If a homeowner’s equity goes negative, will the homeowner feel stuck and unable to find better work? Or, will the homeowner search for new work elsewhere and take the loss? It’s an important question in New York bankruptcy because if the so-called “lock-in” effect is real, homeowners would probably be better off in the long …
The ‘Lock-In Effect’ Revisited: Underwater Homeowners Stuck in Communities Read More »
I recently wrote about research showing that race sometimes influences New York bankruptcy chapter choices, and lawyers might misdirect black clients to chapter 13 when chapter 7 would be more appropriate. A new study from the Pew Research Center offers insight as to why black (and Hispanic) borrowers struggle with debts, specifically mortgage debts. Pew …
Pew Study: Blacks, Hispanics Struggle in Mortgage Markets Read More »
Many mortgage lenders probably believe that homeowners default on their mortgages because they have negative equity, i.e. they’re underwater. In other words, these homeowners can afford to repay their mortgages but simply choose not to, and there’s a surprising amount of academic literature to that effect. Why “strategic default” is a bad idea for debtors …
Study: Unemployment Bigger Cause of Mortgage Default Than Previously Thought Read More »
Now that it’s 2017, the federal government’s Home Affordable Modification Program (HAMP) has expired. Maybe that’s a bad thing for struggling homeowners, but investigative reporting found that HAMP was a dismal failure. It rejected millions of applications, and only several hundred thousand made it past that stage. Thus homeowners might want to know about other …
The upfront short answer is: not a whole lot. A while ago I posed the question of what happens to homeowners or condominium fees in New York bankruptcy. This post is sort of a sequel. Many New Yorkers live in common-interest housing that charge either homeowner association (HOA) or condominium association (COA) fees. These fees …
How Does Association Foreclosure Differ From Typical Mortgage Foreclosure? Read More »
One might think that The New York Times‘ “Your Money” article on a company that offers to swap student debt for mortgage debt is an advertisement, but it’s an alternative to New York bankruptcy worth considering. SoFi, a nonbank lender, with the help of the government mortgage entity Fannie Mae promises student debtors the opportunity …
NYT Discusses Program for Swapping Student Debt for Mortgage Debt Read More »
That’s a question a New York bankruptcy lawyer should ask whenever a debtor seeks to strip a lien off an (allegedly) underwater junior mortgage in a chapter 13 bankruptcy. I’ve discussed this before, but as a quick review, debtors who owe multiple mortgages can strip the liens off junior mortgages that have no equity in …
More than two years ago, I raised the question of whether another mortgage crash would strike New York homeowners. It’s a provocative discussion because New York City wasn’t seen as representative of the mortgage crash like Las Vegas or Miami. At the time, many homeowners in the New York City metropolitan area had been served …
New York City Homeowners Struggling More Than National Average Read More »
I wrote recently about “non-recourse” debts after New York bankruptcy, commenting that the terms “recourse” and “non-recourse” loans usually refer to deficiency judgments after foreclosure. Specifically, state laws differ on allowing plaintiff-creditors to sue defendant-debtors for amounts owed beyond either the fair-market value of the properties or the auction prices at foreclosure sales. Some states …
What Is the ‘Election of Remedies’ Rule in New York Foreclosure? Read More »
The terms “recourse” or “non-recourse” usually relate to whether lenders can sue debtors for mortgage deficiencies after foreclosure. The state’s “election of remedies” rule complicates things somewhat, but the issue in New York bankruptcy is really what happens to secured debts that debtors continue to pay even after their personal obligation has been discharged. The …
When Are Post-Bankruptcy Non-Recourse Debts a Good Idea? Read More »
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