New Jersey and New York Foreclosure Defense Attorneys
Foreclosure is a scary prospect for any homeowner. If you have fallen behind on your mortgage payments and are in danger of foreclosure, it can seem like an overwhelming, hopeless situation. However, it is important to remember that you have rights and options. If you are proactive and face the situation head on, you can have a chance to stop foreclosure and stay in your home. At Larkin Farrell, LLC, we are prepared to work tirelessly to help you fight the foreclosure and keep your mortgage servicer from taking advantage of you. With offices in New York City, NY and Red Bank, NJ, we are proud to help homeowners will all aspects of foreclosure defense.
Foreclosure occurs when a homeowner defaults on their mortgage and their mortgage lender begins the process of legally taking back their home. The foreclosure process in New Jersey and New York starts once you have fallen behind on payments for your mortgage and the lender mails you a Notice of Intent to Foreclose. The lender will then file a foreclosure complaint with the relevant court and begin their push for a Final Judgment of Foreclosure. However, during the foreclosure process there are specific procedures that must be followed by law in order for your lender to be legally allowed to foreclosure on your home. As a homeowner you have certain rights and options that can give you the opportunity to delay or stop foreclosure, such as:
- Contesting the foreclosure complaint
- Mortgage reinstatement
- Loan modification
- Short sale
Even if your lender successfully forecloses and starts the sheriff sale process, there are still options available to you. The foreclosure defense lawyers at Larkin Farrell can help you determine what is the right course of action for your particular situation.
A loan modification is the most common foreclosure defense method. It is an alteration to the original mortgage agreement designed to help the borrower get back up to date on their payments. A loan modification restructures the contract into something more suitable for the financial situation of the borrower. Some of the common types of loan modifications include:
- Principal reduction
- Principal forbearance
- Interest rate reduction
- Extending the life of the loan
- Capitalization of arrears
- Late fee forgiveness
Mortgage servicers are required by law to halt foreclosure proceedings and review complete loan modification applications. We pursue failures to review loan modifications aggressively and will file lawsuits against any mortgage servicer who does not meet their servicing obligations under the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA).
If you have gotten into a situation where you owe more on your home than it is worth, it might be time to consider a short sale. A short sale allows homeowners with more debt than the total value of their property to sell their home to a third party for less than is owed on the mortgage. This can allow you to get a fresh financial start and avoid the consequences of a foreclosure or bankruptcy. However, you can only pursue a short sale if your lender agrees to the proposition. You will want an experienced New York or New Jersey short sale attorney to determine if a short sale is the best option for you and guide you through the process.
At Larkin Farrell, we will work to ensure your lender has followed all proper foreclosure procedures and is not taking advantage of you. You have rights as a borrower and we will do our utmost to protect those rights. Some of the more common violations include:
- Refusing to honor your loan modification.
- Failure to review your loan modification.
- Continuing foreclosure actions or pursuing a sheriff sale while your loan modification is under review.
- Declaring that you are in default and are at risk of foreclosure despite your mortgage payments being up to date.
- Being unwilling to accept your mortgage payments or reinstatement.
- Failure to respond to your loan modification application within 30 days.
- Failure to follow RESPA and TILA regulations.
We also check the practices of debt collectors to make sure your rights under the Fair Debt Collection Practices Act (FDCPA) are not being violated. Debt collectors should not be allowed to impact your family, job or privacy or violate any other law that forbids collection actions.
A sheriff sale is a public auction held after final judgment on a foreclosure has been obtained that allows the lender, bank or other litigants to collect money that has been lost on a foreclosed property. Properties sold on a sheriff sale are sold subject to the initial mortgage, which is usually the first lien on the property. Applying for a loan modification or declaring bankruptcy will stop all foreclosure actions, including any scheduled sheriff sale. A loan modification application must be submitted 38 days before the sheriff sale is to take place and the lender must then review the application. Bankruptcy grants you an automatic stay, which is an injunction that stops the sale as well as other collection actions. You have a right to two adjournments and you can also file a motion with the judge to stay the sale. Once the sale has happened, you still have a span of time called a redemption period in which you can object to the sale or redeem the property by paying the full amount of the judgment in addition to other liens, costs and fees. Having an experienced New York or New Jersey foreclosure defense lawyer is invaluable if you plan to fight the sale or want to declare bankruptcy to stop foreclosure actions.
Declaring bankruptcy is never a decision to be made lightly and should only be done after discussion with a qualified bankruptcy attorney. As mentioned before, upon filing a Bankruptcy Petition, an automatic stay on all creditor actions, including sheriff sales and pending evictions, will come into effect. This can provide not only welcome relief from creditors but also a chance to regroup and organize a plan of action. The two types of bankruptcy most people will file under are Chapter 7 and Chapter 13.
Chapter 7 bankruptcy is a liquidation bankruptcy that involves wiping out most of your dischargeable debts without the need for a repayment plan. Dischargeable debts are most forms of unsecured debt such as medical bills, credit card debts, utility balances and personal loans. The cost of this is that any non-exempt liquid assets will usually have to undergo liquidation in order to pay off your creditors, so this may not be the best option if you want to keep the house. Additionally, certain debts cannot be discharged, such as student loans, child support/alimony payments, and certain types of taxes.
Chapter 13 bankruptcy is a repayment based bankruptcy that involves consolidating your debts so that you can repay them over a period of 3-5 years. At the conclusion of this period all remaining debts are discharged. This type of bankruptcy allows you to keep most of your non-exempt assets and as such is often chosen by people who fall behind on their mortgage but can’t quite afford straight reinstatement.
Note that there are exceptions to the automatic stay based on successive bankruptcies. If you had one previous bankruptcy in the past year, your automatic stay will only last 30 days. If you had two or more cases of bankruptcy dismissed within the past year, then you do not even get an automatic stay. The lender can also file a motion to lift the stay with the court, however you are entitled to file a response.
Facing Foreclosure and Don’t Know Where to Turn?
Getting foreclosed on is both scary and stressful. You need someone in your corner who can help you stop the creditors and advise you on which of your options are the best fit for your situation. The foreclosure defense attorneys at Larkin Farrell can provide that assistance and ensure you make the best decision possible. Whether you need to challenge a complaint in court or want to see if bankruptcy is the right path forward, we have the expertise to get results. Contact us today to discuss your situation.