3 Things You Can Do To Help Yourself WIN a Foreclosure Defense Case

Thinking about hiring a lawyer to pursue a wrongful foreclosure or unfair trade practices lawsuit against your lender?

Well here's an important little tidbit. 

Despite what you might think, or what you might see on those clever legal dramas on prime time television, or what that high-priced lawyer in downtown Portland might tell you... 

Lawyers do not win cases.

That's right, we said it. 

We'll say it again.

Lawyers. Do. NOT. Win. Cases.

Facts win cases.

Strike that.

Facts supported by EVIDENCE win cases.

Ever played poker? It's just like that. After all the preening and puffing and posturing, at some point you have to put up or shut up. You have to show your cards.  Winning a case in a court of law is really no different. 

You claim, for example:

Judge....the bank TOLD me if I stopped paying my mortgage, I would get a loan modification. I just did what the bank told me to do! Then they screwed me and filed a foreclosure anyway!

That, good people, is a factual assertion. 

The judge then says:

I understand what you're saying, sir. I understand that you feel you've been wronged, sir.

You smile and think: Justice at last! That big evil bank is going down! 

But the judge doesn't stop there. The judge slowly leans over oh-so-slightly, lowers his or her reading glasses, looks you squarely in the eyes and says....

Now prove it.

Silence. 

The judge is looking at you.

Your lawyer looks at you. 

You look at your lawyer and think: You're the one with a law degree! Do something! Say something! 

Guess what?  There is no pixie dust we can waive over the court's eyes to make everything alright. There is no magic bullet. No eloquent, eleventh hour speech we can make that will seize the day. What we need, what every lawyer needs—and this is where you can help you help yourself—is evidence.

Evidence, good people, is the magic pixie dust that wins cases.

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Have you been mislead by a lender or loan servicer?

Do you believe your foreclosure is wrongful?

Were you mislead into believing you would get a loan modification?

If it makes you feel any better (and it probably won't), there are lots of people out there just like you. You have been wronged. You deserve your day in court. But the critical difference between winning and losing a lawsuit, should it come to that, is having what lawyers refer to as an evidentiary trail. So before you call an attorney, here are 3 things you can do to help yourself WIN that foreclosure defense case:

1.  Record your conversations.

Whenever we suggest recording your conversations with a lender, especially when you're talking about something meaningful or especially important, the almost immediate push back is: "Is that legal?" 

The answer is yes.

Federal law and Oregon law prohibit recording any telephone conversation where you are not a party. (In other words, you can't record someone else's conversation). However, it is perfectly legal here in Oregon to record a telephone conversation as long as one party consents to the recording (see ORS §§165.535, 165.540). What this means is that unless you object to recording yourself, then it is not illegal to record your conversation with another party and then use that conversation as evidence in a court of law. 

Some states, such as Washington, require that both parties consent to the recording of a telephone call. This means that before the conversation can be recorded, the party doing the recording must let the other party know the conversation will be recorded and that party must then consent to the recording. So if you live in Oregon but you're calling Washington, follow Washington law and notify the lender about the recording. If you're calling somewhere else (New York for example), find out if only one party or both parties must be notified. The safest choice, if you're unsure about what to do, is to notify the other party that you intend to record the conversation. 

2.  Get it in writing.

Lenders will tell you a great many things. We have heard horror story after horror story about customer service representatives or loss mitigation mangers telling clients something, but there is no record, anywhere, of what was said, when it was said, or who said it. So whenever possible, if you reach any sort of an agreement with a lender, ask the person on the line to confirm the agreement in an email. You don't need a full blown contract or anything fancy, just a simple email confirming whatever it is you talked about will do. Emails are particularly useful because they are date and time stamped and the sender is clearly identified.

3.  If you can't get it in writing , then confirm it in writing yourself.

In order to be admissible as evidence in court, your don't have to have something in writing from your lender. While this is generally better, many lenders are loathe to confirm anything they say in writing. Or your lender will tell you that they have no problem sending you an email or letter, but you never actually get anything.

So be proactive.

When you conclude a conversation, ask for the person's name, title, address and email address. Then immediately write an email (if the bank will accept an email; if not, write an actual letter) to the person you spoke to confirming the conversation. Something like this will suffice: "Dear Mr. Smith, I enjoyed speaking to you on the telephone today. This email simply confirms our discussion and the agreement we reached during our conversation to [fill in the blank]. The court doesn't require anything fancy. You don't have to write like a lawyer. Just confirm what you discussed and send it via regular mail or email to that person. The existence of an a writing confirming a conversation is evidence you can introduce in court about that conversation. Why? Because the law presumes that if you send someone a writing containing factual assertions, but those assertions are not true, then you will receive a writing of some sort in response denying those assertions. Confirming writing from you + no response from bank = good evidence in court.

And evidence good people, not just facts, is the magic pixie dust you need. 

So help you help yourself and remember these three simple things: (1) record your conversations, (2) get it in writing and/or (3) confirm it in writing. These simple steps could be the critical difference between winning and losing your foreclosure defense case.

And if you have any questions at all, please do not hesitate to contact us at (503) 846-0707 or visit our website at garlandgriffiths.com. 

"Enormous Increase" in Foreclosure Meditation Requests

The new Oregon Foreclosure Avoidance Program has received over 450 mediation requests since its inception on August 4, 2013. What is most compelling about this number is that the vast majority of mediation requests have come from lenders. In the first 13 months of the prior Oregon mediation program, only 286 cases were referred to mediation. However, the prior program was overhauled by Senate Bill 558, which came into law last spring. Under Senate Bill 558, both non-judicial and judicial foreclosures are now subject to the mediation requirement. Under the prior program, only non-judicial foreclosures required mediation. As a consequence, many lenders simply stopped using nonjudicial foreclosures and moved to judicial foreclosures instead. This unintended loophole virtually gutted the "mediation requirement" under the old mediation program. 

Under the new program, a lender who intends to foreclose (whether the vehicle is a judicial or nonjudicial foreclosure) must first request a meeting with the homeowner. A representative from the Oregon Foreclosure Administration Program--the agency responsible for administrating the mediation program--will notify the homeowner of the request. The homeowner has 25 days to respond and must pay a fee -- $50 or $200 depending on income -- and provide some financial information to the lender. The lender must provide payment history and a copy of the loan documents to the homeowner. 

According to Oregon Attorney General Ellen Rosenblum, indications are that hundreds of additional cases could be referred to the new program in the upcoming weeks.

“No one’s happy about impending foreclosures, but we’re delighted with these numbers because, unlike the earlier program, it means this one is working the way it’s supposed to,” said Rosenblum. “We worked hard to close the loophole that allowed banks to avoid face-to-face meetings with borrowers. We remain hopeful that getting lenders and borrowers together at the same table will help prevent foreclosures and keep Oregonians in their homes.”

The mediation requirement will not end the foreclosure problem. Almost 29,000 Oregonians still remain more than 90 days in arrears on their mortgages. Many embattled homeowners have moved and cannot be located. Others lack the resources to pay even a modified mortgage. However, the recent change to the mediation law will result in a significant upswing in the number of face-to-face meetings between homeowners and lenders and that is certainly a step in the right direction.

If a foreclosure action has been initiated against you after August 4, 2013 and you are uncertain about whether or not your lender has complied with the requirements of the new mediation program, we would encourage you to contact us immediately. Alternatively, visit the Oregon Foreclosure Avoidance Program website for more information about the new mediation program. 

Know Your Rights: No More "Dual Tracking"

What is "dual tracking?"

Dual tracking is an ugly, insidious (and therefore unsurprisingly commonplace) practice where Big Bank X (insert name here) is actively negotiating a loan modification with a homeowner while pursuing a foreclosure against that same homeowner...at the same time.  The glaring inequity to this practice has long been a topic of vociferous objection among foreclosure defense attorneys and consumer rights advocates. Thankfully, corrective legislative protections are on the horizon.

Created by the Dodd-Frank Wall Street Reform and Consumer Protect Act of 2010, the Consumer Financial Protection Bureau (or CFPB for short) will have broad--some say unparalleled--regulatory authority to create rules and enforce consumer protection laws that restrict unfair, deceptive or abusive acts and practices (commonly known as UDAAPs). One UDAAP that the CFPB is seeking to forever eliminate is the practice of dual tracking. Consequently, beginning in January of 2014, new CFPB rules will:

• Require a lender or servicer to establish "live contact" with a delinquent borrower within 5 weeks of delinquency and inform the borrower in writing about available loan modification and other loss mitigation options by the 45th day following delinquency.
• Prevent a lender or servicer from filing for foreclosure unless the borrower is more than 4 months delinquent.  
• Prevent a lender or servicer from beginning a foreclosure once a delinquent homeowner submits a loan modification until after a written denial is sent to the homeowner and a 14-day appeal period has run or an appeal has been denied.  The new rules also require the lender or loan servicer “exercise reasonable diligence in obtaining documents and information to complete a loss mitigation" and for the lender/servicer to give the specific reasons for a denial in the denial notice.
• Allow the homeowner to submit an application for a loan modification or other loss mitigation option at any time after the foreclosure process has commenced up to the 37th day before a scheduled foreclosure sale. Once the application is submitted, the servicer may not go through with a foreclosure sale until: (1) the servicer has notified the homeowner that he, she or they are not eligible for loss mitigation (and any appeal or appeal time has been exhausted); (2) the homeowner has rejected all proposals or offers of loss mitigation; or (3) the homeowner has violated or failed to comply with terms of a loss mitigation option such as making required payments under a trial modification plan.

In sum, these new CFPB rules are designed to ensure that lenders and servicers negotiate in good faith and in a timely manner before commencing a foreclosure action. Will these rules stop foreclosures? No. Will these rules have a positive impact on the number of foreclosures? One would hope so.

If nothing else, these new CFPB rules are certainly a step in the right direction.

For more information, please visit the CFPB website at consumerfinance.gov or visit our dedicated foreclosure defense website at garlandgriffiths.com.