Foreclosure Trends

Igor Mosyak asked:


The Maryland foreclosure process is not that difficult to understand. In Maryland, as with the rest of the United States excluding a few blue-chip areas, foreclosure rates on home mortgages are at record high levels. If you are in a compromised position concerning the state of your home mortgage and have questions concerning your rights and the steps you should take, then read on.

The Maryland foreclosure process:

There are three basic criterions with which a lender may initiate a foreclosure on your mortgage. They are:

Judicial foreclosures

If your mortgage or deed of trust has no power of sale or assent to decree clause included, then a lender must initiate a formal complaint against you and request a decree of sale. It is then up to the court to discern whether a default has in fact occurred and issue the decree.

Non-judicial foreclosures

If your mortgage or deed of trust has a power of sale or assent to decree clause included, then a lender is pre-authorized to sell your property in the event of a default. With the Maryland foreclosure process, the lender must still file an order to docket in advance of initiating the foreclosure proceedings. There is however no requirement for a formal hearing to transpire before the proceedings begin.

Assent to decree

Here, the foreclosure process is simplified for the lender as the security documentation already includes a clause, signed by the borrower, that the borrower agrees to an entry for sale upon a pre-specified default amount. Although the lender must still file the motion in court, there is no requirement to wait for an answer or have a hearing in order for the foreclosure process to ensue.





Maryland Foreclosure Guidelines

The lender must have a notice of sale published in a local newspaper for 3 consecutive weeks before the sale is to transpire. The borrower must be informed of the intended sale by certified mail more than 10 days, but less than 30 days prior to the sale.

Only a trustee (an authorized representative of the lender) or the sheriff may conduct the sale. The sale must transpire either at the local courthouse, at the property for sale or at a location that has been included in the advertisements concerning the sale.

If for any reason the sale is postponed, the rescheduled date of sale must be published in the same manner as the first date of sale was.

When the sale has been completed, the seller must notify the court of the sale including complete details. This is to happen within 30 days from the sale date. 

Lenders may file a deficiency judgment for up to 3 years. The amount of this deficiency judgment request is limited to the balance of the defaulted loan. The lender must also forego the costs of the foreclosure sale.

The timeline for the Maryland foreclosure process to be completed is typically 90 days. There is no right of redemption in Maryland. Understanding your rights and the rights of the lender for your mortgage is a necessary and valuable asset when your are faced with the possibility of foreclosure. To learn more about the Maryland foreclosure process, please visit Stop Foreclosure Help Today.



ISIDRO

Foreclosure Fight asked:


The following are legal defenses to foreclosure to beat the bank:

 1.       Truth in Lending Act (TILA) violations enabling rescission.  If your loan is a refinance, the bank must have provided you a set of disclosures at the time of closing.  If these disclosures are inaccurate, the loan is statutorily rescindable under TILA.  For example, in a foreclosure action, the finance charge must have been accurate within $35 or the loan may be rescindable.  This means the loan is cancelled and all money paid to the lender is refunded.   

2.       Truth in Lending Act (TILA) violations enabling damages.  If you purchased the property  with the loan or used the proceeds to refinance and proper disclosures were not given, then you may be entitled to money damages to offset the foreclosure.

3.       Home Ownership and Equity Protection Act (HOEPA).  This is a very powerful federal law governing high cost refinance loans.  If your loan is under $150,000 or the initial rate was above 8%, you should evaluate your loan for violations of this act.  Violations here enable rescission and substantial money damages that can be in excess of the loan’s dollar amount.

4.       Failure to Provide a Correct Notice of the Right to Rescind.  There is a specific notice that must be provided to refinance customers at closing.  If this form is inaccurate or incorrect, the loan is rescindable up to three years after the closing date. 

5.       Breach of Contract.  Many times the lender will do things that are unfair or unjustified before starting the foreclosure process.  Just as you have an obligation to pay the mortgage, the lender has a responsibility not to interfere with your ability to do so – like force placing insurance making the payments substantially more expensive than they should have been.

6.       Real Estate Settlement Procedures Act.  This federal law governs many types of disclosures that lenders must provide at the time of closing, in addition to prohibiting things like kickbacks and unearned fees.  It enables damages, and sometimes rescission if the error triggers TILA.

7.       Fair Debt Collection Practices Act.  This federal law requires servicers or lenders who obtain the mortgage after default follow specific protocol in attempting to collect on the debt.  A failure to follow this law enables statutory damages and attorney’s fees.

8.       Fair Credit Reporting Act.  This federal law governs lenders ability to report information about the mortgage and requires the accurate reporting of negative information.  Violations of this act also enables damages and attorney’s fees.  Punitive damages might be available under this act.

9.       Real party in interest.  This is a procedural defense to foreclosure that can be extremely effective at stopping the lender’s ability to foreclose.  It essentially questions the ownership of the mortgage and questions whether the foreclosing party is, in fact, the holder of the mortgage and note.

10.   Unconscionability.  This defense is focused on the events surrounding the creation and closing of the mortgage loan.  A violation here gives the court great leeway in deciding whether the mortgage should be voided or changed.

11.   Failure to state a claim upon which relief can be granted.  This general defense attacks the lender’s ability to foreclose and is can be used in conjunction with one of the other foreclosure defenses.

12.   Failure to establish conditions precedent.  Want to get a foreclosure action thrown out of court right away?  Use this defense that attacks the lender’s pre-foreclosure processes.

13.   Failure to comply with FHA pre-foreclosure requirements.  FHA requires every lender to mail a booklet called “How to Avoid Foreclosure” and set up a face-to-face meeting with the borrower before foreclosing (in most cases).  If the lender does not take these steps, then it cannot foreclose.



SHAUN