Hann v. Educational Credit Management Corp.

 Creditors cannot ignore claim objections, even when the debt is a nondischargeable student loan.  Debtors objecting to a claim on the merits should be prepared to put on a prima facia case in support of the objection - even if the creditor does not respond. The prevailing party preparing an order, especially ones involving the treatment of a claim, should draft the order with such specificity that its effect cannot be challenged even after completion of the bankruptcy case.  Final orders of the bankruptcy court cannot be ignored with impunity

Loan Modification Update

New Modification Program

The Federal Housing Finance Agency will require mortgage servicers to offer a streamlined modification program to borrowers with loans owned or guaranteed by Fannie Mae and Freddie Mac, starting in July. The offers will be sent to homeowners who are at least 90 days behind on their loans but no more than two years behind. To qualify, borrowers must owe at least 80 percent of the home's value.

The modification reduces the loan's interest rate and extends the loan term to 40 years.
Minimal paperwork:  Borrowers won't be required to submit any financial documentation to the lender to get approval. The loan modification becomes permanent after three payments are made during the three-month trial period.


Ginnie Mae Loans

Your just screwed- no mod for you!



Borrowers seeking low-payment mortgages will be charged for mortgage insurance for the life of their loans if they don't get their Federal Housing Administration mortgages by June 2.

The FHA currently requires borrowers to pay for mortgage insurance on FHA loans until the balance reaches 78 percent of the original value of the home.

Pay forever:  Once the change goes into effect, all new FHA loans with less than a 10 percent down payment will carry mortgage insurance until the loan is refinanced or paid off. Loans with a 10 percent down payment or greater will have to pay for mortgage insurance for at least 11 years.
For borrowers who plan to stay in their homes for less than 10 years, the new rules won't make that much of a difference, says Cameron Findlay, chief economist at Discover Home Loans. That's because normally, it takes borrowers about 10 years to reach the required loan level for the insurance to cancel anyway.

Mortgage Rates

The Mortgage Bankers Association estimates the 30-year fixed rate will reach 3.9 percent by the end of the first quarter this year. That's not as good as the superlow rates that borrowers got in December 2012, when the 30-year fixed hit a record low of 3.5 percent in Bankrate's weekly survey

Florida Faster Foreclosures

http://www.miamiherald.com/2013/05/03/3378402/mortgage-foreclosures-bill-headed.html?utm_source=May+6+Email&utm_campaign=5%2F6%2F13&utm_medium=email


Florida lawmakers sent Gov. Rick Scott a bill Friday that is aimed at speeding up the residential mortgage foreclosure process in a state where the real estate market went into a tailspin during the national housing crisis. (HB 87)


The bill cleared the Senate on a 26-13 vote on the final day of the Legislature's 60-day session. It passed the House recently 87-26.


One key provision would reduce from five years to one year the amount of time for banks to go after foreclosed homeowners on deficiency judgments. Deficiencies are the difference between the money obtained from selling a foreclosed home and what the original homeowner still owes on it.


Homeowners could have limited time to show "a genuine issue of material fact or law" to avoid foreclosures.

Foreclosure Settlement Checks

The compensation payment checks, which range from $300 up to $125,000, are part of the Independent Foreclosure Review Payment Agreement announced in January between federal regulators and 13 mortgage servicing companies, which were subject to enforcement actions for “deficient practices in mortgage loan servicing and foreclosure processing.”  Deficient practices have included errors and misrepresentations and the “robo-signing” of documents.

The regulators are the U.S. Treasury’s Office of the Comptroller of the Currency (OCC) and the Board of Governors of the Federal Reserve System.

The recipients of the checks are mortgage loan borrowers whose homes were in any stage of a foreclosure process during 2009 or 2010, and whose mortgage servicers were among the 13 companies, or their subsidiaries or affiliates.  Compensation payment checks, which began going out April 12, have so far been sent to 3.7 million homeowners. In all, 4.2 million eligible mortgage loan borrowers will receive them.
The 13 servicers are: Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.

According to the OCC’s online FAQ about the agreement, the servicers agreed “to provide more than $9.3 billion in cash payments and other assistance to help borrowers. The sum includes $3.6 billion in direct cash payments to eligible borrowers and $5.7 billion in other foreclosure prevention assistance, such as loan modifications and forgiveness of deficiency judgments.”

By comparison, the five largest banks alone – Wells Fargo, Citigroup, Goldman Sachs, JPMorganChase, Bank of America – earned $60 billion in total profits last year.

The largest payouts – $125,000 – are going to 1,082 members of the military wrongly foreclosed upon, and to just 53 homeowners across the country foreclosed upon even though they never missed a mortgage payment.  But most of the recipients – almost 2 million homeowners – will get the smallest payments of $300 to $600.
http://www.occ.gov/topics/consumer-protection/foreclosure-prevention/financial-remediation-framework.pdf


“In determining the payment amounts,” reads a recent OCC press release, “borrowers were categorized according to the stage of their foreclosure process and the type of possible servicer error.  Regulators then determined amounts for each category, using the financial remediation matrix published in June 2012 as a guide, incorporating input from various consumer groups.”)


So far federal regulators have refused to release information – about what the consultants’ reviews had found about mortgage servicers’ “deficient” practices in mortgage loan servicing and foreclosure processing – to the public, or even to Congress -- claiming the servicers’ documents are "trade secrets."

Wells Fargo Slammed $3,1712,154 for Misapplying Payments in Chapter 13

Judge Elizabeth W. Magner’s  imposition of punitive damages  of $3,1712,154 against Wells Fargo Bank was recently affirmed by the district court in Jones v. Wells Fargo Home Mortgage Inc. 2013 WL 1155248 (E.D. La. 1/19/13).

The district court held that the bankruptcy court’s ruling was substantially supported by the record.  Wells Fargo had initially agreed to a systematic audit of its accounting of home loan payments after misapplying Chapter 13 payments against undisclosed post-petition fees and costs.

In awarding punitive damages, the bankruptcy court said: “After considering the compensatory damages of $24,441.65 awarded in this case, along with the litigation costs of $292,673.84; awards against Wells Fargo in other cases for the same behavior which did not deter its conduct; and the previous judgments in this case none of which deterred its actions; the Court finds that a punitive damage award of $3,171,154.00 is warranted to deter Wells Fargo from similar conduct in the future. This Court hopes that the relief granted will finally motivate Wells Fargo to rectify its practices and comply with the terms of court order, plans and the automatic stay.”

The district court agreed and stated, “Wells Fargo was on notice that its actions were impermissible and could incur significant legal penalties and assessing punitive damages at ten times the amount of compensatory damages is within the constitutional limits.”


Professor of Law, Michaela White is the source of information.

Mortgage foreclosure -- Standing

Stone v. Bankunited, 2013 Fla. App. LEXIS 7207

Mortgage foreclosure -- Standing -- Plaintiff had standing to foreclose mortgage where initial lender had been placed in receivership by FDIC, and plaintiff acquired all assets of initial lender by virtue of the receivership and pursuant to a purchase assumption agreement.

Check Your Credit Report After Bankruptcy

A Creditor May Continue to Report a Debt

The most common way in which credit reporting errors are discovered is at the most importune time, a new credit application rejection. Old debt discharged in bankruptcy may still be reported as delinquent when the debts should have been removed or a settled debt is still listed as owed to the creditor.

The Inaccurate Reporting Maybe the Result of Credit Reporting Agency Negligence
While the Fair Credit Reporting Act was designed to protect consumers from faulty credit reporting there are often allegations of negligence against the three main credit-reporting agencies. You will need to send demand letters to each agency to clear up the errors.  If they refuse a suit may be necessary.

The Bottom Line, Check your Credit Report After Bankruptcy or Debt Settlement
Do not wait until you hear from a lender that there is a problem with your credit report. While experienced counsel can resolve these issues, the time for resolution may be outside the time constraints of a real estate purchase or new car loan application.

Home prices are rising at the fastest rate in seven years, as buyers are returning to a market where the number of properties for sale is in short supply, the Wall Street Journal reported yesterday. Prices increased 9.3 percent in February from a year earlier while mortgage-interest rates hovered at near record lows in 20 major metropolitan areas.

Interest Rates Fall

Mortgage rates continued to creep down near record lows this week, according to reports from Freddie Mac and Bankrate.com. Rates fell all around in Freddie Mac's Primary Mortgage Market Survey for the week ending May 2. According to the weekly survey, the 30-year fixed-rate mortgage (FRM) averaged 3.35 percent (0.7 point) this week, down from 3.40 percent last week. The all-time low average is 3.31 percent, set the week of November 21, 2012. For the second week in a row, the 15-year FRM reached a new low, falling to 2.56 percent (0.7 point).

Bank Pay Day Loans

The banking version of payday lending, called deposit advance, is no better than its storefront cousin. For starters, the advance loan can carry an interest rate of over 300 percent. There is no fixed due date for repayment. Instead, the bank repays itself from an electronic deposit into the borrower’s account. A new study from by the Consumer Financial Protection Bureau says these transactions are anything but harmless, one-time deals. Three-fourths of the loan fees are generated by consumers who borrow more than 10 times in a 12-month period. Overdraft fees deplete the borrowers’ meager resources, causing them to borrow again and again — and pushing them deeper into the debt trap.

Domestic Partner Registration

http://dunedin.patch.com/announcements/countywide-domestic-partnership-registration-begins-april-15in-four-pinellas-county-clerk-of-the-circuit-court-offices


Beginning April 15, any two people over the age of 18 will be able to register as domestic partners in Pinellas County, subject to certain limitations.

Domestic partnership registrations will be accepted at the following Clerk of the Circuit Court offices during regular office hours:

• Clearwater County Courthouse - 315 Court St., Room 150, Clearwater
• North County Branch Office - 29582 U.S. Highway 19 N., Room 101, Clearwater
• St Petersburg Branch Office - 545 First Ave. N., Room 153, St. Petersburg
• Clerk's Tyrone Branch Office - 1800 66th St. N., St. Petersburg

The filing fee for registering as domestic partners is $50, although a reduced fee may apply for those applicants who have already registered their partnerships in a Pinellas County municipality.
More information about the domestic partnership registry may be found online at www.pinellascounty.org/Humanrights/pdf/domestic.pdf and forms relating to the domestic partnership registry may be found online at www.mypinellasclerk.org.

For more information on Pinellas County services and programs, visit www.pinellascounty.org, now with LiveChat, or create a shortcut to www.pinellascounty.org/mobile on any smartphone. Pinellas County government is on Facebook, Twitter and YouTube. Pinellas County complies with the Americans with Disabilities Act.

Court Rejects Ponzi Scheme Victim Payment Plan

The bankruptcy case is In re Rothstein Rosenfeldt Adler, 09-bk-34791, U.S. Bankruptcy Court, Southern District of Florida (Fort Lauderdale). The criminal case is U.S. v. Rothstein, 12- cr-60204, U.S. District Court, Southern District of Florida (Fort Lauderdale).

http://www.businessweek.com/news/2013-04-12/rothstein-judge-hears-arguments-on-plan-to-pay-victims#p1

New Means Test Income Data

1 person $41,915
2 people $51,760
3 people $54,934
4 people $65,260
for cases after April 1, 2013 add $ 8,100 for each additional person after 4

http://www.justice.gov/ust/eo/bapcpa/20121101/bci_data/median_income_table.htm

Bankruptcy Form Changes April 1, 2013

Dollar amounts in title 11 and title 28 of the U.S. Code will be increased for cases commencing after April 1, 2013. Seven Official Bankruptcy Forms (1, 6C, 6E, 7, 10, 22A and 22C) and two Director's Forms (200 and 283).

Tiara Condominium Assoc v Marsh & McLennan Companies

The Florida Supreme Court recently held om March 7, 2013 (SC10-1022) that the application of the Florida economic loss rule is limited to products liability cases.

A condominium association ("Association") retained an insurance broker ("Broker") to secure condominium insurance coverage.  Association's building suffered significant damage cause by Hurricane Frances and Hurricane Jeanne.  Association proceeded with repairs based on assurances by Broker regarding the policy limits of Association's coverage, but later was denied coverage for almost half the amount of Association's costs for repairs when it submitted its claim.  Association filed a lawsuit against the Broker, alleging causes of action including negligence and breach of fiduciary duty.

 

The trial court granted summary judgment in Broker's favor as to all counts, and the Eleventh Circuit Court of Appeals affirmed the trial court on all but the negligence and breach of fiduciary duty claims. The Eleventh Circuit certified to the Florida Supreme Court the question of whether the economic loss rule bars an insured's suit against an insurance broker where the parties are in contractual privity and the damages sought are solely for economic losses.

 

The economic loss rule prevents a party from bringing tort actions against entities with whom they are in contractual privity for purely economic loss unaccompanied by any personal injury or damage to property.  As stated by the Florida Supreme Court, the underlying rationale for the economic loss rule is that "[w]hen parties are in privity, contract principles are generally more appropriate for determining remedies for consequential damages that the parties have, or could have, addressed through their contractual agreement."  In other words, "[w]here damages sought in tort are the same as those for breach of contract a plaintiff may not circumvent the contractual relationship by bringing an action in tort."  Ginsberg v. Lennar Fla. Holdings, Inc., 645 So. 2d 490, 494 (Fla. 3rd Dist. 1994).

 

Having noted the multiple exceptions to the economic loss rule created since its inception, including exceptions for professional malpractice, fraudulent inducement, negligent misrepresentation, and free-standing statutory causes of action, the Court ultimately decided that these exceptions "simply did not go far enough," stating that "we now take this final step and hold that the economic loss rule applies only in the products liability context."