advice needed - Loan Modification Forum

jefferrson · 07-24-2009, 04:12 PM

Hey guys... a friend of mine has not made a payment in several months. He is using an attorney. The attorney says that he will tie up the bank in court hearings for 18-24 months. In this time, the bank cannot foreclose. Then after the 18-24 months, you get a court date with the bank and they will be highly likely to settle ( for a principal reduction) . I do not know a lot about this. he also mentioned that the house is put into bankruptcy. We live in Califonia. Does this sound legit?????

Evan Bedard · 07-24-2009, 04:53 PM

Hi Jefferson,

Quote:

Hey guys... a friend of mine has not made a payment in several months. He is using an attorney. The attorney says that he will tie up the bank in court hearings for 18-24 months. In this time, the bank cannot foreclose. Then after the 18-24 months, you get a court date with the bank and they will be highly likely to settle ( for a principal reduction) . I do not know a lot about this. he also mentioned that the house is put into bankruptcy. We live in Califonia. Does this sound legit?????

Honestly I have dealt with many law firms and have never heard of this before... I'm moving your thread to the California Attorneys section so they can give a little more advice on this..

Nathan Fransen Esq. · 07-24-2009, 05:48 PM

ahh yes, the famous bankruptcy plan. Actually i do not know for sure what method the "law firm" you are describing is using, but it reminds me of a fairl common scam that is not new. Here's how it works. The homeowner is told to transfer 1/8 interest in their property to a bankrupt corporation or LLC. This is done usually just prior to a trustee sale. Since the "owner" is in bankruptcy, the foreclosure is automatically stayed. Of course, the bank seeks relief of stay and usually gets it, but this can take a month or two. Once they get it, the homeowner then transfers another 1/8 interest to yet another bankrupt corporation or LLC, and repeat... This is not legal although can delay the inevitable trustee sale. Homeowners often don't realize they are risking criminal prosecution themselves. You should be able to google 1/8 interest transfer or something to that effect and read all about this. As a general rule, Courts are a place to get some form of justice, not to create roadblocks for lawful enforcement of contractual rights. Be very careful, and remember the addage - if it sounds too good to be true, it probably is...

Regards,

07-24-2009, 04:12 PM	#1 (permalink)
jefferrson Member Join Date: Oct 2008 Posts: 10 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	advice needed Hey guys... a friend of mine has not made a payment in several months. He is using an attorney. The attorney says that he will tie up the bank in court hearings for 18-24 months. In this time, the bank cannot foreclose. Then after the 18-24 months, you get a court date with the bank and they will be highly likely to settle ( for a principal reduction) . I do not know a lot about this. he also mentioned that the house is put into bankruptcy. We live in Califonia. Does this sound legit?????

07-24-2009, 05:48 PM	#3 (permalink)
Nathan Fransen Esq. California Attorney Join Date: Mar 2009 Location: Southern California Posts: 73 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: advice needed ahh yes, the famous bankruptcy plan. Actually i do not know for sure what method the "law firm" you are describing is using, but it reminds me of a fairl common scam that is not new. Here's how it works. The homeowner is told to transfer 1/8 interest in their property to a bankrupt corporation or LLC. This is done usually just prior to a trustee sale. Since the "owner" is in bankruptcy, the foreclosure is automatically stayed. Of course, the bank seeks relief of stay and usually gets it, but this can take a month or two. Once they get it, the homeowner then transfers another 1/8 interest to yet another bankrupt corporation or LLC, and repeat... This is not legal although can delay the inevitable trustee sale. Homeowners often don't realize they are risking criminal prosecution themselves. You should be able to google 1/8 interest transfer or something to that effect and read all about this. As a general rule, Courts are a place to get some form of justice, not to create roadblocks for lawful enforcement of contractual rights. Be very careful, and remember the addage - if it sounds too good to be true, it probably is... Regards, __________________ Nathan Fransen Attorney Fransen & Molinaro Law Firm (951) 520-9684 www.loanlaw.net Disclaimer: The comments by me are for informational purposes only and not for the purpose of providing legal advice. NO ATTORNEY-CLIENT RELATIONSHIP IS CREATED. You should contact your attorney to obtain advice with respect to any particular issue or problem.

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