Deed Fraud

People want what you have. It doesn't matter if you have a lot or a little. People want to take what is yours. I see it every day I come to work. I see a lot of deed fraud. That's the phrase being used to describe what happens when, for example, someone forges your name on a deed to your house. They forge your name, forge a notary stamp, and just like that, they have a deed from you to them.

Sometimes it stops there. Sometimes it goes farther. Sometimes the thief takes out a mortgage, on your property that they have stolen without you knowing, and they disappear with the money. Sometimes the thief just re-sells your house to some unsuspecting mark who pays good money for a deed.

You don't get a dime, of course, because you have no idea that any of this is happening. Your first inkling that your house has been sold out from under you is when you get the eviction notice from the chump who thinks he owns your house. By then the thief is long gone, maybe to a nice beach in a country with no extradition treaty with the United States.

I've seen this happen all over Brooklyn. But it's not a local problem. An article in the Wall Street Journal this week focused on a case of deed fraud in Manhattan. A senior citizen in Harlem was the victim. The article mentioned that this is a national problem. It's happening in Chicago and Detroit, too. Read the article here.

There was always an undercurrent of deed fraud in the real estate business, but things have gotten easier for the thieves. Now that property records are online in New York City, and lots of other places, it's a snap to see past deeds, mortgages, and signatures of owners. You were always able to go to the city clerk's office and see all this, but now you can see it online. Property research is easier now for attorneys, brokers, owners, and even thieves.

Now that all your property records are online, authorities consider deed fraud to be in the same crime category as other forms of identity theft and cyber crime. In Manhattan the District Attorney's office is taking this threat seriously. In Brooklyn, not so much from what I see.

The New York City Sheriff's Department, part of the city's Department of Finance, takes it more seriously. The Sheriff's Department has set up a special unit to investigate deed fraud. Deed fraud bothers the city because it has an effect on taxes the city likes to collect.

That's human nature. Put your hand in someone's pocket and they tend to notice. The city government is like that. Mess with tax collections, and you get noticed. In my humble opinion, the city government is looking out for itself when it investigates deed fraud. They don't care about you, specifically.

If you want to protect yourself, you are on your own. You're flying solo through rough air. You better have a plan to make sure you don't crash and burn. In aviation we are taught to use all available resources to get us through situations we may face as pilots. The same attitude can help protect your house and your financial interests.

Here is one resource I have written about before. Sign up online for automatic email notices any time any document is recorded against your property. You've already paid for this service through your taxes. Go here. Enter every property you own. Register your contact information. The system works. Use it. Don't fly solo through real estate space.

Here's another resource for you: www.LevyNau.com. That's my law firm's website. Click, call or visit for more information, or if you suspect deed fraud.

Tax Liens Can Ruin Your Day

In aviation, sometimes you hear about events that can "ruin your day", like running out of fuel in mid-flight, or hitting a mountainside because you are flying in the clouds and you are below your assigned altitude. It's a euphemism for anything that can harm you or your airplane.

There are things in real estate that can ruin your day too, in the sense that they can harm you financially before you ever see them coming.

One such thing is a tax lien. If you have a mortgage and your monthly payment includes an escrow for taxes, you rarely have to worry about a tax lien. Even if you fail to pay your mortgage, your bank will make sure the property taxes are paid. That's because past due taxes get paid even ahead of a first mortgage, and your bank doesn't want anyone in line ahead of it to get paid out of your hide.

Some mortgages are set up in a way that requires you to pay real estate taxes on your own. This is also your responsibility if you have no mortgage. In New York City we pay our property taxes every three months. Elsewhere it might be once or twice a year.

If you don't pay your property taxes on time, they become a lien on your property. The same is true of water bills and some other charges. These liens are then sold to outside companies that specialize in collecting the money. The tax lien buyer adds more fees and interest to your debt, and before you know it, your tax bill is high enough to ruin your day.

You can’t tell if this has happened simply by looking up your tax account online. The city will show a zero balance, because the city got paid by the tax lien buyer.

The city government is supposed to send you multiple notices of its intention to sell your tax lien, to give you an opportunity to pay up. But it you don’t ever see these notices, you might not know your tax lien has been sold until you get served with tax lien foreclosure papers.

The Center for NYC Neighborhoods has a web-based tool to give you an idea of how widespread tax lien sales are in various neighborhoods. Check it out at http://cnycn.org/taxliensale/.

Don’t let tax liens or unpaid property taxes ruin your day. For more information, call us.

The Foreclosure Timeline

The New York State Department of Financial Services (www.dfs.ny.gov) has a useful timeline showing what you can expect if you go into foreclosure and do nothing, and when you can expect it all to happen. Here is the timeline:

When you fall behind on your mortgage payments, you can expect most lenders to react quickly. Here is a general time line of what may occur following your first late payment and ending in foreclosure. This is taken from the Department of Financial Service’s website, but has been modified to reflect our real-world experience in hundreds of foreclosure cases over the last ten years in New York.

1st month:	· You miss a mortgage payment.
2nd month:	· A late charge is assessed on payment. The loan servicer (the company that processes your mortgage payments) will send you a notice or otherwise attempt to make contact with you.
2 to 3  months:	· If your mortgage is for a home you live in, the lender or loan servicer must send you a pre-foreclosure notice at least 90 days before commencing foreclosure. This 90-day window gives you a chance to work with your lender to find an alternative to foreclosure. The notice must tell you how much you must pay to bring the loan current.  It must also give you the names and phone numbers of at least five government-approved non-profit counseling agencies in your area.
3 to 4 months:	· The loan servicer must send a "demand" or "default" letter stating that you have violated the terms of your mortgage. You will be given 30 days to pay the delinquent amount and the late charges.
4 to 5 months:	· The servicer will begin the legal process of foreclosure. This may include sending the loan to its foreclosure department, hiring an attorney to sue you, and recording a formal notice of foreclosure or “lis pendens” with the court and serving you with notice of the action through a “summons and complaint.” These proceedings can take 7-9 months.
6 to 12 months:	· Once a summons and complaint has been served on you and the lender files proof of service with the court, the court is required to schedule a settlement conference within 60 days. This is an opportunity for you to meet face to face with your lender or lender’s representative to reach a resolution of the case. You should try to meet with a housing counselor or attorney prior to the conference. You should bring proof of income such as your two most recent pay stubs and most recent tax return to the conference.
6 to 12 months (continued)	· You will also have to respond to the summons and complaint. If you do not respond, the court will issue judgment by default, appoint a referee to calculate what you owe, and schedule a foreclosure sale. If you do respond, you have a chance to present any legal arguments you might have.
12 to 24 months:	· If the court issues judgment against you, a foreclosure auction sale will be scheduled. The sale usually occurs at least 4 months after the court ruling. A notice of sale is published in a newspaper once a week for at least 4 weeks prior to the sale date.

If you do nothing, the foreclosure process in New York City currently takes about 18 to 24 months, depending on which county you are in, from the date of the first missed payment to the sale of your home.

Foreclosure sales in New York are by public auction, usually at the county courthouse. The home is sold to the highest bidder and anyone, including the lender, may bid. Once payment is made and the sale is complete the winning bidder takes ownership of the property. At that point, once a sale is complete, you have no right of redemption.  You lose your house forever, and eventually the new owner will evict you if you are still living there.

It is possible to do all this without an attorney, but getting legal advice is always a good idea in these circumstances. Court personnel generally are helpful, but they won’t give you legal advice.

For more information about this topic or anything else we do, ask us. We’re here to help.

Call, visit or click for more information:

Levy & Nau P.C. / attorneys at law

844-LEVY-LAW or 718-622-8150

854 Fulton Street, Brooklyn NY 11238

www.LevyNau.com

Safe Deposit Boxes and Estates

A client recently asked about getting access to a deceased aunt’s safe deposit box. Our client thought his late aunt might have left a will, and that the will might be in the safe deposit box.

This is a question that comes up regularly. Not surprisingly, there is a legal process for this. If the court has already appointed you as administrator of the estate, the Letters of Administration issued by the court give you all the authority you need to open the deceased person’s safe deposit box.

Before you even file a Petition for Administration, however, you need to determine if there is a will. If there is, then you won’t be filing a Petition for Administration. Instead, the Executor named in the will must file a Petition for Probate.

So how do you go about accessing a safe deposit box to even find out if it contains a will? The answer is contained in Section 2003 of the Surrogate’s Court Procedure Act. This law provides the procedure. You must file a Petition to Examine Safe Deposit Box and pay a small filing fee ($20). In this petition you identify who you are, where you live and what your relation to the deceased person was. You list who else has a possible interest in the estate. You identify the location of the safe deposit box and you name the papers you believe might be inside, such as a will, insurance policies or the deed to a burial plot.

If the court accepts your petition, you get an order allowing you to inspect the contents of the safe deposit box, in the presence of a bank officer. If you find a will inside, the bank must mail it to the court. Insurance policies will be sent to the named beneficiaries. The court gets informed of the burial plot, and issues an order about how to handle that. Anything else in the box gets inventoried. Nothing else is removed until the court appoints an Executor (if there is a will) or an Administrator (if there isn’t).

It is possible to do all this without an attorney, but getting legal advice is always a good idea in these circumstances. Court personnel generally are helpful, but they won’t give you legal advice.

For more information about this topic or anything else concerning wills and estates, ask us. We’re here to help.

Call, visit or click for more information:

Levy & Nau P.C. / attorneys at law

844-LEVY-LAW or 718-622-8150

854 Fulton Street, Brooklyn NY 11238

www.LevyNau.com

Useful Home Buying Resources

Wells Fargo, a big player in the mortgage market, has some free resources on its website that home buyers might find useful. Here is a link to a nice loan application checklist. You can use it to gather materials needed for any mortgage application - not just for Wells Fargo. There are other checklists available as well here.