The List of Failed Banks-Find out if your Lender is One

http://www.consumerlaw.org/issues/financial_distress/content/failed_banks/failed-banks.pdf

How the Federal Loan Modification Plan Works?

The Law Office of Malik W. Ahmad is always on the forefront of fighting predatory lending practices and stopping foreclosure including reversing wrongful foreclosure. This is a national crisis and we are doing our bit to stop anyway we can. We strongly believe that preserving the homeownership is the key to restoring American economy. The banks are using all kinds of dilatory tactics to stop or water down the loan modification and we have published innumerable articles to educate our readers and always gets comments and appreciation notes in this regard. However, we continuously strive to educate our homeowners and never shied away or tried to hide any important information from our readers. In fact, we like them to be really educated in every sense. Following is a pdf file which has details how the federal loan modification program should work.
http://www.fdic.gov/consumers/loans/loanmod/FDICLoanMod.pdf

Short Sale--A Painful Process

Short sale is one of the choice when homeowners are facing foreclosure and are in default status. It can be considered as slightly less painful compared to the other choices which are more draconian. In short sale, a sale is neogitated with the lender where the property is not foreclosed, and a buyer is found who gives a reasonable offer to the lender for their approval. By its very nature, the process should be swift, expeditious, and less painful as homeowners miseries are not announced in a public way and also a homeowners can stay in his property. Again, the benefits of short sale are that the homeowners can stay without paying any rent and is safeguarded against all collection calls. Furthermore, a homeowner can also negotiate for not inheriting a deficiency judgement. Done right, no deficiency would follow, as the sword of Damocles can fall on other choices including short sale.

New York Time has recenlty published a very factual article on the miseries of short sale. http://www.nytimes.com/2009/12/13/realestate/13mort.html?_r=2&ref=realestate

Clouds of foreclosure going to loom for few more years

www.lvrj.com/news/breaking_news/Real-estate-analysts-predict-continued-gloom-for-Las-Vegas-79330407.html

Obama Modification Plan Is Moving Very Slow

Our fears has come true as we had indicated that Obama Plan is not overencompassing, and it has no teeth for enforcement. The lenders are still at their games. The keep on asking papers which had been sent to them many times, faxes which are either overworking or not working or out of ink and papers and phones calls which has unlimited voice messages capabilities. A new report has been published which states that these modifications are inherently slow. Please read the article.
http://www.marketwatch.com/story/obama-loan-modification-program-moving-slowly-2009-12-10

MERS Appeal Denied by Arkansas Supreme Court

MORTGAGE ELECTRONIC REGISTRATION SYSTEM, INC., APPELLANT, VS. SOUTHWEST HOMES OF ARKANSAS, APPELLEE

No. 08-1299

SUPREME COURT OF ARKANSAS

2009 Ark. LEXIS 121

March 19, 2009, Opinion Delivered

NOTICE:

THE LEXIS PAGINATION OF THIS DOCUMENT IS SUBJECT TO CHANGE PENDING RELEASE OF THE FINAL PUBLISHED VERSION.

SUBSEQUENT HISTORY: Rehearing denied by Mortgage Elec. Registration Sys. v. Southwest Homes of Ark., Inc., 2009 Ark. LEXIS 458 (Ark., Apr. 23, 2009)

PRIOR HISTORY: [*1]

APPEAL FROM THE BENTON COUNTY CIRCUIT COURT, NO. CIV07-223-2, HON. DAVID S. CLINGER, JUDGE.

DISPOSITION: AFFIRMED.

COUNSEL: George Nicholas Arnold – Counsel for the Appellant.

Howard Keith Morrison – Counsel for the Appellant.

Thomas D. Stockland – Counsel for the Appellee.

JUDGES: JIM HANNAH, Chief Justice. IMBER, DANIELSON and WILLS, JJ., concur.

OPINION BY: JIM HANNAH

OPINION

JIM HANNAH, Chief Justice

Mortgage Electronic Registration System, Inc. (”MERS”) appeals a decision of the Benton County Circuit Court denying its motion to set aside a decree of foreclosure and to dismiss the foreclosure action. 1 MERS alleges that the circuit court erred in ordering foreclosure because as the holder of legal title it was a necessary party that was never served. We affirm the circuit court and hold that under the recorded deed of trust in this case, James C. East, as trustee under the deed of trust, held legal title. Because MERS was at most the mere agent of the lender Pulaski Mortgage Company, Inc., it held no property interest and was not a necessary party. As this case presents an issue of first impression, our jurisdiction is pursuant to Arkansas Supreme Court Rule 1-2(b)(1).

1 Mortgage Electronic Registration System, Inc.’s (”MERS”) motion was [*2] entitled Motion to Set Aside Default Judgment; however, the circuit court found, and the parties agree, that MERS was never served. Because MERS was never served, it could not have failed to respond to that service and suffer a default judgment. The relief sought was that the decree of foreclosure be set aside and the foreclosure action be dismissed.

This case arises from foreclosure on a 2006 mortgage granted in a one-acre lot. A prior deed of trust also encumbered the property. In 2003, Jason Paul Lindsey and Julie Ann Lindsey entered into a deed of trust on a one-acre lot in Benton County to secure a promissory note. The lender on that deed of trust was Pulaski Mortgage, the trustee was James C. East, and the borrowers were the Lindseys. MERS was listed on the deed of trust as the “Beneficiary” acting “solely as nominee for Lender,” and “Lender’s successors and assigns.” The second page of the deed of trust states that “the Borrower understands and agrees that MERS holds only legal title to the interests granted by the Borrower and further that MERS as nominee of the Lender has the right to exercise all rights of the Lender including foreclosure.” The deed of trust was recorded.

In [*3] 2006, the Lindseys granted the subject mortgage on the same property to Southwest Homes of Arkansas, Inc. to secure a second promissory note. This mortgage was recorded. On February 9, 2007, Southwest Homes filed a Petition for Foreclosure in Rem against the Lindseys under the 2006 mortgage. The Lindseys, the Benton County Tax Collector, and “Mortgage Electronic Registration System, Inc. (Pulaski Mortgage Company)” were listed as respondents. Pulaski Mortgage was served; however, MERS was never served. Pulaski Mortgage did not file an answer. 2 A Decree of Foreclosure in Rem was entered on April 4, 2007, and the property was auctioned to Southwest. An Order Approving and Confirming Commissioner’s Sale was entered on May 8, 2007. In February 2008, MERS learned of the foreclosure and moved for relief, arguing it was a necessary party to the foreclosure action. The circuit court denied the motion, and this appeal followed.

2 Pulaski Mortgage was the lender of record. No assignment of the deed of trust was recorded nor had Pulaski Mortgage’s security interest been satisfied of record.

MERS asserts that it held legal title to the property and, therefore, it was a necessary party to any action [*4] regarding title to the property. The deed of trust indicates that MERS holds legal title and is the beneficiary, as well as the nominee of the lender. It further purports by contractual agreement with the borrower to grant MERS the power to “exercise any and all rights” of the lender, including the right of foreclosure. However the deed of trust provides that all payments are to be made to the lender, that the lender makes decisions on late payments, and that all rights to foreclosure are held by the lender.

No payments on the underlying debt were ever made to MERS. MERS did not service the loan in any way. It did not oversee payments, delinquency of payments, or administration of the loan in any way. Instead, MERS asserts to be a corporation providing electronic tracking of ownership interests in residential real property security instruments. See In re MERSCORP, Inc. v. Romaine, 8 N.Y.3d 90, 861 N.E.2d 81, 828 N.Y.S.2d 266 (2006). According to MERS, it was developed by the “real estate finance industry” and was designed to facilitate the sale and resale of instruments in “the secondary mortgage market, which include one of the government sponsored entities.”

MERS contracts with lenders to track security [*5] instruments in return for an annual fee. MERSCORP, supra. Those who contract with MERS are referred to by MERS as “MERS members.” According to MERS, MERS members contractually agree to appoint MERS as their common agent for all security instruments registered with MERS. 3 MERS asserts that it holds the authority to exercise the rights of the lender, and for that purpose, it holds bare legal title. Thus, it is alleged that a principal-agent relationship existed between MERS and Pulaski Mortgage under the contract terms of the deed of trust. 4

3 The Kansas Court of Appeals, in Lankmark National Bank v. Kesler, 40 Kan. App. 2d 325, 192 P.3d 177 (2008), likewise found that Mortgage Electronic Registration System, Inc. acts as an agent. We note the analysis in this case is consistent with our own but also note that the Kansas Supreme Court granted review of the Landmark case.

4 MERS is listed as a nominee on the deed of trust. A nominee is “a person designated to act on behalf of another, usu. in a very limited way.” Black’s Law Dictionary 1076 (8th ed. 2004). A nominee is also a “person who holds bare legal title for the benefit of others or who receives and distributes funds for the benefit [*6] of others.” Id. As discussed above, MERS was not designated to act on behalf of another under the facts of this case. Further, it held no title in this case where title vested in the trustee, and finally, it received and distributed no funds for the benefit of others.

“An agent is a person who, by agreement with another called the principal, acts for the principal and is subject to his control.” Taylor v. Gill, 326 Ark. 1040, 1044, 934 S.W.2d 919, 922 (1996) (quoting AMI 3d 701 (1989)). Thus, MERS, by the terms of the deed of trust, and its own stated purposes, was the lender’s agent, including not only Pulaski Mortgage but also any successors and assigns.

MERS asserts authority to act, arguing that once it becomes the agent on a security instrument, it remains so for every MERS member lender who acquires ownership. This authority is alleged to arise from the contractual relationship between MERS and MERS members. Thus, MERS argues it may act to preserve the rights of the lender regardless of who the lender may be under the MERS electronic registration. We specifically reject the notion that MERS may act on its own, independent of the direction of the specific lender who holds the repayment [*7] interest in the security instrument at the time MERS purports to act. “[A]n agent is authorized to do, and to do only, what it is reasonable for him to infer that the principal desires him to do in the light of the principal’s manifestation and the facts as he knows or should know them at the time he acts.” Hot Stuff, Inc. v. Kinko’s Graphic Corp., 50 Ark. App. 56, 59, 901 S.W.2d 854, 856 (1995) (citing Restatement (Second) of Agency
§ 33 (1958)). Nothing in the record shows that MERS had authority to act. Here, Pulaski Mortgage was the lender and MERS’s principal. Pulaski Mortgage was a named party in the foreclosure action. Thus, MERS was not acting as the lender’s agent at the time it moved to set aside the decree of foreclosure.

However, MERS also argues that it holds a property interest through holding legal title. Specifically, it purports to hold legal title with respect to the rights conveyed by the borrower to the lender. We disagree.

“A deed of trust is ‘a deed conveying title to real property to a trustee as security until the grantor repays a loan.’” First United Bank v. Phase II, Edgewater Addition, 347 Ark. 879, 894, 69 S.W.3d 33, 44 (2001)(quoting Black’s Law Dictionary [*8] 773 (7th ed. 1999)); see also House v. Long, 244 Ark. 718, 426 S.W.2d 814 (1968). The encumbrance created by the deed of trust may be described as a lien. See, e.g., First Amer. Nat’l Bank of Nashville v. Booth, 270 Ark. 702, 606 S.W. 2d 70 (1980).

Under a deed of trust, the borrower conveys legal title in the property by a deed of trust to the trustee. Phase II, supra. “In this state, the naked legal title to real property included in a mortgage passes to the mortgagee, or to the trustee in a deed of trust, to make the security available for the payment of the debt.” Harris v. Collins, 202 Ark. 445, 447, 150 S.W.2d 749, 750 (1941). The trustee is limited in use of the title to passing title back to the grantor/borrower in the case of payment, or to the lender in the event of foreclosure. See Forman v. Holloway, 122 Ark. 341,183 S.W. 763 (1916). The lender holds the indebtedness and is the beneficiary of the deed of trust. House, supra. A trustee under a deed of trust is not a true trustee. Heritage Oaks Partners v. First Amer. Title, Ins. Co., 155 Cal. App. 4th 339, 66 Cal. Rptr.3d 510 (Cal. Ct. App. 2007). Under a deed of trust, the trustee’s duties are limited to (1) upon default undertaking foreclosure [*9] and (2)
upon satisfaction of the debt to reconvey the deed of trust. Id.

In the present case, all the required parties to a deed of trust under Arkansas law are present, the borrower in the Lindseys, the Lender in Pulaski Mortgage, and the trustee in James C. East. Under a deed of trust in Arkansas, title is conveyed to the trustee. Harris, supra. MERS is not the trustee. Here, the deed of trust renamed James C. East as the trustee. The deed of trust did not convey title to MERS. Further, MERS is not the beneficiary, even though it is so designated in the deed of trust. Pulaski Mortgage, as the lender on the deed of trust, was the beneficiary. It receives the payments on the debt.

The cases cited by MERS only confirm that MERS could not obtain legal title under the deed of trust. MERS relies on Hannah v. Carrington, 18 Ark. 85 (1856); however, that case stands for the proposition that a deed of trust vests legal tide in the trustee. We are also cited to Shinn v. Kitchens, 208 Ark. 321, 326, 186 S.W.2d 168, 171 (1945), where this court stated that “[t]he trustee named in the deeds of trust was a necessary party at the institution of the foreclosure suit, as also, of course, was Kitchens, [*10] the holder of the indebtedness.” East, as trustee, was a necessary party. MERS was not. Finally, we are cited to Beloate v. New England Securities Co., 165 Ark. 571, 575,265 S.W. 83 (1924), where this court stated that the real owner of the debt, as well as the trustee in the mortgage, are necessary parties in the action to recover the debt and foreclose the mortgage. Again, this case supports the conclusion that East was a necessary party and MERS was not.

Further, under Arkansas foreclosure law, a deed of trust is defined as “a deed conveying real property in trust to secure the performance of an obligation of the grantor or any other person named in the deed to a beneficiary and conferring upon the trustee a power of sale for breach of an obligation of the grantor contained in the deed of trust.” Ark. Code Ann. § 18-50-101(2) (Repl. 2003). Thus, under the statutes, and under the common law noted above, a deed of trust grants to the trustee the powers MERS purports to hold. Those powers were held by East as trustee. Those powers were not conveyed to MERS.

MERS holds no authority to act as an agent and holds no property interest in the mortgaged land. It is not a necessary party. In [*11] this dispute over foreclosure on the subject real property under the mortgage and the deed of trust, complete relief may be granted whether or not MERS is a party. MERS has no interest to protect. It simply was not a necessary party. See Ark. R. Civ. P. 19(a). MERS’s role in this transaction casts no light on the contractual issues on appeal in this case. See, e.g., Wilmans v. Sears, Roebuck & Co., 355 Ark. 668, 144 S.W.3d 245 (2004).

Finally, we note that Arkansas is a recording state. Notice of transactions in real property is provided by recording. See Ark. Code Ann. § 14-15-404 (Supp. 2007). Southwest is entitled to rely upon what is filed of record. In the present case, MERS was at best the agent of the lender. The only recorded document provides notice that Pulaski Mortgage is the lender and, therefore, MERS’s principal. MERS asserts Pulaski Mortgage is not its principal. Yet no other lender recorded its interest as an assignee of Pulaski Mortgage. Permitting an agent such as MERS purports to be to step in and act without a recorded lender directing its action would wreak havoc on notice in this state.

Affirmed.

IMBER, DANIELSON and WILLS, JJ., concur.

CONCUR BY: PAUL E. DANIELSON

CONCUR

CONCURRING [*12] OPINION.

PAUL E. DANIELSON, Associate Justice

I concur that the circuit court’s order should be affirmed, but write solely because I view the decisive issue to be whether MERS was, pursuant to Arkansas Rule of Civil Procedure 19(a) (2008), a necessary party to the foreclosure action. It can generally be said that “[n]ecessary parties to a foreclosure action are parties whose interest are inseparable such that a court would be unable to determine the rights of one party without affecting the rights of another.” 59A C.J.S. Mortgages § 708 (2008). See also 55 Am. Jur. 2d Mortgages § 647 (2008) (”[A]ll persons who are beneficially interested, either in the estate mortgaged or the demand secured, are proper or necessary parties to a suit to foreclose.”). Moreover, “[p]ersons having no interest are neither necessary nor proper parties, and the mere fact that they were parties to transactions out of which the mortgage arose does not give them such an interest as to make them necessary parties to an action to foreclose
the mortgage.” Id. Indeed, our rules of civil procedure contemplate the same.

Rule 19(a) of the Arkansas Rules of Civil Procedure speaks to necessary parties:

(a) Persons to Be [*13] Joined if Feasible. A person who is subject to service of process shall be joined as a party in the action if (1) in his absence complete relief cannot be accorded among those already parties, or, (2) he claims an interest relating to the subject of the action and is so situated that the disposition of the action in his absence may (i) as a practical matter, impair or impede his ability to protect that interest, or, (ii) leave any of the persons already parties subject to a substantial risk of incurring double, multiple or otherwise inconsistent obligations by reason of his claimed interest. If he has not been joined, the court shall order that he be made a party. If he should join as a plaintiff, but refuses to do so, he may be made a defendant; or, in a proper case, an involuntary plaintiff.

Ark. R. Civ. P. 19(a) (2008).

Here, a review of the deed of trust for the subject property reveals four parties to the deed: (1) Jason Paul Lindsey and Julie Ann Lindsey, “Borrower”; (2) James C. East, “Trustee”; (3) MERS, “(solely as nominee for Lender, as hereinafter defined, and Lender’s successors and assigns)”; and (4) Pulaski Mortgage Company, “Lender.” The question, then, is whether MERS, [*14] as nominee, was a necessary party that had an interest “so situated that the disposition of the action in [its] absence may” have impaired its ability to protect its interest or left a subsequent purchaser or other subject to a substantial risk by reason of its interest. The answer is no; MERS, as nominee, was not a necessary party to the foreclosure action, because it held no such interest.

Initially, I must note that my review of the deed’s notice provision reveals that the deed clearly contemplated the Lender as the party with interest, in that it provided:

13. Notices. . . . Any notice to Lender shall be given by first class mail to Lender’s address stated herein or any address Lender designates by notice to Borrower. Any notice provided for in this Security’ Instrument shall be deemed to have been given to Borrower or Lender when given as in this paragraph.

Here, as stated in the circuit court’s order of foreclosure. Pulaski Mortgage, as Lender, was served with notice of the foreclosure action, in accord with paragraph thirteen.

But, in addition, MERS claims that because it holds legal title, it has an interest so as to render it a necessary party pursuant to Rule 19(a). Indeed, pursuant [*15] to the deed of trust, MERS held “only legal title to the interests granted” by the Lindseys,

but, if necessary to comply with law or custom, MERS, (as nominee for Lender and Lender’s successors and assigns) has the right to exercise any and all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of Lender including, but not limited to, releasing and canceling this Security Instrument.

“Legal title” is defined as “[a] title that evidences apparent ownership but does not necessarily signify full and complete title or a beneficial interest.” Black’s Law Dictionary 1523 (8th ed. 2004) (emphasis added). Thus, as evidenced by the definition, holding legal title alone in no way demonstrates the interest required by Rule 19(a).

MERS further claims that its status as nominee is evidence of its interest in the property, making it a necessary party. However, merely serving as nominee was recently held by one court to be insufficient to demonstrate an interest rising to the level to be a necessary party. In Landmark National Bank v. Kesler, 40 Kan. App. 2d 325, 192 P.3d 177 (2008), review granted, (Feb. 11, 2009). MERS also [*16] asserted that it was a necessary party to the foreclosure suit at issue. There, the district court found that MERS was not a necessary party, and the appellate court affirmed. Just as here, MERS was a party to the mortgage “solely as nominee for Lender.” 40 Kan. App. 2d at 327, 192 P.3d at 179. Based on that status, the Kansas court found that MERS was in essence, an agent for the lender, as its right to act to enforce the mortgage was strictly limited. See id.

Agreeing with MERS that a foreclosure judgment could be set aside for failure to join a “contingently necessary party,” the Kansas court observed that a party was “contingently necessary” under K.S.A. 60-219 if “the party claims an interest in the property at issue and the party is so situated that resolution of the lawsuit without that party may ‘as a practical matter substantially impair or impede [its] ability to protect that interest.’” Id. at 328, 192 P.3d at 180 (quoting K.S.A. 60-219). Notably, the language of K.S.A. 60-219 quoted by the Kansas court is practically identical to the language of Ark. R. Civ. P. 19(a).

The Kansas appellate court noted that MERS received no funds and that the mortgage required the borrower [*17] to pay his monthly payments to the lender. See id. It also observed, just as in the case at hand, that the notice provisions of the mortgage “did not list MERS as an entity to contact upon default or foreclosure.” Id. at 330, 192 P.3d at 181. After declaring that MERS did not have a “sort of substantial rights and interests” that had been found in a prior decision and noting that “a party with no beneficial interest is outside the realm of necessary parties,” the Kansas court concluded that “the failure to name and serve MERS as a defendant in a foreclosure action in which the lender of record has been served” was not such a fatal defect that the foreclosure judgment should be set aside. Id. at 331, 192 P.3d at 181-82.

It is my opinion that the same holds true in the instant case. Here, Pulaski Mortgage, the lender for whom MERS served as nominee, was served in the foreclosure action. But, further, neither MERS’s holding of legal title, nor its status as nominee, demonstrates any interest that would have rendered it a necessary party pursuant to Ark. R. Civ. P. 19(a). For these reasons, I concur that the circuit court’s order should be affirmed.

IMBER and WILLS, JJ., join.

What Is The Future of Trial Loan Modifications?

There is an interesting article published in NY Times, and the writer is just skeptic about the outcome of the 650,000 or more trial loan modifications which may or may not be converted into permanent trial loan modifications. We do not share this skepticism, but however, there are some valid points raised by the author in this regard. Please read the article.

http://www.nytimes.com/2009/12/04/business/economy/04norris.html?_r=1&sq=&st=nyt&scp=2&pagewanted=print

Judge Blasts Bank Erases 525G Debt

A Long Island couple is home free after an outraged judge gave them an amazing Thanksgiving present -- canceling their debt to ruthless bankers trying to toss them out on the street.

Suffolk Judge Jeffrey Spinner wiped out $525,000 in mortgage payments demanded by a California bank, blasting its "harsh, repugnant, shocking and repulsive" acts.

The bombshell decision leaves Diane Yano-Horoski and her husband, Greg Horoski, owing absolutely no money on their ranch house in East Patchogue.

Spinner pulled no punches as he smacked down the bankers at OneWest -- who took an $814.2 million federal bailout but have a record of coldbloodedly foreclosing on any homeowner owing money.


http://www.nypost.com/p/news/local/judge_kos_mortgage_to_slap_bank_28ZS1oW8Y58z6gu1AQbWMI

Obama Administration Announces New Guidelines

The Obama administration disclosed a plan on Monday intended to increase pressure on mortgage companies to permanently reduce monthly payments for troubled homeowners.

Under the guidelines, the government will fine lenders that fail to find ways to increase the number of homeowners who are given relief on their mortgage bills.

The move is the government’s latest endeavor to reinvigorate a $75 billion program that promised to stem foreclosures and help hundreds of thousands of struggling homeowners with their mortgages. So far, however, only a small percentage of eligible Americans have had their mortgage payments reduced, and many are encountering difficulties as they try to make the cuts permanent.

The Treasury Department has blamed banks and mortgage companies, which it says have been slow to process documents, for the program’s lukewarm start.

http://www.financialstability.gov/latest/tg_11302009b.html

Seventy Percent of Nevada Homes Under Water

http://www.lasvegassun.com/news/2009/nov/30/report-nearly-70-percent-lv-homeowners-underwater-/

Obama Administration Making More Changes in Loan Modifcation Program

http://money.cnn.com/2009/11/28/news/economy/Obama_mortgage_announcement/

Facing Foreclosures-What Need To Be Done

Nevada again is on top of the foreclosure statistics, and I really don't feel the necessity of citing any sources. It is an open secret. Foreclosure is on the rise, and the tide has become uncontrollable. I like to mention briefly the tips to stop the foreclosure and also there is an article published in LA Times on the same issues.

1. Please contact your lenders/servicers immediately
2. Open a dialog and tell them your situation.
3. Don't be frustrated with the process
4. Most of the folks (newly hired)at your lenders and servicers are new folks, and learning the job as they go. Please be patient with them
5. Make record of every phone calls, write down the name, phone extension etc.
6. No need to lose your temper.
7. Send them whatever they want, resend the same things again. Don't make a big deal about their demands.
8.Try to call the rep by their first name more often than one time during conversation. Try to build a bond between you and him/herself. Yelling, screaming would be totally unproductive. No need to tell them the horror stories, they know enough already. Try to be brief, and not very legalistic. You are not an attorney, you are consumer. Ask yourself one question, why I am behind? How many months I am behind? Why did not I pay them? Afterall, you signed the contract as well. Please stop having over expectations. No one is deliberatly harming you. Accept the fact that you could be wrong also, and you had made mistakes as well. Now, let us sit back and read this wonderful article.

http://www.latimes.com/classified/realestate/news/la-fi-lew8-2009nov08,0,5612117.story

State Prosecutors Are Planning to Sue Lenders Again

Enough is enough as lenders had their say and swayed of course in all loan modification programs and in preventing the foreclosures process. They have frustrated almost every program the government and the fed had announced. The latest of course was the Obama Plan, which was launched with great fanfare, and of course it had helped the deterioraing foreclosure situations little bit but not enough--it has not stopped tremendous homeowners and their foreclosures. Banks had frustrated all these efforts, and are determined to do their nitpicking on every small issues. We agree with the analysts that the Obama Plan had no teeth in it when it comes to enforcement. Also, the 31 percent limitation of loan modification is not rationale. Again, it had not addressed the principals reduction which is a core issue in this crisis and bring it to the latest market values. Lately, the state top prosecutors are agreeing to seek the judicial remedy again, and are thinking of taking the lenders back to the judicial process. In our view, they are late. A judicial remedy is best, and of course quite expensive for the lenders, who had lately again been giving the despicable bonuses to their executives for doing nothing. When are they going to learn a lesson in this regard. Please read the following links to a very important news item.

http://www.nytimes.com/2009/11/03/business/03suits.html

Foreclousre Situation Still Gloomy?

The situation of foreclosures is getting gloomy and bleaker. The Obama Plan is not helping people because basically it has no teeth for enforcement. Nevada, again is on top of foreclosures. Obama administration is mired in various domestic and international issues, and basically it has too many issues on its plate. Homeownership is one single issue which has single handedly impacted our economy and despite whatever the gurus on the Wall Street are claiming, the economy would not recover without the improvements in homeownership and the curtailment of the rising foreclosures. Please read the following NY Times editorial.

http://www.nytimes.com/2009/11/12/opinion/12thu2.html?_r=1&scp=2&sq=foreclosures&st=cse

Loan Modifications Program Still Working

While the government sponsored HAMP has not fulfilled all the hopes, still is doing an important work in stopping the foreclosure and providing a meaningful home modification for homeowners. Here is the latest report on this matter.

http://www.lvrj.com/business/one-in-five-borrowers-getting-aid-69740912.html

Has Time Came for Commercial Real Estate to Go Bust?

I drive to work from Summerlin (my home) to my office on Sahara and Buffalo, and see signs after signs of lease and rental ads, and it saddens me to see many empty places even spaces which was formerly occupied by big grocery stores like Smith, are empty. Similarly, too much office space is available for rent. The space which was available for at least $2.50 square feet is available easily for $1.00 and sometimes even less. The leasing agent is even agreeable to sign a lease with few months of free spaces. Here, is an article projecting a flood of real estate going bust. Unfortunately, the signs are already very visible. There are "cracks" every where. Here, is the latest link which I found in one of the financial paper.

http://www.msnbc.msn.com/id/33404369/ns/business-personal_finance/

Is Housing Market Recovering?

Lately, I had seen much news in all kinds of media about the rapidly recovering housing market. I wish I can agree with that. The national trends though rising albeit on a snail's pace. Nevada, in particularly, is in very distressed conditions. Please read the following news item.

http://www.lvrj.com/business/housing-recovery-isnt-as-close-to-reality-as-some-statistics-suggest-63955137.html

Nevada Landlord/Tenancy Laws

Quite often we get calls from our present as well as potential clients about tenancy situations, especially where homes are foreclosed and the property is still occupied by tenants. Here, we are posting the exactly Nevada laws without giving any specific opinion. Of course, we can render specific opinion to our valued clients as well. Here, is the link.

http://www.leg.state.nv.us/NRS/NRS-118A.html

Details of Obama Plans Underwriting Guidelines

July 30, 2009 MORTGAGEE LETTER 2009-23

TO: ALL APPROVED MORTGAGEES
SUBJECT: Making Home Affordable Program:
FHA’s Home Affordable Modification Loss Mitigation Option

On May 20, 2009, the President signed the “Helping Families Save Their Homes Act of 2009.” This new law provides the Federal Housing Administration (FHA) with additional loss mitigation authority to assist FHA mortgagors under the Making Home Affordable Program (MHA). The MHA Program is designed to help homeowners retain their homes and to prevent the destructive impact of foreclosures on families and communities.

One key component of MHA provides homeowners the opportunity to reduce their mortgage payments by the use of a loan modification through the Home Affordable Modification Program. When initially introduced to the public, MHA excluded FHA insured mortgages, stating that FHA would develop its own standalone program. This Mortgagee Letter announces a new FHA Loss Mitigation option, the FHA-Home Affordable Modification Program (FHA-HAMP). FHA-HAMP will provide homeowners in default a greater opportunity to reduce their mortgage payments to a sustainable level. This Mortgagee Letter is effective August 15, 2009.

Basic Program Guidelines
The new FHA-HAMP authority will allow the use of a partial claim up to 30 percent of the unpaid principal balance as of the date of default combined with a loan modification. The objective of FHA-HAMP is to assist FHA mortgagors who are in default to modify their mortgage to an affordable payment. According to Mortgagee Letter 2000-05 and subsequent guidance, disposition options (pre-foreclosure sales and deeds-in lieu of foreclosure) are available immediately upon default, if the cause of the default is incurable, i.e. the borrower has no realistic opportunity to replace the lost income or reduce expenses sufficiently to meet the mortgage obligation.

To confirm if the mortgagor is capable of making the new FHA-HAMP payment, the mortgagor must successfully complete a trial payment plan. The trial payment plan shall be for a three month period and the mortgagor must make each scheduled payment on time. The mortgagor’s monthly payment required during the trial payment plan must be the amount of the future modified mortgage payment. The Mortgagee must service the mortgage during the trial period in the same manner as it would service a mortgage in forbearance. If the mortgagor does not successfully complete the trial payment plan by making the three payments on time, the mortgagor is no longer eligible for FHA-HAMP. Prior to proceeding to foreclosure, the Mortgagee must re-examine and re-evaluate the borrower’s financial condition and confirm that none of FHA’s other Loss Mitigation options could assist the mortgagor.

The attachment to this Mortgage Letter supplements program guidelines for FHA-HAMP, including a requirement that the servicer obtain an executed Hardship Affidavit (available at https://www.hmpadmin.com/portal/docs/mod_docs/hamphardshipaffidavit.pdf) from every mortgagor and co-mortgagor seeking an FHA-HAMP. FHA-HAMP is a permanent addition to HUD’s Loss Mitigation Program as of the date of this Mortgagee Letter.

Debt to Income Ratios
To be eligible under FHA-HAMP, the front end debt to income ratio must be as close as possible, but not less than, 31 percent. This ratio is defined as the total monthly mortgage payment (PITI) for the modified mortgage divided by the mortgagor’s gross monthly income (the “Front End Ratio”). The back end debt to income ratio must not exceed 55 percent and is defined as the total monthly mortgage payment plus all recurring monthly debt divided by the mortgagor’s gross monthly income (the “Back End Ratio”). Please refer to the sections in the Attachment regarding Underwriting – Front End and Back End Debt to Income Ratios.

Calculation of Maximum Partial Claim Amount under FHA-HAMP
The maximum partial claim amount under FHA-HAMP consists of the sum of (i) arrearages, (ii) legal fees and foreclosure costs related to a canceled foreclosure action and (iii) principal reduction. Arrearages that may be included in the partial claim shall not exceed 12 months of PITI. The maximum partial claim amount under FHA-HAMP is 30 percent of the outstanding principal balance as of the date of default. The principal deferment on the modified mortgage is determined by multiplying the outstanding principal balance by 30 percent and then reducing that amount by arrearages advanced to cure the default for up to 12 months PITI, and any foreclosure costs incurred to that point subject to the requirements provided in Mortgagee Letter 2008-21. The principal deferment amount for a specific case shall be limited to such an amount that will bring the mortgagor(s) total monthly mortgage payment to 31 percent of gross monthly income.

Example

Mortgagor had a reduction of income and is delinquent 3 full mortgage payments. The unpaid principal balance on the mortgage on the date of default is $150,000 and the monthly payment is $1,220 (consisting of P&I of $920 and escrows, including MIP, of $300). The financial analysis reveals that the mortgagor’s gross monthly income is $3,500 and the total monthly other recurring debt payments are $800.

In order to fulfill the 31% Front End Ratio requirement, the mortgagor(s) total monthly mortgage payment would have to be reduced to $1,085 ($3,500 x 31%). Therefore, P&I would have to be reduced to $785 ($1,085 total monthly mortgage payment less $300 escrow and MIP). Assuming that the loan modification will have an interest rate of 6% and a P&I of $785, the new mortgage amount would have to be $130,931, resulting in a principal reduction of $19,069 ($150,000 unpaid principal balance less $130,931). In this example, the mortgagor’s Back End ratio is 53.9% ($1,885/$3,500), which satisfies the 55% Back End Ratio limitation.

In this example, the maximum principal deferment is $41,340 (30% of $150,000, less the $3,660 delinquency, or $45,000 - $3,660). However, based on their gross income, mortgagor is eligible only for a principal deferment of $19,069 plus $3,660 arrearages (which would include any foreclosure costs incurred to that point, in accord with Mortgagee Letter 2008-21) for the total Partial Claim of $22,729.

Requirements to Use FHA-HAMP

FHA-HAMP can be utilized only if the mortgagor(s) does not qualify for current loss mitigation home retention options (priority order FHA Special Forbearance, Loan Modification and Partial Claim) under existing guidelines (ML 2008-21, 2003-19, 2002-17, 2000-05). To qualify for the FHA-HAMP program, Mortgagees must evaluate the defaulted mortgage for loss mitigation actions using the aforementioned priority order. According to Mortgagee Letter 2000-05 and subsequent guidance, disposition options (pre-foreclosure sales and deeds-in lieu of foreclosure) are available immediately upon default, if the cause of the default is incurable, i.e. the borrower has no realistic opportunity to replace the lost income or reduce expenses sufficiently to meet the mortgage obligation.

If the mortgagor does not successfully execute the loan modification, the mortgagor is no longer eligible for FHA-HAMP. In such cases, per 24 CFR 203.355, the Mortgagee must re-evaluate the mortgagor’s eligibility for the other appropriate loss mitigation actions prior to commencing or continuing a foreclosure.

Mortgagee Incentives
Mortgagees that utilize FHA-HAMP are eligible to receive incentive payments. Mortgagees utilizing this initiative will be allowed to first file for a partial claim (to bring the loan current and defer principal where appropriate), followed by a loan modification claim (claim type 32). Under FHA-HAMP, the Mortgagee may receive an incentive fee of up to $1,250. This total includes $500 for the partial claim and $750 for the loan modification. Mortgagees may also claim up to $250 for reimbursement for a title search and/or recording fees.

Partial Claim Filing and Document Delivery

Mortgagees must file a claim for insurance benefits for the partial claim within the 60-day timeframe stated in ML 2003-19 to receive incentive fees for the FHA-HAMP loss mitigation action. Any previous outstanding partial claim(s) must be subordinated and the mortgage company must provide HUD’s Secretary-Held servicing contractor (see ‘Remittance’ below) with a subordination agreement to request subordination.

Monitoring
FHA will monitor Mortgagees for compliance with the terms of this Mortgagee Letter and will take administrative actions, including sanctions and penalties, against all parties for non-compliance.

Remittance

Please note that all provisions described in the aforementioned existing guidelines, such as Repayment Terms, Option Failure and Disclosures apply also, except as specifically changed under FHA-HAMP.

Mortgagees must forward all required documentation, including subordination requests, and advise all parties to send any payments for the Partial Claims to HUD’s Secretary-Held Assets Servicing Contractor which is currently located at:

C&L Service Corp. / Morris-Griffin Corp.
2488 East 81st Street, Suite 700
Tulsa, Oklahoma 74137

Toll Free Phone: (866) 377-8667 Toll Free Fax: (866) 249-0626
Local: (918) 551-5300 Local Fax: (918) 551-5399

Current information about the Secretary-Held Assets Servicing Contractor is located at:
http://www.hud.gov/offices/hsg/sfh/nsc/fmaddr.cfm

Information Collection Requirement

The information collection requirements contained in this document have been approved by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned OMB control numbers 2502-0060, 2502-0523, 2502-0429, and 1505-0216. In accordance with the Paperwork Reduction Act, HUD may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection displays a currently valid OMB Control Number.

Any questions regarding this Mortgagee Letter may be directed to HUD’s National Servicing Center (NSC) at 888-297-8685 or hsg-lossmit@hud.gov. Persons with hearing or speech impairments may reach this number via TDD/TTY by calling 1-877-TDD-2HUD (1-877-833-2483).

Sincerely,

David Stevens
Assistant Secretary for Housing – Federal Housing Commissioner


Attachment – Guidelines for FHA-HAMP

Obama Plans is Not Stopping Foreclosure

In an article recently published in NY Times stated that the Obama Plan is not really helping and reducing the rising trend of foreclosure. It is unfortunate that such a good plan has met lots of obstacles, and had not met fully the expectations of many homeowners. Here is the article.

http://www.nytimes.com/2009/10/10/business/10modify.html

How to Prepare Financial Information Before You Talk To Your Lender?

HOUSEHOLD FINANCIAL INFORMATION
INCOME BUDGET FOR HOUSEHOLD

SOURCE OF INCOME LAST MO. ACTUAL THIS MO. EXPECTED THIS MO. ACTUAL ADJUSTED MONTHLY
Employment $ $ $ $
Overtime __________________________________________________________
Child Support/Alimony ________________________________________________________
Pension ________________________________________________________
Interest _________________________________________________________
Public Benefits __________________________________________________________ __________________________________________________________
Dividends
Trust Payments __________________________________________________________
Royalties __________________________________________________________
Rents Received ___________________________________________________________
Other (List) ___________________________________________________________

TOTAL (MONTHLY) $ $ $ $

NOTES/ANTICIPATED CHANGES:________

EXPENSE BUDGET FOR HOUSEHOLD

TYPE OF EXPENSE LAST MO. ACTUAL THIS MO. EXPECTED THIS MO. ACTUAL ADJUSTED MONTHLY
Payroll Deductions $ $ $ $
Income Tax Withheld ____________________________________
Social Security ____________________________________
FICA
Wage Garnishments ____________________________________ Credit Union _______________________________________
Other ______________________________________
Home Related Expenses
Mortgage or Rent ______________________________________
Second Mortgage ______________________________________
Third Mortgage ______________________________________
Real Estate Taxes ______________________________________
Insurance ______________________________________
Condo Fees & Assessments ______________
Mobile Home Lot Rent ________
Home Maintenance/ Upkeep ___________________
Utilities ___________________________________
Gas ___________________________________________________
Electric ___________________
Oil ___________________
Water/Sewer ____________________
Telephone:
Land Line ________________
Cell ________________
Cable TV ________________
Internet
Other ________________
Food
Eating Out ________________
Groceries ________________
Clothing _______________________
Laundry and Cleaning _____________________
Medical _______________________
Current Needs _______________________
Prescriptions _______________________
Dental _______________________
Insurance Co-Payments or Premiums
Other _________________________________
Transportation _________________________
Auto Payments _________________________________
Car Insurance _________________________________
Gas and Maintenance _________________________
Public Transportation _______________________
Life Insurance _________________________
Alimony or Support Paid _________________________
School Expenses _________________________
Student Loan Payments _________________________
Entertainment _________________________
Newspapers/Magazines _________________________
Charity/Church _________________________
Pet Expenses _________________________
Amounts Owed on Debts _________________________
Credit Card________________________________________
___________________
Credit Card
___________________
Credit Card
___________________
Medical Bill
___________________
Medical Bill
___________________
Other Back Bills (List)
___________________
___________________
Cosigned Debts
Business Debts (List)
___________________
___________________
Other Expenses (List)
___________________
___________________
Miscellaneous
TOTAL

Other Important Debt Issues:

Wage Garnishments Yes______ No______
Pending Court Cases Yes______ No______
Pending Utility Shut-offs Yes _____ No _____
Car Loan Defaults or Repossessions Tax Debts Yes ____ No____
Student Loan Debts Yes_____ No_____

Other:
Notes/Anticipated Changes:
Describe Assets and Other Resources:

Savings Yes______ No______ Amount $______________

Court Cases Pending Against Others Yes______ No__________
Value $______________

Anticipated Tax Refunds Yes______ No____________
Amount $______________

Assets Which Can Be Sold Yes ______ No______ Value $______________

Pension or Retirement Funds Yes______ No______ Value $______________

Other Assets and Notes:

INCOME AND EXPENSE TOTALS

Last Mo. Actual This Mo. Expected This Mo. Actual Adjusted Expected
A. Total Projected Monthly Income
B. Total Projected Monthly Expenses
Excess Income or Shortfall (A minus B)

Notes:

OTHER INFORMATION

1. Have you made an effort to arrange a workout on their own? What result?


2. Have you filed bankruptcy? If so when? Current status of case if still pending? If bankruptcy is over, what result?


3. Other issues which came up during this time.


4. Questions and open issues that must be resolved.

White House Release Data on the Slow Performance of Loan Modification by Lenders and Servicers

White House released data on the slowest performance of both lenders and servicers in doing loan modification. Here, Wells Fargo and BOA are the slowest in doing loan modifications for its borrowers. Please read the following report.

http://www.ustreas.gov/press/releases/tg252.htm

A Little Judge Throws Away Foreclosure Brooklyn Style

This judge is "my man"--he is doing what everyone should be doing. Stopping foreclosure. Please read this interesting story on this wonderful person.

http://www.nytimes.com/2009/08/31/nyregion/31judge.html?_r=1&emc=eta1

Hard Times Coming to Commercial Real Estate?

The lenders had not learnt any lesson from the deteriorating home market, and now another cloud is hovering over our financial market--this time, it is commercial real estate. There has been widespread cracks in the commercial real estate market in Nevada in the rising forelcousre as well as high vacancy rate. Here is the link to this sad story unfolding.

http://www.nytimes.com/2009/09/02/business/economy/02office.html?scp=6&sq=&st=nyt

Wells Fargo & Bank of America slowest in Loan Modification

A latest report publishes states that Wells Fargo and Bank of America are the slowest banks when doing loan modification. Here is the full report:

http://www.nytimes.com/2009/08/05/business/05treasury.html?fta=y

Banks Executives Hosts Parties in Foreclosed Homes

Finally, some use has been crafted from the executives of the banks_____ it is not the often quoted homeless people illegally occuping empty and foreclosed homes, it is the fancy bank executives.

http://money.aol.com/article/real-estate/bank-exec-hosts-parties-in-bank-owned/666193

How California Is Stopping Loan Modification Fraud?

As the proverb says, "proof is in the pudding". Here, is the copy of original complaint filed by California attorney general against the biggest loan fraud company.

http://www.ftc.gov/os/caselist/0923120/090715usfrcmpt.pdf

Fed is cracking on Loan Modificatin Scam Companies

Here, is the interesting news that Federal Trade Commission is continuously enforcing and prosecuting the loan modification fraud companies.

http://www.walletpop.com/blog/2009/07/15/major-crackdown-on-foreclosure-rescue-and-mortgage-scams-continu/?icid=sphere_blogsmith_inpage_dailyfinance

Problem with Non Attorney Loan Modification Firms

Here, is the problem when homeowners keep on trying non-attorney firms and getting bad result. MSNBC has published a detailed report in this regard.

http://www.msnbc.msn.com/id/32007521/ns/business-the_new_york_times/

Loan Modification on a Slower Pace ---MSNBC

MSNBC is reporting that loan modification has been kept on a slower pace by the lenders, and it is causing lots of discomfots as well as increasing the rate of foreclosure. Here, is the report.

http://www.msnbc.msn.com/id/32281959/ns/business-real_estate/

Foreclosures Still Rising

The latest statistics are out: the foreclosure tide is still uncontrollable.

Should You Engage Either a California Attorney or Loan Modification Agency?

This is an interesting article and published by California Bar Association. It speaks for itself. Interesting and very informative indeed!

http://www.calbar.ca.gov/calbar/pdfs/ethics/Ethics-Alert-Foreclosure.pdf

Rising Foreclosures in Lenders' Interest?

Washington Post has published an interesting article about the rising trends in foreclosures in the best interests of lenders. Strange? But it is becoming true, at least, in Nevada.
http://www.washingtonpost.com/wp-dyn/content/article/2009/07/27/AR2009072703065.html

Nevada Mediation Form

This law office is always in the forefront of helping Nevada homeowners. We had been frequently contacted in the last few days about the form which is required for Nevada Mediation. The following is the copy of this form. Please reprint and use it as many times as required. This is part of the public record. Let us go out and save one more home from the jaws of foreclosure.

---
STATE OF NEVADA
FORECLOSURE MEDIATION PROGRAM
Election/Waiver of Mediation Form FMP Form 001.063009
ELECTION/WAIVER OF MEDIATION FORM
(To be filled out by Trustee)PROPERTY ADDRESS ___________________________ TS # _____________________________________________________________________________
_________________________________APN _______________________________________________
TRUSTEE _____________________________ DoT __________ Book/Inst _______________________
***ATTENTION—YOU MUST ACT WITHIN THIRTY (30) DAYS***

IF NO ACTION IS TAKEN, THE FORECLOSURE MAY PROCEED
You have been served with a Notice of Default and Election to Sell, a copy of which is enclosed, that could result in the loss of your home. You may want to consult with an attorney concerning your rights and responsibilities.

The State of Nevada has created a mediation program for homeowners whose owner occupied, primary residence is subject to foreclosure. Mediation is a process through which you and the lender meet with a neutral mediator to determine whether an agreement can be reached to cure any defaults in the loan or modify the terms of the loan to enable you to remain in your home. The mediator will be appointed by the Foreclosure Mediation Program Administrator. The mediator will not provide legal advice to either party. If you feel the need for legal representation, it is recommended that you retain an attorney to assist you in the mediation.
Your Name(s): _______________________________________
Address: _________________________________________________________________
Phone No: ( ) _________________ (telephone)( ) _________________ (cellular)
Email: __________________________________
Co-owner’s Name: ________________________
Address: ________________________________
________________________________________
Phone No: ( ) __________________ (telephone)
( ) __________________ (cellular)
Email: __________________________________

PLEASE SELECT ONE OF THE CHOICES BELOW AND RETURN COPIES IN ENCLOSED ENVELOPES.
_____ ELECTION OF MEDIATION The undersigned hereby request[s] that a mediation be scheduled to attempt to work out a resolution of the loan. ($200.00 Money Order or Cashier’s Check Applies – See Below) _____ WAIVER OF MEDIATION The undersigned is/are aware of the right to seek mediation but have determined that I/we do not want to proceed with a mediation and hereby waive the right to do so.

The undersigned hereby certify under the penalty of perjury that I/we are the owner[s] of the real property that is the subject of the pending foreclosure and occupy the real property as my/our primary residence.
_____________________________________ ______________________________________
Signature of Property Owner Date Signature of Co-Owner Date

COMPLETE TWO COPIES OF THIS FORM AND FORWARD ONE TO THE MEDIATION ADMINISTRATOR AND THE OTHER TO THE TRUSTEE OF THE DEED OF TRUST. TWO UNSTAMPED, PRE-ADDRESSED ENVELOPES HAVE BEEN ENCLOSED.

IF YOU HAVE CHOSEN TO SEEK MEDIATION, YOU MUST SEND A MONEY ORDER OR CASHIER’S CHECK IN THE SUM OF $200 PAYABLE TO: “STATE OF NEVADA FORECLOSURE MEDIATION PROGRAM.” THIS PAYMENT MUST BE RETURNED, BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, WITHIN 30 DAYS OF THE DATE OF SERVICE OF THE NOTICE OF DEFAULT AND ELECTION TO SELL.
PAYMENT MUST BE SENT TO THE TRUSTEE IN THE ENVELOPE THAT WAS ENCLOSED WITH THIS FORM. DO NOT SEND PAYMENT TO THE MEDIATION ADMINISTRATOR. STATE OF NEVADA
FORECLOSURE MEDIATION PROGRAM Election/Waiver of Mediation Form FMP Form 001.063009
ELECTION/WAIVER OF MEDIATION FORM
Instructions

The Election/Waiver of Mediation is for owner-occupied residential property only. This form is not for use with vacation homes, rental property, or any other property where the owner does not live in the property as a primary residence. This form should come to you from the lender; you cannot begin this process yourself by using this form.

The ELECTION/WAIVER OF MEDIATION form has been provided to you in duplicate. (You may make additional copies if needed.) You must fill out the forms in duplicate so that the same information is included on both copies of the forms. You must fill in the blanks on both forms and make your election to either request mediation or waive mediation.

Print your name and address in the spaces provided. Include your telephone numbers and your email address. If you have a co-owner, their name, address, phone numbers and email address should be included. This information will only be used for the mediation process.
In the designated location, you must select (with a check mark or “X”) one of two choices. You may only select one of the two options. Either select:

1. “___ ELECTION OF MEDIATION” if you choose to enter into the Mediation Program;
OR
2. “___ WAIVER OF MEDIATION” if you do not want to participate in the foreclosure Mediation Program.

You must then sign and date each form. NOTE that by signing the form you are certifying under penalty of perjury that you own and occupy the subject property as your primary residence.
Sign each form. One copy of the form must to be mailed to the Trustee of the deed of trust and one copy of the form must be mailed to the Mediation Administrator. The envelopes provided are preaddressed to the Trustee and Mediation Administrator. You must mail both envelopes by Certified U.S. mail, return receipt requested. You will need to pay the postage for the mailings. Do not mail your payment to the Mediation Administrator.

If you elect mediation, you must include the $200.00 mediation fee along with the form in the envelope addressed to the trustee. The $200.00 mediation fee must be paid in the form of a money order or cashiers check and made payable to: “State of Nevada Foreclosure Mediation Program”.

If you choose to forego or waive mediation, there is no need to send the $200.00 mediation fee. However, whether you elect to enter into the mediation program or elect not to participate in mediation, both forms should be mailed. If you do not mail the forms to the Trustee and the Mediation Administrator, you will not be allowed to participate in the mediation program and the foreclosure will proceed. This is your only opportunity to elect to participate in the foreclosure mediation process.

Man of God's Help to Save Foreclosures

Here the help is coming directly from God's people. Church is getting involved in saving foreclosure. This is the best we had seen.

http://www.msnbc.msn.com/id/32307616/ns/us_news-faith/

Feds Stopping Fraudulent Non Attorney Loan Modification Agencies

Finally, fed had decided to control and weed out non-attorney loan modification agencies.

http://www.msnbc.msn.com/id/32007521/ns/business-the_new_york_times/

Feds Helping Underwater Mortgages

Finally, federal government is thinking of helping the underwater mortgages. Here is the link.


http://www.nytimes.com/2009/07/26/realestate/26mort.html?_r=1&scp=1&sq=mortgage%20July%2026,%202009&st

How to Write a Wrongful Foreclosure Complaint?

Attorney Malik reviews basic wrongful complaint.
How to Write a Sample Complaint for Wrongful Foreclosure
[No legal advice intended. It is purely an academic exercise because of greater interest in such issues. Absolutely no legal relationship is created and no follow up questions entertained other than general issues.]
IN THE CLARK COUNTY
OF THE STATE OF NEVADA

FRANK SINATARA,
Plaintiffs,

v.

MILLSFARGO MUTUAL BANK, FA dba MILLSFARGO MUTUAL MORTGAGE
dba MILLSFARGO MUTUAL; PROFESSIONAL FORECLOSURE SERVICES
Defendants.

FIRST AMENDED COMPLAINT

Come now the plaintiffs, Frank Sinatara, by and through their attorneys of record, and for their First Amended Complaint against the defendants hereby complain and allege as follows:

I. PARTIES

1.1 Frank Sinatara are residents of Clark County, Nevada.

1.2 MillsFargo Mutual Bank, FA (hereafter “WMU”) does business in the state of Nevada and at relevant times serviced a loan acquired by MillsFargo Mutual and ultimately by the Federal National Mortgage Association.

1.3 Professional Foreclosure Services is believed to be a Nevadan corporation operated from California and is in the business of conducting non-judicial foreclosures in Clark County, Nevada.

II. FACTUAL ALLEGATIONS AND FIRST CLAIM: BREACH OF CONTRACT

2.1 On or about January 2005 the plaintiffs purchased a condominium and obtained a mortgage loan from the Johny Walker National Mortgage Company, Pahrump, Nevadain the approximate amount $265,000.00. This mortgage loan was eventually transferred for servicing to Milikan Mortgage Company (hereafter “Milikan”). On or about June, 2006, WMU acquired Milikan and began servicing plaintiffs’ mortgage loan. The exact monthly payment varied according to property taxes and other fees paid but a typical monthly payment was $1496.36 including reserves for the payment of taxes and insurance.

2.2 Beginning in February 2007 and continuing until July of 2001 the plaintiffs made timely payments to Lee National Mortgage until such time as the loan was assigned to Milikan Mortgage and, thereafter, payments were made to Milikan Mortgage.

2.3 Around June of 2001 the plaintiffs were notified that MillsFargo Mutual had acquired Milikan Mortgage and payments were to be made to MillsFargo Mutual prospectively.

2.4 On or about August 1, 2001 the plaintiffs, through their personal bank, MacMacMacPacific Bank, initiated an automatic bill payment service to automatically pay the MillsFargo Mutual home loan payment, which commenced on August 14, 2001. Initially, the payments were scheduled to be sent on or about the 14th day of each month in accordance with the loan agreement. Between August 14, 2001, and April 10, 2002 MacMacPacific Bank sent automatic payments to MillsFargo Mutual for the amount of the full payment each and every month in a timely fashion.

2.5 The automatic payments were received by MillsFargo Mutual within a few days of the transmission by MacMacPacific Bank, but not credited to their account.

2.6 Around October of 2007 the monthly statements from MillsFargo Mutual reflected that payments were not being credited. The Consumers promptly checked with MacMacMacPacific Bank to ensure that the payments had been sent and then supplied the requested information about the transmission and receipt of the payments to MillsFargo Mutual. The Consumers had MacMacPacific Bank produce canceled checks from these payments which were transmitted to MillsFargo Mutual whenever requested. In November, MillsFargo Mutual, without explanation, sent back the September payment to MacMacPacific Bank which credited it to the Consumers’ MacMacPacific Bank account.

2.7 On December 12, 2001 MillsFargo Mutual wrote to the Consumers indicating no payments had been received since October 1. MillsFargo Mutual assessed escrow expenses and delinquency charges and threatened to foreclose on the property.

2.8 The Consumers immediately responded to this, again supplying canceled checks and proof that MillsFargo Mutual had in fact received their payments.

2.9 In early 2002, despite repeated communication from the Consumers and repeated proof of payments made, MillsFargo Mutual hired Professional Foreclosure Services to commence foreclosure. On March 6, 2002, a Notice of Default was issued by Professional Foreclosure Services and approximately 30 days later a Notice of Trustee Sale scheduling a non-judicial foreclosure for July 19, 2002, was transmitted to the Consumers.

3.0 The Consumers continued to send letters and make phone calls to MillsFargo Mutual to no avail. As a result, in April 2002 adverse credit consequences occurred to the Consumers including a cancellation of a MacMacPacific Bank credit line and reduction of an American Express credit line.

3.1 MillsFargo Mutual and/or Professional Foreclosure Services has transmitted to various credit reporting agencies, including Equifax, false adverse information about the Consumers, causing their credit to be impaired.

3.2 In April of 2002 MillsFargo Mutual returned some of the payments and refused to take further payments made by the Consumers.

3.3 Beginning May 2002, the Consumers have made payments directly to MillsFargo Mutual payable to a bank account in a MillsFargo Mutual bank to show their good faith and intent to comply with their loan obligations.

3.4 The Consumers have contacted Professional Foreclosure Services to dispute the debt and request verification of the debt and have received no information whatsoever in violation of the Fair Debt Collection Practices Act and the Alaskan Collection Agency Act, as well as in breach of the duty of Good Faith and Fair Dealing implicit in contracts.

III. SECOND CLAIM: WRONGFUL FORECLOSURE

3.1 As a proximate result of the negligent or reckless conduct of MillsFargo Mutual and Professional Foreclosure Services the Consumers’ credit has been impaired and they are threatened with the eminent loss of their property despite the fact that they have made all payments in accordance with the loan agreement.
3.2 Unless enjoined, the plaintiffs will suffer irreparable harm and will not have an adequate remedy at law.

3.3 As a proximate result of the negligent actions of both defendants, the Consumers have suffered consequential damage and will continue to suffer additional damage in an amount to be fully proved at the time of trial.

IV. THIRD CLAIM: SLANDER OF TITLE

4.1 The defendants have caused to be recorded various documents including a Notice of Trustee Sale which has impaired the Consumers’ title which constitutes slander of title and the Consumers should be awarded resulting damages to be fully proved at the time of trial.

V. FOURTH CLAIM: VIOLATION OF THE CONSUMER PROTECTION ACT

5.1 The defendants have engaged in a pattern of unfair practices in violation of the Nevada Revised Statutes XXXXXX Consumer Protection Act, XXXX et seq. entitling the Consumers to damages, treble damages and reasonable attorney fees and costs pursuant to the statute.

VI. FIFTH CLAIM: SLANDER OF CREDIT

6.1 The Consumers allege that the actions and inactions of the defendants have impaired their credit causing them to lose the ability to have good credit entitling them to damages, including statutory punitive damages pursuant to state and federal law, all to be proved at the time of trial.

VII. INFLICTION OF EMOTIONAL DISTRESS

7.1 The defendants have intentionally or negligently taken actions which have caused the plaintiffs severe emotional distress.

Wherefore, having set forth various causes of action against the defendants, the plaintiffs pray for the following relief:

1.That this Court enjoin the foreclosure presently scheduled for July 19, 2005, conditioned upon the Consumers making payments as the have in the past in a timely fashion;

2. That the actions of both defendants be determined to be unfair and deceptive business practices in violation of UDAP Nevada;

3. That the Consumers be awarded punitive damages provided for in UDAP XXXX including costs and attorney fees;

4. That the Consumers be awarded consequential damages to be fully proved at the time of trial;

5. That the Consumers be awarded their fees and costs pursuant to the written loan agreements which bind the defendants; and

6. That the Court grant any other relief that may be just or equitable.

Attorney for XXXXXXX

FBI Reports Nevada Highest Among Loan Modification Fraud

Here, is the latest report about Nevada as one of the highest state in reference to loan and other mortgage frauds

http://www.fbi.gov/publications/fraud/mortgage_fraud08.htm

Loan Fraud Companies Sued

We hear the loan fraud companies scamming homeowners. Now, this include loan modfication companies including their attorney. Here is the link.

http://www.mortgagefraudblog.com/ee-assets/my-uploads/UnitedFirstComplaint.pdf

Investors, real estate professionals sued for fraud in Arizona

Here, is an interesting lawsuit filed in Arizona against investors, brokers and lenders.

http://www.mortgagefraudblog.com/ee-assets/my-uploads/Arizona%20Investments%20Complaint.pdf

Both Banks and Servicers are still resisting and creating lots of hurdles for the homeonwers desperate to get loan modifications to save their homes. Here, is an excellent article published by NY Times.

http://www.nytimes.com/2009/07/11/business/11nocera.html?8dpc

Servicers Still Resisting Loan Modifications

Homeowners are still facing lots of resistance and sometime total lack of cooperation from both their lenders and servicers. It was the hope of all of us that the servicers and lenders would pick up the pace after the Obama Plan, but unfortunately, it is not the case. The laziness and lack of coperations from both of them is still on going increasing both the frustration level as well as the rate of foreclosures throughout USA.
Here, it is the frontpage story from NY Times.

http://www.nytimes.com/2009/06/29/business/29loanmod.html

Good News for Renters:Federal Laws Passed

A new federal law has been passed protecting the rights of tenants whose homes were foreclosed by banks owing to non payments by their landlords.


http://www.tenantstogether.org/downloads/S.896Final.pdf

Nevada Supreme Court Decides New Foreclosure Mediation Rules

Supreme Court of Nevada Decides New Foreclosure Mediation Rules

As usual, the Law Office of Malik Ahmad is the first one to post these rules on its blog. These rules were just signed by Nevada Supreme Court Judges today i.e June 30th, 2009.

Here, is the good news from Supreme Court of Nevada and for its homeowners. Supreme Court of Nevada had finally decided the detailed rules for the foreclosure mediation program under AB149:

http://www.nevadajudiciary.us/images/pdf/foreclosure.mediation.rules.ord.pdf

http://www.nevadajudiciary.us/images/pdf/foreclosure.mediation.rules.ord.pdf

Nevada Legislature New Mediation Program: Good News

About the Nevada Foreclosure Mediation ProgramCREATING THE PROGRAM

Assembly Bill 149 was passed by the Nevada Legislature during the 2009 session and signed by Governor Jim Gibbons. Its purpose is to address the foreclosure crisis head-on and to help keep Nevada families in their homes.

This law establishes a Foreclosure Mediation Program for owner-occupied residential properties that are subject to foreclosure notices – formally known as a Notice of Default and Election to Sell – filed on or after July 1, 2009. To qualify for the mediation program, a property must be a homeowner’s primary residence and located in Nevada.

WHAT YOU NEED TO KNOW ABOUT FORECLOSURE MEDIATION?

Mediation is an alternative method to help parties resolve disputes by agreement with the help of trained mediators. Mediating a foreclosure action has its advantages. It is fast, inexpensive, and offers a flexibility that more formal processes do not.

Home foreclosures impact both the homeowner and the lender. Homeowners do not want to lose their homes and mortgage lenders do not want to be in the real estate business.

Both sides may benefit through foreclosure mediations.

WHY SHOULD YOU MEDIATE?
You can play a major role, with the help of a trained mediator, in deciding the outcome of your individual dilemma. Mediation is a give-and-take process in which the parties work to reach a mutually acceptable resolution to a mutual problem. Resolutions reached through foreclosure mediations are compromises that offer advantages to lenders as well as homeowners.

If you have the ability to meet the other party half way, everyone may benefit.
 Can you, as a homeowner, make your mortgage payments if your home loan is modified?
 Can you, as a lender in today’s real estate market, modify a loan to the extent that the homeowner can perform?
If the answers are YES, the Foreclosure Mediation Program may be able to save another Nevada home.

WORKING FOR A RESOLUTION

Sometimes the parties will not be able to reach an agreement, even with the help of a trained mediator, and the home will be lost to foreclosure. That is a reality in today’s economy.

But by working together to explore the various options, the hope is that a homeowner can avoid foreclosure and continue living in the home they purchased. If the mediation is successful, the homeowner may also avoid the stigma of foreclosure that can affect a person’s ability to obtain credit for years to come.

However, if a homeowner does not have the financial ability to make mortgage payments, even if the loan is modified, foreclosure may ultimately result.

MEDIATION IS QUICK AND EFFICIENT

Proposed Supreme Court rules limit mediations to four hours and require that mediations be conducted within 90 days of a foreclosure notice being filed.

Those same rules also require that all decision makers be present for the mediations. That means, if an agreement is reached, it can be finalized quickly.

MEDIATION IS COST EFFECTIVE

Other than the filing fee paid by the lender, the cost of mediation is $400, shared equally by the homeowner and the lender. Each party must pay their $200 portion prior to the mediation.

A lawyer is not required to be present with you in the mediation process, but each side is welcome to have an attorney represent them.

AT THE CONCLUSION OF THE MEDIATION…

Within 10 days of the mediation, the mediator will prepare the necessary Statement of Agreement or Non-agreement and serve it on the parties. The original will be filed with the Foreclosure Mediation Program Administrator and the mediation will be closed. If there is an agreement, the parties will execute the appropriate documents. If there is no agreement, the parties will be free to pursue other legal remedies.

This article was taken from the Nevada Supreme Court website.

Feds Cracking On Loan Fraud Companies

Federal government has made elaborate plans to squeeze their grip on fraud loan modification companies. Here is the report prepared by the Housing Committee.
http://www.ftc.gov/os/2009/05/P064814

Good News For Nevada Homeowners

Good News For Nevada Homeowners
Passing of AB 149AN ACT relating to real property; revising provisions governing foreclosures on property; providing for mediation under certain circumstances; providing for the imposition of a fee for mediation; and providing other matters properly relating thereto.

Existing law sets forth procedures governing foreclosures on real property upon default. A trustee under a deed of trust has the power to sell the property to which the deed of trust applies, subject to certain restrictions. (NRS 107.080, 107.085)

LET US HAVE A CLOSER LOOK
Program facts

What’s the foreclosure mediation program?
The program, which was created when Assembly Bill 149 became law, allows homeowners who get a notice of default to go into mediation with their lender in front of a court-appointed mediator. Both parties are required to negotiate in good faith toward a potential resolution, which might include a loan modification. The law was created after looking at similar programs in such states as Colorado, Connecticut, Florida, Massachusetts, Michigan and Pennsylvania.

When does it go into effect?
July 1. Forms and finalized rules will be available by then on the Nevada Supreme Court’s Web site at www.nevadajudiciary.us. The court is seeking public comment to help finalize the program’s rules. The first hearing was held in Carson City on Tuesday, and the second hearing will be held in Las Vegas in Friday. The second hearing will be broadcast live on the Supreme Court Web site.

Who qualifies?
Homeowners who receive a notice of default on July 1 and thereafter will receive a mediation form along with their notice. Homeowners will then have 30 days to request mediation. Homes must be owner-occupied and not be investment properties. Homeowners who already have surrendered their homes to the lender or have started bankruptcy proceedings will not be eligible. Homeowners who received a notice of default before July 1 will only be eligible if their lender provides consent.

How much will it cost?
Lenders and borrowers are required to pay $200 each to pay for mediation costs. Non-native speakers will have to provide their own translator.

Where do I get more information?
For more information — including requesting a mediation or volunteering as a mediator — contact the program administrator’s office at 775-687-9816 or e-mail foreclose@nvcourts.nv.gov

What Additional Changes With Respect to Trustee’s Power of Sale has been made?The good news is that the law has been changed effective July 1, 2009. But it only applies to primary home owners and does not apply to rental properties. Nevada Legislature has placed additional restrictions on home foreclosure. Now a person who holds the title of record can request mediation for loan modification.

Who can provide mediation?It can be an attorney, a senior judge, hearing master or other designee. Some 345 attorneys had signed up for mediation. They shall be paid an hourly rate of $85.00 dollars.

What happens after mediation?
Section 1 of this bill establishes additional restrictions on the trustee’s power of sale with respect to owner-occupied housing by providing a grantor of a deed of trust or the person who holds the title of record with the right to request mediation under which he may receive a loan modification. Once mediation is requested, no further action may be taken to exercise the power of sale until the completion of the mediation. Each mediation must be conducted by a senior justice, judge, hearing master or other designee pursuant to rules adopted by the Nevada Supreme Court, and a fee of not more than $85 per hour may be charged and collected for the mediation.

How a deficiency can be made good under the new Laws?Section 2 of this bill also restricts the trustee’s power of sale with respect to owner-occupied housing by revising the period in which a deficiency in performance or payment under the trust agreement may be made good before the trustee may exercise that power.

Has Service of Notice been changed as well?
Section 3 of this bill restricts the trustee’s power of sale with respect to owner-occupied housing by revising the manner in which service of notice that a person is in danger of losing his home must be made.

Whether Nevada Supreme Court Adopt Rules for Voluntary Mediation?
In addition, section 4 of this bill authorizes the Nevada Supreme Court to adopt rules providing for voluntary mediation with respect to a homeowner who is not in default but is at risk of default.

Other Salient Features of the Bill
Section 1. Chapter 107 of NRS is hereby amended by adding thereto a new section to read as follows:
1. In addition to the requirements of NRS 107.085, the exercise of the power of sale pursuant to NRS 107.080 with respect to any trust agreement which concerns owner-occupied housing is subject to the provisions of this section.
2. The trustee shall not exercise a power of sale pursuant to NRS 107.080 unless the trustee:
(a) Includes with the notice of default and election to sell which is mailed to the grantor or the person who holds the title of record as required by subsection 3 of NRS 107.080:
(1) Contact information which the grantor or the person who holds the title of record may use to reach a person with authority to negotiate a loan modification on behalf of the beneficiary of the deed of trust;

(2) Contact information for at least one local housing counseling agency approved by the United States Department of Housing and Urban Development; and

(3) A form upon which the grantor or the person who holds the title of record may indicate his election to enter into mediation or to waive mediation and one envelope addressed to the trustee and one envelope addressed to the Mediation Administrator, which the grantor or the person who holds the title of record may use to comply with the provisions of subsection 3;

(b) Serves a copy of the notice upon the Mediation Administrator; and
(c) Causes to be recorded in the office of the recorder of the county in which the trust property, or some part thereof, is situated:
(1) The certificate provided to the trustee by the Mediation Administrator pursuant to subsection 3 or 6 which provides that no mediation is required in the matter; or (2) The certificate provided to the trustee by the Mediation Administrator pursuant to subsection 7 which provides that mediation has been completed in the matter.

3. The grantor or the person who holds the title of record shall, not later than 30 days after service of the notice upon him in the manner required by NRS 107.080, complete the form required by subparagraph (3) of paragraph (a) of subsection 2 and return the form to the trustee by certified mail, return receipt requested. If the grantor or the person who holds the title of record indicates on the form his election to enter into mediation, the trustee shall notify the beneficiary of the deed of trust and every other person with an interest as defined in NRS 107.090, by certified mail, return receipt requested, of the election of the grantor or the person who holds the title of record to enter into mediation and file the form with the Mediation Administrator, who shall assign the matter to a senior justice, judge, hearing master or other designee and schedule the matter for mediation. No further action may be taken to exercise the power of sale until the completion of the mediation. If the grantor or the person who holds the title of record indicates on the form his election to waive mediation or fails to return the form to the trustee as required by this subsection, the trustee shall execute an affidavit attesting to that fact under penalty of perjury and serve a copy of the affidavit, together with the waiver of mediation by the grantor or the person who holds the title of record, or proof of service on the grantor or the person who holds the title of record of the notice required by subsection 2 of this section and subsection 3 of NRS 107.080, upon the Mediation Administrator. Upon receipt of the affidavit and the waiver or proof of service, the Mediation Administrator shall provide to the trustee a certificate which provides that no mediation is required in the matter.

4. Each mediation required by this section must be conducted by a senior justice, judge, hearing master or other designee pursuant to the rules adopted pursuant to subsection.
The beneficiary of the deed of trust or his representative shall attend the mediation. The grantor or his representative shall attend the mediation if the grantor elected to enter into mediation, or the person who holds the title of record or his representative shall attend the mediation if the person who holds the title of record elected to enter into mediation. The beneficiary of the deed of trust shall bring to the mediation the original or a certified copy of the deed of trust, the mortgage note and each assignment of the deed of trust or mortgage note. If the beneficiary of the deed of trust is represented at the mediation by another person, that person must have authority to negotiate a loan modification on behalf of the beneficiary of the deed of trust or have access at all times during the mediation to a person with such authority.

5. If the beneficiary of the deed of trust or his representative fails to attend the mediation, fails to participate in the mediation in good faith or does not bring to the mediation each document required by subsection 4 or does not have the authority or access to a person with the authority required by subsection 4, the mediator shall prepare and submit to the Mediation Administrator a petition and recommendation concerning the imposition of sanctions against the beneficiary of the deed of trust or his representative. The court may issue an order imposing such sanctions against the beneficiary of the deed of trust or his representative as the court determines appropriate, including, without limitation, requiring a loan modification in the manner determined proper by the court.

6. If the grantor or the person who holds the title of record elected to enter into mediation and fails to attend the mediation, the Mediation Administrator shall provide to the trustee a certificate which states that no mediation is required in the matter.

7. If the mediator determines that the parties, while acting in good faith, are not able to agree to a loan modification, the mediator shall prepare and submit to the Mediation Administrator a recommendation that the matter be terminated. The Mediation Administrator shall provide to the trustee a certificate which provides that the mediation required by this section has been completed in the matter.

8. The Supreme Court shall adopt rules necessary to carry out the provisions of this section. The rules must, without limitation, include provisions:
(a) Designating an entity to serve as the Mediation
Administrator pursuant to this section. The entities that may be so designated include, without limitation, the Administrative Office of the Courts, the District Court of the county in which the property is situated or any other judicial entity.
(b) Ensuring that mediations occur in an orderly and timely manner.
(c) Requiring each party to a mediation to provide such information as the mediator determines necessary.
(d) Establishing procedures to protect the mediation process from abuse and to ensure that each party to the mediation acts in good faith.
(e) Establishing a total fee of not more than $400 that may be charged and collected by the Mediation Administrator for mediation services pursuant to this section and providing that the responsibility for payment of the fee must be shared equally by the parties to the mediation.
9. Except as otherwise provided in subsection 11, the provisions of this section do not apply if:
(a) The grantor or the person who holds the title of record has surrendered the property, as evidenced by a letter confirming the surrender or delivery of the keys to the property to the trustee, the beneficiary of the deed of trust or the mortgagee, or an authorized agent thereof; or
(b) A petition in bankruptcy has been filed with respect to the grantor or the person who holds the title of record under chapter 7, 11, 12 or 13 of Title 11 of the United States Code and the bankruptcy court has not entered an order closing or dismissing the case or granting relief from a stay of foreclosure.
10. A noncommercial lender is not excluded from the application of this section.
11. The Mediation Administrator and each mediator who acts pursuant to this section in good faith and without gross negligence is immune from civil liability for those acts.
12. As used in this section:
(a) “Mediation Administrator” means the entity so designated pursuant to subsection 8.
(b) “Noncommercial lender” means a lender which makes a loan secured by a deed of trust on owner-occupied housing and which is not a bank, financial institution or other entity regulated pursuant to title 55 or 56 of NRS.
(c) “Owner-occupied housing” means housing that is occupied by an owner as his primary residence. The term does not include any time share or other property regulated under chapter 119A of NRS.

Changes in Notice Provisions of NRS
Sec. 2. NRS 107.080 is hereby amended to read as follows: 107.080 1. Except as otherwise provided in NRS 107.085, and section 1 of this act, if any transfer in trust of any estate in real property is made after March 29, 1927, to secure the performance of an obligation or the payment of any debt, a power of sale is hereby conferred upon the trustee to be exercised after a breach of the obligation for which the transfer is security.
2. The power of sale must not be exercised, however, until:
(a) [In] Except as otherwise provided in paragraph (b), in the case of any trust agreement coming into force:

(1) On or after July 1, 1949, and before July 1, 1957, the grantor, [or his successor in interest,] the person who holds the title of record, a beneficiary under a subordinate deed of trust or any other person who has a subordinate lien or encumbrance of record on the property [,] has , for a period of 15 days, computed as prescribed in subsection 3, failed to make good the deficiency in performance or payment; or (2) On or after July 1, 1957, the grantor, [or his successor in interest,] the person who holds the title of record, a beneficiary under a subordinate deed of trust or any other person who has a subordinate lien or encumbrance of record on the property [,] has , for a period of 35 days, computed as prescribed in subsection 3, failed to make good the deficiency in performance or payment;
(b) In the case of any trust agreement which concerns owner occupied housing as defined in section 1 of this act, the grantor, the person who holds the title of record, a beneficiary under a subordinate deed of trust or any other person who has a subordinate lien or encumbrance of record on the property has, for a period that commences in the manner and subject to the requirements described in subsection 3 and expires 5 days before the date of sale, failed to make good the deficiency in performance or payment;
(c) The beneficiary, the successor in interest of the beneficiary or the trustee first executes and causes to be recorded in the office of the recorder of the county wherein the trust property, or some part thereof, is situated a notice of the breach and of his election to sell or cause to be sold the property to satisfy the obligation; and [(c)] (d) Not less than 3 months have elapsed after the recording of the notice.
3. The 15- or 35-day period provided in paragraph (a) of subsection 2, or the period provided in paragraph (b) of subsection 2, commences on the first day following the day upon which the notice of default and election to sell is recorded in the office of the county recorder of the county in which the property is located and a copy of the notice of default and election to sell is mailed by registered or certified mail, return receipt requested and with postage prepaid to the grantor [, and] or to the person who holds the title of record on the date the notice of default and election
to sell is recorded, at [their respective addresses,] his address, if known, otherwise to the address of the trust property. The notice of default and election to sell must describe the deficiency in performance or payment and may contain a notice of intent to declare the entire unpaid balance due if acceleration is permitted by the obligation secured by the deed of trust, but acceleration must not occur if the deficiency in performance or payment is made good and any costs, fees and expenses incident to the preparation or recordation of the notice and incident to the making good of the deficiency in performance or payment are paid within the time specified in subsection 2.
4. The trustee, or other person authorized to make the sale under the terms of the trust deed or transfer in trust, shall, after expiration of the 3-month period following the recording of the notice of breach and election to sell, and before the making of the sale, give notice of the time and place thereof by recording the notice of sale and by:

(a) Providing the notice to each trustor and any other person entitled to notice pursuant to this section by personal service or by mailing the notice by registered or certified mail to the last known address of the trustor and any other person entitled to such notice pursuant to this section;
(b) Posting a similar notice particularly describing the property, for 20 days successively, in three public places of the township or city where the property is situated and where the property is to be sold; and
(c) Publishing a copy of the notice three times, once each week for 3 consecutive weeks, in a newspaper of general circulation in the county where the property is situated.
5. Every sale made under the provisions of this section and other sections of this chapter vests in the purchaser the title of the grantor and his successors in interest without equity or right of redemption. A sale made pursuant to this section may be declared void by any court of competent jurisdiction in the county where the sale took place if:
(a) The trustee or other person authorized to make the sale does not substantially comply with the provisions of this section [;] or any applicable provision of section 1 of this act;
(b) Except as otherwise provided in subsection 6, an action is commenced in the county where the sale took place within 90 days after the date of the sale; and
(c) A notice of lis pendens providing notice of the pendency of the action is recorded in the office of the county recorder of the county where the sale took place within 30 days after commencement of the action.
6. If proper notice is not provided pursuant to subsection 3 or paragraph (a) of subsection 4 to the grantor, to the person who holds the title of record on the date the notice of default and election to sell is recorded, to each trustor or to any other person entitled to such notice, the person who did not receive such proper notice may commence an action pursuant to subsection 5 within 120 days after the date on which the person received actual notice of the sale.
7. The sale of a lease of a dwelling unit of a cooperative housing corporation vests in the purchaser title to the shares in the corporation which accompany the lease.
Sec. 3. NRS 107.085 is hereby amended to read as follows:
107.085 1. With regard to a transfer in trust of an estate in real property to secure the performance of an obligation or the payment of a debt, the provisions of this section apply to the exercise of a power of sale pursuant to NRS 107.080 only if:
(a) The trust agreement becomes effective on or after October 1, 2003
(b) On] , and, on the date the trust agreement is made, the trust agreement is subject to the provisions of § 152 of the Home Ownership and Equity Protection Act of 1994, 15 U.S.C. §
1602(aa), and the regulations adopted by the Board of Governors of the Federal Reserve System pursuant thereto, including, without limitation, 12 C.F.R. § 226.32 [.] ; or (b) The trust agreement concerns owner-occupied housing as defined in section 1 of this act.
2. The trustee shall not exercise a power of sale pursuant to NRS 107.080 unless:
(a) In the manner required by subsection 3, not later than 60 days before the date of the sale, the trustee causes to be served upon the grantor or the person who holds the title of record a notice in the form described in subsection 3; and (b) If an action is filed in a court of competent jurisdiction claiming an unfair lending practice in connection with the trust agreement, the date of the sale is not less than 30 days after the date the most recent such action is filed.
3. The notice described in subsection 2 must be: (a) Served upon the grantor or the person who holds the title of record:
(1) Except as otherwise provided in subparagraph (2), by personal service or, if personal service cannot be timely effected, in such other manner as a court determines is reasonably calculated to
afford notice to the grantor [;] or the person who holds the title of record; or
(2) If the trust agreement concerns owner-occupied housing as defined in section 1 of this act:
(I) By personal service;
(II) If the grantor or the person who holds the title of record is absent from his place of residence or from his usual place of business, by leaving a copy with a person of suitable age
and discretion at either place and mailing a copy to the grantor or the person who holds the title of record at his place of residence or place of business; or
(III) If the place of residence or business cannot be ascertained, or a person of suitable age or discretion cannot be found there, by posting a copy in a conspicuous place on the trust property, delivering a copy to a person there residing if the person can be found and mailing a copy to the grantor or the person who holds the title of record at the place where the trust property is situated; and
(b) In substantially the following form, with the applicable telephone numbers and mailing addresses provided on the notice and a copy of the promissory note attached to the notice:

NOTICE
YOU ARE IN DANGER OF LOSING YOUR HOME!Your home loan is being foreclosed. In not less than 60 days your home will be sold and you will be forced to move. For help, call:
Consumer Credit Counseling _______________
The Attorney General __________________
The Division of Financial Institutions ________________
Legal Services ______________________
Your Lender ___________________
Nevada Fair Housing Center ________________
4. This section does not prohibit a judicial foreclosure.
5. As used in this section, “unfair lending practice” means an unfair lending practice described in NRS 598D.010 to 598D.150, inclusive.
Sec. 3.5. NRS 107.095 is hereby amended to read as follows:
107.095 1. The notice of default required by NRS 107.080 must also be sent by registered or certified mail, return receipt requested and with postage prepaid, to each guarantor or surety of
the debt. If the address of the guarantor or surety is unknown, the notice must be sent to the address of the trust property. Failure to give the notice, except as otherwise provided in subsection 3, releases the guarantor or surety from his obligation to the beneficiary, but does not affect the validity of a sale conducted pursuant to NRS 107.080 [nor] or the obligation of any guarantor or surety to whom the notice was properly given.
2. Failure to give the notice of default required by NRS 107.090, except as otherwise provided in subsection 3, releases the obligation to the beneficiary of any person who has complied with
NRS 107.090 and who is or may otherwise be held liable for the debt or other obligation secured by the deed of trust, but such a failure does not affect the validity of a sale conducted pursuant to
NRS 107.080 [nor] or the obligation of any person to whom the notice was properly given pursuant to this section or to NRS 107.080 or 107.090.
3. A guarantor, surety or other obligor is not released pursuant to this section if:
(a) The required notice is given at least 15 days before the later of:
(1) The expiration of the 15- or 35-day period described in paragraph (a) of subsection 2 of NRS 107.080; [or]
(2) In the case of any trust agreement which concerns owner-occupied housing as defined in section 1 of this act, the expiration of the period described in paragraph (b) of subsection 2 of NRS 107.080; or (3) Any extension of [that] the applicable period by the beneficiary; or (b) The notice is rescinded before the sale is advertised.
Sec. 4. Chapter 2 of NRS is hereby amended by adding thereto a new section to read as follows:
The Supreme Court may adopt rules providing for voluntary mediation with respect to a homeowner who is not in default but is at risk of default.
Sec. 5. NRS 459.646 is hereby amended to read as follows:
459.646 1. A person who, without participating in the management of a parcel of real property, holds or is the beneficiary of evidence of title to the property primarily to protect a security
interest in the property is not a responsible party with respect to a release of a hazardous substance on the property if:
(a) The owner of the property is relieved from liability under NRS 459.610 to 459.658, inclusive, with respect to the release;
(b) The owner or holder of evidence of title did not cause the release; and
(c) The owner or holder of evidence of title does not participate actively in decisions concerning hazardous substances on the property.
2. A lender to a prospective purchaser who has filed an application to participate in the program pursuant to NRS 459.634 or a lender who forecloses his security interest in property pursuant
to NRS 40.430 to 40.450, inclusive, or 107.080 to 107.100,
inclusive, and section 1 of this act, and within a reasonable period after the foreclosure, not to exceed 2 years, sells, transfers or conveys the property to a prospective purchaser who has filed an application to participate in the program pursuant to NRS 459.634 is not a responsible party solely as a result of:
(a) Foreclosing a security interest in the property; or
(b) Making a loan to the prospective purchaser if the loan:
(1) Is to be used for acquiring property or removing or remediating hazardous substances on property; and
(2) Is secured by the property that is to be acquired or on which is located the hazardous substances that are to be removed or remediated.
Sec. 5.5. The amendatory provisions of this act governing trust agreements which concern owner-occupied housing, as defined in section 1 of this act, apply only with respect to such agreements for which a notice of default is recorded on or after July 1, 2009.
Sec. 5.7. Notwithstanding any provision of NRS 2.120 to the contrary and in recognition of the emergency situation confronting this State concerning mortgage foreclosures and the need to
implement the provisions of this act quickly, any rules adopted by the Supreme Court pursuant to subsection 8 of section 1 of this act take effect on the date specified by the Supreme Court in the order adopting the rules, which in no event may be less than 30 days after entry of the order.
Sec. 6. This act becomes effective on July 1, 2009.