How Do I Protect Myself While Communicating With My Bank?
All communication with your lender should be in writing. Do Not contact your lender or your landlord by phone if you can help it. You are going to need a paper trail of your communications with your creditors. The basis for all of these mortgage and rent assistance programs is abatement of interest, delayed payments, grace periods and forbearance of default. New York and Federal law establish specific protocols as to how consumers communicate with their lenders. There are specific forms used to contact your lender. Lenders are required to answer your requests timely and accurately.
How Do I Avoid Covid-19 Loan Scams?
We are already seeing websites and e-mail blasts going out to business owners, homeowners and renters advertising help in obtaining government assistance for a fee. We all saw this conduct a decade ago. If you are not getting help directly from a licensed attorney, your accountant, your lender or a government agency you are wasting your time. Scammers are going to try to take your money by making false promises and giving bad advice. We are at the very beginning of figuring out how to work through this crisis and there is a lot of information available. Write me by e-mail and I will call you directly.
Can The Bank Start A Foreclosure If I Miss Payments? What Do I Do If I Am Already In A Permanent Or Trial Plan Modification?
As of today most loan servicers have forbearance plans available as an automatic option. All you have to do is to contact the servicer and make a request. It also depends on what kind of loan you have. Fannie Mae, Freddie Mac and FHA loans all have automatic 90 day forbearance. If you don't have a Fannie, Freddie or FHA loan then you are going to have to make a formal request. This is where the banks get tricky. The rule is that if your loan was a Fannie, Freddie or FHA loan and was sold to another servicer, the new servicer has to service the loan as if it were a Fannie, Freddie or FHA loan.
Can I Get A Forbearance If I'm Already In A Loan Modification?
There is no set policy that is published that applies universally to everyone and to all mortgages. My personal opinion is that the law as it exists today requires that a modified loan should absolutely be treated like a regular performing loan. I don't see the logic in an argument that asking for a forbearance should be classified as a default. Fortunately, New York and Federal law protects homeowners and actually forces loan servicers to respond to questions like this with specific answers.
How Is My Credit Going To Be Affected If I Miss Payments?
According to what I have read your credit should not be affected by a forbearance plan. My instincts tell me that it depends on what arrangements and agreements you make with your lenders before you start missing payments. Consumer protection laws dictate the exact protocols lenders and borrowers have to follow when altering the terms of repayment under a contract, even if its temporary. The basic rule everyone should follow is to put everything in writing and to memorialize every conversation with a follow up memo by e-mail if possible. Banks and other creditors are notorious for saying one thing and doing another.
What Happens If I Am In The Middle Of A Real Estate Deal With An Open Contract?
I have several clients that are in contract to purchase and to sell their homes. I really don't see anyone trying to default purchasers for not being able to close. I also don't see purchasers being able to sue sellers for not being able to sell. Usually people move from one house to another. Given the limits put upon people's movement in general my experience so far is that performance on real estate contracts are probably going to be delayed moreso than cancelled altogether.
Am I Going To Have To File For Bankruptcy?
Bankruptcy is always an option. It is usually used as a last resort when all other options are exhausted. There are two kinds of bankruptcy. A Chapter 7 liquidates all your debt. A Chapter 13 is where you reorganize your debt. Which one, if either is right for you. Jeff Spinner Esq.and Erin Wietcha Esq. handle the bankruptcies in the office. My practice concentrates on litigation and litigation alternatives.
I Have A Healthy Business But It Is Suffering Now. How Do I Start A Dialogue With My Creditors So I Can Maintain My Relationships For When Times Improve?
I am a firm believer that if it is at all possible, making partial payments show character and good faith. When this passes your creditors will remember your efforts. That being said, it is important as to how you demonstrate your recognition of your debt and your intent to repay in full. The words you use when you engage in discussions with your creditors may have a profound effect as to how the law will treat your statements. It is probably best if you hire a professional to assist you in your communications with your creditors.