New York Foreclosure Settlement Conferences Can Save Your Home
NYS law requires mediation to assist borrowers to avoid foreclosure. New York Foreclosure Settlement Conferences allow borrowers a face-to-face meeting with their lender. Homeowners can also benefit even if they can’t afford to keep their homes.
What Are New York Foreclosure Settlement Conferences?
Typical New York foreclosure settlement conferences are a meeting between you and your lender. Additionally, the settlement conference provides an opportunity to work out a deal with your lender.
You and your lender try to negotiate a way for you to keep the home. You may also be able to negotiate a Cash-For-Keys deal or a Deed-In-Lieu of foreclosure. These two options are especially relevant if you have to give up the property.
Potential outcomes of a settlement conference include:
- loan modification, or
- forbearance agreement, or
- short sale, or
- deed in lieu of foreclosure.
New York Foreclosure Law and New York Foreclosure Settlement Conferences
New York performs their Foreclosures judicially. Hence, this means the lender must foreclose through the state court system. Therefore, the lender initiates the foreclosure. They file a complaint against the homeowner and then the court then serves the summons on the borrower.
In addition, New York law requires a settlement conference within 60 days of the filing of the proof of service.
Homeowners are entitled to a court settlement conference during foreclosure. The property must also fit the following criteria:
- residential, and
- owner-occupied, and
- a one to four unit family dwelling or condominium.
Notice of Settlement Conference
The court will also send a notice to the parties advising them of:
- the time and place of the settlement conference
- the purpose of the conference, and
- the documents that they should bring to the conference.
Required Documents for A New York Foreclosure Settlement Conference
The lender and the borrowers must provide certain documents at the settlement conference.
Documents the Borrowers Must Provide
The documents that the borrowers must provide include:
- proof of current income (such as two most recent pay stubs), and
- most recent tax return, and
- most recent property tax statements.
Documents the Lender Must Provide
The documents that the lender must provide include:
- the payment history, and
- the mortgage, and
- the note, and
- an itemization of the amounts needed to cure and pay off the loan.
The Settlement Conference
At the settlement conference, the court will:
- discuss the rights and obligations of the parties, and
- determine whether the parties can reach a resolution to avoid foreclosure, and
- evaluate workout/settlement options (such as payment schedules or loan modifications), and
- design a plan to streamline subsequent court proceedings to reach a mutual settlement.
Furthermore, the lender and borrower are also required to negotiate in good faith. Hence, the goal of the settlement conference is to reach a deal. A deal that is almost always mutually beneficial to both parties. The court may also appoint an attorney to represent the borrower if they attend without one.
Brooklyn foreclosure settlement conferences don’t guarantee that you will avoid foreclosure. However, it doesn’t hurt to participate. Attending a settlement conference also gives the judge the impression you are trying to resolve the dispute.
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