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Rusty Payton's Blog

By Rusty Payton | Broker in Chicago, IL
  • How To Save Your Home From Foreclosure

    Posted Under: Home Buying in Chicago, Foreclosure in Chicago, Property Q&A in Chicago  |  January 21, 2014 5:30 AM  |  116 views  |  No comments
    Every foreclosure case is different, but in Illinois, lenders must file a judicial foreclosure action to take your home. This process forces the mortgage lender to file a formal lawsuit, which is many homeowners choose to hire an Illinois foreclosure attorney to help them save their home. To give yourself the best chance to keep your home out of the hands of aggressive lenders, consider taking the following foreclosure-prevention steps:

    Go on the offensive. If you are on the verge of facing a foreclosure, or if your lender has already taken you to court, call your mortgage servicer and ask about foreclosure alternatives. A new federal law passed by the Consumer Financial Protection Bureau requires mortgage servicers to give homeowners a comprehensive list of options to save their homes. 

    Consult a housing professional. Since the Illinois foreclosure process takes place in the county court system, even the simplest of cases can fall into a complex web of state laws. As a result, many Illinois residents contact a foreclosure defense attorney to give themselves the best odds of success in court. 

    Pursue a home loan modification. In many cases, mortgage lenders are willing to modify home loans so that you can keep your house and they can continue to receive a cash flow. These offers, however, don't appear out of thin air. You usually have to ask. And if you want to keep your home, a home loan modification may be your most viable solution. 

    Avoid scams. In recent years, as the foreclosure rate skyrocketed, scam artists began to target homeowners with a heightened level of tenacity. Beware of anyone who offers to "completely" save your home in exchange for a lot of cash, or anyone who isn't licensed as an attorney or housing counselor.  Ignore offers of help from other entities. 

    Know your legal rights. There are a wide body of state and federal laws that protect homeowners, but if you don't know them, they might as well not exist. To learn more about your rights as a homeowner, contact the Consumer Financial Protection Bureau or an Illinois foreclosure lawyer for further information.  
  • Bank of America Catches Heat for Fraudulent Home Loan Modification Tactics

    Posted Under: General Area in Chicago, Financing in Chicago, Foreclosure in Chicago  |  January 21, 2014 5:28 AM  |  137 views  |  No comments
    Bank of America is back in the news for causing more home foreclosure havoc, according to sources following its activities. The bank has reportedly engaged in widespread efforts to circumvent the requirements of the government’s Home Affordable Mortgage Program (HAMP), which was designed to help homeowners struggling under the weight of underwater homes. 

    Sources say the bank faced more than 15,000 consumer complaints last year for failing to properly assist homeowners who exercised their legal right to seek a home loan modification under the HAMP program. Some of the bank’s fraudulent activities included:

    Stalling tactics. Rather than perform their duty to take HAMP requests seriously, Bank of America and its primary vendor, Urban Lending, reportedly sent consumers frivolous paperwork requests in an effort to delay the HAMP process. 

    Incorrect income qualifications. In order to qualify for a home loan modification under the government’s unique program, homeowners must show that they have a relatively low income. In several cases, Bank of America intentionally inflated the incomes of consumers in order to avoid having to extend an offer for a home loan modification. 

    Improper modification denials. In many cases, Bank of America simply denied HAMP applications from homeowners who clearly qualified for the program, without offering an adequate explanation for the decisions, according to investigators. 

    Since HAMP was the crown jewel of President Obama’s efforts to reduce the rate of home foreclosures, federal regulators are taking these allegations seriously. Under ideal circumstances, the HAMP program allows consumers to make trial payments on a plan that could eventually allow them to lower their burdensome mortgage.

    The program was designed to provide aid for at least three million homeowners during its first year, but it fell well short of the target. Initially, this is was interpreted as a failure of the legislation itself, but recent accusations show that financial institutions like Bank of America were also responsible for HAMP’s tepid performance. 

    Nevertheless, the program remains alive and well, despite efforts by mortgage lenders to cripple it. If you have a home mortgage that is worth more than the actual value of your house, contact an Illinois foreclosure defense attorney today to learn more about your legal options. 
  • 3 Ways a Good Foreclosure Attorney Can Help

    Posted Under: Financing in Chicago, Foreclosure in Chicago, Home Ownership in Chicago  |  November 2, 2013 8:09 AM  |  171 views  |  1 comment
    Many homeowners believe the foreclosure process is a nightmare from which they cannot 
    escape. Shockingly, more than 90 percent of homeowners choose not to fight foreclosure 
    actions. This, however, is often a strategic mistake. 

    In many cases, a competent foreclosure attorney can help homeowners launch an effective 
    foreclosure defense. At worst, an attorney may help a family stay in their house for several extra years. At best, foreclosure attorneys may be able to defeat the foreclosure case altogether. 

    And while there are countless ways in which lawyers can help homeowners fight for their 
    properties, listed below are 3 primary ways foreclosure defense attorneys can help:

    1. Foreclosure attorneys can help you navigate the intimidating court system. Many states, 
    including Illinois, have a judicial foreclosure process, which means the mortgagee must 
    obtain a court order before taking your home. This system provides extra protection for 
    homeowners, but it also forces people without legal experience to handle the complex 
    procedural rules inherent in state court proceedings. In order to lighten this burden, many 
    homeowners hire a foreclosure attorney to help ensure their rights are protected in court.

    2. Foreclosure attorneys will examine your mortgage documents for errors. The two key 
    documents in a foreclosure case are the mortgage, which creates a lien against your home, 
    and the promissory note, which provides assurance to the lender that you will repay 
    the loan. In their haste to close deals, many lenders speed through the creation of these 
    documents with little regard for accuracy. If your home loan lender made mistakes or, 
    even worse, engaged in active fraud, a foreclosure attorney can use these errors to provide 
    leverage against your lender.

    3. Foreclosure attorneys can keep mortgage servicers in check. In the fury to foreclose on 
    homes, mortgage servicers often take illegal actions, like forcing people out of their homes 
    prematurely, or pressuring them to waive their legal rights. Your foreclosure attorney can 
    serve as a buffer between you and hostile mortgage servicers, allowing you some breathing
    space while searching for weaknesses in the foreclosure complaint.

    Rusty Payton is a a real estate broker with iMove Chicago [www.iMoveChicago.com] and partner with the Illinois law firm of PaytonDann. [www.PaytonDann.com]  He has over 24 years experience in real estate and bankruptcy matters.   He may be contacted at 321-702-1000 or at payton@paytondann.com.


  • 5 Considerations When Selecting A Foreclosure Defense Attorney

    Posted Under: Financing in Chicago, Foreclosure in Chicago, Home Ownership in Chicago  |  November 2, 2013 8:05 AM  |  191 views  |  1 comment
    If your bank has filed a foreclosure action against your home, you may be confused about 
    your legal rights. Fortunately, in Illinois, foreclosure laws provide a great deal of protection for 
    homeowners. And in recent years, banks made a litany of errors that left them vulnerable to 
    aggressive foreclosure defenses.
     
    In order to fight the banks, many homeowners decide to enlist the aid of a foreclosure attorney. 
    While this is often a necessary step in the foreclosure fight, not all attorneys are created 
    equal. When you’re searching for legal counsel, consider these 5 traits of the best foreclosure 
    attorneys:

    1. Litigation Experience. In judicial foreclosure states like Illinois, the process takes place in 
    a state court, and is subject to the long list of procedural rules unique to that forum. Real 
    estate knowledge certainly helps in a foreclosure case, but if attorneys don’t have prior 
    courtroom experience, they won’t be able to adequately fight a foreclosure case. 

    2. Attention to detail. Foreclosure actions typically turn on the interpretation of two key 
    documents: The mortgage, and the note. If a bank makes a mistake in either document, it 
    may not have the right to pursue a foreclosure action. Sifting through these documents, 
    however, requires a keen focus on tiny details, and a sufficient understanding of the law. 

    3. Flexibility. Some foreclosure attorneys simply fight the foreclosure with a single-
    minded focus, failing to consider the possibility of modifying the underlying loan. Many 
    homeowners, however, would be better served by a loan modification, allowing them to 
    stay in their home while reducing their debt burden. If foreclosure attorneys refuse to 
    consider loan modifications, they have failed to do their job. 

    4. Communication. Some attorneys are happy to take your retainer payment and then 
    disappear for months at a time. But effective representation requires open communication
    between the homeowner, the lender, and the attorney. The best foreclosure attorneys keep 
    their clients informed about the process, and stay in touch with the lenders, in case a loan 
    modification becomes a possibility.

    5. Creativity. Laws governing home foreclosure are constantly evolving at both the federal and 
    state levels. In the past few years alone, legislators have created a wave of rules governing
    the actions of mortgage servicers. The best foreclosure attorneys use these new laws to
    their advantage, ensuring that lenders are following the new rules, and attacking them
    when they fail to hold up their end of the bargain.

    Rusty Payton is a a real estate broker with iMove Chicago and partner with the Illinois law firm of PaytonDann [www.PaytonDann.com].  He has over 24 years experience in real estate and bankruptcy matters.   He may be contacted at 321-702-1000 or at payton@paytondann.com.
  • JP Morgan Chase Agrees to Multi-Billion Dollar Settlement

    Posted Under: Financing in Chicago, Foreclosure in Chicago, Home Ownership in Chicago  |  October 25, 2013 8:09 AM  |  187 views  |  No comments
    After years of harming homeowners with its foreclosure shenanigans, JP Mortgage Chase may finally pay for its crimes. Sources say the maligned bank reached a preliminary $13 billion mortgage settlement with the U.S. government this week, although the settlement will likely cost the bank roughly $9 billion after taxes are deducted. 

    Major Bank Reaches Deal With Foreclosure Watchdogs

    According to reports, $4 billion of the settlement will go directly towards consumers who were hurt by the bank’s fraudulent foreclosure actions. The other $7 billion would take the form of punitive fines, which, in theory, would help dissuade JP Morgan Chase and other major banks from taking similar actions in the future.

    The settlement is a direct result of an effort by the Obama Administration to investigate the sale of mortgage-backed securities, the collapse of which was one of the primary causes of the financial crisis. These securities were created when banks took home loans and sold them to third parties. Thousands upon thousands of loans were shuffled through this process. 

    The tactic, however, depended on rising home values, but when home values started to plummet, huge numbers of home loans went into default, and the mortgage-backed securities collapsed. Unfortunately for consumers, when the defaults started to occur, banks often couldn’t find their original promissory notes, and began engaging in widespread fraud. 

    JP Morgan Chase Punished for Foreclosure Fraud

    Among the fraudulent activities that led government officials to file their claim against JP Morgan Chase were forging foreclosure documents, illegally pushing consumers out of their homes before a foreclosure sale was authorized, and countless violations of state procedural laws. 

    The extreme nature and extent of the crimes against homeowners in foreclosure led to the massive settlement. The chief executive of JP Morgan Chase, Jamie Dimon, visited Washington this week to plead for mercy, but it appears the government was able to secure a historically large settlement. 

    Of course, while the settlement is quite large, it still won’t sink JP Morgan Chase. In fact, some observers speculate that the settlement won’t change the bank’s actions at all. If you are being bullied by an aggressive home loan lender, contact an Illinois foreclosure attorney today to make sure it isn’t engaging in illegal foreclosure activities. 

    Rusty Payton is a a real estate broker with iMove Chicago and partner with the Illinois law firm of PaytonDann.  He has over 24 years experience in real estate and bankruptcy matters.   He may be contacted at 321-702-1000 or at payton@paytondann.com.
  • Jury Finds Bank of America Guilty of Fraud... Again

    Posted Under: Financing, Foreclosure, Home Ownership  |  October 23, 2013 3:59 PM  |  97 views  |  No comments
    A jury has once again found Bank of America guilty with respect to its fraudulent mortgage lending practice.  This time it could cost BOA billions...

  • Landmark Court Ruling Helps Surviving Spouses With Reverse Mortgages

    Posted Under: Foreclosure in Chicago, Home Ownership in Chicago  |  October 23, 2013 6:40 AM  |  143 views  |  No comments
    For years, reverse mortgages have provided necessary aid to senior citizens looking to keep their homes. Instead of a traditional mortgage loan, in which the borrower pays the lender, reverse mortgages allow lender to give money to borrowers so they can stay in their homes. When the borrowers die, the estate sells the property, and the lender, in theory, recoups its investment. 

    But reverse mortgages can also be dangerous. If, for example, one spouse dies, and the surviving spouse is not listed as a borrower on the reverse mortgage, the surviving spouse could face the possibility of losing the home to foreclosure. This bizarre loophole, however, recently changed, thanks to a ruling last week in the United States District Court for the District of Columbia.

    Decision Helps Reverse Mortgagors Prevent Home Foreclosure

    The case that triggered the recent decision started in 2008, when Robert Bennett’s wife died, leaving him alone in his house in Annapolis, Maryland. Bennett’s wife, however, was the sole borrower listed on their reverse mortgage, which was taken out on the couple’s home shortly before her death. 

    Thanks to an obscure rule previously administered by the U.S. Department of Housing and Urban Development (H.U.D.), Bennett’s lender was allowed to foreclosure on the property in the event that Bennett couldn’t repay the loan. Bennett was unable to pay the loan, so in order to prevent home foreclosure, he filed a lawsuit against H.U.D. 

    And last week, the court ruled that H.U.D.’s punitive rules regarding reverse mortgages contradict the very purpose of reverse mortgages: That is, to allow surviving spouses to stay in their homes. The court told the federal agency it must correct the problem, although some uncertainty remains over how the agency will cure the loophole. 

    Home Foreclosure Decision Will Help Senior Homeowners

    Despite the uncertainty over how the law might change, Bennett’s home foreclosure attorney remains optimistic. The decision “marks a turning point for surviving spouses” and ensures that “they will be able to remain in their homes, despite the loss of their husband or wife,” said Jean Constantine-Davis, a senior attorney with AARP Foundation Litigation. 

    And while the decision could help seniors who leave their spouse off a reverse mortgage, Constantine-Davis recommends that elderly couples should try to avoid this tactic. “I would at this point still be very discouraging from doing a reverse mortgage that leaves the spouse off,” said the home mortgage lawyer.

    Rusty Payton is a a real estate broker with iMove Chicago and partner with the Illinois law firm of PaytonDann.  He has over 24 years experience in real estate and bankruptcy matters.   He may be contacted at 321-702-1000 or at payton@paytondann.com.
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