Judge Blasts Bank’s Lawyer and Wipes Out Mortgage in Disputed Foreclosure

punch.jpgForeclosure mills are coming under increasing assault and scrutiny by crafty defense attorneys, and a judiciary that is being pushed beyond their means by the increasingly steady rise of foreclosure filings in Miami, and Florida as a whole.

Recently, Miami-Dade County Circuit Court Judge Jennifer Bailey canceled the homeowner’s debt and mortgage owed to a bank as a direct result of the bank’s willful failure to follow Judge’s Bailey Order. Judge Bailey called the actions of the bank’s lawyer were “contemptuous”. You can read the full court hearing transcript here Judge-Wipes-Out-Homeowner’s-207-000-Mortgage[1].pdf.

The issue in this case began in December of 2009 when Judge Bailey granted the bank’s motion for foreclosure sale of the homeowner’s property. However, the bank had lost the note on the homeowner’s property. As a result, Judge Bailey ordered the bank to post a $414,000 bond to indemnity the homeowner in the event another bank filed a claim against the property in question.

The bank failed to do so, and moved forward with the foreclosure sale. The homeowner’s lawyer then asked Judge Bailey to set the sale aside in light of the fact that the bank had failed to post the bond, and otherwise failed to follow the Judge’s clear court order.

Not only did Judge Bailey agree to the homeowner’s request, but Judge Bailey wiped out the entire debt. In so doing, Judge Bailey complained about the general “chaos and disorganization of lenders and their lawyers.”

This is without a doubt a significant victory for homeowners struggling to keep up with their monthly mortgage payments. It is also the latest in a string of recent rulings from Florida Judges who are beyond frustrated with the bank’s lack of candor with the judicial system. Indeed, Florida’s Attorney General is currently investigating a prominent foreclosure Tampa foreclosure firm due to purported fabrications and allegedly presenting false and misleading documents in many foreclosure cases throughout the State of Florida. These actions by many foreclosure firms have also resulted in the change of certain Rules of Civil Procedure that govern foreclosure cases.

Please contact our office today if you are facing foreclosure. Our team of dedicated attorneys can help you. But don’t delay and call us today.

Foreclosures Hit the Rich and Famous in Miami

Fisher_Island_real_estate.jpgFisher Island is home to many of the rich and famous in Miami. Its residents have seen the likes of Oprah Winfrey, Mel Brooks, actress Sharon Gless, Florida first lady Carole Crist, and Boris Becker. Back in 2008, Fisher Island held the number one spot in Forbes magazine’s annual ranking of America’s most expensive postal zone.

The latest Forbes list, however, revealed that Fisher Island has dropped to No. 33, illustrating that no one is immune from the current economic and foreclosure crisis plaguing South Florida, and the nation as a whole.

Since 2009, at least 17 units have entered foreclosure and more than a dozen short sales – prospective deals in which the owner is willing to accept less than the amount owed – are listed. Smaller units have even been listed at the unbelievable price of $190,000. A recent report from Zillow.com shows that 97 percent of units on the island dropped in value since March of 2009.

Retired builder Arnold Schiller, finds that Fisher Island is not the only luxury community that is suffering during the current economic climate. Other pricy locations such as the Hamptons are feeling the effects of approximately 30 percent decreases in their home values.

However, residents and real estate agents are optimistic that Fisher Island will see signs of improvement in the near future. At the end of the day, Fisher Island is still a captivating place in an incredible location. Its privileged location, pristine beaches, views and unheard of prices will continue to draw attention.

If you are facing a foreclosure, contact our office today to discuss your options. We can be reached at 305-263-7700.

Jockey Club in Miami Lost to Foreclosure

Jockey Club.jpgLike many during the peak of the real estate market run up, Cinerest LLC, Tifeeret LLC and Tzion LLC along with managing member Yaron Horesh had plans of grandeur for the historic Jockey Club located at 11111 Biscayne Blvd., Miami, Fl. In 2005, Horesh’s companies paid a whooping $18.6 million dollars for the land around the condo high rise. They planned to build a residential project on the land. Today, they have nothing to show for it.

What has become rather common in South Florida, Horesh, and his companies, failed to build on the property they purchased back in 2005. Despite plans to build a residential project, construction never commenced. Consequently, Seacoast National Bank, an administrative agent for a group of lenders, filed a foreclosure against Horesh, and his companies, back in 2008.

Horesh lost the foreclosure case, and now the property is scheduled to be sold during an online auction on August 2nd. This is yet another sad chapter of the real estate meltdown that many are experiencing daily in South Florida.

Indeed, so far this year we have witnessed the Icon Brickell turned over in a ‘friendly foreclosure‘, prominent real estate developers suing their banks over projects, and others, like Horesh, that are just losing their properties in foreclosures.
This is a tricky real estate market. You need an attorney that knows this real estate market. If you are facing a foreclosure, or want to assess your options, call our office today.

Mortgage Delinquencies Continue to Worsen in Miami

miami 00a.jpgIn Miami, the mortgage crises continues its ugly march into the record books. According to the Mortgage Bankers Association, more than 10% of homeowners with a mortgage had missed at least one payment between January and March of this year. That is a record high and up from 9.1 percent from a year ago.

While many are predicting an improvement soon, the continued high number of homeowners in default or at risk of losing their home to a foreclosure will have a lingering effect on the economy as a whole.

Worse yet is the fact that a Wall Street Journal report reveals that one in four in the government’s loan modification program are dropped. According to the U.S. Department of the Treasury’s April update, the Making Home Affordable Program (HAMP) has 78,356 home loans under active modification, of which 30,923 are in Miami-Dade, Broward and Palm Beach counties.

On the other hand, we are starting to see some slow progress. For instance, while loan modifications got off to a slow start, housing officials have recently created incentives for lenders and servicers which have resulted in more modifications. Additionally, the number of homeowners starting to show signs of trouble is trending downward. As of March, nearly 3.5% of borrowers had missed at least one month of mortgage payments, down from 3.8% from a year earlier.

But the slow progress we are seeing is not enough to correct a bad situation. Therefore, should loan modifications fail to help, many homes will go up for sale either as a short sale or in a foreclosure sale. Therefore, many are forecasting that home prices will soon see yet another dip as more of these homes go up for sale at deeply discounted prices. While the mortgage crises was initially triggered by lax lending practices, today’s mortgage crises has many reasons other than just a home underwater.
If you are facing a foreclosure, contact our office today to discuss your options. We can be reached at 305-263-7700.

Increase in Miami Homes Being Repossessed Due to Foreclosures

underwater-home1.jpgAccording to a recent news report, home repossessions increased to record levels and more than one fifth of all U.S. mortgage holders were underwater on their mortgages in that they owed more on their mortgage than their home was worth.

More than 1 in 1000 homes were repossessed by lenders in March. Twenty three percent of owners of homes with mortgages owed more than their home was worth, and that was up from 21 percent in the prior three month period.

Moreover, U.S. home values continue to drop. The values dropped 3.8 percent in the first quarter, and that is the 13th straight period of year over year declines. These trends make it increasingly difficult for home owners with homes underwater to move the homes. Thus, when they fall behind, their options are limited. This makes it more likely that those homeowners will lose their homes in a foreclosure.

The continued high number of homes, and homeowners, underwater will continue to place a downward pressure on home prices. Thus, it is likely that we will see home prices continue to fall a bit more during the course of the next 12 months.

Additionally, banks are repossessing homes at a greater rare. In the first quarter, bank repossessions rose by 35% in comparison to the same period of the prior year. Indeed, repossessed homes now account for 1/5 of all homes currently for sale.
Please contact our office today to discuss your real estate options during these turbulent times.

Miami’s Icon Brickell Turned Over in a ‘Friendly Foreclosure’

icon brickell.jpgPerhaps no real estate development symbolizes the boom days of the real estate bubble, and the pop heard years later, better than Miami’s very own Icon Brickell.

Icon Brickell was developed by the Related Group, led by Jorge Perez, the undisputed condo king of South Florida. In creating the Icon Brickell, Mr. Perez, and the Related Group, spared no expense. The massive project sits where the Miami River intersects with Biscayne Bay. It is comprised of 1,646 condos, a 28,000 square foot fitness area, an infinity pool the size of a football field, pool deck, sculptured columns, and many other luxuries symbolic of the opulence associated with the height of the real estate boom.

But instead of a defining triumph for Mr. Perez, and the Related Group, the Icon Brickell has come to symbolize the excess of the building boom, and real estate collapse. At the height of the building boom, many condos at the Icon Brickell were listed at over a million dollars. However, and as 2010 began, only 30 of the 500 Icon Brickell units that were ready for closing in December actually closed. Indeed, and what has become rather common in South Florida, many buyers have hired our firm in an effort to avoid closing on their units and secure the return of their deposits. Indeed, our firm has attained some successful results for buyers seeking the return of their deposits from Icon Brickell.

With angry buyers demanding the return of their deposits, rapidly decreasing property values, eroding equity, it should come as no surprise that the senior lenders at Icon Brickell began to call the shots. Moreover, and given the eroding market conditions, the writing was on the wall, and it was only a matter of time before the Icon Brickell was besieged with a foreclosure.

This week, the Related Group deeded over two 57 story towers back to its lender, a syndicate of lenders led by HSBC, in what is being described as a ‘friendly foreclosure.’ While the Related Group was aggressively offering steep discounts in an effort to entice prospective purchasers to buy, and existing buyer to close, it was not enough to hold back the mounting financial pressure and avoid giving part of the project back to its lenders in a ‘friendly foreclosure.’

This latest chapter of the foreclosure saga playing out daily in South Florida is just another illustration of how foreclosures are impacting our real estate market. It also illustrates that foreclosures are being felt by both the wealthiest of individuals, and the poorest, alike.

Our attorneys have been in the forefront of fighting this fight. If you are faced with the prospect of falling into a foreclosure, or if you would like to assess your options regarding the potential return of your deposit in a condo project like the Icon Brickell, contact our office today.

Delinquent Mortgages in Florida, and Miami, Outpace the Rest of the Country Despite Rise in Home Sales

arrow.jpgFlorida had a higher mortgage delinquency rate than every other state in the country other than Nevada. However, nationally, less Americans were late with their mortgage payment. But more people in Miami were selling their homes at a loss.

As reported in the South Florida Business Journal, the ratio of borrowers 60 days or more past due declined to 6.77%, in the last quarter, compared with 6.89% in the fourth quarter of last year. This statistic is traditionally seen as a precursor to foreclosure filings.

Nevada had the highest delinquency rate, at 15.98%, followed by Florida, at 14.65%. However, Florida is expected to experience the highest mortgage delinquency rate by the end of the year, some say reaching as high as 18.2%.

As we previously noted, those that fell into foreclosure typically had one more reason other than a job loss or bad loan. Indeed, many are even pursuing ‘strategic defaults’ on their loans. And in certain situations, banks are pursuing the borrower for the deficiency.

As a result, the real estate market is seeing increased activity as many are actively trying to ‘unload’ their real estate. Coupled with the extension of the home tax credit, home sales in Miami-Dade County, Broward County, and Palm Beach County, combined, increased by 48.3% in a year over year comparison.

While the increase in home sales, coupled with the decrease in delinquencies, may appear to be all favorable news, it should be noted that more than half of all homes sold in Miami-Dade County last quarter were sold at a loss. Consequently, it comes as no surprise to learn that more than 40% of all single family homes in Miami were underwater with their mortgage at the end of the first quarter.

Although the market for selling a home is slowly improving, the price a homeowner can get for that home continues to decline. Therefore, please contact our office today to discuss your real estate options during these turbulent times.

Banks Pushing Deficiency Judgements Against Many Borrowers in Miami

underwater.jpgIf pushing you to attain an unaffordable mortgage during the go-go heyday of the real estate housing market was not enough. Today, many banks, like Bank of America, are at it again by chasing depleted borrowers to pay for the deficiency to improve the bank’s bottom line, while further pushing the borrower to the brink of economic collapse.

The bank’s latest tactic seems to be pushing desperate homeowners to accept deficiency judgments voluntarily, or pursuing them in the court system. As reported by CNNMoney, because of the declining real estate market, and difficult times stemming from the Great Recession, many borrowers have run into tough times. Indeed, we recently detailed the many factors that typically give rise to a foreclosure.

As a result, many borrowers can no longer afford their homes. Worse yet, they can’t even sell their homes today for what the homes were worth at the time of purchase. Consequently, desperate borrowers are forced to either short sell their homes, or simply lose their homes outright in a foreclosure sale.

The new problem becomes what to do with the short fall, or deficiency, between what the home was sold for minus the amount of the original mortgage. With the precipitous drop in real estate values, it comes as no surprise that the amount of the deficiency is often tens of thousands to hundreds of thousands of dollars.

Rather than write that money off as a bad loan – a bad loan that often times was pushed onto the borrower by mortgage brokers and banks just looking to make a quick buck – many banks are aggressively pursuing the pennyless homeowner, the homeowner down on his luck, and who just sold his home at a loss, to cover the deficiency. This is often done by way of a deficiency judgment, but can also be accomplished by pushy debt collectors hired by the banks to further bolster their bottom line.

It should be emphasized that this situation could happen to individuals who secured bank approval to sell their home for less than what the home is worth by way of a short sale. Therefore, just because your short sale has been approved does not mean that the bank won’t still pursue you for the deficiency. Thus, it is important to contact our office to address your concerns regarding this issue.

Whether banks can and will pursue deficiency judgements often times depends on many factors. The factors include, but are not limited to, whether there’s a second mortgage or other liens on the property. But if the borrower ignores the problem, or ignores the prospect of a deficiency judgment being entered against them, such failure to act could haunt the borrower for many years. Indeed, a bank could have up to 20 years to collect on the deficiency judgment, plus interest.

Therefore, if you are confronted with this situation, it is important to contact our office today to discuss your options.

Changes Made to Rules of Procedure Alter Foreclosures in Miami and South Florida

fl sup ct building.jpgThe Florida Supreme Court recently issued an opinion amending the Florida Rules of Civil Procedure and adopted several new forms to be used in connection with foreclosure cases filed in Miami-Dade County, and the state of Florida as a whole.

The most significant change is the amendment to Rule 1.110(b) of the Florida Rules of Civil Procedure. That rule was amended by the Florida Supreme Court to now require that all residential foreclosure complaints be verified. Verification requires that a bank representative sign the lawsuit under penalty of perjury attesting that all facts within the lawsuit are true to the best of the lender’s knowledge and belief. This new change is aimed at addressing the “lost note” defense, and potentially eliminating that defense all together.

Indeed, the Florida Supreme Court noted that this new requirement is being implemented in order to “(1) to provide incentive for the plaintiff to appropriately investigate and verify its ownership of the note or right to enforce the note and ensure that the allegations in the complaint are accurate; (2) to conserve judicial resources that are currently being wasted on inappropriately pleaded ‘lost note’ counts and inconsistent allegations; (3) to prevent the wasting of judicial resources and harm to defendants resulting from suits brought by plaintiffs not entitled to enforce the note; and (4) to give trial courts greater authority to sanction plaintiffs who make false allegations.”

The other changes made by the Florida Supreme Court include a change to the necessary affidavit of diligent search and inquiry, a form used by banks when they are unable to find or serve the lawsuit on the borrower. And an effort to have all motions to cancel the and re-schedule foreclosure sales uniform in an effort to potentially streamline the foreclosure process.
These are significant changes to the legal foreclosure landscape. Therefore, if you are served with foreclosure papers, please contact our office today.

Foreclosures & ‘Strategic’ Defaults on the Rise in Miami

foreclosure.jpgAs we previously reported, foreclosures are on the rise. But so too are ‘strategic’ defaults.

What is a ‘strategic default’? It is a decision by a borrower to stop making payments on a debt despite having the financial ability to make the payment. For instance, the large financial firm, Morgan Stanley, recently made the calculated decision to give up five San Francisco towers it purchased at the peak of the booming real estate market.

Many individual borrowers are also turning to the same strategy used by Morgan Stanley, and others, and are seeking solutions to the problems brought in by the unstable real estate market. And the reason ‘strategic defaults’ are becoming so popular are for reasons we might consider, and for other reasons we might not necessarily consider.

The two primary reasons appears to be (1) negative equity in the property, and (2) a more borrower friendly environment. The second reason should be kept in mind as we consider the current administration’s continued push to encourage more banks to offer loan modifications, and principal reduction coupled with the Fed’s continued policy to keep interest rates low.

A recent Morgan Stanley report reveals that many U.S. homeowners are opting to walk away from mortgages that they can afford, and that these ‘strategic’ defaults are accounting for an increasing share of defaults. About 12% of all mortgage defaults in February were ‘strategic’, and that is up from 4% in mid 2007. The same report indicates that borrowers will likely stop paying their mortgages the higher their credit scores and the larger their loans.

This following report that ran on the NBC nightly news provides a snap shot into this growing trend.

If you are in a difficult financial situation, contact us today to discuss your options.