Friday, October 29, 2010

Sample Distressed Property Agreement

As promised at the Lieb at Law, P.C. Foreclosure Filibuster class last night in Bethpage, please find below a sample distressed property agreement. This sample is intended for use by individuals, corporations, partnerships, LLCs or other business entities that, directly or indirectly, solicit or undertake employment to provide consulting services to a homeowner for compensation or promise of compensation with respect to a distressed home loan or a potential loss of the home for nonpayment of taxes. It is not necessary that attorneys and other persons/entities use the same (please see N.Y.RPP.LAW § 265-b: NY Code - Section 265-B: Distressed property consulting contracts). Please be aware that the two (2) "Notice of Cancellation" provisions contained below are there by design. It is necessary, under the above law, to attach two (2) copies of the Notice of Cancellation provision to any sample distressed property agreement. Therefore, we've provided the same for your use. Here it is:

WHEREAS, “Homeowner” and Distressed Property Consulting Firm, who’s primary place of business is located at _____________________and telephone number is ________and fax number is________, are parties to a Consulting Agreement dated as of _____,__,201_; and;

WHEREAS, the Consulting Agreement provides the Services to be delivered by Distressed Property Consulting Firm (‘Consultant”) or such other persons as Consulting Firm may designate.

WHEREAS, the scope of this agreement entails that the Consultant provide services to help to achieve any of the following for homeowner:

(i) stop, enjoin, delay, void, set aside, annul, stay or postpone a

foreclosure filing, a foreclosure sale or the loss of a home for

nonpayment of taxes;

(ii) obtain forbearance from any servicer, beneficiary or mortgagee or

relief with respect to the potential loss of the home for nonpayment of

taxes;

(iii) assist the homeowner to exercise a right of reinstatement or

similar right provided in the mortgage documents or any law or to

refinance a distressed home loan;

(iv) obtain any extension of the period within which the homeowner may

reinstate or otherwise restore his or her rights with respect to the

property;

(v) obtain a waiver of an acceleration clause contained in any

promissory note or contract secured by a mortgage on a property in

foreclosure;

(vi) assist the homeowner to obtain a loan or advance of funds;

(vii) assist the homeowner in answering or responding to a summons and

complaint, or otherwise providing information regarding the foreclosure

complaint and process;

(viii) avoid or ameliorate the impairment of the homeowner's credit

resulting from the commencement of a foreclosure proceeding or tax sale;

or

(ix) save the homeowner's property from foreclosure or loss for

non-payment of taxes.

NOW, THEREFORE, in consideration of the foregoing premises and the covenants and agreements herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto intending to be legally bound, hereby agree as follows:

(a) As consideration for Consulting Firm’s agreement to enter into this agreement and rendering the Services, homeowner shall pay to Consulting Firm at the conclusion of the Consulting Firm’s services a fee of $_______; with no payments being charged or accepted at any time prior to the completion of consultants services. Terms of payment shall be ____________.

(b) Except as specifically amended hereby, the Consulting Agreement shall continue in full force and effect unmodified and the parties hereby reaffirm the same.

IN WITNESS WHEREOF, this agreement has been executed by and on behalf of the parties hereto to become effective as of the day and year first above written.

HOMEOWNER.




By:


_______________________ Dated:___________

Homeowner’s name typed

Homeowner







Distressed Property Consulting Firm.




By:


_______________________ Dated:____________

Consultant’s name typed
Consultant

Sworn to and subscribed before me this _____day of ____2010





Sworn to and subscribed

before me this _____day of ____2010

Notary Public

NOTICE REQUIRED BY NEW YORK LAW

You may cancel this contract, without any penalty or obligation, at

Any time before midnight of _____ (fifth business day after

execution).

(the "Consultant") or anyone working for the Consultant may not take any

money from you or ask you for money until the Consultant has

completely finished doing everything this Contract says the Consultant will

do.

You should consider consulting an attorney or a government-approved

housing counselor before signing any legal document concerning your

home. It is advisable that you find your own attorney, and not consult

with an attorney recommended or provided to you by the Consultant. A

list of housing counselors may be found on the website of the New York

State Banking Department, www.banking.state.ny.us or by calling the

Banking Department toll-free at 1-877-BANK-NYS (1-877-226-5697). The

law requires that this contract contain the entire agreement between you and

the Consultant. You should not rely upon any other written or oral

agreement or promise."

NOTICE OF CANCELLATION

Note: You may cancel this contract, without any penalty or obligation,

at any time before midnight of ______. (Enter date)

To cancel this contract, sign and date both copies of this cancellation

notice and personally deliver one copy or send it by facsimile, United

States mail, or an established commercial letter delivery service,

indicating cancellation to the Distressed Property Consultant at one of

the following:

Name of Contractor_________________________

Street Address_____________________________

City, State, Zip___________________________

Facsimile:_________________________________

I hereby cancel this transaction.

Name of Homeowner:_________________________

Signature of Homeowner:____________________

Date:______________________________________

NOTICE OF CANCELLATION

Note: You may cancel this contract, without any penalty or obligation,

at any time before midnight of ______. (Enter date)

To cancel this contract, sign and date both copies of this cancellation

notice and personally deliver one copy or send it by facsimile, United

States mail, or an established commercial letter delivery service,

indicating cancellation to the Distressed Property Consultant at one of

the following:

Name of Contractor_________________________

Street Address_____________________________

City, State, Zip___________________________

Facsimile:_________________________________

I hereby cancel this transaction.

Name of Homeowner:_________________________

Signature of Homeowner:____________________

Date:______________________________________

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