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foreclosure-300x170A recent article in the New York Law Journal discussed the possibility of public foreclosure defense services being in jeopardy due to government funding cuts.  What does this mean for the homeowner whose home may be in danger of being foreclosed?

Homeowners who are having problems paying their existing mortgages may be in danger of having a foreclosure action brought against them.  New York State currently provides public services to assist such parties.  These agencies may provide legal advice on avoiding foreclosure, help with loan modifications and refinancing, and other financial services related to mortgages.  Generally, these services may be provided free of charge by non-profit agencies, such as Legal Services of the Hudson Valley.

However, many of these agencies are overwhelmed by the demand for their services.  As stated in the article, state budget cuts may result in these agencies being unable to provide assistance for all homeowners who may be at risk of foreclosure.  What should these homeowners do in this situation?  We would recommend hiring a private attorney with experience in defending foreclosure lawsuits.  Prior blog posts have shown the various ways in which an experienced attorney can defend a foreclosure case in litigation.  Even delaying a foreclosure action can buy a homeowner valuable time in which to negotiate a loan modification, obtain a refinance commitment, or even sell the property and pay off the mortgage, if there is sufficient equity.

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bucket1So long as one is alive and mentally capable, one is in control of her own financial and legal affairs.  Once a person passes away, a fiduciary needs to be appointed by the Surrogate’s Court  to determine and pay estate debts , collect and distribute assets, file relevant tax returns and pay taxes, vacate a rental property used by the deceased or sell a property owned by the deceased.  Also, if the deceased left minor children surviving, a guardian needs to be appointed to care for the children on a daily basis.  This post will explore the types of fiduciaries that may be involved after a person’s death and how they are appointed.

If a person dies without a will (intestate), the Court will appoint an Administrator to serve.  The Administrator to be appointed will be the same person who will inherit according to the intestacy statute.  For instance, if the closest survivor is a sister, such person will inherit the deceased’s assets and serve as the estate administrator.  Guardians for minor children (under 18 years of age) will need to be appointed by the Court in the event that the person dies intestate.  Since a parent should not leave it to the Court to appoint a guardian for her children, it is prudent for such person to engage the services of a qualified professional to draft a will containing her wishes relative to fiduciaries.

We  have posted previously about the merits of having a will and/or trust.  In either case, fiduciaries are selected by the person making the will or trust.  Executors are formally nominated in wills.  They are charge of paying valid financial obligations and distributing assets that are collected.  The testator (person making the Will) can select the best person in her life for the position of executor.  Perhaps she is estranged from family and would prefer not to have the Court appoint the surviving relative according to statute in the case of intestacy.  Also, the testator may have a friend who is sophisticated with respect to financial matters and is best suited to act as executor.  Trustees of trusts take on similar roles as executors.  Of course, selecting a guardian to raise one’s children in the event of death is a highly personal and important choice to be exercised.

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super-bowl-betting-300x180Scheduled for this Sunday is the Super Bowl between the New England Patriots and the Los Angeles Rams for the championship of the NFL.  Recent news stories in the New York metropolitan area involve the possibility of making legal sports bets on the “big game” at casinos or racetracks located in New Jersey.  The reason for this development is a recent decision by the United States Supreme Court which invalidated a federal law prohibiting individual states from making sports betting legal, with limited exceptions.

The Supreme Court, by a seven to two vote, held that it was a violation of the Constitution to prohibit states from making their own decision regarding the legalization of sports betting.  The result is that every one of the fifty states can now legalize sports betting (or decide not to legalize sports betting), and may determine where, when, and how such bets will be made within their state.  The details of such legalization are left up to each state, including whether to allow online betting.

New Jersey, which brought the case before the Supreme Court, has already passed legislation permitting sports betting in racetracks and casinos, such as the Meadowlands Racetrack located just a few miles from New York City.  New York State has lagged behind, and has not yet legalized sports betting or decided on a structure for such potential legalization.  For the time being, New York State residents who wish to bet against the Patriots in the Super Bowl must travel to New Jersey, or to another state such as Nevada, which has authorized legal sports betting.

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paid-300x241Our firm frequently handles defenses for clients whose property is in foreclosure.  It is possible, for various reasons, that such an individual may eventually be in a position to pay off or reinstate the mortgage loan in question.  There can be many reasons for this to occur.  For example, let’s say a homeowner encounters financial difficulties, and, as a result, defaults on her mortgage.  As prior blog posts have explained, the legal process to foreclose a property may take several years.  Potentially during this period of time, the property owner may inherit a large sum of money from a relative.  She is now in a position to either pay off or reinstate the loan.

Another example may be where the homeowners are a couple who are going through a divorce.  They may be arguing about money matters and cannot agree on whether to pay their mortgage, or to sell the property and move into separate residences.  One of the spouses may have already moved out, and may refuse to pay the mortgage as a result.  While they are going through legal divorce proceedings, the property may go into foreclosure as a result of their failure to make payments.  It is possible that in resolving their divorce action, the parties agree that one of the spouses is to pay off the mortgage in full, with the other spouse receiving full title to the house as part of the settlement.

Assuming that there are now sufficient funds to pay off or reinstate the mortgage, what happens next?  The first step is to have experienced legal counsel contact the lender, or their attorneys.  Both a payoff letter and a reinstatement letter should be requested.  These are written documents which will detail the exact sum due in order to pay off the mortgage in full, or to reinstate the mortgage and resume making regular payments.  These documents will include all sums due to the lender, such as principal and interest, late fees, attorneys’ fees, and any taxes or other fees which the lender has advanced on behalf of the borrower.  Importantly, the letter will also state a date through which the payoff or reinstatement figure is effective.  After that date, the amounts may change, as additional interest or property taxes may become due.

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defense-300x281Prior blog posts have discussed the legal steps required to foreclose property in New York State.  Often, our firm will encounter a foreclosure case that has been in litigation for many years.  In fact, it is entirely possible for a foreclosure matter in New York to take between five and ten years from the commencement of an action to the final sale of the property at auction.  Even after the final sale, there may be additional landlord-tenant litigation involving the owner or tenant being evicted from the foreclosed property.

This post will discuss the legal ramifications of a delay in a foreclosure procedure. Foreclosure cases can be delayed for many reasons.  Common reasons are court backlog, which may involve a Judge taking up to a year to render a decision on a motion, or simply failure of the lender or their attorneys to expeditiously file the various necessary motions in order to advance the case.  Experienced counsel for the defendant may also further delay the case’s progress by interposing legitimate defenses to the action, such as a lender’s failure to provide the correct notices to the borrower as required by law.

As a result, the case may take years to resolve itself.  What is the effect of such a delay?  The first effect is that if the borrower is residing at the property, it allows her time to arrange for new living arrangements.  If there is insufficient equity in the property, and the borrower feels that ultimately, it will be sold at an auction, any delay will allow her to continue living at the premises while the case plays out in Court.  Even after the property is sold, the new owner must bring separate legal proceedings in order to evict any persons living at the premises.   Our attorneys may be able to negotiate with the new owner to give the former owner sufficient time to obtain a new residence and arrange for movers.  We have even successfully negotiated for the new owner to pay the prior owner’s moving expenses in order to have the property vacated.

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Our readers who follow the news are aware that the Federal government has been partially shut down for several weeks.  President Trump has taken the position that he will not agree to re-open the government unless a wall is erected along our southern border.  The Democratic leadership has responded that it will absolutely not agree that a wall is to be installed.  It is not the goal of this author to side with either of these positions.  Rather, we find it striking that neither side is negotiating effectively.  By stating an absolute, such as there must or must not be a wall, both sides are preventing a satisfactory resolution; which requires agreeing to terms that inherently will be neither of these positions.  Presenting an “all or nothing approach” is not how matters are successfully concluded.  This post will address one of the tools that experienced attorneys have at their disposal- strong negotiating skills.  We will explore how these skills are utilized in various legal matters.

Negotiation strategies can take the following course in real estate transactions.  We recommend that parties to a proposed deal let their attorneys “do the talking” and thereby prevent themselves from showing emotion or desperation to sign the contract.  Otherwise, such a party is vulnerable to agreeing to issues in the contract that may not be beneficial and result in regret.  For instance, a seller who needs to sell for financial reasons or who may be facing foreclosure, without other viable offers, may agree to excessive demands from the buyer like making repairs, credits for inspection issues, etc.  On the flip side, a buyer “in love” with a particular house that has multiple offers in a strong Spring market may agree to risky decisions such as waiving the mortgage contingency, allowing violations to remain and the like.  The more prudent negotiation move is to allow only a qualified attorney to be aware of these factors, not display feelings and allow the attorney to be the only one to negotiate on a party’s behalf.

Commercial lease negotiations  contain their own strategy.  A tenant may want to be in a particular location and find it necessary to tolerate the unreasonable expectations of a landlord.  For instance, a landlord may wrongfully impose snow removal obligations on the tenant.  The tenant’s attorney can get more leverage in this negotiation if the tenant is willing to walk away and find another location instead.  Such flexibility may help to achieve better results for the client.  Perhaps the landlord has an opportunity to rent to a “big box” nationally known tenant.  In such a case, the tenant will require that its form of lease be signed and will not be amenable to many landlord requirements.  Locating another tenant who is willing to accept landlord demands could be best in some situations.

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convent-300x223Recently in the news is a decision in a lawsuit regarding the potential eviction of a defrocked nun in a Russian Orthodox convent located in Nanuet, New York.  This case is an interesting intersection of two areas of the law that our firm practices; namely, how the decisions of a religious organization can affect the disposition of real property, as well as the residents of said real property.

Prior blog posts have discussed how religious corporations must obtain approval from the New York State Attorney General in order to sell, lease, or mortgage real estate owned by the religious organization.  This often causes disputes where there are different factions within the religious organization, and these factions cannot agree on whether to sell real estate in order to relocate the place of worship.  As prior posts have discussed, courts are reluctant to intervene in disputes which are solely the result of disputes over religious doctrine.  However, disputes over control of a religious organization which can be resolved on the basis of neutral principles, that is, without second-guessing decisions made solely on the basis of theological grounds, may be resolved by the court.

The First Amendment to the United States Constitution generally forbids government involvement in religious disputes.  This principle also applies to the Courts, which are, in essence, instruments of the government, whether state or federal.  The lawsuit under discussion involves attempts to allow an ejectment action against a nun who was defrocked by her parent religious organization, the Russian Orthodox Convent Novo-Diveevo.  Our blog has previously discussed evictions against certain “non-traditional” tenants, such as licensees and invitees, who usually do not have written leases, but reside at certain properties.  The usual course of action in such matters is to serve a Notice to Quit, giving the tenant (often referred to as a licensee or invitee, depending on the specific situation) thirty days in which to vacate the premises.  If they do not vacate, the owner of the property can then either bring a petition for eviction in the local landlord-tenant court, or, in cases involving more complex issues, a civil action for ejectment in the Supreme Court in which the property is located.

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We have advised our readers of the process for bidding at a foreclosure auction sale in New York.  Perhaps you have attended the auction, participated and made the highest, winning bid.  This post will address what happens next.

Upon making the highest bid, the participant will need to make an immediate payment of ten (10%) percent of the bid price.  The auctioneer will provide a written receipt and the parties will sign the receipt.  The successful bidder should contact an experienced attorney  and provide the Notice of Sale, Terms of Sale and Receipt to his attorney.  Your attorney should review these documents to ensure compliance by the successful bidder as well as the party auctioning the property.

Typically, Terms of Sale provide for the bidder to close and receive the Referee’s Deed to the property within thirty (30) days of the auction sale.  Failure to do so may result in the loss of the deposit and the auctioning party offering the property to the next highest bidder or holding a second auction.  Therefore, the successful bidder should be prepared to pay the balance with readily available liquid funds, without the need to apply for a mortgage.  The attorney should order a title report, which will be bound in a title policy at closing, so that no other liens will encumber the property and the status of real estate tax payments is known for adjustment purposes.  Then, the successful bidder will have the benefit of title insurance.

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auction-300x200Our firm receives many inquiries from parties who intend to bid at a foreclosure sale.  Foreclosure sales most often occur when a party is unable to pay a mortgage encumbering a property, and a foreclosure judgment is obtained by the lender.  What happens next?  A foreclosure sale, or auction, is scheduled by the lender.  This must be properly noticed by having all parties served with the Notice of Sale, as well as having the Notice published in a general circulation publication, which the Court will order, such as the Journal News in Westchester.

Once all notices have been given, the sale is usually held in the lobby of the Courthouse of the Supreme Court in the County in which the foreclosed property is located.  Most courthouses in New York State set aside a specific area or room in their building to hold such auctions, which are open to all members of the public.  Prior to the auction date, it is wise for potential bidders to have experienced counsel review the terms of sale.

The sale is then conducted by the Referee for the foreclosed property.  The Referee is an individual, usually an attorney, who has been appointed by the Court to conduct the auction and transfer the property after a judgment of foreclosure has been obtained by the lender, who is the plaintiff in the foreclosure lawsuit.  The Referee’s role is to prepare all documents, conduct the auction sale, and then prepare the property transfer documents and convey all funds to the lender after the auction.

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