Are we back to Hoovervilles?

What in the world is going on, what with homes in foreclosure being squatted in? This is just unbelievable. 9 years ago we had a budget surplus as far as the eye could see, more income equality, and we squandered it down a hole....

Deutsche bank says Crisis "Far from Over"

And this is news???!!!  I can't tell you how many foreclosures come through my door where Deutsche ban as trustee fro (fill in the blank) is the Plaintiff. No assignment of mortgage, no good faith effort to find a lost note, who are they kidding?  Matbe we should all just be like French Peasants and buy gold to stuff in our mattresses...these "Masters of the Universe" ought to be in irons....

Shadow inventory of unsold foreclosed homes

Here is an article from the san Francisco Chronicle describing the glut of unlisted homes that have already been foreclosed on. Here in Florida, I have no idea about a glut of foreclosed homes in inventory BUT there are probably TEN THOUSAND where the lenders are dragging their feet and don't want to even take title.....

Proposed Texas constitutional amendment would prohibit HOA foreclosures

This has to be be the most stupid idea in the world; let people who pay for their assessments, and on time, suffer for the people who don't pay. The legislator has apparently never met anybody who operates a community association. If this was ever enacted in Florida, you might as well turn out the lights and throw away the keys....

"Free Fallin"

Like the Tom Petty song, real estate prices are in a free fall in Lee County. Again, this shows the need to be absolutely vigilant about staying on top of your receivables.

Lee County foreclosures-15 seconds, 2 questions and 45 days to get out!

For an interesting description of how the court system at ground zero of the mortgage meltdown is trying to cope with the greatest Ponzi scheme in history (maybe the second greatest, after Social Security) as reported by the Wall Street Journal, click on this link to read about the "Rocket Docket" that has beeen adopted by the court system...

Foreclosures? Want to vomit? Read on!!

Want to know how sick the system is?  Below is just part of one day's analysis of the status of mortgage foreclosures we answered and are monitoring. As you know, we were recently forced to start charging a flat fee of $150 to answer and monitor these cases. I have 2 full time people doing this.  I think we just passed a BILLION Dollars in foreclosure defenses, over 3,200 at about $300k each...

Here is how to read them:

date-initials of my employee-action taken-followup

FC= foreclosure; MSJ= Motion for Summary Judgement' OC= Opposing Counsel.

This is absolutely sickening!  When we call the plaintiffs lawyers, they pull the file and move; if not they only move if their clients scream at them, and because Uncle Sam is bailing everybody out , what do the "lenders" care? They've already raped the investors, and sliced and sliced up the packages of these worthless mortgages.

The lawyers for the plaintiffs are totally under water, and their clients don't really want the properties anyway, what with having to pay back assessments, ongoing assessments, property taxes, maintenance &tc., &tc...... 

These matters are moving at about the speed of molasses, which is why I beat the drum about moving aggressively against delinquent owners, and having clients consider authorization of their own foreclosures even when the first mortgage holder starts foreclosure. This is done on a not to exceed fee of $1500, including costs. We can usually go start to finish in 5-7 months and the associations can then rent out the properties. Remember, no guarantees, but if your association sits on it's hands, you will get death by slicing

I believe it will get worse as the lenders all wait for Uncle sam to see how much they can sucker the taxpayers for in a bailout. Current valuation is about 22 cents on the dollar wait, it gets worse, I think we are half way through, maybe.  Just wait until all of the resets on loans come this year, and all of the foreclosed properties get on the market at 50% of their former "value."

12-06-07-GT-Opened Mtg FC file. XXXXXX's office answered complaint 10-11-07.

docket pulled - nothing since answered filed. Check status 2mos.

02-20-08-GT-Per Gail, OC is awaiting hearing date for MSJ. Check status

2mos.

08-08-08-GW-Pulled docket nothing since April.  Status 2 mo

08-29-08-GW- MSJ filed.  check 1 mo for hearing date

02-02-09-GW- Nothing on docket since 8/08.  Check 2 mos

2-06-07-GT-Opened Mtg FC file. XXXXXXX's office answered complaint 10-11-07.

docket pulled - nothing since answered filed. Check status 2mos.

02-20-08-GT-Per Gail, OC is awaiting hearing date for MSJ. Check status

2mos.

08-08-08-GW-Pulled docket nothing since April.  Status 2 mo

08-29-08-GW- MSJ filed.  check 1 mo for hearing date

02-02-09-GW- Nothing on docket since 8/08.  Check 2 mos

04-09-08 LAP Answered Complaint.  Check status 3 mos.

08-08-08-GW- Pulled docket.  Nothing since April.  Check 2 mos

11-21-08-GW- MSJ filed.  Check 2 mos for hearing date

02-09-09-GW- Check 2 mos for hearing

12-03-07-GT-Answered Mtg FC complaint. Check status 3mos.

03-04-08-GT-MSJ was set for 02-28-08. Check status 2mos.

08-13-08-GW-  Sale date Septemebr 8, 2008.  Check 1 mo for CT

09-09-08-GW- OC filed Motion to cancel sale.  Check 1 mo for resch.

02-09-09-GW-Case reopened 9/08.  Nothing filed since 9/08.  Check 3 mos

03-16-08-GT-Gail answered Mtg FC complaint 03-07-08. Check status 3mos.

08-08-08-GW- Pulled docket.  Service being perfected.  Check 2 mo

02-09-09-GW- MSJ filed 11/08.  Check 1 mo for hearing

03-16-08-GT-Gail answered Mtg FC complaint 02-12-08. Check status 3mos.

05-22-08-GT-MSJ hearing set for 07-03-08. Check status 2mo.

08-08-08-GW-Pulled docket.  Nothing since April.  Check 2 mos

02-09-09-GW- Pulled docket.  MSJ filed 4/08 nothing since.  Emailed atty for

status

03-16-08-GT-Gail answered Mtg FC complaint 03-04-08. Check status 3mos.

04-20-08-GT-Owner filed BK 04-09-08.

08-20-08-GW-OC filed Amended Amts Due and Owing.  Check status 2 mos

08-22-08-GW-BKR discharged July 20, 2008.

02-09-09-GW- Defaults being filed 1/09.  Check 2 mos for MSJ

11-21-07-GT-Answered Mtg FC complaint. Check status 2mos.

01-28-08-GT-Stern's office is perfecting service and entering defaults.

Check status 2mos.

08-08-08-GW- Nothing on docket since December.  Check 2 mos

02-09-09-GW- Cas dismissed 8/14/08.  File closed

11-16-07-GT-File pulled for case status update. Docket shows no movement

since 04-03-07.

11-28-07-GT-Emailed status request to Echevarria.

11-29-07-GT-Per plaintiff's atty, this file is on BK hold. Check status

3mos.

03-04-08-GT-No movement on docket since 04-03-07. File to Gail to call OC.

03-07-08-GT-Per Gail's email from OC, file is still on BK hold. BK is

active. Check status 3mos.

10-24-08-Amending MSJ  Check 3 mos for hearing Check 2 mos

02-05-09-GW- BKR terminated.  Check 2 mos

02-09-09-GW- 10/08-Lenders atty amending MSJ and reschedule sale date.

03-09-08-GT-Gail answered Mtg FC complaint 02-12-08. Check status 3mos.

06-27-08-GW-Sale date 7/23/08.  Check 1 mo for CT. No fax sent per Kathy.

08-04-08-GW-Sale to third part for $99,700.  Check 1 mo for CT

4-18-08 LAP Answered Complaint.  Check status 3 mos.

02-09-09-GW- Nothng on docket since 7/08.  Check 2mos

12-27-07-GT-Answered Mtg FC complaint. Check status 2mos.

03-02-08-GT-OC is preparing defaults. Check status 2mos.

04-09-08-GT-BK filed 03-31-08.

05-22-08-GT-File was administratively closed but NOT dismissed. Check status

2mos.

09-18-08-GW-9/18/08 Hearing cancelled per phone call 9/17 from OC office.

Check status 2 mos

09-30-08-GW-Hearing cancelled.  check 2 mos for reschedule

02-09-09-GW-Nothing on docket since 9/08.  Court has the file as closed.  No

dismissal filed.  Check 2 mos

12-17-07-GT-Answered Mtg FC complaint. Check status 2mos.

03-02-08-GT-OC is preparing for defaults. Check status 2mos.

07-17-08-GW- Check status 2 mo

08-04-08-GW-MSJ hearing for 7/31/08 cancelled.  Check status 2 mos

02-09-09-GW- Hearing cancelled.  Notingo n docket since 7/08.  Check 2 mos

01-07-08-GT-Answered Mtg FC complaint. Check status 2mos.

02-04-08-GT-Owner is in BK.

03-09-08-GT-File is on BK hold. Check status 3mos.

06-15-08-GT-BK was discharged 03-24-08. OC is restarting the Mtg FC action.

Check status 2mos.

06-18-08-GW-MSJ hearing 7/17/08.  Check 1 month after.

09-15-08-GW- Hearing cancelled.  check 2 mos for reset.

11-01-08-GW-MSJ filed Check 2 mos for hearing date

02-09-09-GW-MSJ hearing 4/21/09.  Check 1 mo for sale date

01-21-08-GT-Answered Mtg FC complaint. Check status 3mos.

07-17-08-GW-Service being perfected.  Check 2 mo

02-09-09-GW- Noting on docket since 6/08.  called lender atty they are

preparing the MSJ in about a month  Check 1 mo

09-10-08-GT-Opened FC file. Ran clerk search - clear. Ready for TS.

10-03-08-GT-Have not rec'd TS back from Mike. Check status 2wks.

10-09-08-GT-Updated clerk search - Mtg FC found. File converted to Mtg FC.

Check status 3mos.

10/28/08-GW-Ans Complaint.  Check status 3 mos

03-18-08 LAP Answer Complaint - Check status 3 mos.

08-04-08-GW-MSJ hearing 9/22/08.  Check 1 mo for sale date

10-18-08-GW-MSJ hearing 11/4/08.  Check 2 mos for sale date

11-13-08-GW- Sale date 12/5/08.  Check 1 month for CT

11-18-08-GW- Bankruptcy filed 11/5/08.  Check 3 mos

12-01-08-GW- Foreclosure sale cancelled  Check 2 mos

02-09-09-GW- Nothing on docket since 12/08.  Check 2 mo

Community Association Collections Crisis Worsens

In the past few months, a huge issue has arisen that needs to be properly dealt with by community associations.

What to do about lender foreclosures?

This post examines the ways to handle the position of the association in such actions.

When a mortgage foreclosure is filed and served, the vast majority of the properties have no equity. On sale, the association will not get paid and its' lien will be wiped out. The ability to obtain a money judgment is available either as part of the foreclosure as a cross claim for damages, or down the road in a Small Claims Court action.

On defense of mortgage foreclosures I notice that some lawyers file a claim, and incurs the expense of a process server and charges the association for the legal fees and costs. I think this is a gross waste of time and money to get a money judgment against someone who is letting a $300,000 asset be taken in th esuit. "You can't get blood from a turnip" is th elegal doctrine here, I believe.....

While this is legally proper, in the short term, I think it is only $$$ in the pocket of the lawyer doing the work. While it may end up with a judgment in favor of the association that is good for 20 years (must be renewed periodically during that time) and may someday be paid off, the association has paid a heck of a lot of money relative to the claim for a piece of paper (the judgment) that may never be collected upon. The reason for my conclusion is that the present value of the money probably never works in favor of the association.

When I defend foreclosures, I do not do counterclaims for that reason; I think it is throwing good money after bad. It's not a situation where one approach is "proper" and one is "improper" it's just that associations are under siege and I see no benefit in charging hundreds of dollars in the context of defending and counterclaiming in a first mortgage foreclosure, with the hope that the amount due will be collected some time in the next 20 years....I answer the complaint and monitor it until the CT is issued.

More later on an aggressive approach in these turbulent times.