Monday, February 28, 2011

Employment Opportunity: Attorney for Lieb at Law

Lieb at Law is Hiring!

We are seeking an innovative and career-oriented Attorney with transactional and litigation experience for a management position within our production department. The firm's legal concentrations are plaintiff’s personal injury and real estate litigation / transactions inclusive of bank representation. Our new hire's responsibilities will include overseeing the firm's processing team in court applications, contract preparation, legal research and strategy.

Requisite qualifications: Legal research skills with Westlaw and Lexis, excellent legal writing experience and a high degree of computer literacy. Must want to be the best, Must have swagger.

Email resume and writing sample to
* Must be willing to work out of Center Moriches office location

Friday, February 25, 2011


Continuing Education Registration Updates:
  • The Commercial Real Estate Course - Scheduled on March 8th in Patchogue is now full. If you would like to be put on the waiting list email
  • Mortgage Mania - Scheduled on March 24th in Bethpage has seats available. REGISTER HERE.
Coming Soon:
  • April Course Calendar will be posted soon!
  • The Real Estate School will be announcing a new and exciting School Sponsor.
  • Brand NEW 3 Credit Continuing Education Course awaiting DOS Approval. We anticipate offering this course in April & May in Nassau County and the Twin Forks. Course entitled -Conflicts of Interest: A Course on Real Estate Ethics

***Lieb at Law will be launching a brand new website. Stay tuned for more updates!

Monday, February 21, 2011

Wells lowers credit score requirement

The bank is now shifting focus from a high scredit score to a larger down payment requirement & a lower debt-to-income ratio. Now, an FHA borrower who comes up with a minimum 10% down payment & has a maximum debt-to-income ratio of 31% can qualify for a loan if their credit score is over 500.

It seems that this may be related to the administration's housing report, which discussed a need for higher down payments & discussed establishing more federal oversight of credit scores. Regardless, the key takeway is that the bank cares more about how much the borrower has to lose if they do not pay their mortgage and how much money they have available to pay their mortgage, rather than what the borrower's previous borrowing habits indicate.

To learn more about Wells' new move, click here.

Wednesday, February 16, 2011

Legal Aid to provide FREE representation in foreclosures

For the 3rd time this past week the real estate world has been hit with a whopping change for the better. To learn more about the announcement made during Chief Judge Lippman's State of the Judiciary 2011, you can either read a New York Times article by clicking here or the text of the speech by clicking here.

Coupled with the other changes, this change signals that we are in a homeowner / mortgagor / borrower friendly world where the government is going to influence lenders to agree to mortgage workouts.

In the speech, the Chief Judge took time to call out robosigners and the affect at curtailing robosigners that the new attorney affirmation requirement has had, topics that I will be discussing at a CLE sponsored by First American Title Insurance Company of New York on March 30, 2011. To be invited to this free seminar, please contact First American at 516-832-3263.

The striking part of the speech was when the Chief Judge said that "63% of homeowners appearing for mandatory court settlement conferences are unrepresented". The Chief Judge than promulgated a new program providing homeowners who cannot afford a lawyer with legal assistance at the foreclosure settlement conference stage of a foreclosure. Yet, the program's great ambitions were limited when the Chief Judge said "these legal services attorneys will provide legal assistance or representation to unrepresented homeowners at the initial conference in as many cases as possible. Thereafter, the attorney will either keep the case and continue with representation or refer the homeowner to a network of legal services, pro bono or law school clinic counsel who will be standing by to provide additional legal assistance in support of this project."

Of note, the project will be piloted in Queens and Orange Counties and is expected to be expanded thereafter.

My take is that this is an excellent move by the Judiciary. Nonetheless, this program has issues that must be addressed in order for it to be succesful including the following:
  1. There is no constitutional right to representation here as there is in the criminal arena and therefore when this program fails homeowners cannot cite the lack of representation to keep their homes while they (lay individuals) will interpret this program as establishing a fundamental right. Therefore, the legislature must follow with creating a right to give this program real teeth or clearly articulate in public service announcements how it does not.
  2. Introducing homeowners to attorneys at the conference stage means that the homeowners likely already defaulted in the matter because the time to Answer the Summons and Complaint will have expired by this stage. Therefore, the homeowner is left to negotiate a workout while the tides are against them and will also have difficulty defending the action on the merits.
  3. Private attorneys with large hourly fees and budgets have a hard time making it financially viable to perform a forensic analysis of all of the mortgage documents to red flag violations of statute and case law in order to change the bargaining positions of the parties in negotiating a workout (modification, short sale, or deed in lieu), I cannot fathom how the State can afford to provide what theoretically is included in proper legal services, particularly in the face of the major budget cuts being made every day by the Governor.
I am very interested to learn of other peoples thoughts on this topic, so please share either on this blog or offline.

Monday, February 14, 2011

50% of foreclosed homeowners can defend

In a great decision for defaulting borrowers, In re Ferrel L. Agard, which can be found by clicking here, the United States Bankruptcy Court for the Eastern District of New York claims to be setting precedent whereby Mortgage Electronic Registration System (MERS) lacks the authority to assign or foreclose a mortgage.

Prior decisions seemed to state that where MERS was granted the appropriate authority it could assign or foreclose a mortgage. This decision seems to intentionally and expressly state otherwise.

Citing the Court: "MERS and its partners made the decision to create and operate under a business model that was designed in large part to avoid the requirements of the traditional mortgage recording process. This Court does not accept the argument that because MERS may be involved with 50% of all residential mortgages in the country, that is reason enough for this Court to turn a blind eye to the fact that this process does not comply with the law".

For those who are unaware of MERS and its role in our mortgage system, Judge Grossman's point is that MERS was designed to provide a database which allowed its member banks to electronically self-report transfers of the Note in an effort to circumvent governmental real estate recording systems and therefore should not be afforded anything, but a strict interpretation of its authority. You mess with the government and the government will win.

For the lawyers who read this blog, the key words used by the Court are as follows: "MERS admits that the very foundation of its business model as described herein requires that the Note and Mortgage travel on divergent paths. Because the note and mortgage did not travel together, Movant must prove not only that it is acting on behalf of a valid assignee of the Note, but also that it is acting on behalf of the valid assignment of the Mortgage."

WOW!!! - I'm betting this goes to the Supreme Court.

Of note, the Court in this case ruled in the lender's favor on a different argument, but made this decision nonetheless for the stated purpose of defining MERS' authority.

Saturday, February 12, 2011

Winding down Fannie Mae and Freddie Mac

On February 11, 2011, the Obama Administration (through the Department of the Treasury and the Department of Housing and Urban Development) delivered a report to Congress that provides a path forward for reforming America’s housing finance market - LOANS WILL NEVER BE THE SAME.

To read the report, click here.

Key in the report is the need for:
  1. More rental options through lending to the multifamily market
  2. Increased coordination between governmental finance options
  3. Increased availability of low income housing
  4. Consumer protection
  5. Lowering the maximum LV Ratios
    1. Minimum of 10% down payment for governmentally backed loans
    2. Lower conforming loan limit (highest loan amount for governmentally backed loans)
    3. Decreased maximum loan size that can qualify for FHA insurance (goal - lowering market share of FHA from 30% to 15%)
  6. Transparancy for investors through disclosure of information on the credit, geographic, and demographic characteristics of the underlying loans that are packaged into securities
  7. Higher capital retention by lenders (originators retaining 5% of loan risk in securitization)
  8. More conservative underwriting standards
  9. Regulation of mortgage originator and servicer standards
  10. Private guarantees of mortgages and public guarntees with increased cost to reflect risk
Interestingly, this is a small government report coming from a democratic administration. Yet, remember this is just the administration's views and will require legislation from the Congress before its enacted. In fact, it only offers 3 options into the future, not a clear direction. Nonetheless, real estate professionals should start hedging their strategies based upon this report as those who leverage change in market principles will get ahead financially.

My takeaway is to concentrate on the rental markets because the administration's plan is ultimately to eliminate a homeownership option for speculators - individuals without the means to afford a mortgage without appreciating home values. Therefore, many potential homeowners will be pushed out of the market to purchase and placed into the rental market.

Of note, the report makes frequent mention of the The Dodd-Frank Act as the first steps towards the administration's goals. Therefore, a careful review is required by real estate professionals.

Lastly, the report discusses loan steering and a new requirement that loan originators will have to perform due diligence of borrowers' claimed finances to determine a borrower's ability to repay a loan. These are many of the topics that are being heavily litigated in the foreclosure world today and I believe that this report will strengthen the position of homeowner who seek a modification in foreclosure. If nothing else, the report requires national standards for loan servicing, which is the entity charged with negotiating a mortgage workout with a borrower - this will HELP!

Short sale professionals; the report also addresses working with second liens in mortgage workouts, this is a must read.

Thursday, February 03, 2011



***  Renewal must be completed online.

TIP: Quoted directly from the DOS  "They need to renew online and make sure they answer “YES” to the continuing education question.  If they mistakenly answer “NO”, we will not renew their license until we see their original course completion certificates.    They also need to hold onto their original course completion certificates in the event we audit them."

The below Q&A is taken from the Department of State website.

Renew My License

Q: Why should I renew online?

In accordance with New York’s Green Initiative to reduce paper use, all Real Estate Licenses must be renewed online.

Q: Why must I renew my license?

If you do not renew your expired license, you cannot conduct any real estate activities that require a New York State real estate license in accordance with Article 12-A of the Real Property Law. There are no grace periods that allow you to continue working while not licensed. You have two years from the date your license expires to renew your license. If you fail to renew within that period, you will be required to pass the state written examination and submit a new salesperson/broker application and fee. No continuing education will be required to repeat the licensing process again.

Q: How do I know when I should renew my license?

Your license expiration date is printed on the license. You are eligible to renew your license three months prior to the expiration date.

Three months prior to your license expiration date, you are sent an email and post card reminder that it’s time to renew your real estate license. Both reminders provide you with written instructions on how to renew your license online through your eAccessNY Account.

Q: How do I renew my real estate license?

After you logon, from the Main Menu page click on “List of Licenses (Access your license here).” A listing of all your License(s) and License Number(s) (UID#’s)will be listed. If you have more than one license, click on the license you wish to renew.

1. Click on “Renew License” and then “Next Step” to renew the license.

If the Office/Sponsorship information listed is incorrect, DO NOT continue with this renewal until your new broker has submitted a change of association for you. If you are changing association or the business address, those changes must be performed, by the principal broker, prior to renewing your license online. Proceed with this online renewal ONLY if the information listed is correct.

2. Answer the questions and press “Next Step” to continue.

3. Affirm the application by checking the “I Agree” box and press “Next Step” to continue. When you affirm your application, you are indicating that you have met the requirements for renewal. Therefore, your continuing education must be completed prior to submitting your online renewal.

4. Enter your credit card details and press “Submit” ONLY ONCE to submit your payment. Your card will be charged with the total amount displayed.

5. You will get a “Confirmation” page indicating your renewal has been submitted. Print the page for your records. Submission does not constitute an approval. Your renewal application will be reviewed by the Department to make sure it is complete and meets the qualifications for renewal.

Q: What if I don’t have a printer? Can I save a “confirmation page” to my computer?

Yes, you can save any web page to your computer. For most browsers, click on “File” in the menu bar, then click on “Save As.” When the “Save As” dialogue box appears, save the page as a web page or as a text file, to the location on your computer you choose. After you save it, you can open the file at any time without being connected to the Internet.

Q: What if I answer no to the continuing education question when renewing my real estate salesperson/broker license in eAccessNY?

If you answer no to this question, your renewal application will not be approved. You will receive notification from the Department acknowledging receipt of your renewal application. This notice will inform you that approval of your renewal application will not be granted until original certificate(s) of completion evidencing successful completion of the required continuing education or proof satisfactory to this division that you are exempt from this requirement is submitted to the Bureau of Educational Standards for review and approval.

You must submit this proof even if you have answered no to this question in error. By answering NO when submitting your on line renewal, you have affirmed that you have not completed the required education and that you are not exempt from this requirement.

Q: How do I know my license was renewed successfully online?

After completing all of the steps on your renewal check list (including payment), you will submit your online renewal for processing. At the end of the renewal process you will get a Confirmation page indicating that your renewal has been submitted. This does not mean your license is renewed. Your renewal application will be reviewed to make sure it is complete and meets the qualifications for renewal.

You should access your account to see if the license shows as current. If you check “Application Status Display” and that license is still showing “in progress”, then your renewal application is still waiting to be reviewed by the Department of State. If anything additional is required, you will be contacted by the Department.