Sign New York Banking Forbearance Agreement Simple

Industry sign banking new york forbearance agreement simple

all right my name is Karl Pearson I'm a New York Attorney a graduate of Harvard Law School and represent homeowners and small businesses throughout the United States in foreclosure defense litigation quiet title actions and wrongful foreclosure actions customarily to make the mortgage more affordable with a loan modification that mean that including any principal reduction this video 108 F entitled loan modification agreements is the sixth in a series of related videos the videos are being prepared for reviewing in sequence from a to L now here's a history of loan modification agreement audits the history of forget the word audits as shouldn't meet it the history of residential mortgage loan modification agreements goes back 80 years to the Great Depression when millions were losing their jobs and couldn't maintain their mortgage payments state laws in the 1930s were passed as mortgage moratorium acts and in 1933 the Supreme Court upheld as constitutional as a matter of public policy a minnesota mortgage moratorium statute against a banks challenge that the statute violated the constitutional provision about enforcement of contracts thereafter banks started their efforts to provide affordable monthly payments through loan modification agreements and the practice has continued to the state sometimes they are referred to as workout agreements when homeowners stopped paying their mortgage and property values are declining the best thing for banks prior to securitization was to bring the property back to performing by giving an affordable loan modification agreement whether there is a duty or not to negotiate in good faith is a legal issue which frequently is resolved against homeowners although there is some justification for finding a duty to fairly negotiate under industry custom and usage which becomes binding that inter actually if you can prove that such custom exists nevertheless there is a recent development in law which in some case states including New York requires the bank to negotiate in good faith as to a loan modification agreement in the conferencing or settlement negotiations required at the outset of a foreclosure actually in some states although required to negotiate in good faith the bank is not actually required to grant a loan modification agreement only to negotiate in good faith this good faith requirement if not honored by the bank during a foreclosure action can be a defense or an additional of defense to the foreclosure action so pay careful attention to whether there there really is any evidence of any failure to negotiate in good faith such as by summarily rejecting an application and without having any standards to apply in New York the homeowner would ask for a good faith hearing at which time the issue is whether the bank has been negotiating in good faith if the hearing decides against the bank the bank's foreclosure action could be dismissed by the court perhaps under the doctrine of unclean hands loan modification agreements vary from one bank to another the loan servicer is generally the organization that the homeowner works through by sending the loan modification application to the servicer if in litigation the homeowners lawyer sends the loan modification application to the attorney which then sends the application directly to the loss mitigation department of the bank bypassing the team of 1,000 or so persons working in India who often handle both modification requests for the bank and have a checklist of perhaps 500 different things to require before they are allowed to pass a a now a loan modification application of the line this is how most loan modification applications get nowhere because they are not made in the context of a lawsuit whether a quiet title action or quarrel defending a foreclosure action the loan servicer when receiving a completed loan modification application either has the authority in advance which is very rare to decide itself whether to grant a modification or not and if the servicer has no such authority the servicer then transmits the loan modification application to the REMIC trustee who in turn writes a letter to the 10,000 or perhaps 1000 owners of beneficial interests in the pool bones of which the mortgages loan is merely one asking them that they want to grant the loan modification and with a I think 70% or 75% vote requirement depending upon the PSA and generally they vote against it and tell the REMIC trustee this event tells the servicer that the loan modification request has been rejected if however there is a lawsuit pending the loan modification application is given more serious consideration if for no other reason that this will incur additional legal fees that will sooner or later wipe out some or all the investors equity in the lump a most important fact for you to take into consideration is that the unpaid mortgage payments that are doing owing will generally be forgotten and forgiven and not be part of the final loan modification agreement because to have it otherwise would not work in other words loan modification agreed are not forbearance agreements which the unpaid money has put at the back end then it is ultimately paid so the modification is truly not the forbearance agreement and you ought to keep track of the difference to make sure that you know what's being offered to you also there are trial modifications to watch out for because most of these trial modifications make no promises as to any specific loan modification you will be offered if you make the trial payments on time and most of the trial modifications end up with a bank getting more of the homeowners money and the homeowner getting turned down for a permanent loan mod trial loan modifications are just another trick for the bank to extract as much money from the borrow as it can before selling the borrower's home in a foreclosure or foreclosure auction sale at least in my opinion so what we come down to is this in my opinion a homeowner trying to obtain a loan modification agreement without any accompanying litigation is less apt to obtain it than someone in litigation with a bank everything else being equal and the same is true for a pro se litigant somebody with no attorney or a litigant who has no experience attorney the bank knows that they can more easily win the litigation against a pro se litigant or an inexperienced attorney than when they can when the homeowners attorney is experienced and and the homeowners chances of obtaining an affordable loan modification are much better everything else being equal there are some notes of caution which I need to add number one support the defense under the Home Affordable mortgage programs called nap one and then the sequel to attempt to for loans created prior to January 1 2009 or ending or have ended so that the bank will have to use an in-house modification instead of an established governmental program in-house means that the bank can set its own standards for granting or denying a loan modification request - just for the record the Home Affordable Refinance Program known as Harvey it's another federal program for persons not behind in their mortgage payments but whose property is underwater and for that reason cannot obtain traditional refinancing of their loan - 3 it is easier to obtain a loan mod when you are living in the property than when you are a mere investor because when you are living in the property you are less likely to abandon it and walk away from the lump or if you cannot afford the loan modification you won't be given it the bank concluding that they would be back in court with you anyway in a few months and might as well bring this problem to an end now rather than waiting it's hard to find fault with that conclusion all right whether you should sue in a quiet title action to allege that the bank doesn't own the note and mortgage and hope that the bank will give you a loan mod to end the litigation is a business decision not a legal one as I see it the homeowner and I do not know the facts in the possession of the servicer custodian and mimmik trustee so that we're not in a position to tell whether the Remmick trustee has good title or not instead you should be looking at the cost of bringing a quiet title action and computer this with a value of the desired results and what probability is there that you will obtain these desired results six if you are to spend six thousand dollars and hope to get a hundred thousand dollars in benefits this makes some sense but if you are to spend six thousand dollars and hope to get ten thousand dollars in benefits this makes almost no sense at all seven loan modifications are now being made more frequently with substantial principal reductions I'm not sure if the same is true outside of a litigation context seven ideally I would like to see a loan modification agreement have a principal amount equal to the present value of the property which is the amount that Bank could get in a foreclosure action at an interest rate equal to the present interest rate for mortgage loans of that type and for a thirty-year period with elimination of the debt at the end of the 30-year period by gradual retirement through the payments with part of the payment being used to reduce principal this is precisely what the bank would get if it sold the world at auction for its present value and then financed the option purchaser of the property with a thirty-year conventional loan at the present interest rate so in my opinion why not just keep the present owner in the property and just give him what they would otherwise get if they sold the property nine instead of having a loan moratorium law the banks need to be working to arrange this equitable type of loan modification to enable Americans to stay in their properties this is the bank is getting more this way than it deserves the property gets back to performance status more quickly legal fees are ended more quickly and the homeowner is paying top dollar the present value because at auction the bank will often get substantially less sometimes quite a lot less than than the than the value of the property because of the distress conditions and often the banks don't advertise it well anyway so the auction property sometimes goes for a song ten a point about hardship don't go overboard to sell a bank on your hardship and inability to pay the mortgage the banks are not charities if you prove hardship preventing you from paying the loan you can expect the bank to deny your application therefore don't show any tears or crying tears on your application to try to gain the bank's sympathy with a series of disasters that befell you on your way towards non-payment the bank will only use your admissions of inability to pay against you by denying your loan mod application 11 another point you should use an experienced person to work with you in preparing and submitting your loan modification application there are things that can be done to help it along and you lose a good opportunity of obtaining a loan mod agreement but not using someone highly skilled in the process I am such a person who knows loan mods inside and out and those that will deal with the banks to obtain results 12 finally there is never a guarantee as to any of these activities it should be done professionally which will give you the best chance for success I'm now finished with loan modification agreements and you should go on to my next video 108 F visible reductions if you have any questions please give me a call my telephone number is two one two three zero seven four four four four I provide free consultations and represent homeowners and businesses throughout the US as to their foreclosure problems including the saving of properties through loan modifications and any principal reductions my telephone number once again is on two three zero seven four four four four