Foreclosure Defense

What is a foreclosure?

A foreclosure is a legal proceeding that is started by a lender after a homeowner has failed to pay his/her mortgage. After a homeowner has failed to make their payments on time (usually at least 90 days, but a lender does not have to wait before holding a borrower in default after even one missed payment), a lender will serve notice of default on the borrower as required by the loan documents (specifically the Mortgage in New York State). If the borrower does not cure their default by the time stated in the default notice, the lender can commence foreclosure proceedings in accordance with the law to take actual possession of the home. If a foreclosure is permitted, the borrower loses the title to the home and the lender becomes the official owner of the home.

What happens in a foreclosure proceeding?

A foreclosure proceeding occurs when a lender files a lawsuit seeking to take possession of your home. After the lender commences the action, the borrower is given a limited time to reply. If the borrower fails to reply, a default judgment can be entered and ownership of the home transferred to the lender by the court. If a borrower appears in the action, the Court will usually order the parties to provide each other with whatever information each has in their possession and over time, listen to the factual and legal arguments of each party. Ultimately, a Judge may make a legal ruling deciding the result or a trier of fact (jury) could decide the case if an actual trial is needed.

What is a Notice of Lis Penden?

A Notice of Lis Pendens (“Lis Pendens”) is a legal document that is filed with the County Clerk’s Office. This document gives notice to all that there is a pending lawsuit against the borrower and the property. A Notice of Lis Penden is usually filed when a bank or creditor wishes to initiate foreclosure proceedings against a delinquent borrower. Once the Lis Pendens is filed, the borrower is served with a Summons and Complaint. These documents give the borrower formal notice that the foreclosure action has been started. In New York State, a borrower then has 20 days to respond if they were personally served, and 30 days to respond if they were served in any other manner.

What should I do if I received a foreclosure notice?

If you have been served with a Summons and Complaint containing a foreclosure notice, you should act as quickly as possible to explore any foreclosure defenses you might have. The best thing you can do is speak with a qualified lawyer. Generally, if your family attorney does not handle this area of the law, they should have the professional expertise to refer you to someone who does. By getting help from a knowledgeable law firm and its’ staff, you will receive the information, advice and solutions you need to avoid foreclosure, or if foreclosure is not avoidable, to help you protect any and all rights you may have, including the right to sell your home if you have equity in it, a “short-sale” if it can be negotiated with your lender or a deed in lieu of foreclosure whereby you can walk away from the home without any further obligations to your lender.

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