Posted by kevin on December 25, 2011 under Foreclosure Blog | 
Last week, the Appellate Division came down with a case that may have some implications for borrowers. There were two defendants which collateralized a business loan with New Jersey real estate. They defaulted on the payment of the loan. The bank sued on the note. If it is not a residential first mortgage, the lender has the option to foreclose, sue on the note or do both at the same time.
Ultimately, the parties settled. The settlement agreement was drafted by the lender and was very involved and in legalese. In essence, the borrowers would give up two properties by deeds in lieu of foreclosure. The lender gave one borrower a release and the other a $4,000 credit. The collateral left a balance due in excess of the $4000. So, the bank sued the one borrower for the difference.
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Posted by kevin on December 14, 2011 under Foreclosure Blog |
Last week, I argued before the Appellate Division to set aside a default judgment. My client had good arguments that the loan was predatory, that the plaintiff lacked standing and that the Fair Foreclosure Act may have been violated. However, the judges focused on the fact that my client never hired a lawyer until more than a year after default judgment had been entered. I made creative arguments to get around this “bad fact”- arguments that are a little too detailed and, perhaps, too boring to be presented here.
Without going into detail, there is a lesson to be learned irrespective of how the Appellate Division rules. When you get served with a Notice of Intent to Foreclose or a Complaint, hire an attorney to file an answer. I know that at the same time these papers are coming in, the servicer is bombarding the borrower with letters about modifications containing statements that the lender wants to work with you to save your house. That is usually a lot of hot air especially when you look at the dismal percentages on permanent modifications being granted even at this late date.
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