Many a client call me when its toooooo late however sometimes something can be done it would envolve an appeal and this application for a stay. Most likely you will have to pay the reasonable rental value till the case is decidedex-parte-application-for-stay-of-judgment-or-unlawful-detainer2
Category: I Have a Plan
The Doan deal
California Civil Code 2923.6 enforces and promotes loan modifications to stop foreclosure in the state. California Civil Code 2923.6 (Servicer’s Duty under Pooling Agreements) went into effect on July 8, 2008. It applies to all loans from January 1, 2003, to December 31, 2007 secured by residential real property for owner-occupied residences.
The new law states that servicing agents for loan pools owe a duty to all parties in the pool so that a workout or modification is in the best interests of the parties if the loan is in default or default is reasonably foreseeable, and the recovery on the workout exceeds the anticipated recovery through a California foreclosure based on the current value of the property.
Almost all residential mortgages have Pooling and Servicing Agreements (“PSA”) since they were transferred to various Mortgage Backed Security Trusts after origination. California Civil Code 2823.6 broadens and extends this PSA duty by requiring servicers to accept loan modifications with borrowers.
How does this law apply?
Attorney Michael Doan provides this example of how the new law applies in his article entitled “California Foreclosures: Lenders Must Accept Loan Modifications” on the Mortgage Law Network blog. We removed the borrower’s name from the example for the sake of privacy.
A California borrower’s loan is presently in danger of foreclosure. The house he bought 2 years ago for $800,000 with a $640,000 first and $140,000 second, has now plummeted in value to $375,000. The borrower can no longer afford the $9,000 per month mortgage payment. But, he is willing, able, and ready to execute a modification of his loan on the following terms:
a) New Loan Amount: $330,000.00
b) New Interest Rate: 6% fixed
c) New Loan Length: 30 years
d) New Payment: $1978.52
While this new loan amount of $330,000 is less than the current fair market value, the costs of foreclosure need to be taken into account. Foreclosures typically cost the lender $50,000 per foreclosure. For example, the Joint Economic Committee of Congress estimated in June, 2007, that the average foreclosure results in $77.935.00 in costs to the homeowner, lender, local government, and neighbors. Of the $77,935.00 in foreclosure costs, the Joint Economic Committee of Congress estimates that the lender will suffer $50,000.00 in costs in conducting a non-judicial foreclosure on the property, maintaining, rehabilitating, insuring, and reselling the property to a third party. Freddie Mac places this loss higher at $58,759.00.
Accordingly, the anticipated recovery through foreclosure on a net present value basis is $325,000.00 or less and the recovery under the proposed loan modification at $330,000.00 exceeds the net present recovery through foreclosure of $325,000.00 by over $5,000.00. Thus, California Civil Code 2823.6 would mandate a modification to the new terms.
This new law remains in effect until January 1, 2013. Restructuring your mortgage will stop foreclosure and lower mortgage payments. Depending on your circumstances, you may also be able to lower your interest rate, as well. Visit the “Get Started” page to find out if you can benefit from this new California law and avoid foreclosure.
I HAVE A PLAN If the foreclosure has occured and you are now facing Eviction I HAVE A PLAN
The next thing you can expect is a knock on your door. It will be the friendliest guy or gal that you would ever want to meet. Its the real estate agent with orders to get you out of the house. They may offer you cash for keys or whatever remember they are not your friend they have one purpose and one purpose only. TO GET YOU AND YOUR FAMILY OUT.
They may say things like don’t worry we can get you back in the house and you can buy it back. I had one Realtor promise that the people could buy back the house they just needed to move out over the weekend and the lender would work things out for them. They did only to find the Marshall had posted the house and nobody could get back in except a 3 hour period to get their stuff to the curb. Don’t let it happen to you.
In California tenants have 60 days and former owners 3 days before an eviction can be stated.
Step 1 send the party that gives you this notice a rental agreement showing someone as being a tenant in the house. (This will get you Sixty days)
Step 2 File a lawsuit for fraud and improper sale in that 2923.5 was not complied with prior to sale. sample-bank-final-complaint1
Step 3 File a Lis Pendenslisp-for-client
Step 4 Make motion to consolidate eviction with Superior court case.galejacksonconsolidation Alternative to Step 4 would be to apply for a temporary restraining order to hold the eviction till Fraud Case determined. Alternative to step 4 actually a Step 5 would be a motion in the unlawful detainer court for a stay of the judgment till the outcome of the Fraud case.
What will this do?
In the worst case it will keep you in your house and you may have to post a bond equaling the reasonable rental value of your house. Let me take that back just remember Judges have the power and the can disregard the law and the constitution and put you out without even a trial. This is the extreme and some days are extreme. The lenders lawyers are in front of that judge all the time, but as a whole you can expect a fair minded judge.
In the best case you could be in your house without having to post a bond and you will be offered the house back at today’s value and a low rate of interest.
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