Housing Price Plummet Delayed to June 30, 2021

The headlines are in - the federal foreclosure / eviction moratoriums are extended to June 30, 2021 from March. This extension applies to 70% of single family home mortgages.

The subtext is that we have a foreclosure / eviction crisis on the horizon. According to the White House "1 in 5 renters is behind on rent and just over 10 million homeowners are behind on mortgage payments." 

If you just use a little deduction, you will quickly realize that almost every block across America is going to see foreclosures and evictions. In the micro, this will result in firesales, which will reduce comparable home prices across the board. In the macro, it will decrease property upkeep and maintenance, which will create a secondary impact on the greater community's desirability and pricing. 

That's the bad. 

The good is that it's going to be a buyer's market soon.

We need to start thinking about strategies to Purchase Property Post-Pandemic. 

What's your strategy? 

Assaulting and Injuring a Landlord Is Not Enough for Eviction

In the Matter of Bryant v. Garcia, the First Department found that the termination of a tenant’s tenancy was too much of a penalty for hitting the landlord’s employee.

In this case, the tenant was a 64-year-old woman who has been a New York City Housing Authority (NYCHA) tenant for more than 40 years and who “suffered a momentary loss of control when she struck respondent’s employee, whom she believed to be in a relationship with her former partner” per the First Department. Due to the incident, the NYCHA terminated her lease and the tenant is now seeking to vacate that determination.

The Court granted her request and found that because the tenant has lived there for more than 40 years without incident and that the NYCHA has not showed any other proof that the tenant presents a safety concern, a lesser penalty than terminating her lease is warranted. Now, it’s up to the lower court to determine what the lesser penalty should be.

What do you think the penalty should be? Should assaulting and injuring a landlord be enough to evict?

Co-op / Condo / HOA By-Laws Can Reduce Board's Protection From Suit - If You Don't Know What You're Doing

Traditionally, boards are protected from suit under what is called the Business Judgment Rule, which means that actions that are undertaken in good faith and in furtherance of the community, no matter how foolish, can not give rise to board liability. The only real exceptions to this rule are for acts of self-dealing or discrimination. 

However, poorly drafted By-Laws can change that standard and expose boards to liability. 

This was just highlighted in the recent Appellate Division case of Matter of Kotler v 979 Corp.

In the case there was a dispute about the assignment of a cooperative's proprietary lease on the lessee's death. The Court found that the by-laws supplanted the Business Judgment Rule with a heightened Reasonableness standard when the document stated "consent shall not be unreasonably withheld to any assignment or transfer of this lease."

Then, the board lost the case and was told to pay damages and attorneys' fees. 

Attention boards, managing agents (property managers), and board counsel - don't just copy another board's by-laws - think for yourself.

You Know That Your Mortgage Payoff # Is Wrong - What Should You Do?

Here is the scenario - You are trying to sell a property and you order a payoff from your mortgage company, but that payoff quote comes in much higher than you believe that it should. 

You are in a real bind. 

You need to sell, but you don't want to overpay. What should you do?

This is particularly problematic where you are in default on your mortgage and the lender has started tacking on exorbitant penalties and attorneys' fees.

The answer is that you better protest the payoff, in writing, while requesting an itemization and then, you should pay it anyway. 

If you do, you can then file a motion for an accounting and ask the court to compute the appropriate fees, charges, expenses, and other payments due under the mortgage. 

If you don't, your motion to the court for an accounting will probably be denied in light of the voluntary payment doctrine, equitable estoppel, and waiver bar the accounting.

Again, protest and pay is the strategy based upon the appellate court decision in US Bank v. Cordero. 

Are you selling a house in foreclosure? If so, pay attention. 

Implicit Bias Discrimination Trainings in the Face of EO 13950 Restriction

Anti-discrimination trainings start with learning that we all have implicit biases. However, President Trump had blocked training this topic by Executive Order in many different situations. Well, the federal courts took none of that and have permitted implicit bias trainings again. Andrew Lieb provides an update in the Suffolk Lawyer, Law Journal.

Read the full published article HERE.