Kramer Huy P.A.

Marco Island Office
SunTrust Centre
950 North Collier Boulevard Suite 101
Marco Island, Florida 34145
239-394-3900 Telephone
239-642-0006 Fax
239-394-7814 Real Estate Fax

Facing Foreclosure? We Can Help.

Have you fallen behind on your mortgage payments? Are you about to? Have you been served with a mortgage foreclosure complaint? If you ignore the situation, you could be turning a bad situation into a catastrophic one. We can help you, but it is imperative that you act now.


We Buy You Time.

If you are delinquent in your mortgage payments to the lender (or your lender’s servicer), have been served with a notice of foreclosure or have received a mortgage foreclosure complaint, you have a very short time to respond. In many cases, a homeowner and borrower begin to lose precious legal rights in as little as twenty (20) days. Florida’s mortgage foreclosure process will absolutely have serious, long lasting ramifications that you may have to deal with in the future. It is in your best interest to participate and fight the foreclosure now while it is occurring. Your decision to participate now may preserve, protect and safeguard valuable legal rights affecting your future income, credit worthiness and income tax consequences.

While you are fighting the foreclosure action, you are not required to make your normal monthly mortgage payments. The legal process will afford you time to reinstate the mortgage, sell your home, file a bankruptcy or move out. You may be able to force the lender to completely rewrite the terms of your note and mortgage, enabling you to keep your home.

Your Bank Could Be The One At Fault.

This may sound too good to be true, but you may actually have valuable defenses and counterclaims against your mortgage company that could actually prevent foreclosure and even require your lender to pay you damages. Across the country, judges are punishing mortgage companies for incomplete record keeping and for violations of the Truth In Lending Act. You may be able to allege valid defenses including fraud and Truth In Lending Act violations.

Defenses and Affirmative Defenses.

Are you aware that your mortgage company is probably not the same company that actually loaned you the money to buy or refinance your home? How do you know if the mortgage company suing you has been properly assigned your note and mortgage? Your mortgage company may have failed to properly assign the note and mortgage before initiating the foreclosure. Does your foreclosure complaint even have copies of the note, mortgage and purported assignment attached?

Most likely, these documents are not attached, and may not even be in the possession of your mortgage company. Your mortgage company may be attempting to substitute your original note and/or mortgage with a purported copy. This is called a ’Count to Establish Lost Documents’ There are strict legal requirements to establish a lost note or mortgage, and your mortgage company may be unable to meet the requirements if challenged.

If your current mortgage company is not your original lender, it probably has never read your mortgage. Your mortgage may require that the plaintiff accelerate (i.e. demand) the entire balance of the note. Your mortgage company may have failed to do that, which may entitle you the opportunity to cure the mortgage by paying the reinstatement amount. It is also common for mortgage companies to inflate the balance due on the mortgage by charging homeowners junk fees, such as Broker Price Opinions (BPO), property inspections and other ’property preservation expenses.’

Act Now.

So, essentially, your mortgage company may have filed an improper foreclosure lawsuit, but your time is limited. You have or will be served a copy of the foreclosure complaint by a process server. You typically have only 20 days to respond to the mortgage company’s complaint, so you need to see an attorney immediately if you wish to defend against the foreclosure. If you are beyond the twenty days, there are still defenses that can be raised.

We provide borrowers with a mortgage foreclosure defense. Contact us for more details. Our representation in your foreclosure action will provide you with:

Foreclosure rates in the State of Florida continue to increase. The lenders are not always correct in the numerous avenues of legal compliance that they must abide by for each and every single real estate closing. Florida is a judicial foreclosure state, which means that a civil action must be commenced in order to foreclose upon a delinquent loan. The lender will file a law suit against the delinquent borrower and seek to involuntarily force the sale of the borrower’s home or real estate at a public auction to the highest bidder present on that day. The proceeds of the sale will be delivered to the lender to pay all remaining amounts owed on the delinquent mortgage. If there are no bids at the foreclosure sale, the lender will be permitted to take title to the property or home, at which time, the lender will attempt to sell the home or real estate on the open market to recover its mortgage debt. Below, is a brief outline of the time frames in which you can expect the foreclosure law suit to proceed.

I am behind on my mortgage payments, what do I do?
Don't ignore the problem. It will only make your situation worse. The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house. Prioritize your spending. After healthcare, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment. Look for optional expenses-cable TV, memberships, entertainment-that you can eliminate. Delay payments on credit cards and other "unsecured" debt until you have paid your mortgage. Contact us immediately for a free consultation.

I am in foreclosure, what options do I have?
There are many options for you to pursue during the pre-foreclosure and foreclosure process. The following is a list of possible options.

Should I open and respond to all mail from my lender or lender’s attorney?
The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notice of pending legal action and important dates. Your failure to open the mail will not be an excuse in foreclosure court, and ignoring these notices will only make the situation worse. Before responding, contact us immediately for a free consultation. Your lender will have an attorney working for them, so should you.

I have just been served with a summons and foreclosure complaint. What do I do?
You must respond in writing and/or file an answer and affirmative defenses within 20 days fo being served with the complaint. Any delay may make the situation you are in worse, and if a borrower or homeowner fails to do anything at all, the situation may become the worst case scenario possible. Contact us immediately for a free consultation. Florida's mortgage foreclosure process will absolutely have serious, long lasting ramifications that you may have to deal with in the future, so it absolutely in your best interest to participate now while it is occurring. Your decision to participate now may preserve, protect and safeguard valuable legal rights affecting your future income, credit worthiness and income tax consequences. Contact us immediately for a free consultation.

If I do nothing, what will happen?
A default and default judgment will be entered, and the clerk of the court will auction your property, usually within 30 days from entry of a final judgment.

Should I use a foreclosure prevention company?
You don't need to pay fees for foreclosure prevention help-use that money to pay the mortgage instead. Many for-profit companies will contact you promising to negotiate with your lender. While these may be legitimate businesses, they will charge you a hefty fee (often two or three month’s mortgage payment) for information and services your lender may provide for free. Watch out for foreclosure recovery scams! If any firm claims they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf, you may well be signing over the title to your property and becoming a renter in your own home. Never sign a legal document without reading and understanding all the terms and getting professional advice from an attorney or a trusted real estate professional.

Will the foreclosure process affect my credit score?
It is hard to say exactly how many points your credit score will drop due to a foreclosure. There are numerous factors that affect your credit score. It does appear though, that loss mitigation options that do not result in the completion of the foreclosure are better for your credit score depending on which credit buerau you are looking at. However, Fair Issac Corp. (FICO) has been quoted as saying that loss mitigation options have the exact same negative effect on a person’s credit score. This is so because Fair Issac Corp. has done very little analysis distinguishing loss mitigation options vs. foreclosures, and as a result of ignorance they treat loss mitigation options and foreclosure all the same. However, Transunion, Equifax and Experian have a little more detailed credit scoring system, so they may account for loss mitigation options. However, a benefit of short sales and other loss mitigation options is that borrowers will generally face a shorter waiting period before they can obtain another mortgage. Many lenders primarily make loans that they can sell to big mortgage players Fannie Mae and Freddie Mac. Fannie Mae generally will not buy loans made to borrowers involved in a short sale in the past two years. That’s shorter than the four-year wait time if you have a deed in lieu of foreclosure on your record, and the five-year wait time if you have a foreclosure on record. Typically, any late mortgage payments are viewed as a negative mark. Generally, negative marks will remain on a credit report for 7 years. Foreclosures also remain on credit scores for 7 years. The impact on credit scores diminishes over time though. Loss mitigation efforts and foreclosure are definitely better than a bankruptcy, as the filing of a bankruptcy is viewed by the credit reporting industry as an attack against all trade lines across the board, whereas a mortgage foreclosure is only an attack against a single trade line, your mortgage lender.

What if I file bankruptcy?
A bankruptcy will stop the foreclosure. A chapter 13 bankruptcy may allow you to make up the arrearages and reinstate your mortgage, over a period of time, usually 5 years. It means you make a regular payment and part payment each month until you get caught up. In a chapter 7, you will have to pay back the arrearages much quicker than 5 years, the foreclosure will continue. The general rule is bankruptcy negatively affects your credit score for 10 years, but sometimes the creditors on a chapter 13 will voluntarily remove it after 7 years to encourage people to file a 13 rather than a 7.

Are their income tax consequences as a result of a foreclosure?
It usually depends on whether or not your home or property has equity and what type of loan it is. If there is no equity, it is likely that the property or home will be sold for less than the mortgage amount owed. The Internal Revenue Service will consider debt forgiveness by the lender as income, however, The Mortgage Forgiveness Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualify for this relief. This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion doesn’t apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition. Consult with an accountant. These rules are complicated and you are advised to make a thorough examination of your personal financial situation with an experienced tax professional. Further information, including detailed examples, can also be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments.

After the property is auctioned by the court clerk, do I have to get out?
Yes. The sheriff’s office will physically evict you and remove you and your personal effects from the property, usually in as little as 10-15 days.

What can an experienced and knowledgeable lawyer do?
File an answer containing affirmative defenses, which are special defenses which must be specifically alleged, such as truth-in-lending violations, usury, fraud and other specific types of improper conduct by the lender, which may defeat or partially defeat the lender’s claims.

In the answer, is a denial of the lenderís complaint all I need to do?
Usually not. You must state all affirmative defenses, otherwise they may be waived or may not be sufficient to stop the foreclosure process.

Why are affirmative defenses different than just an answer with denials?
The lender has a sufficiently more difficult burden to obtain a summary judgment of foreclosure when affirmative defenses are filed.

Can an attorney just delay the case without justification?
No. An attorney cannot cause delay solely for that purpose. But, in the full exercise of your legal rights, delay may result as a by-product of a proper defense, often caused by the plaintiff not properly and promptly responding to your attorney’s rightful demands.

If I get a lawyer, does he automatically get more time to file an answer?
No, the 20 days continues to run. If a default is taken against you, it will pose, at a minimum, difficulties in getting the default set aside and allowing your attorney to use the defensive arsenal otherwise available on your behalf.

If my property is sold by the court clerk, what price will it bring?
Usually much lower than fair market value. Most of the time it is sold for the total amount of the mortgage, or less.

Will I get any of the sales proceeds?
Only if there is a surplus (if the property is sold for more that what is owed in total to the plaintiff and all other mortgages and liens on the property).

If the property is sold for less than the total owed, can the lender collect the difference?
Yes, but only if the lender also obtains a deficiency judgment.

Can I sell the property and get my money out?
Yes, you can sell or refinance so long as the lender is paid prior to the foreclosure sale date.

Do I have the right to reinstate or bring the mortgage current?
Not always, unless your mortgage or mortgage note specifically gives you this right. However, many mortgage lenders often voluntarily consent to reinstatement.

I have many other questions, can I call the judge or the court for advice?
No. Judges, judicial assistants, court clerks and the sheriff’s department cannot practice law or give you legal advice. They can only point out the existence of certain procedures, but cannot tell you how to follow them or how effective they will be.

Interested?

If you’d like to find out more about working together, please contact us. We’ll have a conversation and see if we are the right attorneys for you, and if you’re the right kind of client for us. We hope to hear from you soon.