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Get Help with Your Home Foreclosure

By Timothy Leventry, LL M.

Tell Us little about your Company and it's Foundation:

Leventry, Haschak & Rodkey, LLC (LHR) is a full service law firm that provides quality and innovative legal services to individuals, businesses and institutions of Western Pennsylvania and beyond. The Attorneys and Staff of LHR strive to always exemplify honesty, integrity and respect toward their clients and coworkers. LHR focuses on over 20 practice areas and employs seven highly qualified, conversant attorneys, one attorney of counsel, two paralegals, four legal assistants and seven professional administrative staff members, making this firm one of the largest law firms in our area. Established in 1983, LHR has over 30 years of experience helping members of our community with their legal needs. Whether someone is looking to start a new business venture, close on their home, begin planning for their future by developing an Estate Plan or looking for advice on a family law matter the attorneys and staff of LHR are capable of handling your unique situation. LHR also does banking and foreclosure work for both creditors and debtors. For a list of LHR's practice areas and to learn more about our attorneys visit www.lhrklaw.com

What is a foreclosure and how can it be initiated?

A foreclosure is preceded by the borrowing of money by a party, either individual(s) or an entity, such as a business. The lender is typically a bank or some other financial institution, though the loan can be from private individuals. To protect its interest in the money being loaned, the lender requires some form of security or collateral, which will ideally insure repayment from the borrower. Usually, the security is real property purchased or owned by the borrower. Real property is the land and includes structures such as houses, buildings and barns on the land. The lender draws up documents dealing with this transaction with stipulations for the repayment of the loan principal and interest that accumulates while the loan remains outstanding. Among these documents is a mortgage, which encumbers the property as a security for the loan. When the party borrows the money, they become a debtor and the lender becomes a creditor. When a mortgage is involved, the debtor becomes the mortgagor and the creditor is the mortgagee.

Upon a default of the terms of the mortgage and its accompanying note by the borrower, the lender may choose to foreclose in order to be able to sell or get the property back. Before the mortgagee can initiate foreclosure in the courts by filing a Complaint, the mortgagee is statutorily required to send two (2) Notices to the mortgagor:

  • Notice of Intention to Foreclose Mortgage and Accelerate Loan Balance ("Notice of Intention"). This Notice gives the borrower notice and time to cure the default; and
  • Notice of Homeowners Emergency Mortgage Assistance Act ("Act 91 Notice"). This Notice tells the borrower where they may get assistance.

If the mortgagor fails to adhere to these Notices or has exhausted the protections allowed by these Notices, then the mortgagee may proceed with filing the Complaint, which may include accelerating the mortgage note balance due. This means, whatever amounts remain outstanding will be sought for payment. Furthermore, the mortgagee may seek other costs, such as late charges, filing fees and reasonable attorneys' fees. The mortgagee may move for the sale of the land and receive the proceeds to pay off its mortgage.

What should homeowners know about their rights during a foreclosure?

The Notice of Intention informs the mortgagor of the amount(s) due to the mortgagee in order to provide them an opportunity to cure the default within thirty (30) days. If the mortgagor fails to do so, the Notice provides alternatives. Among the alternatives is selling the property that is the security or some other property to pay the debt or to borrow the money from a third party.

The Act 91 Notice notifies the mortgagor of the Homeowner's Emergency Mortgage Assistance Program ("HEMAP") and how the program works. The mortgagor will need to meet with a consumer credit counseling agency ("agency") within thirty-three (33) days of the date of this Notice. These agencies are listed on the Act 91 Notice. During these thirty-three (33) days, the mortgagee is prevented from proceeding with a foreclosure action. If the mortgagor meets with the agency within the allotted time, the agency will assist the mortgagor with completing an application to be filed with the Pennsylvania Housing Finance Agency ("PHFA"). PHFA has sixty (60) days to make a decision after receipt of the application. During these sixty (60) days, no foreclosure proceedings may be pursued.

What are the benefits of working with an attorney when your home is being foreclosed and do homeowners need to hire one?

When your home is being foreclosed it is a stressful time, as it is with many legal actions, and requires special knowledge. The benefit of working with an attorney during this time is having a professional focused on this situation who knows the law while the mortgagee is trying to cure the default. The homeowners themselves are required to meet with the government agencies face-to-face. Every situation is different, and an attorney may be able to provide solutions to the threat of a foreclosure action.

Also, bankruptcy may be a viable option when a foreclosure is filed. An attorney can explain your rights and may permit you to keep your home with a reduced payment.

How do Pennsylvania state laws affect the foreclosure process?

Aside from the Notices already mentioned, the foreclosure process is not instantaneous. A Complaint needs to be filed with the Prothonotary of the county where the property is located. After filing, the Complaint needs to be served by Sheriff upon the property owner. The property owner has the right to file an Answer to the Complaint. If a default judgment is taken or after a hearing judgment is rendered for the lender, the property is then put up for sale at a Sheriff's Sale. The mortgagor has until the commencement of a Sheriff's Sale to cure the default, which can be at least eight (8) to twelve (12) months from the date of filing the Complaint.

What is one of the biggest regrets you've seen people have when it comes to paying their mortgage? What would you recommend to help homeowners avoid this?

Many homeowners are burdened with a limited income, therefore, they must budget the monies they receive from their occupations and other avenues rather than spending their money unwisely. Many people ignore notice after notice from the banks and then act when it is too late. If a homeowner does not pay the electric bill, they lose the electricity but can regain it once the bill is paid. If a mortgage is not paid, they can lose the home. Your home is one of your most important assets and you should give the mortgage used to purchase your utmost attention.

What's the best way for people to reach you and your firm?

  • By telephone: (814) 266-1799
  • By FAX: (814) 266-5108
  • By mail: Leventry, Haschak & Rodkey, LLC 1397 Eisenhower Boulevard Richland Square III, Suite 202 Johnstown, PA 15904
  • Website: www.lhrklaw.com
- See more at: http://www.pennsylvaniahomes.com/articles/get-help-with-your-home-foreclosure#sthash.K0nyKcGM.dpuf
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About The Author

Timothy Leventry is the managing partner of Leventry, Haschak & Rodkey, LLC. Mr....

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