FORECLOSURE DELAYED UNTIL THE “BANKS” GIVE RIGHTS TO HOMEONWERS

Under the New California Homeowners Bill of Rights the State of California has found that it is essential to mitigate the negative effects on the economy and the housing by modifying the foreclosure process to ensure that borrowers who may qualify for a foreclosure alternative are considered for, and have a meaningful opportunity to obtain, available loss mitigation options. And that avoiding foreclosure, where possible, will help stabilize the state’s housing market and avoid the substantial, corresponding negative effects of foreclosures on families, communities, and the state and local economy.

The California Homeowners Bill of Rights prohibits notice of default (the first step in a foreclosure ) until 30 days after the mortgage servicer has:

Sent a first-class letter to the homeowner that includes the toll-free telephone number made available by HUD to find a HUD-certified housing counseling agency.

Attempt to contact the borrower by telephone at least three times at different hours and on different days.

Sent a certified letter, within two weeks after the telephone call requirements

Provided a means for the borrower to contact it in a timely manner, including a toll-free telephone number that will provide access to a live representative during business hours.

Posted a prominent link on the homepage of its Internet Web site containing the

following information:

Options that may be available to borrowers who are unable to afford their mortgage payments and who wish to avoid foreclosure, and

instructions to borrowers advising them on steps to take to explore those options,

A list of financial documents borrowers should collect and be prepared to present to the mortgage servicer when discussing options for avoiding foreclosure,

A toll-free telephone number for borrowers who wish to discuss options for avoiding foreclosure with their mortgage servicer, and

The toll-free telephone number made available by HUD to find a HUD-certified housing counseling agency.

This means the “bank” must give the homeowner a single point of contact with a live person, notice of the options to refi, and a list of documents needed to apply for a refi.

The new Bill of Rights also gives the homeowner the right to designate a lawyer or other representative to help in the loan modification and the foreclosure prevention process. My estimate is that this process will extend the time for a foreclosure to 9- 12 months from the date the “bank” decides to start the foreclosure process and give a fair opportunity for borrowers to refi or otherwise avoid foreclosure.

By David DiJulio:

For more informantion contact : DiJulioLawGroup.com

Consumer Financial Protection Bureau New Rules for Mortgage Servicers

The Consumer Financial Protection Bureau has proposed new rules for the mortgage servicing industry, which include a requirement that servicers must make a decision on any mortgage relief applicant within 30 days, and must not begin foreclosure proceedings until completing that process.

Under the Consumer Financial Protection Bureau’s proposal, loan servicers would be required to evaluate homeowners’ applications for loan-assistance within 30 days of receiving an application and would be barred from going ahead with a foreclosure until a final decision has been reached on a borrower’s application for help […]

The consumer bureau’s proposal, along with new bank-capital standards and other regulations, could push some large banks to accelerate sales of poorly performing loans to smaller companies that specialize in managing distressed loans, said Issac Boltansky, a Washington analyst with Compass Point Research & Trading.

“We expect the big bank servicers to offload a sizable portion of their servicing assets,” to smaller companies known as special servicers, he wrote in a note to clients. Some of those companies include Ocwen Financial Corp., Nationstar, and Walter Investment Management Corp.

Large banks are “simply not going to make as much money,” on servicing and are likely to hire other companies to perform many servicing functions, said Ed Delgado, a former Wells Fargo executive and chief operating officer of Wingspan Portfolio Advisors, which performs those functions.

Under the proposed rules, banks and other financial institutions that manage home loans – the servicers – must provide “direct, ongoing access” to staff members to help borrowers fighting to save their homes from foreclosure. Servicers must also halt foreclosure proceedings while borrowers apply for a loan modification and tell homeowners in danger of foreclosure about their options.

David DiJulio

For more information contact David DiJuliomailto:rdj@dijuliolaw.com.

DiJulio Law Group: Los Angeles real estate attorneys with more than 35 years of experience. Call 888-519-1613 or emal rdj@dijuliolaw.com.

DiJulio Law Group

PRESCRIPTIVE EASEMENT – WHAT IS IT?

An Easement is the right to use somene else’s land. A prescriptive easement is a right acquired by long term use.

The elements for adverse possession and a prescriptive easement are identical except for the fourth element- the payment of taxes. (Sulivan v. Balestrieri (1956) 142 Cal.App.2d 332 [298 P.2d 688].)

To acquire title by prescriptive easement or by adverse possession, the claimant must establish: (a) hostile acts to the true owner’s title; (b) actual, open, and notorious occupancy of the land; c) possession under a claim of right or a color of title; (d) continuous and uninterrupted possession for five years; and (e) payment of all taxes levied and assessed for the possession period. (Safwenberg v. Marquez (1975) 50 Cal.App.3d 301 [123 Cal.Rptr. 405.)

One party “Mover” moved a fence has been in place for 40 years because a recent survey indicated that a portion of land on the other side of the fence (” V”) belonged to Mover. (the “Disputed Property.)

Hostile Possession and Claim of Right.

When the V purchased their home, the fence made the Disputed Property appear to belong to the V, they were told by the real estate broker that the Disputed Property was their property. V have watered, improved and maintained the Disputed Property as their own for more than 20 years. As a result, The V treated the Disputed Property as theirs, creating the necessary hostile intent to possess it.

Actual Open and Notorious.

There is no question that The V’s possession of the Disputed Property was open and notorious because their possession by way of various improvements was clearly visible to A.

Claim of Right.

At all times, the V’s have fenced the Disputed Property and treated it as their own,

excluding A under a claim of right.

Possession for Five Years.

The use of the Disputed Property began in the 60’s and has continued to the present date by all owners of the V property, until last month when A moved the fence. Thus, the five years is easily met.

These Elements are enough for a prescriptive easement to use A’s property in the future.

For more information contact David DiJuliomailto:rdj@dijuliolaw.com.

DiJulio Law Group: Los Angeles real estate attorneys with more than 35 years of experience. Call 888-519-1613 or emal rdj@dijuliolaw.com.

DiJulio Law Group

MEDIATION BEFORE LITIGATION IN REAL ESTATE DISPUTES

Mediation and Real Estate.

Most houses in Los Angeles are purchased using the California Association of Realtor’s form California Residential Purchase Agreement has. The Purchase Agreement provides that the parties will mediate disputes and this article explains what that means.

The Purchase Agreement at para 17 a (Mediation and Arbitration) states:

“Buyer and Seller agree to mediate any dispute or claim arising between them out of this Agreement, or any resulting transaction before resorting to arbitration or court action. …If for any dispute or claim to which this paragraph applies, any party (I) commences an action without first attempting to resolve the matter through mediation, or (ii) before commencement of an action, refuses to mediate after a request has been made, then that party shall not be entitled to recover attorney fees, even if they would otherwise be available to that party in any such action.

If there is between Buyer and Seller arising out of the Purchase Agreement the parties are obligated to go to Mediation before suing – in court or Arbitration. Arising out of means that it something that directly comes from the Purchase Agreement and is less broad than arising from.

First of all, you don’t have to GO to mediation you must OFFER to go to mediation. If the other side accepts that offer or makes the offer, you must go the mediation or suffer the consequences.

 

If you don’t go to mediation, you lose your right to collect attorneys fees, even if you win ths case. This means that you could win the case and lose money. In most cases, the loss of the right to attorneys fees, is a significant factor in the outcome of the case.

The California Courts have reiterated existing California law: “The new provision barring recovery of legal fees by a prevailing party who refuses a request for mediation means what it says and will be enforced.” The attorneys fees provision of the mediation clause “is designed to encourage mediation at the earliest possible time.” Moreover, “opponents accordingly are not entitled to postpone it until they feel that they have marshaled the strongest possible support for their positions in litigation and mediation.” The court also noted that there is a strong public policy in favor of mediation as a preferable alternative to judicial proceedings because it is less expensive and more expeditious.

Real estate parties and their attorneys should in most cases offer mediation first and accept an offer of mediation. Not only, does it gives both sides a chance to settle the case before spending thousands of dollars on their attorneys. In addition in the vast majority of cases, having the right to collect your attorneys fees is a key consideration. Even in a real Estate case for a two million dollar house, waving attorneys fees of $50 or $100,000 hurts.

Waving attorneys fees by an over anxious attorney may well result in a valid claim for malpractice. Before filing, offer to mediate.

For more information contact David DiJuliomailto:rdj@dijuliolaw.com Or contact the DiJulio Law Group: Los Angeles real estate attorneys with more than 35 years of experience. Call 888-519-1613 or email rdd@dijuliolaw.com.

Beware.

What are the Consequences of Not Going to Mediation?

What happens If I don’t Go to Mediation?

When Does the Mediation Clause Apply?

The Mediation Clause.

SHORT SALE BONANZA

During the next few months, short sales will sky rocket. Short Sales are sales of upside down houses for the market value. To make the short sale work the first and second mortgage holders must write down the loans to equal the true market value of the house. Since the first has first call on the funds, the second write down a much large percentage of its loan, often 80-90%. Seconds have been resistant to do so, in hopes that the First would foreclose because under current law, if the First forecloses and makes the Second worthless, the Second the right waive the deed of trust and sue on the note- for the full amount of the second loan.

However, under an amendment of CA Code of Civil Procedure 580, the second cannot get a deficiency judgment in any event on any loan, refinance, or other credit transaction that is used to refinance a purchase money loan, as defined, or subsequent refinances of a purchase money loan.

The law seems to limit these rules to new loans but I believe that holders of Seconds will be fearful that the law will be extended by the courts to all loans. If that happens the Second becomes worthless. I think that this threat will induce the seconds to take what they can get in a short sale.

For more information contact David DiJuliomailto:rdj@dijuliolaw.com or a broker that specializes in short sales.

DiJulio Law Group: Los Angeles real estate attorneys with more than 35 years of experience. Call 888-519-1613 or emal rdj@dijuliolaw.com.

DiJulio Law Group

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