With COVID-19 affecting not only New York’s job market and the economy, it has inevitably taken away jobs as well. With unemployment benefits ending in New York State, many homeowners are finding themselves still jobless, gone through most of their savings, and unfortunately, unable to pay their monthly mortgage. Although some homeowners with federal loan mortgages may be spared from being foreclosed on due to the federal CARES ACT, most homeowners who have private and non-federal mortgages are facing a foreclosure dilemma.
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This article shall address what to do if you receive a foreclosure notice, how to prepare a verified answer to a foreclosure complaint in New York, and shall also discuss counterclaims to a foreclosure complaint.
You may be saying to yourself, “I was served foreclosure papers. I am facing foreclosure. I need help learning how to reply to a foreclosure summons, and how to fight foreclosure in NY. The first step is learning about the foreclosure process.
Under New York State law, the mortgage holder must mail you a 90 Day Pre-Foreclosure Notice at least 90 days before initiating a foreclosure case, and this notice must be sent by both regular and certified mail. This notice allows the chance for the borrower to contact the mortgage company before the mortgage foreclosure process begins.
What is the process? The foreclosure process is the legal process by which the lender must follow in order for the lender and/or bank to take possession of the property. In general, the borrower must be over 90 days past due before a foreclosure can begin. The foreclosure process must follow strict deadlines and filings, and if the lender, or mortgage company, does not follow the process, they may waive or delay their period of time of their right to foreclosure. It is particularly important to note that the foreclosure process is judicial, which means that everything must go through the courts.
This means that just because you may receive a foreclosure notice does not automatically mean that the bank and/or lender has the automatic right to take over the property. Again, there is a period of time where you, as the borrower, may try to remedy the foreclosure process and attempt to pay back the amount of the mortgage loan owed. Or, you, as the borrower, may try to negotiate with the bank and/or lender, which again, may stall or terminate the foreclosure completely.
Since the foreclosure process is judicial and everything must be court ordered, it is very important to have somebody fighting for you who understands the foreclosure process, the deadlines and timelines, and ultimately, and what procedures may be implemented to either halt or stop foreclosure completely before the eventual foreclosure sale. Unfortunately, however, the process can be very complicated, and only a skilled, experienced, and knowledgeable foreclosure attorney will be able to advise you in detail of what to expect. The foreclosure process cannot be boiled down in an article such as this. Accordingly, it is imperative that you discuss your individual foreclosure situation with a foreclosure attorney right away.
Getting served foreclosure papers is not fun. Below are the three basic steps to take into consideration when responding to a foreclosure lawsuit.
You should hire an attorney who focuses on Foreclosure Defense and who can review your options before you try to submit an answer yourself.
Since the foreclosure process is complicated and all pleadings, which means all documents, motions, answers, and basically everything and anything, must be filed with the Court, it is important that everything is documented properly. This means that all your Ts must be crossed. Having reviewed hundreds of foreclosure answer samples, a foreclosure attorney will have the experience and knowledge to draft a proper answer to a foreclosure complaint.
It is not recommended to just go on the internet and pull an example of written responses to a foreclosure summons. Each homeowner has their own unique set of facts and circumstances, and only an experienced foreclosure attorney can identify and articulate your individual facts and circumstances to the lender and the Court.
In addition, once you speak to a foreclosure attorney, they may be able to advise and identify some different strategies and options to you to respond to the foreclosure, or an option in the alternative. For instance, your attorney may suggest a short sale rather than a foreclosure, which is far less damaging to your credit score. So before you try to take a stab at answering your own complaint and filing it, you should first talk with a foreclosure lawyer.
Besides filing a general denial to the foreclosure complaint, you may want to allege counterclaim in your answer. Again, only an experienced and well-trained foreclosure attorney will be familiar enough with the process to be able to do so.
One example of a counterclaim is if the lender committed any misrepresentation or fraud. For instance, if the bank or lender communicated to you a statement that you relied upon that ultimately helped contribute to you being in foreclosure in the place, that bank or lender may have committed a misrepresentation or fraud. In those types of counterclaims, stating specific facts is very important as to what was said and who said what and when.
Another example of a counterclaim is if the lender or bank violated any laws by doing something prematurely or not doing something. One of the most common violations is the Real Estate Settlement Procedure Act or RESPA. Under RESPA, the lender or bank must fully divulge the costs of a real estate transaction and provide a detailed breakdown. If they do not do so, they may have violated RESPA.
Again, a foreclosure attorney will be able to review your individual case and apply their knowledge of foreclosure law to your set of facts.
Another consideration when answering the foreclosure complaint can act as an affirmative defense to the complaint if you were not properly served, thereby making any summons you were given faulty and defective.
Like any proper lawsuit, the defendant, or in this case, the homeowner, must be given proper notice of the lawsuit itself. Accordingly, service is generally provided by the bank or lender hiring a court appointed process server and physically handing you the summons, thereby putting you on effective notice.
Being mailed a summons, or receiving a summons taped to your front door, and hearing that you are being sued by word-of-mouth is not always the best way for the court to acknowledge that you were properly served foreclosure papers and therefore may be challenged, which may delay the process.
You should therefore talk with a foreclosure attorney about the facts of your case in order for them to make a determination if service was properly effectuated and then let them explain what your options are. Your attorney may challenge the foreclosure complaint itself, or at the very least, delay the process.
If you were not given the summons in person and received it by mail, you then have 30 calendar days to provide an answer to the foreclosure papers. In your Answer you explain your defenses, which means you explain to the court why you, as the homeowner, have not been able to make your loan payments.
Besides the above, there are other numerous arguments you can make as to why you are late on your mortgage in your answer to the foreclosure complaint. Talking with a foreclosure attorney is key in providing a verified answer to the foreclosure complaint.
If you choose not file a timely answer or no answer at all, the bank or
lender may ask the Court to render a default judgment against you and unless you are able to show good cause for not doing so, the Court will most likely grant the notice of default judgment against you. Accordingly, choosing not to file an answer is never a good idea, as the Court will rarely vacate the default judgment once it is granted.
In addition, if you fail to file an answer, by default, you then lose your right to assert any defenses or counterclaims that were discussed above.
Filing an answer to the foreclosure complaint not only buys you more time to negotiate something with the bank and/or lender, but it also gives you more time to pay off what you owe and come up with the appropriate strategy to fight the foreclosure.
Accordingly, you need to hire the proper foreclosure attorney to analyze your own individual set of facts and circumstances and come up with an appropriate response in your answer to their complaint. Only a skilled foreclosure attorney will know how to properly draft such a response.
Estimated Closing Costs
Due to the fact that the foreclosure process and answering a foreclosure complaint can be highly technical, it is important that the foreclosure attorney that you hire has the experience both in and out of court to be able to handle your claim.
You don’t just want an attorney that does civil practice law, but an attorney familiar with the foreclosure notice, foreclosure process, and knows what to do in a foreclosure case. Only an experienced foreclosure attorney can explain the foreclosure process timeline and discuss how to best defend against foreclosure.
A qualified foreclosure lawyer from the Law Office of Yuriy Moshes has the expertise in legal knowledge of the foreclosure process and experience of stopping foreclosure. Their offices help homeowners in the New York City area including all its boroughs (Manhattan, Brooklyn, Queens, the Bronx and Staten Island) as well as Northern New Jersey, Long Island, and Upstate New York.