HAMP modification but are not offered a trial plan, who do not successfully complete a trial plan or who default on a HAMP modification are usually eligible for entry into the HAFA program.

HAFA typically utilizes either a deed-in-lieu or a short sale in order to help struggling homeowners get out of homes that they can no longer afford. In most instances lenders require borrowers to list their homes in a short sale, for a period not to exceed 12 months, before the lender will consider granting a deed-in-lieu request. While this may not be a very rapid process for homeowners, lenders are prohibited from conducting a foreclosure sale during that time so it may be in many homeowners best interest.

If you have applied for and been denied a HAMP modification, or simply fallen out of your modification plan, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Lawyer today to explore your foreclosure alternative options today.

Many homeowners who use foreclosure alternatives such as short sales or mortgage modifications in order to have a portion of their mortgage debt forgiven face the question "am I going to have to pay taxes on the amount of mortgage debt forgiven." In most instances that answer is no! The Mortgage Debt Relief Act of 2007 was enacted to help homeowners who were trying to escape toxic mortgages and the accompanying debt by not taxing the amounts forgiven as taxable income.

Homeowners who intend to claim the exemption must fill out Form 982 and attach it to their individual tax return in order to be eligible for the relief. Types of eligible debt are debts forgiven in connection with a foreclosure, debt forgiven due to a short sale as well as debt forgiven through a mortgage restructuring such as a HAMP modification. The Act was originally intended to only affect mortgage debt forgiven in 2007, 2008 and 2009 but was recently extended to include all forgiven mortgage debt through 2012!

If you are facing a Florida Foreclosure Lawsuit and want to explore foreclosure alternatives that may reduce your mortgage debt and take advantage of the extension of the Mortgage Debt Relief Act of 2007, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Lawyer today.

A new cooperative study from state attorneys general and lending insiders from across the country has found that greater than 60% of homeowners who are seriously delinquent on their mortgage payments are not involved in any foreclosure alternative with their lender. On its face this news is disturbing, but coupled with the other findings of the study, that loan modifications are leading to few re-defaults, shows just how misplaced many lenders focus is.

The study, conducted by the State Foreclosure Prevention Working Group, found that loans modified in 2009 were 40 to 50 percent less likely to be seriously delinquent after six months than loans modified during the same period in 2008. The group also found that mortgage modifications that lower the amount of principle have significantly lower default rates than overall mortgage modifications. The federal HAMP program recently announced a principle reduction alternative for lenders but the group says it has been very slow to find favor with lenders with only 1 in 5 modifications including a principle reduction.

If you are one of the thousands of Florida homeowners who is delinquent on your mortgage and you are considering a foreclosure alternative, contact a Jacksonville Foreclosure Lawyer today to review your circumstances to determine the best course of action for you.

For more information see the complete State Foreclosure Prevention Working Group report.

On August 2nd the Obama administration announced an additional $2.1 billion in funding to help homeowners located in the hardest-hit housing markets. Currently the housing markets eligible for the new funding are Arizona, California, Florida, Michigan, Nevada, North Carolina, Ohio, Oregon, Rhode Island and South Carolina. The funds will be used to create state Housing Finance Agencies (HFAs) designed to provide stability in these troubled housing markets.

Some of the foreclosure alternative program the HFAs will implement include assistances to unemployed borrowers, funding to extinguish second liens, incentives for lenders to reduce principle on underwater mortgages and program to facilitate short sales and deeds-in-lieu of foreclosure. While the HFA program are a separate and distinct entity from other Making Home Affordable programs such as HAMP, HARP and HAFA, many of the same borrowers will be targeted by the HFAs and some of the same measures used in the Making Home Affordable programs will be utilized.

If you have any questions regarding your rights or eligibility under HAMP or HARP, contact a Jacksonville Foreclosure Lawyer. A Florida Foreclosure Lawyer will know your rights and whether or not you qualify for either of these programs

To view the Hardest Hit Fund website please click here.

Home "flopping" is a practice where a home buyer hires a broker to assess a home's value for less than the fair market value. When they get the assessment the buyer convinces the bank to sell the home to them for the reduced price. Then the buyer conceals from the lender that they have a higher offer lined up on the home. After the short sale is complete the new homeowner quickly resells the property to the pre-arranged buyer and makes a quick profit. The FBI and Freddie Mac have warned that schemes like these are becoming increasingly common across the country. This scam has the potential to significantly raise the losses suffered by the lenders that have been increasingly willing to accept short sales because most short sales are much cheaper for lenders than foreclosure.

The Obama administration's Home Affordable Foreclosure Alternative (HAFA) Program has created financial incentives for parties that agree on short sales. The government has offered up to $3,000 to homeowners and $1,500 to servicers who closed on a short sale. But many critics of HAFA claim that there are not sufficient fraud safeguards in the program which allow these "flopping" scams to succeed. CoreLogic, Inc. estimates that "flopping" occurs in a little over one percent of short sales. According to that estimate this could cost lenders up to $50 million per year.

Lenders are not the only ones that are harmed by this practice. The homeowner that agrees to the short sale for less than fair market value is also hurt by these scams. If a homeowner gets less money than they should on a short sale they have to make up the difference when they pay a deficiency judgment to their lender. This scam harms everybody except for the person running the scam and hopefully our government will soon implement safeguards to protect everybody from these "flopping" scams.

Foreclosure Lawyers in Jacksonville can help you evaluate whether you have defenses to a Foreclosure Lawsuit. They can also help determine if a strategic default on your home mortgage is a viable option for you. It is important to evaluate your complete financial circumstances as well as your mortgage documents to know what defenses and rights you have in defending a potential foreclosure.

Before entering into a loan modification, a Florida Foreclosure Lawyer can help you understand if you will qualify for any of the government based programs to help homeowners lower their monthly payments. It is important to understand that just because your initial payment will be lower, often the "loan modifications' being offered by many banks actually have you pay more for your home than if you performed under the existing loan. Whether this makes sense for you can be decided with the help of a Jacksonville Foreclosure Defense Lawyer.

If you would like a free consultation to help you understand your options contact a Jacksonville Foreclosure Lawyer.

When a homeowner short sells their home they usually do not receive enough money in the sale to pay off the remaining balance on their mortgage. Therefore, the homeowner will usually still owe money to the lender after they sign over the check for the sale of the home. The only way to have the excess amount owed forgiven by the lender is to have them sign a waiver of a deficiency judgment. In order for the lender to waive your deficiency judgment, you must get the lender to agree to this waiver in writing prior to the short sale.

Sometimes the lenders orally agree to a waiver of a deficiency judgment but will deny it after the short sale has taken place. In other cases the homeowner just assumes that since the lender told them that they could short sell the home that the lender is forgiving any excess amount owed after the sale. That is not the case unless the lender has signed a waiver of a deficiency judgment. Do not make this mistake. If you are considering a short sale on your home, contact a Florida Foreclosure Defense Lawyer or Jacksonville Foreclosure Defense Lawyer to review your agreement so that you do not have suprises later like a deficiency judgment waived by your lender.

The Cash for Keys Program is an extension of the deed-in-lieu of foreclosure concept. Deed-in-lieu programs are not new, but the FHA giving the homeowner money to move is a new twist on the concept. Borrowers with FHA loans that receive a deed-in-lieu or cash for keys do not have to repay their mortgage.

Under the program, the lender offers the homeowner a cash settlement (usually around $2,000) and in exchange the homeowner agrees to vacate the foreclosed home. The homeowner then signs the deed over to the lender and the lender then cancels the amount owed on the mortgage. Lenders have also begun to extend these same offers to individuals renting homes that are being foreclosed. The lenders benefit because they do not have to go through the expensive eviction and foreclosure processes, they get the homeowner out of the foreclosed home, and the home is usually left in much better condition than if the homeowner had been evicted. The homeowner receives the benefit of receiving money to move and having the amount owed on their mortgage forgiven in exchange for the deed.

To qualify a homeowner must:

-Be facing long-term financial hardship;
-The house must be on the market for at least 90 days for a reasonable price;
-Face no additional liens or claims except for the first mortgage; and
-Leave the property clean and in good condition.

When a homeowner short sells their home, the only way to have the excess amount owed on the mortgage forgiven by the lender is to have them sign a waiver of a deficiency judgment. In addition to servicing the loans that it originates, Bank of America also services a substantial number of loans for its subsidiary BAC Home Loans Servicing. Bank of America will agree to waive a deficiency judgment, in limited circumstances, on the loans that the company owns. However, Bank of America will not waive a deficiency judgment on a mortgage that is owned by its subsidiary. Bank of America's investors man have a legal right in Florida to collect on a deficiency judgment. Bank of America's position is that if the investors in its subsidiary do not sign off on the waiver of a deficiency judgment there is absolutely nothing that they can do except to collect the deficiency for their investors.

It is important to review your agreement with a Florida Foreclosure Lawyer before you end up with a surprised deficiency judgement.

If you are confused as to whether Bank of America owns your loan or is just a servicer of your loan contact a Florida Foreclosure Defense Lawyer. A Jacksonville Foreclosure Defense Lawyer will find out this information for you. A Florida Foreclosure Defense Lawyer will also determine your eligibility for a waiver of a deficiency judgment and find out whether or not your lender participates in Home Affordable Foreclosure Alternatives (HAFA) and is willing to waive your deficiency judgment.

The Home Affordable Foreclosure Alternatives program "HAFA" is a program for those homeowners who do not qualify for mortgage modification under the HAMP program or who did not successfully complete a HAMP trial period. The HAFA program became effective on April 10, 2010 and functions to provide additional foreclosure avoidance options, primarily through a Short Sale or a Deed-in-Lieu of foreclosure.

Under the HAFA Short Sale Program a homeowner sells their home for less than the actual amount due on the mortgage. The servicer approves the terms of the sale in advance of the home actually being listed and once the home is sold the servicer accepts the proceeds of the Short Sale in full satisfaction of the Mortgage.

Under the HAFA Deed-in-Lieu of Foreclosure Program the homeowner voluntarily agrees to transfer the ownership of the property to the servicer in exchange for the servicer agreeing that once the ownership is transferred the full value of the mortgage is satisfied. In some instances the servicer may require the homeowner to attempt to sell the home before they agree to a Deed-in-Lieu arrangement.

If you need help determining if a HAFA program is a possible option for your family contact a Florida Foreclosure Lawyer or a Jacksonville Foreclosure Defense Lawyer to review your position.