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Judge’s Ruling an NJ Foreclosure Game Changer

April 26th, 2019 by

On the surface, this may not seem like a big deal, but here is why it is important to a homeowner who may be facing or fighting foreclosure.

Here is how it helps the homeowner.

Foreclosures are filed in state court.  In New Jersey, the state courts have become more unfavorable to homeowners since 2012, and they

often rubber stamp bank requests even where the documents are missing.  Courts have made it easier and easier for banks to obtain foreclosure judgments in New Jersey.

Where the State Court allowed the bank to get a judgment including money not owed by the homeowner and the Federal Court ruled that by seeking to collect money not owed the attorneys involved violated Federal Law.  When a bank seeks to collect money it is not owed, a homeowner can sue in Federal Court instead of State Court.  Federal Courts apply the law more accurately than the State Courts.

Homeowners that go on the offensive level the playing field.  A homeowner that shows the bank they are not afraid to fight when their rights are violated, creates leverage.

The number of ways banks and their collection attorneys violate homeowner rights is never-ending and always evolving.  Federal Courts can hear claims where a bank refuses to honor a loan modification, misapplies money paid to the bank, or where the bank breaks into a home.  These are the types of violations that happen on a daily basis across the country.  These are violations of homeowner rights ignored by the State Courts.

Additionally, banks process foreclosure cases as quickly and inexpensively as possible and don’t look into details unless forced to.  Often times they haven’t even looked at the repayment history or loan servicing file before filing a foreclosure.  This increases the chance for an error on by the debt collecting lawyers.  Finding these errors and turning them into leverage for the homeowner is the foundation to creating a smart and effective legal plan for combating foreclosure.

Denbeaux & Denbeaux doesn’t just think about how to defend a foreclosure, they have developed tools to utilize several Federal Laws that allow homeowners to go on the offensive if their rights have been violated by the loan owner, servicer, attorney or their representatives.  The Denbeaux firm uses the Real Estate Settlement Procedures Act to obtain a homeowner’s complete loan servicing file.  This includes loan payment history, letters sent by the loan servicer, loan modification applications, phone call records, and other documents that often demonstrate violations of Federal Law that can be acted upon by the homeowner.

Going on the offensive is the best way a homeowner facing foreclosure can improve their situation.  The banks, loan servicers, and their attorneys take matters seriously when they get sued with legitimate claims.  They pay attention in part because they are under a close watch from the Financial Consumer Protection Bureau (CFPB) which pays attention to how often financial institutions get sued, and the reasons for the lawsuits.  The ruling in Psaros v. Green Tree Servicing demonstrates the difference between operating in State Court and Federal Court and shows that homeowners facing foreclosure have many rights, but only if they are willing to directly stand up for themselves.

Judge’s Ruling a NJ Foreclosure Game Changer

February 16th, 2016 by

Why is this important?
It is the idea that the best defense is to be able to be in control and have an aggressive offensive strategy. This applies to whether you are trying to stop a foreclosure, get a loan modification, or believe that you were subject to fraud.

This is why this ruling is such a game changer for you. It allows you to turn the tables on the banks, loan servicers, and even their attorneys.

A loan servicer trying to foreclose on your home is subject to the same laws as that apply to a debt collector.  A law firm that represents a loan servicer is also subject to the same laws. In a foreclosure action both the loan servicer and the law firm are subject to penalties and enforcement under federal laws as debt collectors and can be sued by a homeowner.

What changed?
In the landmark case [Psaros vs. Gree Tree Servicing ] brought and won this year by Denbeaux and Denbeaux, possible favorable outcomes for foreclosure defense shifted more in favor of the homeowner.

The takeaway for New Jersey homeowners facing foreclosure as explained in the articles “Debt collectors beware: Judge’s Ruling Could Change the Game” by David Porter of the Associate Press, and ‘These Are People’s Lives You’re Playing With’:The Fight to Curb Debt Collector Lies” by Alan Pyke is this: a law firm who represents a bank in a foreclosure case can be held responsible for the mortgage company’s loan servicing errors.

Both the loan servicer and the law firm that represent them can have complaints filed against them and the law firm can be made to testify and provide evidence against their client.

Judge’s Ruling a NJ Foreclosure Game Changer

Joshua Denbeaux, Esq.

On the surface this may not seem like a big deal, but here is why it is important to a homeowner who may be facing or fighting foreclosure.

Here is how it helps the homeowner.

Foreclosures are filed in state court.  In New Jersey, the state courts have become more unfavorable to homeowners since 2012, and they often rubber stamp bank requests even where the documents are missing.  Courts have made it easier and easier for banks to obtain foreclosure judgments in New Jersey.

Psaros v. Green Tree Servicing is a good example, where the State Court allowed the bank to get a judgment including money not owed by the homeowner, the Federal Court ruled that by seeking to collect money not owed the attorneys involved violated Federal Law.  When a bank seeks to collect money it is not owed, a homeowner can sue in Federal Court instead of State Court.  Federal Courts apply the law more accurately than the State Courts.

Homeowners that go on the offensive level the playing field.  A homeowner that shows the bank they are not afraid to fight when their rights are violated, creates leverage.

The number of ways banks and their collection attorneys violate homeowner rights is never-ending and always evolving.  Federal Courts can hear claims where a bank refuses to honor a loan modification, misapplies money paid to the bank, or where the bank breaks into a home.  These are the types of violations that happen on a daily basis across the country.  These are violations of homeowner rights ignored by the State Courts.

Additionally, banks process foreclosure cases as quickly and inexpensively as possible and don’t look into details unless forced to.  Often times they haven’t even looked at the repayment history or loan servicing file before filing a foreclosure.  This increases the chance for an error on by the debt collecting lawyers.  Finding these errors and turning them into leverage for the homeowner is the foundation to creating a smart and effective legal plan for combating foreclosure.

Denbeaux & Denbeaux doesn’t just think about how to defend a foreclosure, they have developed tools to utilize several Federal Laws that allow homeowners to go on the offensive if their rights have been violated by the loan owner, servicer, attorney or their representatives.  The Denbeaux firm uses the Real Estate Settlement Procedures Act to obtain a homeowner’s complete loan servicing file.  This includes loan payment history, letters sent by the loan servicer, loan modification applications, phone call records, and other documents that often demonstrate violations of Federal Law that can be acted upon by the homeowner.

Going on the offensive is the best way a homeowner facing foreclosure can improve their situation.  The banks, loan servicers, and their attorneys take matters seriously when they get sued with legitimate claims.  They pay attention in part because they are under a close watch from the Financial Consumer Protection Bureau (CFPB) which pays attention to how often financial institutions get sued, and the reasons for the lawsuits.  The ruling in Psaros v. Green Tree Servicing demonstrates the difference between operating in State Court and Federal Court and shows that homeowners facing foreclosure have many rights, but only if they are willing to directly stand up for themselves.

Debt Collectors Beware: Judge’s Ruling Could Change the Game

January 24th, 2016 by

Debt Collectors Beware: Judge’s Ruling Could Change the Game

  • By DAVID PORTER, ASSOCIATED PRESS

HAWTHORNE, N.J. — Jan 24, 2016, 11:11 AM ET

Ever had a debt collector on your back for money you knew you didn’t owe? Listen to the story of Steven Psaros and take heart.

The Great Recession forced Psaros into foreclosure on the house he had bought in this northern New Jerseytown in 1999.

Then, another blow. A debt collector demanded about $11,000 in homeowners’ insurance, money Psaros claimed he didn’t owe under terms of a mortgage refinance signed several years earlier.

He fought back in court and, in a ruling that could change how law firms handle debt collection, a federal judge held last month that the firm representing the debt collector could be liable for damages even if it didn’t know its client was relying on incorrect information.

Some experts see the ruling as a game-changer in foreclosure actions, which by their nature target people who are under emotional and financial stress.

“Think of the psychological state of people going through foreclosure,” said Seton Hall law school professor Charles Sullivan, who specializes in contracts and employment law. “They can’t pay their mortgage and they think they’re going to be in foreclosure. They’re not looking at the papers, and if they are, whether it’s $360,000 or $370,000, neither is a sum they can pay. They may not even seek an attorney. But attorneys in the past didn’t have the tools this this decision now gives them.”

The debt collection industry is a top source of complaints from consumers, according to the federal Consumer Financial Protection Bureau. Formed in 2011, the bureau began collecting complaints in its system in mid-2013; by the end of that year, it had received more than 30,000 complaints about debt collectors.

The most frequent complaints were about debt collectors attempting to gather money that wasn’t owed. And according to Psaros’ lawsuit, his case falls under that category.

Adam Deutsch, an attorney representing Psaros for the Westwood-based Denbeaux and Denbeaux law firm, said the ruling “sends a message to people on the collection side that you can’t just assume the information you’re being provided by your client is accurate.”

In an email, he said he suffered economic losses during the recession in 2009. According to his suit, BAC Home Loans Servicing, through the law firm Stern, Lavinthal and Frankenberg, filed a debt collection foreclosure action in September 2010. Servicing for the mortgage was later taken over by St. Paul, Minnesota-based Green Tree Servicing.

Through a deal he negotiated when he refinanced his mortgage in 2008, Psaros was paying property insurance and real estate taxes directly, rather than through an escrow account managed by the lender. Last April, however, Green Tree allegedly sent him a letter telling him he owed $10,974.37 for insurance premiums.

Psaros sued Green Tree and Stern Lavinthal in federal court last June, and in the fall the law firm asked U.S. District Judge Jose Linares to dismiss Psaros’ claim because it hadn’t demonstrated “any false or misleading representation by Stern Lavinthal that might give rise to liability” under the federal Fair Debt Collection Practices Act.

The judge disagreed, writing last month that the firm “cannot evade its responsibilities as a debt collector by blaming its client for providing it with factually inaccurate information used in the process of collecting a debt.”

Sullivan predicted the ruling will lead to fewer mistakes as law firms become more vigilant in checking their clients’ claims when seeking to collect debts.

Adam Deutsch, an attorney representing Psaros for the Westwood-based Denbeaux and Denbeaux law firm, said the ruling “sends a message to people on the collection side that you can’t just assume the information you’re being provided by your client is accurate.”

An attorney representing Stern Lavinthal declined to comment, and an attorney for Green Tree didn’t respond to a request for comment.

United States District Court Judge: Legal Counsel Is Liable Under FDCPA For False Representations of Their Clients in Court Filings

January 5th, 2016 by

United States District Court Judge:  Legal Counsel Is Liable Under FDCPA For False Representations of Their Clients in Court Filing

NJ firm Denbeaux & Denbeaux earns major victory using FDCPA for national consumers victimized by  false information presented by law counsels at the bidding of their clients.

Adam Deutsch, Esq.

Westwood, NJ, January 5, 2016:   No longer can legal counsel evade liability under the Fair Debt Collection Practices Act (FDCPA) by claiming false information provided to a court or debtor was supplied by their client.  This is the conclusion of a groundbreaking judicial opinion according to Westwood, NJ financial consumer rights law firm Denbeaux & Denbeaux.

U.S. District Court Judge Jose Linares denied a debt collection law firm’s motion to dismiss in Steven Psaros vs Green Tree Servicing, LLC.  According to Judge Linares’ 16-page opinion, Psaros successfully alleged that New Jersey law firm Stern Lavinthal & Frankenberg violated FDCPA laws by charging and attempting to collect improper fees of $10,974.37 for property insurance outlays to Psaros’ home mortgage debt.  The fees were improper because Psaros had paid all taxes/insurance, and his mortgage loan contained an escrow waiver.  In response Psaros sued both Green Tree Servicing, LLC and Stern Lavinthal & Frankenburg.   Stern Lavinthal & Frankenburg argued that they were not liable for the false representations of the debt owed by Psaros because the false information was generated by their client Green Tree

Servicing, LLC.  Justice Linares rejected their defense, ruling that “Stem Lavinthal cannot evade its responsibilities as a debt collector by blaming its client for providing it with factually inaccurate information used in the process of collecting a debt.” Green Tree Servicing, LLC did not move for dismissal of the claims.

Judge Linares’ December 21 opinion is significant for Mr. Psaros and will prove meaningful to scores of other consumers facingdebt collection litigation,” said Denbeaux & Denbeaux Senior Associate Attorney Adam Deutsch who serves as Psaros’ counsel.  “It is unfortunate how often lawyers choosing to make a living collecting debts do so based-upon false information provided by their clients.  Green Tree Servicing, LLC was notified by Mr. Psaros of the error, and they still directed Stern Lavinthal & Frankenberg, LLC to collect funds not owed.  Industry wide, there is evidence that debt collectors and their attorneys regularly engage in this conduct unchecked.”

The Court’s words are perfectly concise: ‘A plain reading of the statute leads to the conclusion that a violation has occurred,’” said Denbeaux & Denbeaux Partner Joshua Denbeaux.  “Systematic flaws in the state judicial process have resulted in an increased level of arrogance and greed among debt collectors as evidenced in this case.  It was not enough for the debt collection law firm and loan servicer to seek recovery of the debt owed, instead they inflated the sum by thousands of dollars and assumed with confidence they would get away without anyone noticing.  Had Mr. Psaros not been diligent to seek the assistance of an attorney, the collectors would have successfully stolen this money.”

Click here to read the entirety of Judge Linares’ decisionhttp://denbeauxlaw.com/wp-content/uploads/2015/12/Steven-Psaros-vs-Green-Tree-Servicing-LLC-Civil-Action-No15-4277-1.pdf

The law firm of Denbeaux and Denbeaux is located at 366 Kinderkamack Road Westwood New Jersey 07675. Tel: 201-664-8855 or email pr(at)denbeauxlaw(dot)com.Denbeaux and Denbeaux is a family operated law firm with a tradition of excellence in consumer rights and family law. Formed in 1989, Denbeaux & Denbeaux is a law firm dedicated to providing top level legal representation to its clients. The partners, Marcia Denbeaux and Joshua Denbeaux, represent individuals and businesses in New Jersey State and Federal Trial and Appellate Courts. The firm primarily practices civil litigation, with a concentration in mortgage foreclosure, consumer fraud, commercial litigation, matrimonial law, business, insurance coverage litigation.

Their work has been featured in major media sources throughout the country including CNN, MSNBC, NPR, C-SPAN, CBS Evening News, the Associated Press, The Star Ledger, and The Record.

For media inquiries contact: Donald Tremblay |  Phone 718-664-3405 | [email protected]

Debt Collection Law Firm Held Responsible for Client’s Misrepresentation

December 29th, 2015 by

U.S. District Court Judge Jose Linares denied a debt collection law firm’s motion to dismiss in Steven Psaros vs Green Tree Servicing, LLC. 

According to Judge Linares’ 16 page opinion,  Psaros successfully alleged that New Jersey law firm Stern Lavinthal & Frankenberg violated FDCPA laws by charging and attempting to collect improper fees of $10,974.37 for property insurance outlays to Psaros’ home mortgage debt.

The fees were improper because Psaros had paid all taxes/insurance, and his mortgage loan contained an escrow waiver. In response Psaros sued both Green Tree Servicing, LLC and Stern Lavinthal & Frankenburg.  Stern Lavinthal & Frankenburg argued that they were not liable for the false representations of the debt owed by Psaros because the information was generated by their client Green Tree Servicing, LLC.  Justice Linares rejected their defense, ruling that Stern Lavinthal cannot evade its responsibilities as a debt collector by blaming its client for providing it with factually inaccurate information used in the process of collecting a debt.” Green Tree Servicing, LLC did not move for dismissal of the claims.

Adam Deutsch, Esq. comments denial of a debt collection law firm’s motion to dismiss in Steven Psaros vs Green Tree Servicing, LLC.

“Judge Linares’ December 21st opinion is significant for Mr. Psaros and will prove meaningful to scores of other consumers facing debt collection litigation.  It is unfortunate how often lawyers choosing to make a living collecting debts do so based upon false information provided by their clients.  Green Tree Servicing, LLC was notified by Mr. Psaros of the error, and they still directed Stern Lavinthal & Frankenberg, LLC to collect funds not owed.  Industry wide, there is evidence that debt collectors and their attorneys regularly engage in this conduct unchecked, ” says plaintiff attorney Adam Deutsch, Esq. of the law firm of Denbeaux and Denbeaux.