Recent Blog Posts

Principal Reductions- The Golden Egg of Loan Workout Solutions

Liberty Credit Law Team — Fri, 07 Oct 2011 15:08:00 GMT

For most homeowners, a principal reduction is the "golden egg" of loan workout solutions. For those unfamiliar with the term, a principal reduction is the permanent reduction of the outstanding balance of a loan. Basically, a bank writes off a portion of the loan and the borrower no longer owes that money to the lender. As you could imagine, lenders are extremely resistant to offer principal reductions. Principal reductions are designed as a way to assist "underwater" borrowers: Borrowers who owe more on their mortgage than their homes are worth. However, according to Dailyfinance.com, only 4% of all loan modification handed out include some sort of principal reduction. 4%? According to Zillow.com, approximately 28% of American homeowners are currently underwater.

Despite the difficulty Americans seem to have convincing their lenders to offer a principal reduction, Liberty Credit Law is sometimes able to achieve this result for our clients. In fact, we were able to negotiate a $90,795 principal reduction for one of our recent clients!

Here's the story: The client first approached Liberty Credit Law after successfully being granted a loan modification by her lender. However, the terms of this modification were not favorable and were unacceptable for the client. The homeowner decided to retain the law firm for assistance in working out a favorable solution with her lender. After an in depth evaluation and a Net Present Value analysis, the Liberty Credit Law attorneys decided that the best option for the client was to pursue a HAMP modification. The legal team presented a strong case for granting their client a principal reduction as well. After many rounds of phone calls, document submissions, and financial proposals, the bank agreed to offer our client a principal reduction along with a very favorable loan modification. A resolution was reached, giving the client excellent modification terms with an overall savings of $984 a month! The client was able to meet the new temporary requirements, and within a few short weeks Liberty Credit Law was able to secure the client a permanent modification. The client was overwhelmed with joy. She even called the LCL lawyers "Angels". We at Liberty Credit Law were also ecstatic that we were able to achieve such positive results. Congrats to the client on a great modification.

Here are the terms of the final modification:

New interest rate: 2%

New monthly payment: $876.82

Payment Reduction of:51%

Principal Reduction: $90,795

Liberty Credit Law Navigates Obstacles to Obtain Positive Results for Struggling Homeowners

Liberty Credit Law Legal Team — Wed, 22 Jun 2011 20:56:00 GMT

The legal team at Liberty Credit Law, P.C successfully negotiates loan modification agreements for its clients daily. The team is comprised of experienced bankruptcy attorneys, mortgage experts, and paralegals who have dedicated their careers to assisting consumers experiencing financial difficulties with effective assistance. Liberty Credit law has helped over 1,000 homeowners stay in their homes more affordably. As you could probably imagine, Liberty’s legal team has heard it all. Banks lie and deceive consumers every day. Our team is well trained to overcome every deceptive practice the banks throw at them. Losing paper work, asking for documents already submitted, robotic denials. ”NPV” failures, premature foreclosure sales and the list goes on. There is not a single obstacle the banks can think of that the Liberty Credit Law legal team has not overcome.

Any one of the bankruptcy attorneys or paralegals on staff at Liberty Credit Law can probably write a book of stories and anecdotes about clients of the firm who were bullied and lied to by lenders and servicers. They can also talk about the many clients that thought they were out of luck before Liberty Credit Law came to the rescue and helped save their homes. Not a single business day has gone by in the last six months in which Liberty’s legal team didn’t obtain a loan modification or otherwise succeed for AT LEAST one of its clients. In general during negotiations with banks, the staff tries to part with their emotions and go full steam ahead with the task at hand-to negotiate favorable mortgage terms for their clients, often saving a clients home from foreclosure. However, recently the firm has gained a few victories which the staff’s emotional involvement was ever –present. These victories are sweet and rewarding. Often the amount of work that is required to gain a positive outcome for clients is underestimated. Here is one such account as told by a member of Liberty Credit’s Law legal team.

“Our office was retained by a client who had previously been notified that his home was scheduled to be foreclosed and sold at an auction. As soon as the firm was retained and the attorney completed his initial review, he instructed the legal team how to proceed and we began working vigorously to collect all necessary documentation from the client. A complete loan modification application and worksheet was quickly compiled and submitted to the mortgage servicer with a proposal. We made sure that the file was quickly assigned to a person of authority at the bank, because there was already a sale date scheduled for the home. The servicer typically requires a copy of the homeowner’s recent pay stubs, so we were pro-active in obtaining that and sure to include them in our proposal. The bank’s negotiator contacted me and advised that the pay stubs he received were “crap” (new banking terminology?) and that he would not accept them. We decided that in this particular situation, we would better serve our client if we followed the servicer’s requests, which we viewed to be pretty arrogant, repetitive, and absurd, rather than enter a lengthy debate about the servicer’s procedural shortcomings. In addition to a request for new pay stubs, the servicer requested a letter from the client’s employer and copies of their W2’s, which our office gathered promptly and submitted upon request.

The servicer soon notified the firm that they decided to deny the modification request and close the file because the negotiator claimed to have advised our firm that he needed the updated documents within 24 hours. Since this claim was untruthful, The Liberty Credit Law team escalated the file to a superior at the bank who finally agreed to request a postponement of the home’s sale from the investor of the loan. However, the sale postponement was not granted by the investor and the home was sold at an auction within days.

Liberty Credit Law’s legal team was not going to accept this injustice. The sale of this property was unjust and immoral. The legal team strategized and one of the firms managing attorney’s escalated the file directly to the investor of the loan. He simply was not going to let the homeowner’s life be turned upside down because of an unscrupulous banker. A package was prepared to be submitted to the investor of the loan, which included a sale rescission demand letter from one of our attorney’s, a loan modification proposal, and a detailed report of our client’s personal financial information. In addition, a Net Present Value analysis (NPV) of the client’s home was conducted, which showed a detailed report of the investor’s financial outcome if they were to modify the client’s loan rather than foreclose. All of this information was immediately presented to the investor’s general Counsel and chief Executive officer via both e-mail and regular mail. A copy was also sent to the servicers General Counsel and Vice President Of Home Retention and the attorney tasked with overseeing the foreclosure of the home.

Within one week of submitting an appeal, Liberty Credit Law received a phone call from one of the partners of the lender’s law firm tasked with overseeing the foreclosure and was advised that the investor had granted the rescission of the sale. The sale of our client’s home was reversed and they were once again in active review for a loan modification. We continued to negotiate with the bank on our client’s behalf to assure that they can continue to live in their home. In June of 2011, just 6 hours before the home was scheduled to sell AGAIN, Liberty’s legal team completed its negotiations with the bank and the client was approved for a loan modification. Over a year of delinquency was placed on the “back of the loan” and our client is now current on his mortgage. A member of our legal team was honored to break the exciting news to the client.

Our staff loves making these types of phone calls to clients. There is no feeling more rewarding than when we hear our clients drop the phone and scream. “Honey I have great news, they did it!” we get to make these types of calls every day. This is what makes all the hard work worth it.”

Here are just a few more of the many recent successes which Liberty Credit law has obtained for its clients:

Mortgage Terms: Original Mortgage Details / New Mortgage Details
Interest Rate: 7.5% / 2.0%
Monthly Payment: $2,125.68 / $1,354
Delinquency Amount: $ 21,829 / $.0.00
# of Payments Behind: 17 / Current
Mortgage Type: Adjustable Rate / Fixed Rate

Monthly Payment Reduction: $771.68

____________________________________________________

Mortgage Terms: Original Mortgage Details / New Mortgage Details
Interest Rate: 6.0% / 3.850%
Monthly Payment: $1,425 / $1,147.38
Delinquency Amount: $4,679 / $0.00
# of Payments Behind: 6 / Current
Mortgage Type: Fixed / Fixed

Monthly Payment Reduction: $ 277.62

___________________________________________________

Mortgage Terms: Original Mortgage Details / New Mortgage Details

Interest Rate: 7.9% / 2.0%
Monthly Payment: $2,321 / $954.83
Delinquency Amount: $25,790.89 / $0.00
# of Payments Behind: 12 / Current
Mortgage Type: Adjustable Rate / Fixed rate

Monthly Payment Reduction: $ 1,366.17

___________________________________________________

*Prior results do not guarantee a similar outcome.

High Fives all around!

Liberty Credit Law Legal Team — Tue, 21 Jun 2011 20:33:00 GMT

Here is a recent success story that generated some high fives in the Liberty Credit Law office: A client contacted the firm after being denied for a loan modification from their bank. The client's family was experiencing significant financial hardship. The client retained Liberty Credit Law and the legal team immediately began working with the bank on the client's behalf. Soon after beginning work on the file, the legal team received notice that the bank had once again denied the client for a modification. The liberty team resubmitted the loan modification application and escalated it to the appropriate department in order to expedite the process.

Although the client was eventually offered a temporary loan modification, the legal team thought that the client qualified for better terms. The client had an affordable monthly mortgage payment in mind which would leave enough income left over to support the family. After countless hours of phone conversations, paperwork submissions, escalation letters from the attorneys, and constant communication with the client, the legal team finally negotiated a loan modification which far exceeded the client's expectations. Great job legal team! And congratulations to the client! Here are the terms:

New interest rate:

2% for first 2 years. Interest rate increases 1% each year and will max out at 6.375% in year 7.

New Mortgage Payment:

$1,634

Old Mortgage Payment:

$2,511 (interest only loan)

Monthly Savings (Year 1)

$877

Principal Forgiven

$59,674.84

Liberty Credit Law Team Looking Forward to a Summer Filled With Positive Results for our Clients!

Liberty Credit Law — Mon, 13 Jun 2011 19:29:00 GMT

The Liberty Credit Law legal team has recently been obtaining some of its best and most exciting results ever. There are constantly important changes and relevant news stories that we feel our cleints can benefit from. Stay tuned to our blog in the coming days and weeks for important updates and trends regarding consumer credit, debt, and mortgage related matters!

Welcome to our Liberty Credit Law Blog

Credit Law Attorney — Wed, 21 Apr 2010 17:07:00 GMT

We are pleased to announce the launch of our Liberty Credit Law Blog