Our Military Is Protected from Foreclosure under The Servicemen Act (SCRA)


We have been approached by few military families whose home were foreclosed while the owner were performing military services overseas. This is very painful, but unfortunately, it has been done and the homes were foreclosed in clear violation of the SCRA. In one case, our law office helped getting back garnished wages of a police officer back. Two mortgage servicing companies have agreed to settle federal complaints that they wrongfully foreclosed on the homes of at least 178 military service members and to set aside a minimum of $22 million to compensate those victims. This is a great victory for the Justice Department that various lenders had settled such cases. The lenders include, of course the notorious one i.e Countrywide Home Loan Servicing and Saxon Mortgage Services. These companies knowingly and repeatedly violated the Service members Civil Relief Act, a federal law that extends an array of financial and legal protections to military personnel. The former Countrywide unit agreed to pay $20 million to approximately 160 victims of illegal foreclosures from January 2006 to May 2009. It also agreed to reimburse victims of any other illegal military foreclosures found to have occurred from May 2009 to the end of last year.
NY Times has posted one such painful story of Sgt. James B. Hourley who was away on war duties in Iraq. In violation of a law intended to protect active military personnel from creditors, agents of Deutsche Bank foreclosed on his small Michigan house, forcing Sergeant Hurley’s wife, Brandie, and her two young children to move out and find shelter elsewhere.

“When the sergeant returned in December 2005, he drove past the densely wooded riverfront property outside Hartford, Mich. The peaceful little home was still there — winter birds still darted over the gazebo he had built near the water’s edge — but it almost certainly would never be his again. Less than two months before his return from the war, the bank’s agents sold the property to a buyer in Chicago for $76,000. Since then, Sergeant Hurley has been on an odyssey through the legal system, with little hope of a happy ending — indeed, the foreclosure that cost him his home may also cost him his marriage. ”Brandie took this very badly,” said Sergeant Hurley, 45, a plainspoken man who was disabled in Iraq and is now unemployed. ”We’re trying to piece it together.”

“In March 2009, a federal judge ruled that the bank’s foreclosure in 2004 violated federal law but the battle did not end there for Sergeant Hurley. Typically, banks respond quickly to public reports of errors affecting military families. But today, more than six years after the illegal foreclosure, Deutsche Bank Trust Company and its primary co-defendant, a Morgan Stanley subsidiary called Saxon Mortgage Services, are still in court disputing whether Sergeant Hurley is owed significant damages. Exhibits show that at least 100 other military mortgages are being serviced for Deutsche Bank, but it is not clear whether other service members have been affected by the policy that resulted in the Hurley foreclosure.”

In court papers, lawyers for Saxon and the bank assert the sergeant is entitled to recover no more than the fair market value of his lost home. His lawyers argue that the defendants should pay much more than that — including an award of punitive damages to deter big lenders from future violations of the law. The law is called the Service members Civil Relief Act, and it protects service members on active duty from many of the legal consequences of their forced absence.

We suggest as a foreclosure defense attorney, and working in this field for long time, we encourage any military family (living in Nevada) to ask our free legal help in this regard. We would not charge any money upfront from any such familiy AND EVEN ADVANCE COURT COST, if they have meritorious case while their loved one were performing military services overseas. Call us at (702) 270-9100 and even get a free consultation over the phone.

How to bounce back after bankruptcy?


Can you bounce back after bankruptcy?
I have been asked many times what would be the life after bankruptcy and how the debtors can reestablish their credit again and acquire credit again. Of course, it would be difficult and time consuming, but it is not impossible. Soon after the discharge of bankruptcy, one start getting offers from credit card companies and a secured credit card is an ideal form for reestablishing credit. Actually, almost anyone can get credit soon after a bankruptcy. It’s just a matter of knowing how and what steps to take. Of course, bankruptcy deals a devastating blow to your credit and your credit score, the three-digit number lenders use to gauge your credit-worthiness. your FICO is at the bottom of scores, but you should not be discouraged by this devasating score. Of course, you can build it slowly and surely. But the effects don’t have to be lasting. Long before the bankruptcy drops off your credit report, you could be qualifying for loans with good rates and terms. I still consider FICO a fiction but it still runs your credit life, and all the lenders use this tool all the time. So, it is an important yardstick.

Nothing in credit remains forever. A bankruptcy legally can remain on your credit report for up to 10 years, but its effect on your credit score can start to diminish the day your case is closed — if you adopt responsible credit habits such as paying your bills on time, using only a small portion of your available credit and not applying for too much credit at once. Well, to start, one must learn some lesson, some financial education after declaring bankruptcy and devise a saner financial course. The days of wasteful expenditure should be gone forever and one must always learn new tools, education, train, or get a professional training to acquire more money. Of course, if you become wealthier, it may solve lots of your financial problems.

You may live on cash for quite some time and paying by cash is a good habit, but still one has to use credit. Afterall, we live in a credit society and we have to travle, hire a cab or rent a car and buy grocery sometime on credit cards. You have to get and use credit to build your credit score. But if you want to rebuild your credit score, you can’t sit on the sidelines.

Did you ever try to make a budget? Of course a written budge, and not something on whims only. No technical knowledge is required. Simply write one page all sources of your income and on the next page write faithfully all of your expenditure, and see why there is so much widespread deficit in both. Why can’t you balance the budget and live a healthy life.
Of course it is time to clean up your credit report. You may find someone who can help you or you can write simple letters to all the credit bureaus. Possibly, your credit report may still show some of the delinquencies which ought to have been wiped out but still lingering there like a bad dream. Also, if you have other serious mistakes on your credit report, those need to be corrected as well. Your credit score is based on information in your credit report, so errors on your report can seriously dampen your score.

Nevada Scam Loan Modification Agencies Fined by MLD


The Division of Mortgage Lending continues to diligently enforce mortgage lending laws by disciplining 10 entities for various violations of those laws.

* The Division fined now former mortgage agent Charmaine A. Hicks $2,500 plus administrative costs for failing to cooperate in a Division investigation.

* Henderson-based mortgage broker Evofi One was fined for sharing office space with unaffiliated businesses. The Division issued a fine of $5,000, plus administrative costs.

* Las Vegas-based The Sussex Group, an escrow agency, and its sole shareholder, Barry L. Fulco, were ordered to Cease & Desist operations after the Division discovered that the physical location listed on the application did not match the location provided to clients, after the business vacated a location without disclosing it to the Division, and after the Division was unable to subsequently find a permanent office location for the business. The Sussex Group was ordered to provide a full accounting of all transactions and moneys held in trust and was issued a $30,000 fine, plus administrative costs.

* Las Vegas-based mortgage broker Pinnacle Lending Group has entered into a Stipulated Settlement Agreement with the Division because the company improperly compensated its mortgage agents. This activity resulted in a fine of $10,000 (a portion of which was suspended) and administrative costs.

* Pea Management Group, Inc., dba Escrow Unlimited, entered into a Stipulated Settlement Agreement with the Division because the company did not maintain complete and suitable transaction records. Pea Management has been fined $3,500. The company has corrected the records deficiencies and has also agreed to increase its surety bond.

* The Division has fined Home Plus Financial, Inc., formerly licensed as a mortgage banker, a total of $5,000: $2,500 for failing to submit financial information and $2,500 failing to permit an examination.

* Cedar Mortgage Company, Inc., dba Cedar Mortgage, based in Fallon, Nevada, has entered into a Stipulated Settlement Agreement with the Division. Cedar Mortgage providedmortgage broker services out of an licensed California office. The company agreed to pay a fine of $2,500 and surrender its mortgage broker license.

* The Division has revoked Las Vegas-based OneCap Mortgage Corporation’s mortgage broker’s license because of its failure to abide by the terms of a previous settlement agreement.

* The Division has issued a Cease & Desist Order to Las Vegas-based Homekeepers RSVP, formerly dba Homekeepers, LLC, for performing unlicensed loan modification services. The company is prohibited from advertising for and/or soliciting foreclosure or loan modification consulting business and cannot provide these services to Nevada consumers. The company has also been fined $20,000 and must pay the Division’s investigative costs.

* After investigating numerous complaints, the Division has issued a Cease & Desist Order to Las Vegas Paralegal Services and Maria D. Davila for providing foreclosure and loan modification consulting services without a license from the Division. Ms. Davila and Las Vegas Paralegal Services are prohibited from advertising for and/or soliciting foreclosure or loan modification consulting business and cannot provide these services to Nevada consumers. They have each been fined $10,000 and are required to pay the Division’s investigative costs as well as any attorney’s fees the Division may incur.

“Today’s announcement once again highlights our continuing commitment to protecting Nevada consumers,” said Mortgage Lending Commissioner Joe Waltuch. “Those allowing or participating in inappropriate mortgage-related activity will be held accountable.”

For more information about the Division of Mortgage Lending, visit http://mld.nv.gov/index.htm

How to prepare financial information before you talk to your lender?


HOUSEHOLD FINANCIAL INFORMATION INCOME BUDGET FOR HOUSEHOLD

SOURCE OF INCOME LAST MO. ACTUAL THIS MO. EXPECTED THIS MO. ACTUAL ADJUSTED MONTHLY
Employment $ $ $ $
Overtime ______________________________________________________
Child Support/Alimony ___________________________________________
Pension _______________________________________________________
Interest _______________________________________________________
Public Benefits _________________________________________________ ______________________________________________________________
Dividends
Trust Payments ________________________________________________
Royalties ______________________________________________________
Rents Received _________________________________________________
Other (List) ____________________________________________________

TOTAL (MONTHLY) $ $ $ $

NOTES/ANTICIPATED CHANGES:______________

EXPENSE BUDGET FOR HOUSEHOLD

TYPE OF EXPENSE LAST MO. ACTUAL THIS MO. EXPECTED THIS MO. ACTUAL ADJUSTED MONTHLY
Payroll Deductions $ $ $ $
Income Tax Withheld ____________________________________
Social Security _________________________________________
FICA
Wage Garnishments ____________________________________ Credit Union _______________________________________
Other ________________________________________________
Home Related Expenses
Mortgage or Rent ______________________________________
Second Mortgage ______________________________________
Third Mortgage ________________________________________
Real Estate Taxes ______________________________________
Insurance _____________________________________________
Condo Fees & Assessments ______________________________
Mobile Home Lot Rent ___________________________________
Home Maintenance/ Upkeep ______________________________
Utilities _______________________________________________
Gas __________________________________________________
Electric ___________________
Oil _______________________
Water/Sewer ____________________
Telephone:
Land Line _______________________
Cell ____________________________
Cable TV ________________________
Internet
Other __________________________
Food
Eating Out ______________________
Groceries _______________________
Clothing ________________________________
Laundry and Cleaning _____________________
Medical ________________________________
Current Needs _______________________
Prescriptions _______________________
Dental _______________________
Insurance Co-Payments or Premiums
Other _________________________________
Transportation _________________________
Auto Payments ________________________
Car Insurance ________________________
Gas and Maintenance _________________________
Public Transportation _______________________
Life Insurance _________________________
Alimony or Support Paid _________________________
School Expenses _________________________
Student Loan Payments _________________________
Entertainment _________________________
Newspapers/Magazines _________________________
Charity/Church _________________________
Pet Expenses _________________________
Amounts Owed on Debts _________________________
Credit Card__________________________________
___________________
Credit Card
___________________
Credit Card
___________________
Medical Bill
___________________
Medical Bill
___________________
Other Back Bills (List)
___________________
___________________
Cosigned Debts
Business Debts (List)
___________________
___________________
Other Expenses (List)
___________________
___________________
Miscellaneous
TOTAL _______________________________________________________

Other Important Debt Issues:

Wage Garnishments Yes______ No______
Pending Court Cases Yes______ No______
Pending Utility Shut-offs Yes _____ No _____
Car Loan Defaults or Repossessions Tax Debts Yes ____ No____
Student Loan Debts Yes_____ No_____

Other:
Notes/Anticipated Changes:
Describe Assets and Other Resources:

Savings Yes______ No______ Amount $__________________

Court Cases Pending Against Others Yes______ No__________
Value $______________

Anticipated Tax Refunds Yes______ No____________
Amount $______________

Assets Which Can Be Sold Yes ______ No______ Value $______________

Pension or Retirement Funds Yes______ No______ Value $______________

Other Assets and Notes:

INCOME AND EXPENSE TOTALS

Last Mo. Actual This Mo. Expected This Mo. Actual Adjusted Expected
A. Total Projected Monthly Income
B. Total Projected Monthly Expenses
Excess Income or Shortfall (A minus B)

Notes:

OTHER INFORMATION

1. Have you made an effort to arrange a workout on their own? What result?

2. Have you filed bankruptcy? If so when? Current status of case if still pending? If bankruptcy is over, what result?

3. Other issues which came up during this time.

4. Questions and open issues that must be resolved

Strategic Defaults or Walkaways–New Threats to Homeownership


We are hearing new and new words again and our real estate terminology is becoming richer every day. Until only couple years ago, we did not even know what is a short sale or deed in lieu. Now, a new word is becoming familiar every day and it is called strategic default. A strategic default is the decision by a borrower to stop making payments (i.e. default) on a debt despite having the financial ability to make the payments.
This is particularly associated with residential and commercial mortgages, in which case it usually occurs after a substantial drop in the house’s price such that the debt owed is (considerably) greater than the value of the property — the property negative equity or “underwater” — and is expected to remain so for the foreseeable future, such as following the bursting of a real estate bubble. Such borrowers are called “walkaways”.
Even distinguished economists Paul Krugman and Hal Varian have acknowledged that strategic default will be an inevitable result of the collapse of the finance and property bubble of the era following 2006. They also note that this is one of the few ways of freeing people from the burden of mortgage debt
The walkaways are the people who find themselves unable to meet their mortgage payments—and to solve the problem simply move out their belongings at night, drop their house key in the mailbox and disappear. In West Texas, largely because of walkaways, the Federal Government currently has 1,800 repossessed houses on its hands. In seven South Florida counties, walkaways have abandoned 3,000 FHA-homes. The rate of mortgage foreclosures has tripled during the past ten years, to an estimated 3.77 per 1,000 mortgages. Most housing economists agree that the leveling off of home prices in many parts of the U.S. accounts for most of the increase. As long as home prices were rising, a homeowner who could not meet his payments could always sell out—usually at a profit. Now, with prices steady, an overextended homeowner must either sell at a loss or face foreclosure.
WAlkAWAYS are done by homeowners who are financially savvy and had calculated that there is no outcome or light at the end of the tunnel. A strategic default is done by smart and educated people compared to Walkaways who are financially not that savvy and no solid jobs and can move easily. While strategic defaulters calculate and savvy and knows the financial market well. They have good income jobs and mostly both the spouses are working in middle income bracket.
Again, this walkaways and strategic default is a dangerous phenomenon and would nullify all the efforts by federal government in solving this home foreclosure crisis. If it continues, there would be no end in sight and it would engulf all of us. Our situation would not be different than say from Greece or Portugal.

Foreclosures Are Coming Down-Finally something better to read!


The good news is that foreclosure rate is coming down. It is happening all across USA. Nevada is a bit slow to catch up. However, things are improving in Nevada as well. Please read the following article.
http://247wallst.com/2010/05/13/a-little-relief-in-foreclosure-rates/

Lawsuit Filed Against Wells Fargo For Not Doing Permanent Loan Modification


As we know banks had done temporary loan modification and promised permanent loan modifications if the borrowers at least make three payments and their financial conditions are not substantially changed. Many lenders had done temporary loan modification but somehow were reluctact to do permanent loan modification. Here, we have a copy of the complaint where Wells Fargo and Bank of America were sued.

http://www.nclc.org/issues/cocounseling/content/hamp-BosqueWFComplaint.pdf

http://www.nclc.org/issues/cocounseling/content/hamp-Johnson-BOA-Complaint.pdf

What About 2nd Mortgages?


JPMorgan Chase this week became the latest big bank to say it is willing to modify second mortgages for some struggling borrowers. It can be termed as baby step as we had seen a continuous neglect by lenders to modify second mortgages. They had frowned upon this idea for long time. As we know, most of the homes in Nevada has a second loan which are called junior liens in legal language and they are subordinate to the first loan.

Most of the homeowners who are behind on their first mortgage payments are also behind on their second mortgage payments. All the modification programs by federal government only has tackled first mortgages . The Home Affordable Modification Program, which is intended to ease mortgage payment reductions, is aimed at several million struggling borrowers. Of 1.4 million trial modifications offered so far, only 170,000 have resulted in adjustments that the program calls “permanent.” In reality, even after modification many borrowers are still overburdened, and further defaults look inevitable.

That ought to focus banks’ attention on their second-lien loans. There may be little or no chance many of them will ever be repaid. But banks have avoided writing down second liens because accounting rules allow them to consider the loans performing so long as borrowers make interest payments. It’s easy to understand why the banks are avoiding the issue. According to Amherst Securities, of $1.05 trillion in outstanding second liens, commercial banks hold $767 billion. Bank of America, Citigroup, JPMorgan Chase and Wells Fargo alone hold $442 billion of them.
A government modification program for second liens, known as 2MP, was first put forward a year ago. But Bank of America, Wells Fargo and now JPMorgan Chase have only recently joined. It is not likely to reach many borrowers since it focuses on only those few who do “permanent” modifications under the federally sponsored program. Assuming around half of distressed homeowners have second mortgages, this would cover some 85,000 second liens, of the millions that are outstanding.

Class Lawsuite filed Against BAC for Reneging on Loan Modification


Finally, a lawsuit is filed in Seattle against Bank of America. It says that Bank of America dragged its foot in every matter denying the homeowners of the true benefits of both TARP and HAMP

http://www.seattlepi.com/local/417333_mortgage24.html?source=mypi

What Are Nevada Bankruptcy Exemptions?


When a debtor files bankruptcy, all his property becomes part of the estate and a trustee is entrusted to handle all the matters of his estate. However, a debtor is entitled to get back his property which is exempted. Exemptions are handled under Nevada laws.
This article describes various exemptions and provided an answer to the various exemptions under bankruptcy.

Has state opted out of federal bankruptcy exemptions?
Yes. Nev. Rev. Stat. § 21.090.
Is opt out limited to residents or domiciliaries of the state?
Yes. Nev. Rev. Stat. § 21.090:
‘‘Any exemptions specified in [§ 522(d)],
do not apply to property owned by a resident of this State. . . .’’
Do state’s exemptions have extraterritorial application?
Homestead: $550,000.00
Personal property: Uncertain.
Wages: Nev. Rev. Stat. §§ 21.090, 31.295 to 31.298.
How much of a debtor’s earnings can be garnished via garnishment in Nevada?
Earnings.
Amount: Garnishment may not exceed the lesser of 25% of disposable earnings for the workweek or the amount by which disposable earnings that week exceed 50 times the federal minimum wage.
Survival after payment/deposit: Yes. Earnings are defined to include compensation received by the judgment debtor, in the possession of the judgment debtor, held in accounts in a bank or any
other financial institution, or, in the case of a receivable, compensation that is due the judgment debtor.
Waiver: Not specified in garnishment statute.
Homestead: Nev. Rev. Stat. §§ 21.090, 21.095, 115.005, 115.010,
115.040.
Amount: $550,000 in either land and a dwelling or a mobile home, subject to certain liens; land held in spendthrift trust for debtor is exempt. Unlimited exemption if ‘‘allodial title’’ has been established.
(Nevada residents can acquire ‘‘allodial title’’ to their land by buying out the property tax right from the government. Then the landowner does not have to pay property tax on the land.) The
primary dwelling, including a mobile home, and land may not be executed upon for a medical bill during the lifetime of the debtor, debtor’s spouse, a joint tenant who was a joint tenant at the time
judgment was entered, or debtor’s disabled dependent adult child, or during the minority of any child of debtor. A 2007 amendment added an exemption for sums reasonably deposited with a landlord,
to secure the rental or lease of debtor’s primary residence (except not exempt as to landlord’s claims for rent).
Procedural requirements: Procedure available for filing declaration of homestead. Exemption available even without declaration. Once declaration is filed, spouse must join in any encumbrance or sale.
Special provisions: None specified.
Waiver: Spouse must join in conveyance or encumbrance of declared homestead.

How much of a tangible personal property is exempted?
Nev. Rev. Stat. §§ 21.080, 21.090,
21.100.
Household goods: $12,000 necessary household goods, furnishings,
electronics, wearing apparel, other personal effects and yard
equipment.
Motor vehicles: $15,000, no limit if specially equipped for disabled
debtor or dependent.
Tools of trade: $10,000 tools of trade; $4500 mining equipment;
$4500 farm equipment.
Clothing and jewelry: Jewelry is included in the $5000 wildcard
exemption.
Miscellaneous and wildcard: $5000 in private library, works of art, musical instruments and jewelry, all family pictures and keepsakes; health aids; property held in a spendthrift trust; uniforms debtor is legally required to keep, one gun, a collection of metal
bearing ores, geological specimens, art curiosities or paleontological remains if the debtor catalogues them and the catalogue is kept near the collection for the free inspection of all visitors; coin collections are not exempt. $1000 in any property, including accounts in a financial institution.
Waiver: Not specified in exemption statute.
Benefits, retirement plans, insurance, judgments, and other intangibles:
Nev. Rev. Stat. §§ 21.080, 21.090, 21.100.
Public benefits: Social Security benefits, including without limitation,
retirement, survivors, SSI and disability. See Nev. Rev. Stat.
§ 422.291 (assistance awarded pursuant to public welfare administration
laws is exempt). Earned income credit or any similar credit pursuant to state law.
Pensions, retirement plans and annuities: Up to $500,000 (present value) in tax-qualified retirement plan.
Insurance, judgments or other compensation for injury: Money or benefits in any manner growing out of life insurance, if premium not more than $15,000 per year (for higher premium, the proportion that $15,000 bears to the premium paid); $16,500 personal injury judgment; wrongful death judgment for person on whom debtor was dependent; compensation for loss of future earnings of debtor or person on whom debtor was dependent, so far as needed
for support; criminal restitution.
Bank accounts: Not specified in exemption statute.
Alimony, child support: Court-ordered family support.
Survival after payment or deposit: Not specified in exemption statute.

Obama Plan Is adding Woes to Homeowners’ Miseries!


Obama plan was launched with great fanfare. Only 759,000 loans were modified and that too on a trial loan modification basis. During this long ordeal, the lenders had made various excuses to delay or postpone or lengthen the miseries of the homeowners. Now, only 37,000 homes have been permanently modified. Still long way to go. In fact, according to many studies it has perpetuated the homeowners miseries. The following is an interesting article taken from NY Times.

http://www.nytimes.com/2010/01/02/business/economy/02modify.html?hp