Businesses and individuals often wait until a foreclosure notice is received before meeting with an attorney about what to do next.

Lanigan and Lanigan, P.L., tell clients with mortgage issues that waiting is the biggest mistake of all. Doing nothing until a foreclosure is filed means that you have missed out and possibly eliminated any openings to work out a mortgage with the bank.

Never wait or lose that opportunity to make changes to an existing mortgage. Options disappear and a family home or business can be foreclosed upon. This is not a time to sit back and see what happens. Don’t procrastinate because you’ll end up in foreclosure if you do nothing.

Options to Foreclosure 
There are many foreclosure options and steps to be taken that can prevent a foreclosure — as soon as you know a mortgage payment will be late or cannot be paid.

This is a good time to find out if you are eligible to instead to execute a mortgage workout. A foreclosure filed against you has a devastating effect on your credit. Consult with Lanigan and Lanigan, P.L., immediately, before it’s too late to try the many options available if you’re behind on payments.  There may other ways out of the financial challenges that only attorneys can offer after a thorough review of your finances and paperwork.

Lanigan and Lanigan, P.L., foreclosure alternatives:

• Interest rate reduction: It’s possible to receive a lower interest rate via negotiation with your lender to eliminate an out of control Adjustable Rate Mortgage. The tactic has to be agreed to by lender(s), and is not easy to receive approval for. This option should be handled only by an attorney familiar with banks and process.
   
• Fight foreclosure in court: Hire an attorney to fight a foreclosure in court. An attorney carefully reviews the mortgage to confirm proper execution, determining that it was not “robo-signed” or that a foreclosing party broke state foreclosure rules. Proof of ownership by a foreclosing party is needed to be sure the mortgage held is held by the lender filing foreclosure.
   
• Reverse mortgage: This is an option only available to people over age 62 with extractable equity in the home for a loan on the overdue amount that can be given to the lender. The  lender provides a loan and as long as you stay in the home, the loan is not due until death or when a house is sold.
   
• Giving up a property: Homeowners may provide a deed in lieu of foreclosure but this is an option only an attorney should manage. You want to ensure that there is an agreement with the lender not to make you liable for any deficiency between the sale and what you owe. The home may sell under what’s owed creating a deficiency that a homeowner is liable for.
   
• Short sale: A short sale is where a lender agrees to allow you to sell your home, knowing there will be a deficiency–a lower amount received–than is due the lender. A deficiency may be owed unless an attorney negotiates that a homeowner or business will not owe the deficiency. Second or third mortgages owed can prevent this option availability because the other lenders are unlikely to receive any revenue from the sale.
   
• Reinstate a mortgage: This option allows you to catch up on late payments. You  pay all money that’s due to become current in your mortgage payments. Work with a lender and within the Florida state laws allowing a homeowner time to make up missed payments before a foreclosure proceeds. 
   
• Negotiate a workout: Work with an attorney, a mortgage specialist and a lender and you may be able to negotiate:
• Lowered interest rates
• Makeup payments by adding onto the end of an existing loan
• Temporary relief (forbearance) for a few months 
• Reduce or forgive principal balance 
   
• Refinancing: Work with the lender and a lawyer to find a loan payment  you can afford through a lower interest rate. This is not easy these days as home values have dropped nationally eliminating equity and value in homes. Qualifying for the refinance has restrictions and this option will depend solely on a lender’s willingness and remaining home equity.
   
• Filing Chapter 7 Bankruptcy: Filing a Chapter 7 bankruptcy may delay foreclosure but you can’t stop it. If you review options and decide to file, you may be able to eliminate other debt that will allow you to have funds to pay for a lowered mortgage.
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• File for Chapter 13 bankruptcy: You create a three- to five-year repayment plan to catch up on late, missing or partial payments made that caused your lender to file foreclosure against you. Your unsecured debt may be wiped out in this process.
   
• Forbearance: You may be able to work out an agreement with your lender to get a break from payments temporarily or a suspension or even a reduction in your payments. But, you’ll have to agree to resume making full payments at the end of the forbearance agreement. You make extra payments within this agreement, eventually to make things right with the total loan balance owed. You will have to pay past due amounts in full.
   
• Reduce principal: This is a negotiation that should be accomplished by an attorney familiar with what banks want and how they operate. It’s a reduction in money owed the lender which it based on equity in the home, financial circumstance and proof of ability to pay long-term.
   
• Walk away: This is an option generally available to homeowners who hold only one mortgage. This should be considered only by owners certain the lender can’t sue after the foreclosure sale, in case of a shortfall, for any deficiency amount owed.

Foreclosure and Mortgage Misconceptions
Many homeowners believe that the bank is the actual owner of their home which is not the case. The bank doesn’t own your home; you do. The bank did lend you the money to buy it, but in exchange for the loan, you gave them a mortgage. This is a secured interest in the property that you own.

Whether you discharge that debt or surrender the home in bankruptcy, the bank still has to get the title ownership of the home from you. That’s foreclosure: Getting the title back from the homeowner who defaulted on the loan.

A mortgage secured the loan. A title is the piece of value that the bank needs back when the mortgage default occurs by a homeowner.

Many very smart people think the bank owns the house and that foreclosure turns the home back over to the bank which is not true. You own the house. In our English system of law, you own title, you have the deed, and you own title to the home. When you own, when you have title, you have rights.

Mortgage Mistakes Effect Foreclosures
There are many mistakes made within mortgages that change foreclosure outcomes:

1. Was your mortgage correctly executed?
2. Was it valid?
3. Did they have the secured interest in your piece of property that you own as a result of your loan?
“We’ve had many instances where we found that the mortgage is not valid. What does that mean for you as the homeowner?”

Invalid Mortgages
An invalid mortgage can mean you still owe the money but the bank doesn’t have the secured interest in your property. And under the Florida Homestead Exemption which says your property is exempt from creditors, basically nobody can touch it.

There are incidents where people are walking away with their home when going into a foreclosure. But due to investigation by Lanigan and Lanigan, there are mistakes found and mortgages are found to be invalid.

What you have to understand about foreclosure is that a person’s credit is destroyed. It’s a debt that’s going continue and that you’ll have to owe but they’re just not going to be able to take your home.

Foreclosure Questions and Answers from Lanigan and Lanigan, P.L.

How does foreclosure work?
Usually an owner is 6 to 9 months late in payments, foreclosure papers are sent to a client who is not paying a mortgage in full or on time. It’s been late, and whether or not partial payments are made, foreclosure doesn’t stop.

If you’re nine months late, a bank is going to contact you and ask you for payment and tell you that if you’re not caught up and you’re behind that they’re going to foreclose on your home.  They want the title back.

What are the benefits to keeping your home?
A lot of times people ask how to go into foreclosure because they know they’re going to run out of money soon and are afraid of what will happen to their home. Do they file bankruptcy, foreclosure or both? Does it make economic sense for you to keep your home? 

There is not one answer so it’s best to receive a consultation with Lanigan and Lanigan to clarify options with a plan that makes sense for individuals and businesses. Every situation is different. 

Am I going to be kicked out of my home?
The answer to that question is usually no, not right away and certainly not for several months.

How long does the foreclosure process last?
As of now (August 1, 2011) in Central Florida it takes about two years minimum from start to finish for a foreclosure to run its course. Lanigan and Lanigan have had foreclosure clients who are (as of Aug. 1, 2011) rolling into month 37. There are clients who due to various circumstance have been in foreclosure for more than three years. Individual reasons vary and do not compare any situation of your own to this situation.

Eric and Roddy Lanigan have found that the amount of time a foreclosure takes within the Central Florida market and with the large number of people filing foreclosures through the law firm cannot be predicted. The rocket docket has been stopped (cases were being rushed to get foreclosures completed due to extreme volume) at the Orlando courthouse.

What is the average time for a Florida foreclosure?
Nobody really knows how long a foreclosure will take because there are so many foreclosures happening quickly, rapidly increasing over the last three years. There’s no way to predict the amount of time it will take to foreclose on a business or individual in Florida.

“People who face foreclosures are just going to give up because they’re not
going to have bad credit. They’ve already filed bankruptcy. The debt is already
discharged. People are still in their homes debt free and not hurting their credit. They’re
not damaging their credit. They aren’t paying for anything but insurance.”

Does the bank own the home when you stop paying?
You own your home until the bank forecloses on it. In foreclosure they are suing you for foreclosure in court to regain the title free and clear from you for the interest in the home.

What is a short sale?
A short sale occurs when the bank agrees to allow you to sell your home for less than what you owe on it. Generally speaking you are not required to make up a deficiency but every case is different and there is no promise or prediction that can be made.

If you’re going to do a short sale you absolutely need an attorney to oversee the documents that you sign at the closing. An attorney can try to make sure that it’s structured in a way that you are not responsible for the deficiency. The deficiency alone can put you into debt that you will not recover from and can force you into bankruptcy.

What is a deficiency?
When a home is sold in a short sale, a deficiency is the amount of money between what an owner owes on a home and what a home is sold for . It’s the difference in price for what’s on the mortgage a person holds and what the short sale brings in. If there’s a shortage and if a short sale is completed and a homeowner isn’t covered by legal language that only an attorney can assure is in the closing documents, a homeowner is 100% responsible for paying the amount of the deficiency.

What’s the worst that can happen in a foreclosure?
An example of the worst situation is someone who tries to avoid bankruptcy and foreclosure, but ends up filing bankruptcy after owing a deficiency from the short sale. The deficiency amount was so high that the individual could never make it up and has to file bankruptcy to discharge the debt from the deficiency. There are many situations and every case is different. 

Why hire an attorney for foreclosure?
Without an attorney in a foreclosure case a homeowner can lose the home, owe a deficiency and have to file bankruptcy because they went through a short sale without knowing they were responsible for the deficiency. A bank contacts the homeowner, tells them, yes, they could do a short sale. However, the homeowners didn’t have a document signed  saying this because they did the foreclosure on their own.  The only creditor on a bankruptcy was the bank that held the mortgage on the home.

What about going to companies to advise you and help you through foreclosure?
Be skeptical of anyone who comes to you, who is not an attorney, who says that they can help you. Your rights are not their interest. They’re in it for financial gain.

What do you look for in a foreclosure attorney?
The No. 1 one thing to look for is an attorney who understands the economics of foreclosure. Do they understand how the banks operate and what they’re doing on that end?

If the attorney has that knowledge it can be one of the best reasons and one of the greatest likelihoods that you’re going to have in keeping your home and working out a deal in mediation.

What does an attorney do in a foreclosure?
An experienced foreclosure attorney can and will carefully examine your files to determine whether you have any defenses. Was your mortgage signed or was it a situation where you had your mortgage “robo-signed” at the bank?

What’s the short version of the foreclosure process?

• The foreclosure is filed
• The foreclosure is answered
• You request mediation
• You attend mediation
• You workout a settlement in mediation (i.e., a lowered monthly payment)
• If the above doesn’t work out, you continue with foreclosure

What are the benefits a small law firm?
Lanigan and Lanigan, P.L., does everything a large firm does. Less is more. If you want a small firm that has the attorneys updated in real time with the day-to-day activity that affects your case as opposed to a paralegal who is assigned as your case manager. If you have a question, you speak to Eric or Roddy Lanigan.

What if I want to stay in my home? Is there help?
Sometimes clients say “I cannot lose this home under any circumstance.” Some times after the Lanigans take clients through a thorough economic analysis there is no way that they should stay in the home. In these cases, clients are informed and the decision is up to the client.

Will I get evicted when foreclosure papers arrive?
There are many thoughts that go through your mind One of fears homeowners have after they receive a foreclosure notice is that they are going to be immediately ejected from their home with no other option for their home or for their family. That is simply not the case if you follow the steps correctly after being served with a complaint.

On average in Central Florida right now a foreclosure is taking between one to two years to complete.

When do I hire an attorney?
It’s important that you engage an experienced attorney to represent you in the matter after you’ve been served with a foreclosure complaint because you do have options. There are many ways to fight it if you take the right steps and seek legal representation, you’re not going to get tossed out of your home tomorrow.

What should I do if I receive notice of a foreclosure?
In a foreclosure situation timing is absolutely imperative. After being served with a foreclosure complaint the most important thing that you can do is to see an attorney–immediately. Not next week, not the week after, but the very next day. You should have an appointment with a licensed attorney to clearly decide next steps.

Will I see an attorney in the first meeting or a paralegal?
All foreclosure cases are overseen and handled personally by Eric and Roddy Lanigan. There are no paralegals used.  The majority of foreclosures cases are form-driven. At Lanigan and Lanigan, P.L., every pleading, every file is prepared personally. It’s not prepared by a paralegal and then placed on a desk for an impersonal signature.

Lanigan and Lanigan is a family firm. We’re a small firm and we’ve purposely made the decision not to go big. We feel we do a better service to our clients by personally overseeing every single case. We prepare the pleadings ourselves and sign them.

What can Lanigan and Lanigan offer clients?
One of the most important things to look for in a foreclosure attorney is an attorney who understands the process and understands how mediation fits into the process. An attorney who can look at your financial statements and who has done an evaluation on the value of your home; looks at the cost of your home, the appraised value of your home vs. any equity in your home.

How do you know which choice to make in foreclosure?
You want an attorney who understands how foreclosures work economically. What are the economics of your foreclosure and what makes sense. Does what the banks suggest and think make sense? Does your attorney understand how the banks operate?

You need an attorney who understand the way that banks think and what your situation is financially; that’s when you’re going to get a best case scenario. You’re in a position to keep your home when you walk in and sit down for that mediation.

An attorney will examine your file and determine if you have any defenses:

1. Is the mortgage signed?
2. Was there “robo-signing”?
3. Which bank is the lender holding the mortgage on the home?

Are there options or am I going to be foreclosed on?
There are many options when you receive a foreclosure notices. While it’s best that you make decisions and begin working with the bank or lender as soon as your mortgage will be paid late, there are still options. When you come to the offices of Lanigan and Lanigan, they will carefully review your economic situation, the value of your home, your mortgage, your economic statements. Then they ask questions. They find out what you want and then work together for the best outcome for you. You’ll decide from the choices they provide what will be in your best interests.

Mortgage Workouts
Lanigan and Lanigan have brought in Rich Marquez, a non-attorney specialist who supports negotiations during mortgage workouts and foreclosure alternatives. Rich has had years of experience working with banks. He speaks the banks’ language. He understands what it takes to go through mediation in order to get a deal done.

Richard Marquez
Richard Marquez is not an attorney but a former mortgage broker specialist who is a full-time mortgage workout negotiator and loan renegotiation specialist at Lanigan and Lanigan, P.L.

A Mortgage Workout is a Foreclosure Alternative
A mortgage workout is the description for renegotiation options provided to banks and lenders that will allow owners to keep their homes. There are always alternatives each of which depends on careful review of the financial status of a business or an individual.

Foreclosure Alternatives
Richard Marquez works with banks, mortgage and loan companies to negotiate on behalf of Lanigan and Lanigan, P.L., clients trying to prevent foreclosure to stay in their homes. Payment plans can be altered. Interest rates can be renegotiated. Clients can have time built in to catch up on payments, remain in the home or business and return to regular payments.

Don’t give up or file bankruptcy before consulting with Eric and Roddy Lanigan. It’s never too late to try, even when a business or individual has stopped payments, stopped communication and stopped making an effort to relieve the late payment, missed payment situations.

Come in to find out if Lanigan and Lanigan can prevent foreclosure and what the alternatives are to help to save your home from foreclosure.