Foreclosure Sales UP

Posted by kevin on August 10, 2016 under Foreclosure Blog | Be the First to Comment

WSJ states that foreclosure sales are up while new foreclosures are down in NJ and NY. NJ has 6.2% of its home mortgages in foreclosure. Although down, that puts NJ #1 in the country. NY comes in at 4.6%. Most of the other states have less foreclosures not because their economy and housing market are in better shape than NJ and NY, but because they have already completed most of their foreclosures.

NJ and NY are called judicial foreclosure states. That means a lender has to file a lawsuit and obtain a judgment before it can foreclose. In non-judicial foreclosure cases, the borrower signs a Deed of Trust instead of a mortgage. If the borrower defaults, the trustee (after performing steps required by state where the property is located), lists the property for sale. The borrower then must file an affirmative lawsuit (in a short period of time) to attempt to put off the foreclosure. The result is that in non-judicial foreclosure states, there is lot less litigation, and houses go to sale much more quickly.

While foreclosures are still up in NJ and NY, foreclosure sales are up also. I can see two reasons for that. First, borrowers who have ask judges to put off sales because of hardship have exhausted the good will of a vast majority of the judges. Second, housing values have gone up over the last three years. When prices were down, mortgage holders put off the sale. They did not want to get stuck with the maintenance of the property while at the same time take a bath on any resale. However, with 30% rise in prices over the last 4 years, mortgage holders can recoup more money and. perhaps, even be made whole.

There are still strategies that will keep you in your house with the goal of getting a modification. But it is getting tougher.

Student Loan Debt and Senior Citizens

Posted by kevin on September 30, 2014 under Foreclosure Blog | Comments are off for this article

A little change of pace. The amount of student debt in the United States is exceeding the amount of credit card debt. So, from time to time, I will write about student debt either in this blog or my bankruptcy blog.

I attended a seminar a few months back on student loans. I was aware that since 1999, you could discharge student loans in a bankruptcy only by showing hardship. However, the test is so difficult that (and my older readers will probably get this), the only people who get hardship discharges are the one’s that can win on Queen for A Day (a somewhat popular daytime show from the late 50″s early 60’s where three women told their hard luck stories and the audiences voted on who had the toughest lot. That woman became queen for a day and won food and a clothes washer.) I’ve always thought that the test used for hardship in bankruptcy has been too stringent.

At the seminar, the presented pointed out that there were only 3 offenses under federal law that did not have a statute of limitations: murder, treason, and failure to pay your student loan. About a week ago, the Bergen Record ran an article about senior citizens saddled with student loan debt. It claimed that in 2010 4% of seniors carried $18.2 billion of student debt. Some were for Parent Plus loans for their kids, but the vast majority was on their own loans.

The problem is that these loans do not go away. The bigger problem is that if you are in default, a collection fee (in the range of 18-25%) is added on to the amount due. The biggest problem is that the federal government can garnish a portion of your wages and social security to recoup the loan.

It is tragic to think that unsuspecting Americans take out loans to get an education to get a better life, and millions are stuck with these debts even into retirement.

In this blog, I have written on numerous occasions about mortgage modifications. They are hard to get even when you qualify. It takes months of being jerked around. Sometimes you must question the good faith of the mortgage servicers who control this game.

Well, you can get modifications of federal student loans. That is the good news. The better news is that you eventually deal with the Department of Education as opposed to servicers and collection agents (but that takes a little effort). The best news is that you can substantially reduce or eliminate your monthly payments on student loans depending on your income.

It is worth looking into. Our offices are available for consultation on these matters. Email us at or call at 201-248-2204.