Tuesday, November 25, 2014

Good Faith Decisions on Short Sales - Updates Coming 12/1/2014

Effective December 1, 2014, the Courts of the State of New York will oversee negotiations between lenders and borrowers to achieve a short sale or deed-in-lieu within foreclosure settlement conferences. The Courts are empowered to sanction parties who negotiate in bad faith.

Previously, borrowers were only allowed to attend the conferences to discuss workout options, such as loan modifications and payment plans, which would allow borrowers to keep their homes. If borrowers were denied loan modifications, their cases would be released from the settlement conference part, and they would be forced to do short sales or deeds-in-lieu on their own without court intervention or oversight. Oftentimes, these exit strategies took a very long time because many borrowers with second mortgages had difficulties settling their second mortgages or were unable to keep up with the lender’s numerous and complicated document requests. Many borrowers simply gave up and allowed their properties to go to foreclosure rather than spend thousands of dollars on legal fees for help with a short sale that was never going to be approved.

Now, with court oversight, it is anticipated that lenders will now be making quicker decisions on short sale and deed-in-lieu applications within the State of New York, and there should be fewer foreclosures overall. The court referees will set deadlines for the submission and review of short sale and deed-in-lieu applications and will ensure that the borrower is complying with the lender’s document requests and that the lender is properly reviewing the applications.

Despite this new rule, it is likely that short sales will continue to decline because the Mortgage Forgiveness Debt Relief Act of 2007 expired at the end of 2013. Under this Act, borrowers were not required to pay income tax on cancelled mortgage debt as a result of loan modifications, short sales, or deeds-in-lieu. Now that it has expired, borrowers who choose to do short sales may be hit with large tax bills after they sell their properties for less than what is owed on the mortgage. Therefore, even though the short sale and deed-in-lieu application process will be quicker with court oversight, borrowers may still choose to not move forward with these exit strategies because they cannot afford the taxes.

Monday, November 24, 2014

Fair Housing CE Requirements for NY Real Estate Agents

Every 2 years, licensed real estate brokers and salespersons in the State of New York are required to take 22.5 continuing education credits. The ONLY mandatory class requirement is at least 3 hours of instruction pertaining to fair housing and/or discrimination in the sale or rental of real property or an interest of real property, within the 2 - year period immediately preceding a renewal.

Lieb School's free CE entitled, The Fair Housing Act satisfies this requirement. This course will be held at 230 Elm in Southampton on December 10th, 2014. Enrollment is only available online through www.liebschool.com

Thanks to our sponsors, this event will be fully catered. Sponsors include Behind the Hedges, DE Capital Mortgage, and Douglas Elliman

Friday, November 14, 2014

No Drone For You - The FAA Bans the Use of Drones in Real Estate Brokerage

Dennis Valet, Esq., an Associate Attorney at Lieb at Law, P.C. writes about the FAA banning the use of drones in real estate brokerage. This article was featured in The Suffolk Lawyer.

Click Here To Read The Article

Thursday, November 13, 2014

New York Foreclosure Settlement Conferences are Tools to Help Homeowners Stay in Their Homes

New York is one of many states across the country that has implemented court-mandated settlement conferences for residential foreclosure actions.

It is important to understand how these conferences work so that homeowners can take full advantage of this opportunity to delay and avoid foreclosure. The initial conference must be scheduled within 60 days after the proof of service of the complaint has been filed with the county clerk and allows the borrower to meet with his or her Lender and a court referee or judge to discuss potential workout options, such as loan modifications or payment plans. If the borrower decides to apply for a loan modification, the Lender provides the borrower with a document request for the loan modification application, and the court referee sets deadlines for the submission and review of the application. Typically, there are numerous conferences throughout the application process in order to ensure that the borrower is complying with the Lender’s document requests and that the Lender is properly reviewing the application. If a borrower believes he was improperly denied a loan modification, his attorney may request a bad faith hearing with the judge to determine whether the Lender should be sanctioned for bad faith negotiations. These settlement conferences not only help homeowners delay the foreclosure process but also can stop the foreclosure process all together.

Not every person who has a property in foreclosure in New York State is entitled to these mandatory pre-trial foreclosure settlement conferences. The law in New York (CPLR 3408), extends the conferences only to owner-occupied residential properties, so if a homeowner has a vacant property or a rental property in foreclosure, he or she is not entitled to a CPLR 3408 conference as of right.

Further, CPLR 3408 does not apply in federal court, but settlement conferences are still available at the federal level. Rule 16 of the Federal Rules of Civil Procedure allows federal courts to hold pre-trial conferences for the purpose of settlement negotiations and encourages judges to take an active part in the settlement negotiations. The procedures differ at the federal level but the purpose is still the same. These conferences are often the difference between a homeowner staying in his or her home and losing it.

Monday, November 3, 2014

10 Surprises When Inheriting Real Estate

Following the death of a loved one, you may become the recipient of an unexpected parcel of real estate. Yet, with every windfall comes great obligations, so be prepared for the surprises you may encounter when inheriting property.

Andrew Lieb's latest article featured in The Huffington Post includes the following topics:


  1. Mortgage Transfer
  2. Reverse Mortgage
  3. Rental
  4. Homeowners Insurance
  5. Testamentary Substitutes
  6. Estate Tax
  7. Capital Gains Tax
  8. Probate
  9. Heirs at Law
  10. Right of Election
You can view the article by clicking here.