FEast
03-04-2006, 11:13 AM
I'm writing this on behalf of a friend (let's call him Mark [for easy mark, which he's always been]), who's in a terrible mess. I'll try to keep it brief, but I doubt that will be possible.
Mark's owned a house on LI for about ten years. He's always having financial problems, and has had to refinance his mortgage several times. Each time he was hit with an even higher interest rate, so it became impossible for him to make his payments. He eventually had two strokes and had to go on disability. Being unemployed, therefore, he was unable to refinance yet again.
Mark asked his employed best friend (let's call him Push, for pushover) to help him by deeding the house over to him, while applying for a lower rate mortgage. It was a totally paper transaction, with no money actually changing hands. They also had a separate agreement whereby Push would deed the house back to Mark after a certain period of time.
Push went out and got a mortgage broker (let's call him Thief), who wound up scamming them at the closing in several ways. Not only did he throw in a bunch of unnecessary charges, he brought along his own lawyer to represent Mark and Push, instead of alerting Mark's attorney that the closing was taking place, as he'd promised to do. Not only that, but they wound up with an even higher interest rate than Mark had previously!
Thief was given a year's worth of mortgage payments to hold in escrow, in order that they could be certain the monthly payments would be made while Mark tried to get back on his feet. Thief made about three payments, then skipped town. Mark's lawyer said he could do nothing about it, and told the friends to report the matter to the NYS Attorney General. Turns out the AG has had many complaints about Thief, and added Mark's name to the list of complainants while they investigate Thief. That, however, will take forever, and it's doubtful he'll ever get a penny of his money back.
In the meantime, although Mark had a few months breathing space to put away the rent from his two tenants, so he'd be able to start making the mortgage payments when the year was up, he didn't do so. Therefore, after receiving no payments for about six months, the bank started foreclosure proceedings last June. Mark's attorney drew up a deed from Push to Mark, but told them it shouldn't be filed with the County Clerk yet, because it might affect the mortgage. Also, Mark didn't have the filing fee.
While the foreclosure auction has yet to take place, as these cases are backed up in the local courts, a referee has been assigned to the case. Meanwhile, Push, needless to say, has been very upset about this, as among other things, his credit has been adversely affected, and even those credit cards he'd paid regularly and always on time, have increased his interest rate to 30 percent because of this black mark on his record, which has greatly lowered his credit score. Therefore, he set about trying to get help. An non-attorney acquaintance of his discovered that neither the original deed nor mortgage have been filed with the County Clerk, and he's willing to fight to get the complaint overturned, but for a fee.
He then discovered that the foreclosure complaint actually admits these facts. It states, among other things, that "...said mortgage was submitted for recording at the office of the Clerk of the County of Nassau, but the mortgage was inadvertently not recorded" and that "...said deed has been inadvertently lost or destroyed." I can't help but suspect that Thief somehow managed to walk off with these two documents, but I wasn't there, so...
Furthermore, last month Push received a letter from the bank (which, keep in mind, is in the middle of foreclosure proceedings on the property) that they'd sold the mortgage to another party.
Okay, here are my questions:
1. Since the mortgage was never recorded, is it possible to get the foreclosure action temporarily overturned, giving Mark more time to either sell the house or find another sucker, er friend to get the mortgage refinanced? His attorney never answered the foreclosure complaint, and the time is long past due for doing that.
2. Does the deed's having been lost have any effect on this proceeding?
3. Finally, does the bank's having sold the mortgage to another party affect the action, or can the summons and complaint simply be amended to include the new mortgagee?
Sorry this took so long, but I think you can understand why. Thanks for any advice you can offer. I'm trying to find a good real estate lawyer for Mark (his current one, an old school chum, specializes in criminal law, and Mark insists that, since he owns property, he's well-versed in real estate law. Ack!), who's finally accepted the fact that his lawyer has been less than sterling in protecting him.~Bountifully, Fuchsia
Mark's owned a house on LI for about ten years. He's always having financial problems, and has had to refinance his mortgage several times. Each time he was hit with an even higher interest rate, so it became impossible for him to make his payments. He eventually had two strokes and had to go on disability. Being unemployed, therefore, he was unable to refinance yet again.
Mark asked his employed best friend (let's call him Push, for pushover) to help him by deeding the house over to him, while applying for a lower rate mortgage. It was a totally paper transaction, with no money actually changing hands. They also had a separate agreement whereby Push would deed the house back to Mark after a certain period of time.
Push went out and got a mortgage broker (let's call him Thief), who wound up scamming them at the closing in several ways. Not only did he throw in a bunch of unnecessary charges, he brought along his own lawyer to represent Mark and Push, instead of alerting Mark's attorney that the closing was taking place, as he'd promised to do. Not only that, but they wound up with an even higher interest rate than Mark had previously!
Thief was given a year's worth of mortgage payments to hold in escrow, in order that they could be certain the monthly payments would be made while Mark tried to get back on his feet. Thief made about three payments, then skipped town. Mark's lawyer said he could do nothing about it, and told the friends to report the matter to the NYS Attorney General. Turns out the AG has had many complaints about Thief, and added Mark's name to the list of complainants while they investigate Thief. That, however, will take forever, and it's doubtful he'll ever get a penny of his money back.
In the meantime, although Mark had a few months breathing space to put away the rent from his two tenants, so he'd be able to start making the mortgage payments when the year was up, he didn't do so. Therefore, after receiving no payments for about six months, the bank started foreclosure proceedings last June. Mark's attorney drew up a deed from Push to Mark, but told them it shouldn't be filed with the County Clerk yet, because it might affect the mortgage. Also, Mark didn't have the filing fee.
While the foreclosure auction has yet to take place, as these cases are backed up in the local courts, a referee has been assigned to the case. Meanwhile, Push, needless to say, has been very upset about this, as among other things, his credit has been adversely affected, and even those credit cards he'd paid regularly and always on time, have increased his interest rate to 30 percent because of this black mark on his record, which has greatly lowered his credit score. Therefore, he set about trying to get help. An non-attorney acquaintance of his discovered that neither the original deed nor mortgage have been filed with the County Clerk, and he's willing to fight to get the complaint overturned, but for a fee.
He then discovered that the foreclosure complaint actually admits these facts. It states, among other things, that "...said mortgage was submitted for recording at the office of the Clerk of the County of Nassau, but the mortgage was inadvertently not recorded" and that "...said deed has been inadvertently lost or destroyed." I can't help but suspect that Thief somehow managed to walk off with these two documents, but I wasn't there, so...
Furthermore, last month Push received a letter from the bank (which, keep in mind, is in the middle of foreclosure proceedings on the property) that they'd sold the mortgage to another party.
Okay, here are my questions:
1. Since the mortgage was never recorded, is it possible to get the foreclosure action temporarily overturned, giving Mark more time to either sell the house or find another sucker, er friend to get the mortgage refinanced? His attorney never answered the foreclosure complaint, and the time is long past due for doing that.
2. Does the deed's having been lost have any effect on this proceeding?
3. Finally, does the bank's having sold the mortgage to another party affect the action, or can the summons and complaint simply be amended to include the new mortgagee?
Sorry this took so long, but I think you can understand why. Thanks for any advice you can offer. I'm trying to find a good real estate lawyer for Mark (his current one, an old school chum, specializes in criminal law, and Mark insists that, since he owns property, he's well-versed in real estate law. Ack!), who's finally accepted the fact that his lawyer has been less than sterling in protecting him.~Bountifully, Fuchsia
