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Foreclosures Continue Slamming Investors, Businesses With Major Losses

January 12, 2012

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It's no secret that the real estate market has been devastated by foreclosures, which has caused a domino effect of unemployment and market turbulence that our country still hasn't figured a way out of.

The sometimes unseen victims of this whole collapse isn't the homeowners themselves, who have missed payments and caused their homes to go into foreclosure, but the investors who were fooled by banks into buying loans that were bad from the start. Often, this requires litigation in order to recover money that was taken through unethical and unlawful means. In other cases, businesses may be facing foreclosure of commercial property for a variety of reasons.

In cases like this, contingency business litigation lawyers can be helpful for investors who don't have expendable income left to spend on lawsuits, but who want justice done. With this set up, clients pay nothing up front, but only pay if they've won.

Right now, we're experiencing a time when lawsuits are flying from every direction. We're seeing banks suing homeowners to foreclose on homes where payments have been missed. Then, there are homeowners suing back, alleging that banks used robo-signing tactics -- where documents were signed and authenticated by people other than the signature -- as well as created false documents in support of a foreclosure.

On the other hand, there are investors suing banks because the mortgage-backed securities they bought were flawed from the start and fraught with bad documents, but those facts weren't revealed up front. As housingwire reports, more and more mortgage bond investors are filing legal actions. In fact, the Patton Bogs Mortgage Litigation Index, which follows mortgage lawsuits, rose to its highest level in four years recently.

According to the news article, there were only 23 cases of mortgage litigation in the third quarter of 2010, but that number doubled to 50 in the second quarter of 2012 and 82 in the third quarter.

News recently came out that bankers were encouraged by their bosses to funnel minorities into high-risk subprime mortgages even though many of the people were qualified for regular loans. This has sparked a new round of lawsuits against banks.

Foreclosure tracking company RealtyTrac reported that there were 1.4 million homes in foreclosure nationwide in November, with the average foreclosure sale price at $169,451. California and Florida continued leading the way in foreclosures. In California, there were nearly 64,000 foreclosures filed, while Florida checked in at 24,739. Six other states had more than 10,000 foreclosures filed that month.

And then there's a couple in Florida who is now facing a foreclosure lawsuit on a house they have already paid off because of a typo filed nine years ago. The couple sold their home and paid their mortgage in full in 2003, but because the legal description on the deed is incorrect -- the house has been sold three times since then -- and the current owner is going into foreclosure, this family is being forced to defend themselves.

These are examples of the major problems that are arising in the real estate market right now. They are problems that happened years ago and people are looking to the court system to fix the wrongs. Our contingency business litigation attorneys are prepared to handle any aspect of the real estate collapse.

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Foreclosure Litigation Continues to Snare Businesses and Investors

February 10, 2011

477807_holding_the_key.jpgFewer homes entered foreclosure in January than at any time since the beginning of the economic downturn three years ago as foreclosure litigation continues to slow the process, MSNBC reports.

Much of the slowdown is being blamed on investigations and litigation surrounding the actions of banks, mortgage companies, title companies and their law firms. As we reported recently on our Contingency Business Litigation Attorney Blog, some homeowners have begun suing to regain their homes.

Central to the issue is proof of bank ownership of homes in foreclosure. Electronic mortgage tracking and the advent of mortgage-back securities has made proof of ownership difficult in some cases. The issue has impacted law firms working for banks, title companies, investors, property trusts and a host of other individuals and business entities. Consulting a business litigation law firm can help protect your rights in the wake of allegations of wrongdoing involving foreclosed property or other real estate issues.

The number of homes served with an initial notice of default tumbled 27 percent over last year, according to RealtyTrac. Scheduled auctions also fell to the lowest level in two years.

The slowdown has been particularly pronounced in states like Florida, where a judge is required to approve a foreclosure action. There, foreclosure actions are down by more than 50 percent from last year. Even with the decline, Florida still had the second-highest number of homes in some form of foreclosure.

Banks took back more than 78,000 homes in January -- 11 percent fewer than a year earlier. More than 1 million homes were taken back by banks last year. Experts say banks will repossess more than that this year, despite the slowdown. About 5 million homeowners are at least two months behind on their mortgage.

Lingering high levels of unemployment and a sluggish real estate market continue to feed the problem. In all, more than 260,000 properties received foreclosure notices in January. Nevada led the nation, with 1 in every 93 households facing foreclosure.

Other top states for foreclosure were Arizona, California, Florida, Utah, Michigan, Georgia, Illinois and Colorado.

Continue reading "Foreclosure Litigation Continues to Snare Businesses and Investors" »

Foreclosed Homeowners Sue To Regain Homes

November 6, 2010

Sun Sentinel Articles
You are here: SunSentinel.com>Collections>Class Action
Foreclosed homeowners sue to regain homes
Class action against three major lenders could affect thousands
October 29, 2010|Diane C. Lade, Sun Sentinel


JIN LEE, Bloomberg News


South Florida homeowners have filed suit against three major banks and are demanding more than compensation for what they say were illegal foreclosures.

They want their property back, according to a complaint filed this week in U.S. District Court in Miami.

Legal experts, however, say it's highly unlikely the courts would force out new owners of these homes if they had bought them in good faith, as they would have protection under the law, said Nina Simon, director of litigation for the Center for Responsible Lending. That probably is particularly true in states like Florida, she said, where judges must approve foreclosure actions.

But if the lender or an affiliate still has the property? "Who knows?" Simon said. "A lot of stuff still is in inventory."

Attorneys who filed the suit have requested it be certified as a class action lawsuit.

The suit, filed on behalf of three Miami-Dade County homeowners, names three major lenders: BAC Home Loans Servicing, a subsidiary of Bank of America; Deutsche Bank National Trust Company, and US Bank National Association. The action alleges that court documents used in the homeowners' foreclosures were improperly notarized and false, because the agents testifying to the paperwork's accuracy never personally reviewed it.

Spokesmen for Deutsche Bank and US Bank said their companies acted as trustees for the trusts holding the mortgage securities. So it was not them but the loan servicers, and the foreclosure law firms they employed, that handled the foreclosure procedures referenced in the lawsuit, they said.

Bank of America spokeswoman Shirley Norton said the lender, one of the largest in Florida and the nation, had not yet seen the suit. But in regards to other suits filed against the company, "we believe we have valid defenses against them and intend to vigorously defend against them," she said.

Class action filings are springing up around the country, as state investigations and private lawsuits uncover similar questionable foreclosure procedures by lenders, loan servicers and their law firms. The Center for Responsible Lending is one of several parties involved in a class action, on behalf of Maine homeowners, against Ally Financial's GMAC mortgage unit.

While the allegations echo those in the Miami suit, Simon said the Maine case asks for ongoing foreclosures or evicitions to be stopped, or monetary damages if the homeowners already have lost their property.

The Miami class action, if certified, could include homeowners outside of Florida and number in the thousands.

Attorney Juan P. Bauta of The Ferraro Law Firm, one of three firms involved in the Miami suit, said innocent buyers of an illegally foreclosed upon house would have no more rights than those who unwittingly bought a stolen car. Wrongful foreclosures must be thrown out, and the paperwork redone, "or we will have issues cropping up years from now," Bauta said.

Bauta said he did not know if the properties referenced in the suite had new owners and if so, how the courts might treat them. "It's uncharted territory," he said.

Diane Lade can be reached at 954-356-4295 or dlade@sunsentinel.com.

Bank Foreclosure Processes Result In Class Action Lawsuit

November 4, 2010

MIAMI, Oct. 28 /PRNewswire/ -- The Ferraro Law Firm, Daniels Kashtan and The Burton Firm filed a Class Action lawsuit yesterday against BAC Home Loans Servicing, LP, a Texas Limited Partnership, a subsidiary of Bank of America Corporation, and successor in interest to Countrywide Home Loans Servicing, LP, a Texas limited partnership; Deutsche Bank National Trust Company, a New York corporation; and U.S. Bank National Association, a Minnesota association, on behalf of all those property owners who lost title to their property in foreclosure proceedings based on false and perjurious affidavits filed by the Banks and their servicing companies. They seek to restore title to the property owners.

The Complaint alleges that the Defendants obtained wrongful foreclosures by abusing the court process and submitting affidavits that were false, even though sworn to under penalty of perjury, as the basis for obtaining foreclosure judgments. The property owners' due process rights were violated and the Banks used and abused the court rules and process to obtain judgments against all of the Class Members. "The rule of law and due process are the cornerstone of our judicial system and we must be able to rely on the integrity of the judicial system before property rights can be taken away," said Juan Bauta, II, of The Ferraro Law Firm. The courts relied on the Banks to provide true and accurate affidavits before granting judgments and taking the property away from the property owners. "In essence, the courts were lied to and the property owners' due process rights were blatantly violated," stated Mr. Bauta, II, of The Ferraro Law Firm, one of the attorneys representing the property owners.

The Complaint seeks to have the judgments that the Banks obtained with fraudulent affidavits vacated and title restored to the property owners.