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A Fresh Start

Advice on mortgage outside SOL judicial foreclosure

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Hello fellow CB'ers,

 

I need some help on an SOL question.

 

We took out a mortgage in 2004 on a home in New Mexico. Along came 2008 and all the problems that followed. We were forced to close our business and filed ch7 in Sept '08. Last mortgage payment was made in Aug '08.

 

BAC filed foreclosure action in 2009 or 2010 (don't have the paperwork in front of me). We decided to fight the foreclosure and went to court. We asked for documents related to our mortgage, the note, endorsements etc. The case was dismissed by the court for lack of prosecution in 2011. BAC attorney motioned to have the case reopened, we responded and motion was denied.

 

We haven't heard anything more from anyone on this until a few days ago.

 

We received a new letter from another law firm stating they intended to foreclose. My first reaction was to send them an FOAD letter as everything I've read stated the SOL on written contracts is 6 years in NM. I thought I'd better get some advice on this before I jump off the deep end.

 

I was going to use a modified version of Radi8 letter found here: https://creditboards.com/forums/index.php?showtopic=278917

 

Does the SOL in NM apply to mortgage notes and if so, is that the correct letter to use? Is there a better option to handle this?

 

Any help is much appreciated

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ahhh

 

the SOL issue resolves around the filing and dismissal of the court case

 

the filing of the Case Stops the SOL from running, and the dismissal restarts it - but it's a fine point of law on whether the time between tolled it permanently

 

or whether the Tolling provision fell away completely since it was for lack of prosecution

 

if it tolled it permanently, total up the SOL Time

 

 

 

Default Sept 08 ( 30 days past last payment ) - Start of SOL .

Filed ______, 2009 ( ___? year, ____ month accrued for SOL Purposes )

dismissed ________, 2011

dec 2016 ( ______ years _____months Accrued for SOL purposes )

 

Filing might stop the SOL from Running, but it doesn't reset the clock to day 1 )

 

you're going to need your papers

 

 

but you may have another way out

 

 

B. Involuntary dismissal; effect thereof.

 

For failure of the plaintiff to prosecute or to comply with these rules or any order of court, a defendant may move for dismissal of an action or of any claim against the defendant.

 

After the plaintiff, in an action tried by the court without a jury, has completed the presentation of evidence, the defendant, without waiving the right to offer evidence in the event the motion is not granted, may move for a dismissal on the ground that upon the facts and the law the plaintiff has shown no right to relief. The court as trier of the facts may then determine them and render judgment against the plaintiff or may decline to render any judgment until the close of all the evidence. If the court renders judgment on the merits against the plaintiff, the court shall make findings as provided in Rule 1-052 NMRA.

 

Unless the court in its order for dismissal otherwise specifies, a dismissal under this paragraph and any dismissal not provided for in this rule, other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join a party under Rule 1-019 NMRA, operates as an adjudication upon the merits.

 

 

So they can't file suit again if they failed to prosecute the first action, unless the court order for Dismissal specifically allowed it

 

 

GO FIND THAT ORDER OF DISMISSAL !!!

 

I"ll do some more research on the tolling issue on dismissed action while you go look for papers.

 

Call the Clerk of courts in NM to get copies if you don't have the actual order.


yeah, Don't use the generic FOAD letter, to a lawyer

 

 

you need a specific one -

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37-1-20. [No sale upon mortgages, etc., when action barred.]
No lands, tenements, hereditaments, goods or chattels shall be sold under any power of sale contained in any mortgage, deed of trust or other written instrument of like effect, where an action or suit upon the indebtedness secured thereby is barred by the provisions of Chapter 68, New Mexico Statutes of 1915.
37-1-12. [When commencement of action stayed or prevented.]
When the commencement of any action shall be stayed or prevented by injunction order or other lawful proceeding, the time such injunction order or proceeding shall continue in force shall not be counted in computing the period of limitation.
37-1-13. [When action deemed commenced.]
The filing in the proper clerk's office of the petition, declaration, bill or affidavit, upon the filing of which process is authorized by law to be issued, with intent that process shall issue immediately thereupon, which intent shall be presumed, unless the contrary appear, shall be deemed a commencement of the action.
History: Laws 1880, ch. 5, § 8; C.L. 1884, § 1867; C.L. 1897, § 2920; Code 1915, § 3367; C.S. 1929, § 83-124; 1941 Comp., § 27-112; 1953 Comp., § 23-1-13.
37-1-14. [When second suit deemed continuation of first action.]
If, after the commencement of an action, the plaintiff fail therein for any cause, except negligence in its prosecution, and a new suit be commenced within six months thereafter, the second suit shall, for the purposes herein contemplated, be deemed a continuation of the first.
History: Laws 1880, ch. 5, § 12; C.L. 1884, § 1872; C.L. 1897, § 2925; Code 1915, § 3355; C.S. 1929, § 83-110; 1941 Comp., § 27-113; 1953 Comp., § 23-1-14.
it's not TOLLED !
Gathman-Matotan v. DEPT. OF FINANCE, 787 P. 2d 411 - NM: Supreme Court 1990
King v. Lujan recognizes the general principle that the filing of a complaint ordinarily tolls the applicable limitations period. Id. at 180, 646 P.2d at 1244, citing Prieto v. Home Educ. Livelihood Program, 94 N.M. 738, 616 P.2d 1123 (Ct.App. 1980). In this respect, New Mexico has adopted an "equitable" or nonstatutory tolling principle alongside the statutory tolling provisions in NMSA 1978, Sections 37-1-14, 37-1-9 and 37-1-12. This nonstatutory tolling doctrine, however, should be subject to the same exception or limitation as applies in the statutory situations: Where an action is dismissed for failure to prosecute (negligence in its prosecution), the limitations period will not be interrupted. As we said in King in language fully applicable to the claim asserted by plaintiff in the present case:
A plaintiff who files near the end of the limitations period benefits from being able to prosecute his claim after the period has expired, but if he fails to take advantage of that opportunity, and suffers dismissal for failure to prosecute, there is no reason to let him have an extended period in which to sue.

 

 

See Bracken, 760 P. 2d at 466. "Where an action is dismissed without prejudice [, however,] because of a failure to prosecute, the action will be deemed not to interrupt the running of an otherwise applicable statute of limitations [.]"
- in Muller v. Vilsack, 2014 and one similar citation
Muller v. Vilsack, Dist. Court, D. New Mexico 2014

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So Send the Attorney this FOAD letter ?

 

I think it may be worth hiring a NM lawyer to review the above cases to ensure I'm correct.- I"m not a lawyer ,

 

not everything is on Google Scholar and there may be some other technical procedural issue i'm unaware of.

 

don't know if the BK 7 has any effect, you didn't reaffirm the mortgage or make any payments that reset the SOL ?

 

 

(Attorney name )

 

 

re: Foreclosure on Property @ _____________________

 

 

Dear Sir,

 

I am in receipt of your letter advising that you intend to foreclose on property located at ________________,

 

However there was a previous foreclosure attempt filed on xx-xx- 2009 which was Dismissed for lack of prosecution on xx-xx-2011.

 

Pursuant to Muller v. Vilsack, Dist. Court, D. New Mexico 2014, Gathman-Matotan v. DEPT. OF FINANCE, 787 P. 2d 411 - NM: Supreme Court 1990, and NMRS 37-1-14. , that foreclosure proceeding had no effect on the running of the Statute of limitations

 

As your clients cause of action accrued on Sept 08, 2008 and this is December 2016, I believe any action on this matter is Time-Barred

 

Should you believe otherwise, please explain your reasoning.

 

As you should know, lawyers are covered under the FDCPA, and mistake of law is no excuse, along with deceptive means to collect a debt.

 

Sincerely,

 

your printed name

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Hi ICANHASMUNY,

 

First off, thank you so much for your research! I truly appreciate it.

 

Looking up the case online, it appears I was off on my timeline. I'm not sure if that makes any difference for SOL purposes.

 

08/01/2008 - First payment missed

08/29/2008 - Filed CH.13

09/22/2008 - Converted to Ch.7

01/05/2009 - Ch7 Discharge

05/14/2010 - foreclosure complaint filed

02/18/2013 - Dismissal for Lack of Prosecution

06/04/2013 - Order Denying Plaintiff's Motion to set aside Disposition Order for Lack of Prosecution

 

We did not reaffirm or make any payments to anyone. In fact, we haven't talked to anyone other than attorneys via the courts regarding this mortgage.

Edited by A Fresh Start

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like I said, you should probably run this past a NM attorney - worth a couple hundred to avoid a lawsuit, the foreclosure and a judgment on the deficiency balance after the sale

 

it's possible your mortgage was sold to a new servicer that doesn't have any record of the previous foreclosure attempt

 

so what happened to the house?

 

still sitting there empty ?

 

guess you still own it, wonder if you could sell it ?

 

if you do hire an attorney, forward the cases I cited.

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I'll look for an attorney Monday. Should it be a foreclosure attorney or ???

 

We have a friend go to the house a couple times a week to check on it. Keeps vandals away.

 

I wouldn't mind selling it, but according to the letter we got from the attorney, we now owe $500k on it! Original mortgage was $375k. We would need to somehow quiet title to remove the lien. Not quite sure how to go about that one.

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I don't think you could sell it without the lein. You could quit claim it to someone and let them deal with the foreclosure.

 

I almost bought a dirt cheap rental property on a land contract. I ordered a cheap online title report and reading through the chain of title was murky and it looked like someone still had an interest in it from 12 years ago. The current owner/seller would only issue a quit claim deed at the end of the land contract, which just means hes releasing his interest in it. Its not guaranteed with title insurance, like a warranty dead someone else could come along and still sue saying its theirs. I probably should of bought it, the guy only wanted 15k and few grand down. I probably could of just rented it out and nothing would of ever came up, I'm sure the old owner washed there hands of it. You just never know though the old owner could come around, see it fixed up and worth a little bit.

 

In your situation the buyer would be buying it knowing there a lein on it. He'd only pay significant money if he knew he could win in court. He'd still pay considerably less than market value for court costs and the gamble.

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I'll look for an attorney Monday. Should it be a foreclosure attorney or ???

 

We have a friend go to the house a couple times a week to check on it. Keeps vandals away.

 

I wouldn't mind selling it, but according to the letter we got from the attorney, we now owe $500k on it! Original mortgage was $375k. We would need to somehow quiet title to remove the lien. Not quite sure how to go about that one.

 

most foreclosure attorneys are going to take the creditors side, cause that's who they work for predominately.....

 

- find a FDCPA lawyer -

 

your old BK Attorney should know, or know of someone

 

for a 500K Action, I would spend a few grand on an attorney, let them handle the Foreclosure attorney

 

that judge probably refused to reopen the case based on the case law I cited -

 

you should get certified copies of all the actual papers filed. from the clerk of courts

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I don't think you could sell it without the lein. You could quit claim it to someone and let them deal with the foreclosure.

 

I almost bought a dirt cheap rental property on a land contract. I ordered a cheap online title report and reading through the chain of title was murky and it looked like someone still had an interest in it from 12 years ago. The current owner/seller would only issue a quit claim deed at the end of the land contract, which just means hes releasing his interest in it. Its not guaranteed with title insurance, like a warranty dead someone else could come along and still sue saying its theirs. I probably should of bought it, the guy only wanted 15k and few grand down. I probably could of just rented it out and nothing would of ever came up, I'm sure the old owner washed there hands of it. You just never know though the old owner could come around, see it fixed up and worth a little bit.

 

In your situation the buyer would be buying it knowing there a lein on it. He'd only pay significant money if he knew he could win in court. He'd still pay considerably less than market value for court costs and the gamble.

This is an interesting idea that may be worth looking into. The discharge removes liability from us and if the foreclosure is outside the SOL, it would basically remove the threat of judicial foreclosure (only type allowed in NM) against the house.

 

 

 

I'll look for an attorney Monday. Should it be a foreclosure attorney or ???

 

We have a friend go to the house a couple times a week to check on it. Keeps vandals away.

 

I wouldn't mind selling it, but according to the letter we got from the attorney, we now owe $500k on it! Original mortgage was $375k. We would need to somehow quiet title to remove the lien. Not quite sure how to go about that one.

 

most foreclosure attorneys are going to take the creditors side, cause that's who they work for predominately..... Sorry, I misspoke. I meant foreclosure defense attorney

 

- find a FDCPA lawyer - A quick search reveals slim pickings in NM it seems

 

your old BK Attorney should know, or know of someone Unfortunately, he's no longer available

 

for a 500K Action, I would spend a few grand on an attorney, let them handle the Foreclosure attorney

 

that judge probably refused to reopen the case based on the case law I cited -

 

you should get certified copies of all the actual papers filed. from the clerk of courts

 

 

While searching for an attorney, I did run across the following interesting item from the New Mexico Law Review

 

 

In 2010, Professors Timothy Goldsmith and Nathalie Martin reported the results of an empirical study that determined the impact of
providing information about time-barred debts to consumers.
The study divided consumers into two groups—A and B—that were statistically
similar based on sex, age, education, income, and debt.
The participants in each group were asked how likely they would be willing to pay a debt that they had stopped making payments on more than six years ago. The
study informed Group A that the debt was not enforceable in court because the enforcement period had expired. Group B did not receive this notice. As expected, the pay-rate response by Group A was significantly lower than that of Group B. Goldsmith and Martin concluded that given this difference, knowledge of the expiration of the limitations period is a material consideration for debtors in deciding whether to make payments. The New Mexico Attorney General’s office used the results from this study to settle a lawsuit that alleged that a collector’s failure to disclose that it was collecting time-barred debts was a deceptive trade practice.
The settlement resulted in a cash payout and an injunction that prohibited the collection of time-barred debt without disclosing that the debt would not be enforceable in a court action. 360
Subsequently, New Mexico issued regulations in 2010 that prohibit the collection of time barred debts, unless the collector discloses that the debts would not be
enforceable in court, and that partial payment or acknowledgement of the debt could result in restarting the limitations period.361 A limited
number of jurisdictions have adopted similar legislation or regulations.
Additionally, in 2012 the FTC imposed disclosure requirements as a condition of settlement with collectors who allegedly pursued time-barred debts. 363
360. Goldsmith & Martin, supra note 25, at 380.
361. 12.2.12 NMAC (12/10/2010).
363. Consent Decree, United States v. Asset Acceptance, LLC, No. 8:12-cv-182-T-27EAJ (M.D. Fla. Jan. 31, 2012),
available at http://www.ftc.gov/os/caselist/0523133/120131assetconsent.pdf(requiring disclosures if know or should know that debt is time-barred). The Seventh Circuit Court of Appeals has also recently decided that a
debtor may have a misrepresentation claim under the FDCPA if a collector knowingly seeks to collect time-barred debt without disclosing that the debt is time-barred. McMahon v. LVNV Funding, LLC, 744 F.3d 1010, 1020 (7th Cir. 2014).

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yeah, it's in the state law forum. ( HINT )

 

any case - what would be/is the lien value filed against the house?

 

you should ask on the mortgage forum regarding home lender charge off requirements - usually once it's charged off, they can't charge interest .

 

wonder how they got to that 500K ?

 

are you paying the property / local taxes on it, or is the bank?

 

who did the CA/lawyer state they were representing?

 

https://www.fdic.gov/regulations/laws/rules/5000-1000.html

 

• One- to four-family residential real estate loans and home-equity loans that are past due 90 days or more with loan-to-value ratios greater than 60 percent should be classified Substandard. Properly secured residential real estate loans with loan-to-value ratios equal to or less than 60 percent are generally not classified based solely on delinquency status. Home-equity loans to the same borrower at the same institution as the senior mortgage loan with a combined loan-to-value ratio equal to or less than 60 percent need not be classified. However, home equity loans where the institution does not hold the senior mortgage, that are past due 90 days or more should be classified Substandard, even if the loan-to-value ratio is equal to, or less than, 60 percent.
For open- and closed-end loans secured by residential real estate, a current assessment of value should be made no later than 180 days past due. Any outstanding loan balance in excess of the value of the property, less cost to sell, should be classified Loss and charged off.

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you should ask the Admins to move to the Mortgage foreclosure forum, let the forum leads there answer the mortgage, interest / lien issues

 

I"m more into the SOL / legal research.

 

just hit the report button and ask the Mods to move the whole thread.

 

 

this for NM realestate / consumer advocates

 

http://www.consumeradvocates.org/find-an-attorney?field_areas_of_practice_list_value=Mortgage%2FReal+Estate%2FHousing&field_practice_states_value=NM

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The TAXES may be an issue

 

could the bank sue for unjust enrichment if they've been paying the taxes all these years, even thought they can't foreclose?

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I've asked to have this moved. Thanks again for all your help!

 

 

yeah, it's in the state law forum. ( HINT )

any case - what would be/is the lien value filed against the house? Original mortgage was for $375k

you should ask on the mortgage forum regarding home lender charge off requirements - usually once it's charged off, they can't charge interest .

wonder how they got to that 500K ?

are you paying the property / local taxes on it, or is the bank? The servicer

who did the CA/lawyer state they were representing? Fannie Mae

https://www.fdic.gov/regulations/laws/rules/5000-1000.html

• One- to four-family residential real estate loans and home-equity loans that are past due 90 days or more with loan-to-value ratios greater than 60 percent should be classified Substandard. Properly secured residential real estate loans with loan-to-value ratios equal to or less than 60 percent are generally not classified based solely on delinquency status. Home-equity loans to the same borrower at the same institution as the senior mortgage loan with a combined loan-to-value ratio equal to or less than 60 percent need not be classified. However, home equity loans where the institution does not hold the senior mortgage, that are past due 90 days or more should be classified Substandard, even if the loan-to-value ratio is equal to, or less than, 60 percent.

For open- and closed-end loans secured by residential real estate, a current assessment of value should be made no later than 180 days past due. Any outstanding loan balance in excess of the value of the property, less cost to sell, should be classified Loss and charged off.


you should ask the Admins to move to the Mortgage foreclosure forum, let the forum leads there answer the mortgage, interest / lien issues

I"m more into the SOL / legal research.

just hit the report button and ask the Mods to move the whole thread.


this for NM realestate / consumer advocates Fantastic!

http://www.consumeradvocates.org/find-an-attorney?field_areas_of_practice_list_value=Mortgage%2FReal+Estate%2FHousing&field_practice_states_value=NM


 

 

The TAXES may be an issue

could the bank sue for unjust enrichment if they've been paying the taxes all these years, even thought they can't foreclose? Not sure. This is something to ask the attorney.

 

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http://www.nytimes.com/2015/03/30/business/foreclosure-to-home-free-as-5-year-clock-expires.html?_r=0

 

 

was Fannie Mae the original lender?

 

who was listed as the plaintiff on the first attempted foreclosure?

 

http://www.sfreporter.com/santafe/article-8225-can%E2%80%99t-touch-this.html

 

case on google scholar

 

Bank of New York v. Romero, 320 P. 3d 1 - NM: Supreme Court 2014

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http://www.nytimes.com/2015/03/30/business/foreclosure-to-home-free-as-5-year-clock-expires.html?_r=0

 

 

was Fannie Mae the original lender?

 

who was listed as the plaintiff on the first attempted foreclosure?

 

http://www.sfreporter.com/santafe/article-8225-can%E2%80%99t-touch-this.html

 

case on google scholar

 

Bank of New York v. Romero, 320 P. 3d 1 - NM: Supreme Court 2014

FNMA isn't a lender (they can't be OC) they are an investor (GSE) who would have bought the loan right after closing and have a servicer (many times but not always) the originating lender service the loan on their behalf. Edited by tiggerlgh

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http://www.nytimes.com/2015/03/30/business/foreclosure-to-home-free-as-5-year-clock-expires.html?_r=0

 

 

was Fannie Mae the original lender? The original loan was done with Countrywide

 

who was listed as the plaintiff on the first attempted foreclosure? BAC Home Loans

 

http://www.sfreporter.com/santafe/article-8225-can%E2%80%99t-touch-this.html

 

case on google scholar

 

Bank of New York v. Romero, 320 P. 3d 1 - NM: Supreme Court 2014

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Country wide

 

bought out by

 

bank of america

 

Fannie Mae

 

Good luck straightening out that mess

 

Bank of america settled with Fannie Mae to buy back the countrywide loans back in 2008

 

http://investor.bankofamerica.com/phoenix.zhtml?c=71595&p=irol-newsArticle&ID=1771565#fbid=4EBY1c5j59r

 

I"m sure the lawyers in NM are real familiar with all of this.

 

but it looks like you have SOL and the NM supreme court ruling on your side, hope it holds up

 

find a lawyer yet?

 

If not, because it's the holidays, I would send the letter to at least stall the foreclosure attorney - he will at least have to look up the previous case and pull court documents before proceeding if he's smart.

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I called several attorneys from the link you provided, but was only able to leave a message. No call backs as of this evening. If I don't hear back in the next few days, I'll send off the letter you supplied.

 

Looking at the letter, I don't believe it was even looked at by an attorney. It's in form letter format and not actually signed.

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