How to handle lawsuits filed by lenders for second trust deed in Nevada?

This is a complex topic and should only be left to seasoned attorneys. Our law office, Law Office of Malik W. Ahmad is well situated to handle these kinds of lawsuits and we have successfully settled, or litigated to an acceptable levels all such lawsuits.

Guarantors of a purchase-money loan on real property in Nevada should now be entitled to the anti-deficiency protections afforded under NRS 40.455 through 40.459, w which statutes limit the amount of any deficiency judgment to the lesser of either:

1. The amount by which the amount of the indebtedness which was secured exceeds the fair market value of the property sold at the time of the sale, with interest from the date of the sale, or

2. The amount which is the difference between the amount for which the property was actually sold and the amount of the indebtedness which was secured, with interest from the date of sale.

The Nevada legislature has recently enacted Nevada Assembly Bill 273, which provides a third subsection with applicability in situations where a foreclosing lender “acquired the right to obtain the judgment from a person who previously held that right”, such as where an originating lender sell a note to a third party lender. In such a situation, the deficiency amount is limited (beyond the amounts described in NRS 40.459(1) and (2), described above), to also include the further limitation to any available deficiency that: “If the person seeking the judgment acquired the right to obtain the judgment from a person who previously held that right, the amount [of deficiency recoverable is limited by the amount] by which the amount of the consideration paid for that right exceeds the fair market value of the property sold at the time of sale or the amount for which the property was actually sold, whichever is greater, with interest from the date of sale and reasonable costs, whichever is the lesser amount.” The intent of the Nevada legislature was clearly to provide certain protections to guarantors.

The Nevada Supreme Court has expressly held that guarantors are entitled to the benefits of Nevada’s anti-deficiency legislation, stating that without such protection, the court “would thereby detach lenders from the deficiency standard imposed by the legislature and subject guarantors to the vagaries of a lender’s scruples in every transaction.” First Interstate Bank of Nevada v. Shields, 102 Nev. 616, 619, 730 P.2d 429 (1986) (emphasis supplied). The Ninth Circuit, applying the Shields decision, has similarly held that guarantors are entitled to the benefits and protections of Nevada’s anti-deficiency legislation. FBW Enterprises v. The Victorio Company, 821 F.2d 1393, 1394-95 (9th Cir. 1987).

The Nevada legislature has recently enacted new legislation aimed at avoiding the scenario of a lender suing a guarantor without first foreclosing. Under Nevada Assembly Bill 273, signed by the Nevada Governor on June 10, 2011, the following language was added to NRS 40.495:

(4) If, before a foreclosure sale of real property, the obligee commences an action against a guarantor, surety or other obligor, other than the mortgagor or grantor of a deed of trust, to enforce an obligation to pay, satisfy, or purchase all or part of an indebtedness or obligation secured by a mortgage or lien upon the real property:

(a) The court must hold a hearing and take evidence presented by either party concerning the fair market value of the property as of the date of the commencement of the action. Notice of such hearing must be served upon all defendants who have appeared in the action and against whom a judgment is sought, or upon their attorneys of record, at least 15 days before the date set for the hearing.

(b) After the hearing, if the court awards a money judgment against the debtor, guarantor or surety who is personally liable for the debt, the court must not render judgment for more than:

(1) The amount by which the amount of the indebtedness exceeds the fair market value of the property as of the date of the commencement of the action; or

(2) If a foreclosure sale is concluded before a judgment is entered, the amount that is the difference between the amount for which the property was actually sold and the amount of the indebtedness which was secured, whichever is the lesser amount.

Deficiency Judgments
The lender has the right to sue the borrower for the deficiency within six months after the date of the foreclosure sale, unless all of the following conditions are met:
• The mortgage lender is a financial institution.
• The property securing the mortgage is a single-family dwelling.
• The borrower was the owner of the property at the time of the foreclosure sale.
• The borrower used the proceeds of the mortgage to purchase the property.
• The property was the borrower’s primary residence continuously after the borrower took out the mortgage.
• The borrower did not refinance the mortgage.

If all of these conditions are met, the homeowner is not liable to the lender for any deficiency remaining after the foreclosure sale. Nev. Rev. Stat. § 40.455.
The amount of the deficiency is limited to the lesser of these two amounts:
• The difference between the amount of the outstanding mortgage debt and the property’s fair market value at the time of the foreclosure sale, or
• The difference between the amount of the outstanding mortgage debt and the foreclosure sale price. Nev. Rev. Stat. §40.459.

Summary of NV Laws Nonjudicial Not if all of the following conditions are met: (a) lender is a financial institution; (b) mortgage loan originated on or after October 1, 2009; (c) property securing mortgage is a single-family dwelling owned by borrower at the time of the foreclosure sale; (d) mortgage debt was used to purchase the property; (e) property was borrower’s primary residence continuously from the time mortgage was executed; and (f) borrower did not refinance the mortgage. Allowed in all other foreclosures, but amount that may be recovered is limited to lesser of (a) the difference between the outstanding debt and the fair market value, or (b) the difference between the outstanding debt and the foreclosure sale price.

Nevada garnishment and how to handle it.

Garnishment is not something which cannot happen to you: its signs must be visible for quite some time. You can see them from a distance.
– You may get notices, which you ignore and you are burying your head into sand.
– You do not open your mail,
– Ignore the phone call, or just can’t see writing on the wall.
– It is a last-ditch effort at debt collection and hits at your paycheck. Of course it hits it hard and draws your quick attention. Now, you are awake and don’t know what to do.
– However, if you move with some lightning speed, you can be helped. Time again is the essence.
– When facing credit card debt that can’t readily be paid, the best plan of action is to act early reach some sort of payment arrangement and stick to a repayment plan.
– The court intervenes when everything else fails. Now, the question is can you move fast and stop this financial bleeding?
Garnishment is a legal and judicial remedy: It is authorized by a court either after full hearing or pursuant to a default judgment against you. It should be considered a collection tool of last resort. It is mostly a judicial action authorizing the judgment creditor, or the constable to go and levy your wages. It is a direction from the constable office (In Nevada) to your payroll to start deducting a certain and defined amount from your wages in every pay period until satisfied.
Not all garnishment are court initiated:
It is true that most of the garnishment is court authorized but there are some limited exceptions to it. In every case, it is best to go to your payroll and ask them a copy of the garnishment execution papers.
Exceptions to Court Sanctioned Garnishment:
There is no need to go to court for garnishment in at least the following situations:
a. Student Loan
b. Spousal Support
c. IRS taxes.
d. Certain specified lien.
You Should Stop the Evil In the Bud:
As we stated before you can see the signs of garnishment and many cases they are predictable. In our office, we hear all kinds of stories. They levied my bank account and took all the money, or I did not know anything about legal lawsuit against me. Come on guys, you were ignoring all the letters send to you. You just did not open any judicial mail sent to your address. Well, if you changed your address, you still are bound to receive your mail. Why? Because it is your job to go to the post office and change your address. Clients are often embarrassed when faced with garnishment because now their paycheck is involved, which means their employer is aware of their financial situation. Employers are typically required to tell workers about the withheld amount. Also, you should remember that it is against the law for an employer to fire an employee whose wages are garnished, but embarrassment is noted and it does not paint a good picture especially if you are working in a financial environment.
Still No Bid Deal:
Here, the garnishment papers had been served on you and you also got a notification from your payroll. But, still something can be done.
1. Come and meet us at the Law Office of Malik W. Ahmad (702) 270-9100, make an appointment. Of course, we listen to you patiently. The Judgment Creditor is still shaky though he had reached you and can grab a part of your paycheck. But what is the guarantee that he would continuously receive the garnished amount. If you leave the job, they have to start this process all over again, and it is complicated and expensive process.
2. You can start the bankruptcy process. Of course, we are here to help you.
3. If you do not like to file bankruptcy, definitely we can settle with you creditors if you have some financial capacity or make one time settlement. Of course Law Office of Malik Ahmad had helped many debtors in this regard. Desperation cannot resolve anything: only strong determination can resolve your financial matters.
4. The only recourse for a consumer after a judgment has been rendered is to ask the court to adjust the amount of the garnishment if the reduction in pay severely impacts the consumer’s ability to support himself and any dependents.
5. If a judgment is rendered in a state where the garnishment law differs from federal law, the law requires the court to adjust the garnishment to the lesser amount.
Don’t bury your head in the sand:
No need to be ostriches and bury your head into the sand, you can be helped in very short period of time. No need to stay miserable. If you wanted to be helped, you can be helped.
Laws on garnishing
While the garnishment laws vary from state to state and bank to bank but here we are only discussing wage garnishment as applicable in the state of Nevada. Again, state and federal law regulate the amount of money that may be garnished from a consumer’s wages or bank account. In Nevada, it is 25% of the total wages. Again, it is hefty amount regardless and can upset your budget and limited income. Also, it is like a bolt from the blue for which you or your family is not ready. This garnishment can be on top of other debts and liabilities. A garnishment is a serious encroachment into your financial matters; it also leaves a very heavy derogatory impact on your credit report
No need to be scared, as help available to you. Just call the law office of Malik W. Ahmad at (702) 270-9100.

What are the limitations on deficiency judgment in Nevada?

Nevada Statute NRS 40.458 deals with Deficiency judgment as this placed many limitations and propitiation Award to judgment creditor or beneficiary of deed of trust under certain circumstances.

Financial Institution: 1. If the judgment creditor or the beneficiary of the deed of trust who applies for a deficiency judgment is a banking or other financial institution, the court may not award a deficiency judgment to the judgment creditor or the beneficiary of the deed of trust if:
Single Family Dwelling: (a) The real property is a single-family dwelling and the debtor or the grantor of the deed of trust was the owner of the real property at the time of the sale in lieu of a foreclosure sale;
Bought a Property: (b) The debtor or grantor used the amount for which the real property was secured by the mortgage or deed of trust to purchase the real property;
Continuous Occupation: (c) The debtor or grantor continuously occupied the real property as the debtor’s or grantor’s principal residence after securing the mortgage or deed of trust;
Sale to a third party for lesser amount: (d) The debtor or grantor and the banking or other financial institution entered into an agreement to sell the real property secured by the mortgage or deed of trust to a third party for an amount less than the indebtedness secured thereby; and
(e) The agreement entered into pursuant to paragraph (d):
(1) Does not state the amount of money still owed to the banking or other financial institution by the debtor or grantor or does not authorize the banking or other financial institution to recover that amount from the debtor or grantor; and
(2) Contains a conspicuous statement that has been acknowledged by the signature of the debtor or grantor which provides that the banking or other financial institution has waived its right to recover the amount owed by the debtor or grantor and which sets forth the amount of recovery that is being waived.
2. As used in this section:

What is the definition of a financial Institution?
(a) “Banking or other financial institution” means any bank, savings and loan association, savings bank, thrift company, credit union or other financial institution that is licensed, registered or otherwise authorized to do business in this State.
(b) “Sale in lieu of a foreclosure sale” means a sale of real property pursuant to an agreement between a person to whom an obligation secured by a mortgage or other lien on real property is owed and the debtor of that obligation in which the sales price of the real property is insufficient to pay the full outstanding balance of the obligation and the costs of the sale. The term includes, without limitation, a deed in lieu of foreclosure.
(Added to NRS by 2011, 2051)

What is the Limitations on the Amount of Money Judgment?

NRS 40.459 Limitations on amount of money judgment.
1. After the hearing, the court shall award a money judgment against the debtor, guarantor or surety who is personally liable for the debt. The court shall not render judgment for more than:
(a) The amount by which the amount of the indebtedness which was secured exceeds the fair market value of the property sold at the time of the sale, with interest from the date of the sale;
(b) The amount which is the difference between the amount for which the property was actually sold and the amount of the indebtedness which was secured, with interest from the date of sale; or
(c) If the person seeking the judgment acquired the right to obtain the judgment from a person who previously held that right, the amount by which the amount of the consideration paid for that right exceeds the fair market value of the property sold at the time of sale or the amount for which the property was actually sold, whichever is greater, with interest from the date of sale and reasonable costs,
 whichever is the lesser amount.
2. For the purposes of this section, the “amount of the indebtedness” does not include any amount received by, or payable to, the judgment creditor or beneficiary of the deed of trust pursuant to an insurance policy to compensate the judgment creditor or beneficiary for any losses incurred with respect to the property or the default on the debt.

Questions About Nevada Exemptions? How, When, Where?

What happens after the Debtor files his affidavit claiming exemption?
The constable or sheriff is to release the property to the Debtor within 9 judicial days after the claim of exemption has been served unless the Creditor files an objection to the claim of exemption and notice for a hearing are not filed within 8 judicial days after the claim of exemption has been served NRS 21.112.
When is a hearing on the property exemption to be scheduled? If an objection to the claim of exemption and notice for a hearing is filed by the Creditor with the court within 8 judicial days after the claim of exemption was served, the Creditor shall also serve a notice of the date of the hearing not less than 5 judicial days before the date set for the hearing. NRS 21.112
What should I do if the creditor requests a hearing? Be prepared to prove at the hearing that your property is exempt. Bring receipts, bills of sale, Kelly Blue Books, assessors’ statements, vehicle registration renewals, monthly bank statements or whatever else is necessary to prove your claim.
If you convince the judge of your claim, he or she will order that the money or property be released to you. If the judge determines that the property is not exempt, he or she will not return the property to you.
If the judge denies my exemption claim, do I have any appeal rights?
Yes. It is best to contact an attorney immediately to obtain assistance.

Can exempt property ever be taken? There are certain situations in which otherwise exempt property can be executed upon. Included are:
• When the judgment entered against you is for child support, some of the listed exemptions such as 75% of take-home pay, do not apply.
• Where a bankruptcy court orders that the property be taken.
• If the judgment is to satisfy certain tax liens.
• Where the judgment was for the purchase, loan or improvement on that property – for example, the remaining installment payment on a used car which you bought.
What can I do if I have property or wages which are not exempt from execution?
To avoid garnishment or attachment if you have non-exempt wages or property generally your options are to either:
• Pay the debt either in full or through a payment plan that is negotiated with the creditor or imposed by a court;
• Convert non-exempt property to exempt property- for example, filing a homestead exemption on your house; or
• Erase the debt through a bankruptcy.
For expert assistance in deciding the option which is best for you may contact any bankruptcy attorney or the Law Office of Malik W. Ahmad at (702) 270-9100. They can refer to you an appropriate agency for a nominal fee to get these financial counseling and debtors education classes.
To file a bankruptcy, you should consider hiring an attorney if you can afford one.

How does the debtor claims an exemption?

How does the Debtor claim an exemption?
Just because property attached is exempt, the Debtor must bring this to both the Creditor and Court’s attention. In order to claim exemption of any property levied on, the debtor must, within 10 days after the Notice of Execution is mailed, serve on the constable and plaintiff and file with the clerk a claim of exemption on a form provided by the clerk. NRS 21.112. The clerk will also provide a checklist and description of the most commonly claimed exemptions, instructions concerning the manner in which the property must be released if no objection is filed and an order to be used by the court to grant or deny an exemption. No fee may be charged for providing such a form or for filing the form with the court.
The claim of exemption is to be accompanied by all documents relied upon by the party claiming the exemption. JCRLV 27.

Nevada Exemptions to Money Judgment

What are Nevada Exemptions against Money Judgment (things which cannot be collected) from Defendants

An exempt property is that which cannot be garnished or forefeited even if there is a judgment against you. In other words, there are certain types of property that cannot be taken from you even if you have a judgment against you. This property is called exempt property. Included in the property which is exempt under Nevada law (NRS 21.090) are:
■75% of your disposable earnings or 50 times the minimum wage (currently $362.50 per week) which ever is higher.
■Payments received as disability, illness or unemployment benefits
■Workers Compensation (SIIS) benefits
■Welfare benefits, public assistance benefits from the Nevada State Welfare Division (TANF, Food Stamps, etc.) or local government (like General Assistance)
■Veterans benefits
■Social Security and Supplementary Security Income
■Social Security disability payments
■Amounts paid pursuant to a court order for child support or maintenance of a former spouse.
■Vocational rehabilitation benefits
■Certain federal and state retirement monies
■Certain Individual Retirement Accounts
■Life insurance proceeds, if your annual premium is less than $15,000
■One vehicle, if your equity (the market value minus how much you owe) is under $15,000, unless the lawsuit concerned the loan on the vehicle.
■A “homesteaded” house or mobile home, even if you do not own the land. The exemption protects up to $550,000 of the home’s value. It can protect up to 100% if the judgment is for a medical bill or you establish “allodial title”. The homestead exemption does not apply if the judgment was for the mortgage or a mechanic’s lien upon the property.
■Necessary household goods, personal effects, and yard equipment, (maximum $12,000).
■Professional Libraries, equipment, supplies, and the tools, inventory, and materials to carry on your trade or business for the support of yourself or your family (maximum $10,000); Private libraries, works of art, musical instruments and jewelry which belong to you or your dependent (maximum of $5,000).
■Compensation for personal injury up to $16,150 (excluding pain and suffering or actual pecuinary loss) to you or your dependents.
■Certain compensation for the wrongful death of a person upon whom you were dependent to the extent reasonably necessary to support you and your dependents.
■Compensation for the loss of your future earnings or the future earnings of a person upon whom you were dependent to the extent reasonably necessary to support you and your dependents.
■Restitution payments to you for a criminal act.
■A security deposit on your primary residence.
■Personal property, not to exceed $1,000 in total value, if the property is not otherwise exempt.
■A tax refund received from the earned income credit provided by federal law or a similar state law.
■Proceeds received from a private disability insurance plan.
■Money in a trust fund for funeral or burial services pursuant to NRS 689.700.
■Compensation that was payable or paid pursuant to chapters 616A to 616D, inclusive, or chapter 617 of NRS as provided in NRS 616C.205.
■Unemployment compensation benefits received pursuant to NRS 612.710.
■Benefits or refunds payable or paid from the Public Employees’ Retirement System pursuant to NRS 286.670.
■Money paid or rights existing for vocational rehabilitation pursuant to NRS 615.270.
■Public assistance provided through the Department of Health and Human Services pursuant to NRS 422.291.
■Child welfare assistance provided pursuant to NRS 432.036.
■If money has been deposited into a personal bank account electronically within the immediately preceding 45 days from the date on which the writ was served which is reasonably identifiable as exempt from execution under federal law, notwithstanding any other deposits of money into the account, $2,000 or the entire amount in the account, whichever is less, is exempt.
■For personal bank accounts which do not contain exempt federal funds deposited electronically, $400 or the entire amount in the account, whichever is less, is is exempt, unless the writ of execution or garnishment is for the recovery of money owed for the support of any person.

Note: This is not a complete list of exemptions. Call the law office of Malik W. Ahmad at (702) 270-9100 to discuss your personal situation. Remember, we offer 20 minutes of our time free.

Bank of America Agrees to Settle for 10 Billion dollars–Great Victory

Finally, Bank of America says it will spend more than $10 billion to settle mortgage claims resulting from the housing meltdown. This was announced Monday, the bank will pay $3.6 billion to Fannie Mae and buy back $6.75 billion in loans that the North Carolina-based bank and its Countrywide banking unit sold to the government agency from Jan. 1, 2000 through Dec. 31, 2008. That includes about 30,000 loans.

Bank of America bought Countrywide Financial Corp. in July 2008, just before the financial crisis. Countrywide was a giant in mortgage lending, but was also known for approving risky loans. Fannie Mae and Freddie Mac, which packaged loans into securities and sold them to investors, were effectively nationalized in 2008 when they nearly collapsed under the weight of their mortgage losses.

Bank of America’s purchase of Countrywide originally was lauded by lawmakers because the bank was viewed as stepping in to eliminate a bad actor from the mortgage market. But instead of padding Bank of America’s mortgage business, the purchase has drawn a drumbeat of regulatory fines, lawsuits and losses.

Bank of America said that the loans involved in the settlement have an aggregate original principal balance of about $1.4 trillion. The outstanding principal balance is about $300 billion. Bank of America Corp., which is based in Charlotte, N.C., also said that it is also selling mortgage servicing rights on about 2 million residential mortgage loans. The loans have an aggregate unpaid principal balance of approximately $306 billion.

Nevada Foreclosure, Deficiency Laws and Statutory Time Period

What is the role of the recourse loan?
A loan is termed recourse if the borrower is personally liable for its repayment and nonrecourse if he is not. After a foreclosure, a lender can go after a recourse loan borrower for the difference between the market value of the home at sale and the outstanding loan balance by suing for a deficiency judgment. It is barred from going after a nonrecourse loan borrower. State law often affects the classification of a loan as recourse or nonrecourse. In Nevada, any mortgage taken out to purchase a property is considered nonrecourse. Any refinanced loan or loan taken out after the purchase is recourse. Many, but not all, second mortgages are recourse.

Nevada’s One-Action Rule
Under Nevada rules, if a foreclosing lender wants to collect a deficiency judgment, it must use the judicial foreclosure process because state law limits it to one action against the borrower. A deficiency judgment may be wrapped into a judicial foreclosure but not with a non-judicial foreclosure. If the foreclosing lender owns both the first and second mortgages, then it must use the judicial foreclosure process to collect any remaining debt associated with either the first or first or second mortgages.

Lien Wiped Out But Not Debt
If the lenders of the first and second mortgages of a Nevada mortgage are different, the first mortgage holder will foreclose and the second will not. The second mortgage is wiped out as a lien in the foreclosure. However, the underlying debt and agreement between the borrower and lender remains if the mortgage was a recourse debt. Because the second mortgage holder did not participate in the foreclosure, it is still allowed its “one action” against the borrower to recover the debt. The second mortgage holder is able to file a lawsuit against the borrower for his failure to repay the debt. This is an action unrelated to foreclosure.

A second mortgage is a loan that was obtained after another mortgage loan secured by the same property. The general purpose of providing mortgage security on a loan is to give the lender the right to foreclose if the borrower stops making payments. The problem with second mortgages is that the foreclosure rights under a second mortgage are inferior to the foreclosure rights of the first mortgage loan. Foreclosure on a first mortgage loan may eliminate the second mortgage loan.

Notice
The first mortgage lender and second mortgage lender each has a mortgage lien on the same piece of property. When a mortgage lender forecloses, the lender has to involve all parties holding an ownership or lien interest in that property. Therefore, if the first mortgage lender initiates foreclosure on the property, it must involve the second mortgage lender in that foreclosure process. In judicial foreclosure, this means the second lender must be a party to the foreclosure lawsuit, while in nonjudicial, or power of sale, foreclosure, this means the foreclosing lender has to provide notice to the second lender.

Lien Elimination
When a mortgage lender forecloses, the lender causes the secured property to be sold at a public auction. The purchaser at the auction acquires whatever right the foreclosing lender had in the property at the time when the mortgage loan first attached to the property. By definition, a second mortgage lien does not attach to the property until after the first mortgage lien has attached to that property. Accordingly, foreclosure on a first mortgage loan results in the discharge and elimination of the second mortgage lender’s lien on the property.

Right to Proceeds
A foreclosure sale produces sales proceeds that can be used to pay off liens on the property sold. In some foreclosures, the sales price may be high enough to pay off the first mortgage lien, but not any other liens in the property. In fact, most foreclosure sales result in the mortgage lender making a credit bid equal to the amount due on the mortgage loan, which means the sales price is exactly equal to the payoff balance on the first mortgage. As a result, there is no extra money to pay off the second mortgage lender, so the second mortgage lender remains unpaid and loses its lien on the property. But, if the sales price is high enough, there may be enough money to pay off the first mortgage plus some or all of the second mortgage.

Lien Protection
A second mortgage lender’s only option to protect its lien on the property is to pay off the first mortgage before the foreclosure sale. The second mortgage lender has the right to pay the first mortgage lender the total balance due on the first mortgage loan. If that happens, the first mortgage lien is paid off, thereby causing the second mortgage lien to move into the position of first mortgage lien. However, this option requires the second mortgage lender to come up with the cash necessary to pay off the first mortgage.

Nevada Laws About Foreclosure, Deficiency and Statutory Time Period (Part 3)

Should you buy trust deed property sale?
What is First Lien?
Let us say that if you purchase a property at a foreclosure sale on a second trust deed, this means you will purchase the property subject to an existing first lien on the property. That lien will remain on the property after you become the owner following the foreclosure sale. Foreclosure on a lien results in the elimination of any junior liens, but not any senior liens, and a first deed of trust lien is senior to the second deed of trust lien.

Title Review
You should always review the title of the property so you should know the quality and health of your title as this would save you from many problems and of course any potential litigation and headache. You have to determine the quality of the lien and its standing, if it is first line or second or third because your rights would depend upon this standard. In other words, if it were superior lien, or junior lien, the procedure would be different. It is good to go through an escrow company who can vouch for a title, and find out about the liens on the title. Only once you get the assurance, then you go ahead.

First Lien Payoff
The easiest way to clear title to property after a foreclosure on a secondary lien is to simply pay off the first lien on the property. You can always negotiate this with the lender, but it is appropriate to find it first how much flexibility they have, because once you buy second trust deed, your hands are tied, and you cannot bargain much. The owner of the property always has the right to pay off liens on the property. You can contact the first deed lender and request a payoff balance. If you can come up with the cash, you can pay off the first mortgage and have the lien removed from the property. Paying cash, of course, is the best way, as cash is king, but cash is also limited and unavailable in many situations.

Nevada Laws About Foreclosure (Part 2)

What is the procedure in judicial foreclosure:
The judge will issue an order that clarifies the condition of title. It may remove all the clouds on this title, or leave some open. A lawsuit may be helpful, or even necessary, in order to clear the title after foreclosure on a second trust deed. Payment may also be required.

In a judicial foreclosure, the lender file a lawsuit in a Court and file or should have filed a lis pendens against the property and, if the borrower loses the lawsuit, the Court enters a judgment on the debt and orders it executed against the secured property through a foreclosure sale. A lis pendens should always be filed, as this is a simple work and our law office can help in filing any such lis pendens and also how to remove it. This is a convenient tool in a jurisdiction which is called notice jurisdiction. The property is then sold as part of a publicly noticed sale by the Sheriff or Constable as noted above. After a judicial sale, the borrower has one year (12 months) after the foreclosure sale to redeem the property; that is to say, the borrower (or assignee of the borrower) has one year to come back and pay the price paid by the purchaser at the foreclosure sale (plus interest and some statutory processing fees) and the borrower (or assignee) will get the property back. This is intended to discourage buyers from underbidding the property, as if they do, the borrower (or assignee or even a minority lien holder) can get it back for the same price.

Can you file Quiet Title Action in Nevada?
Another option for attempting to clear the title to your property is to file a quiet title lawsuit in Nevada state court. A quiet title lawsuit results in the issuance of a judicial order clarifying all interests in, or claims to, the property. When you file the lawsuit, you will have to serve a summons on the first mortgage lender. If the first mortgage lender does not appear in the lawsuit, that lender’s lien on the property can be removed in the quiet title judgment. Most likely, however, the first mortgage lender will appear in the lawsuit in order to protect its valuable lien right. If they show up, you can negotiate to a handsome deal. In fact, even if they show the intent, making a handsome offer can get you a better deal. Therefore, a quiet title action may be a futile effort. It is impossible to predict what a mortgage lender will do in a quiet title suit.

Inside a Foreclosure Factory

This is a very interesting article published in MSNBC which states how a production mill of a bank is working to prepare documentation for more foreclosure and how they are omitting basic rules in implementation and causing more avoidable foreclosures.
http://economywatch.msnbc.msn.com/_news/2012/04/19/11269115-inside-the-foreclosure-factory-theyre-working-overtime?lite

What is debt forgiveness, and its implications

If you owe a debt to someone (lenders) else and they cancel or forgive that debt, the canceled amount may be taxable.

The Mortgage 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, qualifies for the 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 does not 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.

More information, including detailed examples can be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments. Also see IRS news release IR-2008-17.

We have simplified the legislation and the following are the most commonly asked questions and answers about “The Mortgage Forgiveness Debt Relief Act” and debt cancellation:

What is Cancellation of Debt?
If you borrow money from a commercial lender and the lender later cancels or forgives the debt, you may have to include the cancelled amount in income for tax purposes, depending on the circumstances. When you borrowed the money you were not required to include the loan proceeds in income because you had an obligation to repay the lender. When that obligation is subsequently forgiven, the amount you received as loan proceeds is normally reportable as income because you no longer have an obligation to repay the lender. The lender is usually required to report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt.

Here’s a very simplified example. You borrow $10,000 and default on the loan after paying back $2,000. If the lender is unable to collect the remaining debt from you, there is a cancellation of debt of $8,000, which generally is taxable income to you.

Is Cancellation of Debt income always taxable?
Not always. There are some exceptions. The most common situations when cancellation of debt income is not taxable involve:

Qualified principal residence indebtedness: This is the exception created by the Mortgage Debt Relief Act of 2007 and applies to most homeowners.
Bankruptcy: Debts discharged through bankruptcy are not considered taxable income.
Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you. You are insolvent when your total debts are more than the fair market value of your total assets.

Certain farm debts: If you incurred the debt directly in operation of a farm, more than half your income from the prior three years was from farming, and the loan was owed to a person or agency regularly engaged in lending, your cancelled debt is generally not considered taxable income.
Non-recourse loans: A non-recourse loan is a loan for which the lender’s only remedy in case of default is to repossess the property being financed or used as collateral. That is, the lender cannot pursue you personally in case of default. Forgiveness of a non-recourse loan resulting from a foreclosure does not result in cancellation of debt income. However, it may result in other tax consequences.
These exceptions are discussed in detail in Publication 4681.

What is the Mortgage Forgiveness Debt Relief Act of 2007?The Mortgage Forgiveness Debt Relief Act of 2007 was enacted on December 20, 2007 (see News Release IR-2008-17). Generally, the Act allows exclusion of income realized as a result of modification of the terms of the mortgage, or foreclosure on your principal residence.

What does exclusion of income mean?Normally, debt that is forgiven or cancelled by a lender must be included as income on your tax return and is taxable. But the Mortgage Forgiveness Debt Relief Act allows you to exclude certain cancelled debt on your principal residence from income. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

Does the Mortgage Forgiveness Debt Relief Act apply to all forgiven or cancelled debts?
No. The Act applies only to forgiven or cancelled debt used to buy, build or substantially improve your principal residence, or to refinance debt incurred for those purposes. In addition, the debt must be secured by the home. This is known as qualified principal residence indebtedness. The maximum amount you can treat as qualified principal residence indebtedness is $2 million or $1 million if married filing
separately.

Does the Mortgage Forgiveness Debt Relief Act apply to debt incurred to refinance a home?
Debt used to refinance your home qualifies for this exclusion, but only to the extent that the principal balance of the old mortgage, immediately before the refinancing, would have qualified. For more information, including an example, see Publication 4681.

How long is this special relief in effect?
It applies to qualified principal residence indebtedness forgiven in calendar years 2007 through 2012.

Is there a limit on the amount of forgiven qualified principal residence indebtedness that can be excluded from income?
The maximum amount you can treat as qualified principal residence indebtedness is $2 million ($1 million if married filing separately for the tax year), at the time the loan was forgiven. If the balance was greater, see the instructions to Form 982 and the detailed example in Publication 4681.

If the forgiven debt is excluded from income, do I have to report it on my tax return?
Yes. The amount of debt forgiven must be reported on Form 982 and this form must be attached to your tax return.

Do I have to complete the entire Form 982?
No. Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Adjustment), is used for other purposes in addition to reporting the exclusion of forgiveness of qualified principal residence indebtedness. If you are using the form only to report the exclusion of forgiveness of qualified principal residence indebtedness as the result of foreclosure on your principal residence, you only need to complete lines 1e and 2. If you kept ownership of your home and modification of the terms of your mortgage resulted in the forgiveness of qualified principal residence indebtedness, complete lines 1e, 2, and 10b. Attach the Form 982 to your tax return.

Where can I get this form?
If you use a computer to fill out your return, check your tax-preparation software. You can also download the form at IRS.gov, or call 1-800-829-3676. If you call to order, please allow 7-10 days for delivery.

How do I know or find out how much debt was forgiven?
Your lender should send a Form 1099-C, Cancellation of Debt, by February 2, 2009. The amount of debt forgiven or cancelled will be shown in box 2. If this debt is all qualified principal residence indebtedness, the amount shown in box 2 will generally be the amount that you enter on lines 2 and 10b, if applicable, on Form 982.

Can I exclude debt forgiven on my second home, credit card or car loans?
Not under this provision. Only cancelled debt used to buy, build or improve your principal residence or refinance debt incurred for those purposes qualifies for this exclusion. See Publication 4681 for further details.

If part of the forgiven debt doesn’t qualify for exclusion from income under this provision, is it possible that it may qualify for exclusion under a different provision?
Yes. The forgiven debt may qualify under the insolvency exclusion. Normally, you are not required to include forgiven debts in income to the extent that you are insolvent. You are insolvent when your total liabilities exceed your total assets. The forgiven debt may also qualify for exclusion if the debt was discharged in a Title 11 bankruptcy proceeding or if the debt is qualified farm indebtedness or qualified real property business indebtedness. If you believe you qualify for any of these exceptions, see the instructions for Form 982. Publication 4681 discusses each of these exceptions and includes examples.

I lost money on the foreclosure of my home. Can I claim a loss on my tax return?
No. Losses from the sale or foreclosure of personal property are not deductible.

If I sold my home at a loss and the remaining loan is forgiven, does this constitute a cancellation of debt?
Yes. To the extent that a loan from a lender is not fully satisfied and a lender cancels the unsatisfied debt, you have cancellation of indebtedness income. If the amount forgiven or canceled is $600 or more, the lender must generally issue Form 1099-C, Cancellation of Debt, showing the amount of debt canceled. However, you may be able to exclude part or all of this income if the debt was qualified principal residence indebtedness, you were insolvent immediately before the discharge, or if the debt was canceled in a title 11 bankruptcy case. An exclusion is also available for the cancellation of certain nonbusiness debts of a qualified individual as a result of a disaster in a Midwestern disaster area. See Form 982 for details.

If the remaining balance owed on my mortgage loan that I was personally liable for was canceled after my foreclosure, may I still exclude the canceled debt from income under the qualified principal residence exclusion, even though I no longer own my residence?
Yes, as long as the canceled debt was qualified principal residence indebtedness. See Example 2 on page 13 of Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments.

Will I receive notification of cancellation of debt from my lender?
Yes. Lenders are required to send Form 1099-C, Cancellation of Debt, when they cancel any debt of $600 or more. The amount cancelled will be in box 2 of the form.

What if I disagree with the amount in box 2?
Contact your lender to work out any discrepancies and have the lender issue a corrected Form 1099-C.

How do I report the forgiveness of debt that is excluded from gross income?
(1) Check the appropriate box under line 1 on Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) to indicate the type of discharge of indebtedness and enter the amount of the discharged debt excluded from gross income on line 2. Any remaining canceled debt must be included as income on your tax return.

(2) File Form 982 with your tax return.

My student loan was cancelled; will this result in taxable income?
In some cases, yes. Your student loan cancellation will not result in taxable income if you agreed to a loan provision requiring you to work in a certain profession for a specified period of time, and you fulfilled this obligation.

Are there other conditions I should know about to exclude the cancellation of student debt?
Yes, your student loan must have been made by:

(a) the federal government, or a state or local government or subdivision;

(b) a tax-exempt public benefit corporation which has control of a state, county or municipal hospital where the employees are considered public employees; or

(c) a school which has a program to encourage students to work in underserved occupations or areas, and has an agreement with one of the above to fund the program, under the direction of a governmental unit or a charitable or educational organization.

Can I exclude cancellation of credit card debt?
In some cases, yes. Nonbusiness credit card debt cancellation can be excluded from income if the cancellation occurred in a title 11 bankruptcy case, or to the extent you were insolvent just before the cancellation. See the examples in Publication 4681.

How do I know if I was insolvent?
You are insolvent when your total debts exceed the total fair market value of all of your assets. Assets include everything you own, e.g., your car, house, condominium, furniture, life insurance policies, stocks, other investments, or your pension and other retirement accounts.

How should I report the information and items needed to prove insolvency?
Use Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) to exclude canceled debt from income to the extent you were insolvent immediately before the cancellation. You were insolvent to the extent that your liabilities exceeded the fair market value of your assets immediately before the cancellation.

To claim this exclusion, you must attach Form 982 to your federal income tax return. Check box 1b on Form 982, and, on line 2, include the smaller of the amount of the debt canceled or the amount by which you were insolvent immediately prior to the cancellation. You must also reduce your tax attributes in Part II of Form 982.

My car was repossessed and I received a 1099-C; can I exclude this amount on my tax return?
Only if the cancellation happened in a title 11 bankruptcy case, or to the extent you were insolvent just before the cancellation. See Publication 4681 for examples.

Are there any publications I can read for more information?
Yes.
(1) Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments (for Individuals) is new and addresses in a single document the tax consequences of cancellation of debt issues.

(2) See the IRS news release IR-2008-17 with additional questions and answers on IRS.gov.

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.

Can the economy revive without help to homeowners?

The homeowners are bleeding for long time and the scant help has given them no respite. The statistics are increasing and still Las Vegas is number one in foreclosure sale. None of the higher constitutional authorities had done any thorough probe in this matter. We hear lots of news but no solution so far. Only half-hearted measures had been taken and none of that has produced any tangible result to correct the rampant situation. Now, we have another fiasco and that is that the Standard and Poor’s has purposely overrated the toxic mortgage rating/securities before this financial fiasco erupted with full force. Yes, the same S&P which has decreased the rating on USA which resulted and still bleeding our markets by a descent of 1500 points so far.

We rather not say much about Congress as much has been said in the media. As usual we have assembly of incompetent, nincompoop, and do nothing people who like to come to the house, fight and then go to long vacation. As we know,tens of millions of Americans are continuously being crushed by this mortgage crisis. See for example, the stock of Bank of American. They had taken a big hit–some 10 billion loss only this years, and there stock price has been reduced to half the size. Yet, when it comes to loan modification, they resisted every request for loan modification. At least the homeowners were reaffirming the original debt. But BAC rather let it go to short sale for one third of the original loan, then give a reduced payments to the genuine, and hardprssed homeowners. We tried, we called several times, sent innumerable paperwork, and yet same annoying people gave us the same annoying news.

Obama administration has no mechanism to enforce, no accountability other than advice to bank to “do their best”. There were two other crook organization who thanks got are bankruptcy now i.e Freedie Mae and Fannie Mae. Banks took advantage of their idiocy and incompetence and made millions dumping bad securities upon them. Of course, there is no let up in sight. We have left with one thing, and that is reducing principle once for all. The reckless borrowers are no more on the horizons. Thus, this is good time to reward genuine homeowners. Also, we suggest to let the bankruptcy courts do the loan modification. Somehow they are already involved via chapter 13 this time.

Homeowners Needs Help–The Economy is Not Reviving

href=”http://www.nytimes.com/2011/08/22/opinion/homeowners-need-help.html?_r=1&hp”>

How to stop wage garnishment in Nevada?

As we had stated many times, when someone file Chapter 13 or Chapter 7 bankruptcy petition, any pending garnishment (except for child support) will stop immediately. It also control any funds seized after the date of your bankruptcy filing will be returned to you.

How about Judgment Entered Against You
State Court Judgments Can Result in Significant Seizure of Your Income

In most cases, wage garnishments arise from lawsuit judgments. There cannot be any wage garnishment in Nevada except child support and student loan without a judicial process. For everything else, a judicial process is required. The judicial process means you have be issued a summons along with a complaint for which you have a right to confront and appear in a court of law. Judgments come from lawsuits and after you lose or ignore lawsuits. For example, if a credit card company filed suit against you for non-payment and you did not answer, a default judgment would issue against you. These judgments do not disappear into thin air but stays and the judgment/creditor waits for an appropriate time to pounce against you just like cheetah in a jungle who wait endlessly to prey on the animals. If you were involved in litigation and lost, a judgment would issue against you. These judgments can be executed personally against you or your business, and the judgment creditors is watching your assets or searching for them and the appropriate moment to execute against these assets.

It is not surprising that our clients many times report that they were not even aware of a pending lawsuit, much less a judgment. This is possible as the judgment creditors might be a different entity than the original lender and this credit transactions has been sold and resold many times, and the final holder are entirely different people now. This type of unpleasant surprise happens more often than you might think. Sheriff’s deputies, who are responsible for serving the lawsuit, are permitted to leave the lawsuit with an adult who answers the door to your house. This is also called personal service in Nevada. We sometimes see cases where a spouse accepts service but fails to deliver the lawsuit papers to the named defendant. Also, these papers can get mixed up with lots of other papers and one just ignore them or do not understand the implication of these judicial papers. I had seen many many times the original papers and the client does not even know what kind of papers are they and their purpose.

Most of these cases revolve around credit card debt. As you may know, the cardholder agreement provides that payment disputes shall be referred to an arbitrator out of State, or that a specific court in another State shall be the venue for any collection lawsuit. These collections needs to be validated and usually requires 30 days time period. Defending a lawsuit is not an easy thing, it is expensive, time consuming, and basically you have no defenses other than the statutory time period, if you had used the money and is not paying it back to your creditors. Also, it is quite possible that the original paperwork may be lost or is not transferred to the current credit holder. If your creditor possesses an out of state judgment, it can “domesticate” the judgment in your home county. Once a judgment is domesticated here, you will be subject to wage garnishment, bank account levy and any other remedies otherwise available to a winning plaintiff here in Las Vegas.

Wage Ganishment Threatens 25% of Your Net Pay and Possibly Your Job
Once a judgment has been issued, your creditor can ask the local sheriff’s office for a summons for continuing garnishment and execution of judgment. Your employer will be served with this garnishment summons and ordered to withhold 25% of your after tax earnings. In addition, your employer may charge a handling fee for the extra paperwork involved with fulfilling the garnishment requirements.
Be aware that your employer cannot choose to ignore a summons of continuing garnishment. If your employer does not honor the summons, your employer will become responsible for payment of the entire debt.

As you might imagine, human resource and payroll coordinators for most employers find wage garnishments troublesome for a number of reasons. Firstly, your employer must expend time and effort to complete the paperwork associated with calculating and processing garnishment orders. Secondly, until the garnishment is paid in full or otherwise released, your employer has potential financial liability if there are errors with the paperwork. Finally, your credibility may be called into question as a defendant found liable for a judgment in a lawsuit. It would not be an understatement to conclude that your job might be at risk if you involve your employer in your personal business and wage garnishment.

Law Office of Malik Ahmad is experienced in these matters and can stop any pending garnishment no matter where you fall in the process. If you contact us before the pending lawsuit against you goes into default, we may be able to avoid a judgment from issuing. If a judgment has been issued, the judgment creditor’s right to seize your wages terminates the instant we file your bankruptcy case. Sometimes, money that has been seized can be returned to you or it can be used to pay non-dischargeable debt like taxes.

Summary Judgments and wage garnishments function as powerful tools used by creditors to seize your money. When we file your bankruptcy case, your creditors are powerless to take any action and they lose their right to seize your wages. You can file a bankruptcy at any point in the pre-judgment or judgment process to put an end to creditor action. Don’t wait until your wages are at risk – call the Law Office of Malik Ahmad at (702) 270-9100 as soon as you suspect any risk of wage garnishment.

Nevada Mediation Rules Changed

The Supreme Court of Nevada has changed rules effective March 1, 2011.
Here is the set of new and amended rules.

http://www.nevadajudiciary.us/index.php/viewdocumentsandforms/func-startdown/5925/

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