Mortgage and Note in Foreclosure Actions
Mortgages are “secured transactions.” Secured Transactions are, essentially, collateralized loans. In secured transactions, borrowers give lenders an interest in some property (collateral) that will cover the amount borrowed if the borrower defaults. When someone buys a car, for instance, the car can be repossessed by the lender if the borrower stops making payments. The car will, theoretically, cover the remaining amount of the loan. The collateral (the car) “secures” the transaction because it practically guarantees that the lender will get, at least, an amount equal to the value of the collateral in return for the loan.
When someone mortgages a home, the home serves as collateral for the amount of the loan. The note is the contract in which a borrower agrees to repay a loan. The mortgage is the contract that makes the real property collateral for the loan. The mortgage gives a lender the right to take the home if a borrower stops paying the debt, as agreed to in the note.
Foreclosure plaintiffs (banks or other lenders) must prove that they own both the note, and the mortgage. Plaintiffs that can’t prove that they own these two instruments will not win a foreclosure case. If the plaintiff is not the original party to the loan – which could happen if one bank or lender sells the loan obligation to another – then the plaintiff must show how it came to own the loan.
One would expect banks and lenders to keep documents as important as notes and mortgages safe and secure. Surprisingly, this is not always the case. During the housing boom, mortgages and notes changed hands so frequently and quickly that it was not uncommon for one or the other to get lost in the shuffle. Earlier this month, an attorney representing a homeowner in Queens won a foreclosure case because the bank couldn’t prove that it owned the mortgage and note.
Not all homeowners will be so lucky. But chain of title issues are definitely worth investigating. Foreclosure defendants should consult with experienced foreclosure attorneys in order to explore all options and defenses.
Foreclosure Attorney in Mineola
If you have questions about this or other legal issues, call The Law firm of Vaughn, Weber & Prakope, PLLC at 516-858-2620 today to schedule a free consultation.
Student Loan Benefits for Military Servicemembers
The Service Member Civil Relief Act offers many benefits for student loan borrowers in the military. Unfortunately, those benefits are difficult to identify, or to claim.
According to an official report, many of the benefits the Service Member Civil Relief Act grants to those in the military go unredeemed. In some cases, this is because lenders adopt difficult procedural barriers designed to disqualify servicemembers. In other instances, servicemembers remain in payment plans that end up costing them more than they would have to pay under available alternatives, simply because the servicemembers aren’t aware of their options.
The Consumer Financial Protection Bureau is partnering with the Defense Department to increase awareness of the benefits available to student loan borrowers in the military.
If you are having difficulty paying your student loan debts, The Law Firm of Vaughn, Weber & Prakope, PLLC may be able to help. Call 516-858-2620 today to schedule a free consultation.
Mortgage Relief Scammers
The Federal Government appears to be increasing its efforts to protect homeowners from mortgage rescue scammers. As we reported here, mortgage rescue scammers may attempt to take advantage of homeowners by fraudulent posing as government programs, accepting payments without providing services, or transferring title to the mortgaged premises, among other things. The scale of this lawsuit, along with the fact that the Federal Government seems to be pursuing these types of cases more frequently, should discourage individuals attempting to pursue such practices. But the fact that the Government named so many defendants also means that these practices are still probably quite common. Homeowners should diligently research foreclosure rescue programs before entering any agreements, or making payments. Read more about the lawsuit here.
Foreclosure Attorneys in Mineola
The Attorneys at the Law Firm of Vaughn, Weber & Prakope, PLLC are experienced in Loan Modification Negotiation and Foreclosure Defense. If you have questions about these or other legal issues, call our office at 516-858-2620 today to schedule a free consultation.
Innocent Spouse Doctrine
Tax Fraud and Innocent Spouses
Generally, when spouses file tax returns jointly, each spouse is liable for any understatement on the jointly filed return. This means that, for example, a husband will be held liable if his wife understates her income, and vice-versa. In a sense, this places a burden on each spouse to ensure that the other spouse’s income is reported correctly.
But what if one spouse hides income from the other? Individuals that can convince a court that they did not know of their spouse’s unreported income when they filed the return may be considered “innocent.” Innocent spouses will not be prosecuted by the taxing authority. But if the innocent spouse benefits from the unreported income, that spouse still may have to contribute to the tax debt. Additionally, in a divorce action, a matrimonial court may distribute liability for the debt between the spouses without regard to the innocent spouse rule.
Long Island Divorce Attorneys
If you have any questions about Family Law, Divorce, or other legal issues, the attorneys at the Law Firm of Vaughn, Weber & Prakope, PLLC can help. Call our office at 516-858-2620 today.
Keep in Touch