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What are Some of my Potential Defenses?
Contrary to common belief - there are numerous defenses to a Foreclosure Law Suit. Some attorneys will tell you "We can buy you some extra time" The Law Offices of Grausso & Foy are here to win your case, not to buy you and your family "extra time" AND you will be informed of what those defenses are at your free consultation.
The following is a list of defenses that occur either (1) due to a defect in your bank's handling of your mortgage or (2) due to an error with the Bank's Law Firm.
Where's the Note Defense!
When you signed your mortgage papers either when you purchased your home or refinanced for a better rate, you should have signed two specific documents, one called a mortgage, the other called a note. The note is actually the contract (think of it as a personal check) the mortgage is simply an agreement between you and the bank that if you default on paying monthly that they may take your home to collect on the note's debt.
If your bank cannot prove that they have your mortgage, there's no effect, they can still foreclose! However, if your bank cannot prove that they own your note, you can defeat your Bank's suit.
Part of the "Where's the Note Defense" is a thorough investigation into any and all transfers of your mortgage. Any transfer of your mortgage must include a proper assignment - what constitutes as a proper assignment depends upon the circumstances of that assignment. Some assignments may need a power of attorney in order to be effective, others may need multiple assignments in order to be valid. Although this is a tricky issue, it also determines whether or not the company that is trying to foreclose on your home is entitled to do so.
Fraudulent Assignment: Robo-Signing
Once the 'Great Recession' began in the summer of 2007, a tidal wave of foreclosures rushed into New York State Courts, when this happened the banks were then required to submit certain signed and even notorized documents to the court simply as a matter of course. When the major banks realized that they did not have the necessary documents in many of their cases, they simply hired low wage employees and independant contractors to fraudulently fill out these documents as if they were signed years ago. These assignments are not simply fraudulent - they are ineffective, and thus grounds for winning your case.
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RPAPL 1304: 90 Day Notice
In order for your bank to foreclosure, they are required to send you a very specific notice 90 days before they start the foreclosure lawsuit . This pre-requisite actually extends to numerous defenses, violation of any is fatal to the bank's case.
"Strict Compliance" with the rules regarding this notice is required. This is another way of saying that one single mistake either in the notice or in its delivery will permit you to win your case.
RPAPL 1304(1): Notice Requirements
This notice must not only have very specific language, it must also include an attachment behind it listing at least five local United States Department of Housing and Urban Developement (HUD) Approved Housing Counseling Agencies.
RPAPL 1304(2): Mailing Requirements
This notice must not only be sent ninety (90) days prior to starting a foreclosure law suit, but it must be sent to you twice, once certified mail and a second time first class mail.
Although this may seem insignificant it is actually grounds to win your case. If your bank cannot prove that they sent these notices certified mail and first class mail you can win your case.
Mortgage Electronic Registration Services: "M E R S"
If MERS is involved in your foreclosure case, you may very well have sufficient grounds to win your case. MERS is a complicated subject not only because MERS itself is complicated but also because the law's treatment of MERS is slowly moving (against it). If you understand nothing else in the following explaination just remember that if MERS is involved in your foreclosure case in any way, you may have grounds to win your case.
MERS is involved in approximately 60 million mortgage loans and is involved in 60% of all loans that are given out today. So what is MERS, why was it created? MERS was created so that Banks could dodge a tax, specifically a tax involving the assignment (or transfer) of a mortgage. The Banks wanted to (and ultimately did) treat your mortgage like a stock on the Stock Exchange, transfering it many times to many different companies. The fear was that if compainies had to pay this tax in order to buy the stock, it would make the stock less valuable. The Bank’s solution to this fear was to simply not pay the tax. Their solution was to place MERS (on paper) as the owner of your mortgage and then simply require MERS to keep track of when your mortgage exchanged hands. The problem is that under actual law – only the person who physically and legally ‘holds’ the mortgage papers you signed is the owner of your debt and since the Banks never actually mailed these documents to MERS, it never actually owned your mortgage, and thus – it never had the power/ability to assign your mortgage to other companies.
Once a bank listed MERS as the owner of your mortgage, they then converted your mortgage into a stock and traded it on the stock exchange; it was the responsibilty of MERS to keep track of who actually owned your mortgage.
I warned you, its complicated, but the following is the light at the end of the tunnel:
In June of 2011 a court that governs every trial court on Long Island effectively ruled that MERS does not have the right or ability to assign mortgages in accordance with their current business model. Translation - a bank can assign a mortgage to MERS but it cannot simply list it on paper as the owner and then leave it up to MERS to keep track of who owns the mortgage, instead it must follow the same rules that apply to any other company who receives or assigns mortgages. The court's ruling started by saying, "This matter involves … whether such rules should be bent to accommodate a system that has taken on a life of its own."and ended concluding, "This Court is mindful of the impact that this decision may have on the mortgage industry … nonetheless, the law must not yield to expediency and the convenience of lending institutions." Bank of New York v. Stephen Silverberg. This is what we call a homerun.
Please consult an attorney for advice about your individual situation. This site and its information is not legal advice, nor is it intended to be. Feel free to contact us by electronic mail, letters or phone calls. Contacting us does not create an attorney-client relationship. Until an attorney-client relationship is established, please withhold from sending any confidential information to us. Grausso & Foy, LLP do not accept service via e-mail.
N.Y.C.P.L.R. 3215(c): Abandonment
Has your bank filed a foreclosure against your home years ago and you want to know whether anything can be done this late in the case - the answer may surprise you. Your bank has an obligation to move your case through the foreclosure process. If your bank has taken over a year to win your case you may have grounds to have your case thrown out of court for abandonment.
RPAPL 1303 - Summons & Complaint Instruction Notice
If your bank serves you with foreclosure papers, they must deliver a RPAPL § 1303 Instruction Notice on colored paper that is a different color then the summons and complaint. The notice must be in bold, the body of the notice must be in fourteen-point font and the title of the notice must be in twenty-point font. Did your bank use the correct font size? Did your bank deliver this notice with your summons and complain on colored paper?
Administrative Order 548/10: Attorney Affirmation
During and after August 2010, numerous and widespread insufficiencies in foreclosure filings in various courts around the nation were reported by major mortgage lenders and other authorities. These insufficiencies include: failure of plaintiff’s and their counsel to review documents and files to establish standing and other foreclosure requisites; filing of notarized affidavits which falsely attest to such review and to other critical facts in the foreclosure process; and “robosignature” of documents by parties and counsel. The wrongful filing and prosecution of foreclosure proceedings which are discovered to suffer from these defects may be cause for disciplinary and other sanctions upon participating counsel. As a result, attorneys and/or individual Plaintiffs must attest under penalties of perjury that they have reviewed the documents of the foreclosure action as well as other critical facts in the foreclosure process and that these facts and documents have been reviewed and are accurate.