The trend of every empty space in Brooklyn being built upon continues. 324 Macon Street, between Marcus Garvey and Lewis, once upon a time was one of a row of historic brownstones. The block is part of the Bedford-Stuyvesant/Expanded Stuyvesant Heights landmark district. The building, built around 1889, was torn down around 1967.

Plans have been filed to build on the empty lot. Unlike many parts of Brooklyn where there is no landmark protection, here the project must actually fit in architecturally with the surrounding properties. That's good news for this historic block and the residents in the neighborhod.

Justice takes a long time. Swift justice is an oxymoron. We have become as accustomed to this truism as we have to traffic jams on the Long Island Expressway at two o'clock in the morning.

Sometimes the sloth-like pace of justice is the result of lawyers delaying things. Not always, but sometimes. Other times the culprit might be a judge who takes too long to render a decision, or a clerk's office that loses critical documents. I see all of that, every month.

Sometimes, however, it's not the fault of the court system or those of us connected to it. Sometimes it's family.

I was in Surrogate's Court this morning on a simple probate matter. A woman was smart enough to prepare a will before she died. It was a simple will. Nothing fancy. She left her stuff to a handful of relatives - but not all the relatives who would have benefited if she had no will.

So now we had relatives who felt no incentive to cooperate with the process, because, after all, what was in it for them? Must be nice to have family like that.

We had to deliver a "citation" to one of those relatives. A citation in a Surrogate's Court probate proceeding is simply formal notice that if you want to object to the will, or you have a problem with the executor, you must come to court at 9:30 in the morning on a date stated in the citation. If you don't show up, the court assumes you are OK with the proceeding moving ahead.

Court rules required that the citation be delivered in-hand. We sent a sheriff's deputy to the relative's home. He wouldn't open the door. Three times the deputy went, and three times he was rebuffed.

So now, thanks to this loving relative, the rest of the family must wait even longer for the decedent's simple will to be probated, and the family must spend more money to get a court order allowing service of the citation by alternate means.

Not my idea of family values.

Beware the friendly “investor” who offers to save your house

My law practice touches on real estate in many ways, whether in the form of transactions, litigation over property rights, or probate matters. Over the last 30 years I’ve seen all kinds of real estate and mortgage fraud, and all manner of shady or questionable transactions.

Sometimes the perpetrator is a professional scam artist. They are everywhere, and they are always on the lookout for their next victim. Sometimes the culprit behind a scam is, or appears to be, a professional, such as a real estate agent, a mortgage loan officer, or even an attorney. I have seen it all, and every year I see new variations on the theme.

The most common scam remains the “just give me your deed and I’ll get you out of foreclosure” play. Sometimes it comes from someone you know, or trust. More often, it comes from a stranger who talks a good game. They sound professional, they have a respectable-looking office, maybe even a slick website.

The deeper in the financial home the homeowner is, the more likely he will fall prey to scam like that. That’s just human nature. The professional scammer knows where to find the most desperate people. For years I’ve seen one particular bad guy prey on homeowners in Brooklyn. His name came up in certain neighborhoods too often to be coincidental. He especially likes to target people of color.

The story goes like this most of the time: “Investor” befriends homeowner in distress. Sometimes “investor” makes friends with a real estate agent eager to make money but too lazy to get listings honestly. Agent sniffs out a desperate homeowner, pretends to be her friend, and reels her in, bringing investor into the picture a little later on.

Either way, investor smiles a lot. Investor helps out with homeowner’s bills. Investor helps evict a non-paying tenant that homeowner can’t afford to fight on her own. Investor offers to go into partnership with homeowner. Investor puts up the cash, homeowner puts up the deed. Sometimes investor pays off the mortgage and keeps the deed. Sometimes investor just keeps the deed without paying more than a few thousand dollars to homeowner. Either way, investor is careful not to put the “partnership” in writing.

“What partnership”, says “investor” after the fact. “You were never my partner. You were going to lose your house anyway”. See this page at Freddie Mac for Federal government information on “investor” foreclosure rescue scams.

Sometimes homeowner complains to the District Attorney’s office. Most of the time the DA’s office does nothing because the case isn’t big enough to get news headlines. Once in a while, the DA’s investigator will call “investor” and question him. “Investor” tells the investigator, “Yes, I took advantage of someone in trouble. It’s not a crime”. Usually the DA’s office agrees and again, nothing happens.

Sometimes “investor” will enlist an unscrupulous lawyer to make the scam go down easier. “You’re not giving me advice I want to hear”, I’ve heard homeowner tell me, “I’m going to hire this other lawyer that investor recommends”. And off homeowner goes, retaining investor’s lawyer.

Investor’s lawyer has an enormous conflict of interest. Investor’s lawyer is looking out for investor, not for homeowner.

I have seen this happen. Read a published article about lawyers participating in foreclosure rescue scams here.

Don’t’ let it happen to you. If you are in financial trouble, if you are behind on your mortgage, don’t take advice from anyone who may have an ulterior motive or an adverse interest. Don’t take advice from a lawyer being paid by someone else. Don’t take advice from anyone connected with an “investor” who promises to save your house.

Do get advice from an independent source. Call the lawyer your friend, who has nothing to gain from your trouble, recommends. Call the Bar Association. Whatever you do, get your own INDEPENDENT legal advice, even if it costs you more than you want to spend. If you don’t, you most certainly will pay a lot more later. You get what you pay for. And NEVER agree to anything involving your home or your mortgage unless and until you’ve received that independent legal advice. Don’t fall for the investor’s smile.

There are many mortgage calculators available online. One that I like in particular is at www.navyfederal.org/calcs/mortgage-calculator.php. This one, like others, will calcualate your payment based on term, principal and interest rate. You can also figure in taxes and insurance if you want.

What makes this online mortgage calculator especially useful is the ability to vary any or all of the numbers using slider bars. Change the rate, the amount, the monthly payment - in any combination - and see the results immediately.

Section 3408 of the New York Civil Practice Law and Rules (CPLR) governs how settlement conferences are run in foreclosure cases. Last year the state legislature made some important changes that benefit homeowners. These changes took effect last month and will remain in force until at least February 13, 2020.
 
Here is a cheat-sheet on how the law applies, and how it may affect you if you are in foreclosure.
 

• Applies to residential foreclosure actions involving a home loan (defined in RPAPL 1304) where defendant resides in the subject property.
• Plaintiff required to file proof of service within 20 days of service. Court required to hold conference within 60 days after proof of service is filed.
• Purpose of conference: Settlement discussions for purposes including but not limited to:
  • Determining whether the parties can reach a mutually agreeable resolution to help defendants avoid losing their home.
  • Evaluating potential modification of monthly payments or amount owed.
  • Explore other workout options such as loan modification, short sale, deed in lieu of foreclosure, or any other loss mitigation option.
  • Whatever other purposes the court deems appropriate.
• At initial conference, any defendant appearing pro se shall be deemed to have made a motion to proceed as a poor person under CPLR 1101. Court may appoint counsel for pro se defendant under CPLR 1102(a). If it does, conference must be adjourned for appearance of counsel. [3408(b).]
• Mechanics of the conference. [3408(c)]
  • Plaintiff and defendant shall appear in person or by counsel.
  • Each party’s representative shall be authorized to dispose of the case.
  • If defendant is pro se, court must advise defendant of the nature of the action and his rights and responsibilities as a defendant.
  • Court may permit plaintiff’s representative or the defendant to attend by phone or video-conference.
• What happens when the RJI is filed. [3408(d) and (e)]
  • Court must send copy of RJI or send defendant’s name & contact info to a housing counseling agency on a list designated by DHCR.
    • Agency must use information to make homeowner aware of housing counseling and available foreclosure prevention services and options.
  • Court must promptly send notice of conference date/time purpose and what information the parties must bring.
  • Plaintiff is required to bring (this is not an exhaustive list):
    • Payment history
    • Itemization of the amounts needed to cure and pay off the loan
    • The mortgage and note or copies of the same
    • Standard application forms
    • A description of loss mitigation options, which may be available
    • Any other documents required by the judge.
  • If plaintiff is not the owner of the mortgage and note, plaintiff must provide the name, address and phone number of the legal owner of the mortgage and note.
  • If lender or servicing agent has evaluated or is evaluating eligibility for loan modification programs or other loss mitigation options, in addition to the documents listed above, plaintiff must also bring:
    • Summary of the status of the evaluation
    • List of outstanding items (if any) required from the borrower to complete any modification application
    • Expected date of completion of the evaluation
    • If modification was denied, plaintiff must also bring:
      • Denial letter or other document explaining the reason for denial.
      • Data input fields and values used in net present value evaluation.
      • If modification was denied on the basis of an investor restriction, plaintiff must also bring documentary evidence which provides the basis for the denial, such as a pooling and servicing agreement.
  • Defendant must bring documents to the conference, including but not limited to:
    • Information on current income tax returns
    • Expenses
    • Property taxes
    • Previously submitted applications for loss mitigation
    • Benefits information
    • Rental agreements or proof of rental income
    • Any other documentation relevant to the proceeding required by the judge.
• Good faith. [3408(f)]
  • Both sides must negotiate in good faith to reach mutually agreeable resolution, which may be loan modification, short sale, deed in lieu of foreclosure, or any other loss mitigation, if possible.
  • Factors in deciding good faith:
    • Compliance with 3408, court rules, court orders, and directives pertaining to settlement conference process.
    • Compliance with mortgage servicing laws, rules, regulations, investor directives, and loss mitigation standards or options concerning loan modifications, short sales, and deeds in lieu of foreclosure.
    • Conduct consistent with efforts to reach a mutually agreeable resolution. This includes, but is not limited to:
      • Avoiding unreasonable delay.
      • Appearing at the settlement conference with authority to fully dispose of the case.
      • Avoiding prosecution of the foreclosure action while loss mitigation applications are pending.
      • Providing accurate information to the court and parties.
    • Mere failure to make or accept an offer is sufficient to establish failure to negotiate in good faith.
• Discontinuance. [3408(g)]
  • Plaintiff must file a notice of discontinuance and vacate lis pendens within 90 days after settlement agreement or loan modification is fully executed.
• No fees to borrower for conference. [3408(h)]
  • Bank cannot require homeowner to make payment for any cost, including but not limited to attorneys’ fees, for appearing at settlement conferences.
• Bad-faith.
  • If court determines that a party failed to negotiate in good faith, court can issue order, on motion or sua sponte, finding bad faith. A referee may hear and report findings of fact and conclusions of law concerning any party’s failure to negotiate in good faith and remedies. [3408(i)]
  • Remedies for bank bad faith [3408(j)]:
    • Tolling of interest, costs, and fees during any undue delay caused by the plaintiff. This is the minimum the court must do. Court may also impose one or more of the following:
      • Compel production of any documents requested by the court during the settlement conference.
      • Impose a civil penalty payable to the state that is sufficient to deter repetition of the conduct, up to $25,000.
      • Award actual damages, fees, including attorney fees and expenses to the defendant.
      •  Award any other relief that the court deems just and proper.
  • Remedies for defendant’s bad faith. [3408(k)]
    • Remove case from conference calendar.
    • Court must take into account equitable factors including, but not limited to, whether the defendant was represented by counsel.
• Answering the complaint: 3408(l) and (m).
  • At the first settlement conference, if the defendant has not filed an answer yet, the court shall:
    • Advise defendant of the requirement to answer the complaint;
    • Explain what is required to answer a complaint in court;
    • Advise that if an answer is not served, the ability to contest the foreclosure action and assert defenses may be lost; and
    • Provide information about available resources for foreclosure prevention assistance.
    • The court shall also give the defendant a copy of the Consumer Bill of Rights provided for in RPAPL 1303.
    • A defendant who appears at the settlement conference but who failed to file a timely answer shall be presumed to have a reasonable excuse for the default and shall be permitted to serve and file an answer, without any substantive defenses deemed to have been waived within 30 days of the first conference.
    • The default shall be deemed vacated upon filing an answer.
• Motion practice [3408(n)]
  • Any motions by either side shall be held in abeyance while the conference process is ongoing, except for motions concerning compliance with this rule and its implementing rules.

I don’t usually write about landlord-tenant issues, but today’s Law Journal mentions a case that is worth writing about.

A landlord brought a holdover proceeding against a tenant who was arrested and charged with the crime of reckless endangerment. NYPD observed the tenant, acting alone, setting fire to clothing piled in the apartment’s bathtub. The tenant lit the fire and let it burn, with the nearby gas oven and stove both turned on.

The housing court judge, in her infinite wisdom, dismissed the landlord’s case. Why? Because the landlord picked the wrong legal theory to support eviction. The landlord claimed that the tenant, by creating a situation that could have caused an explosion or burned down the building, created a nuisance.

The judge said that recklessly setting your apartment on fire is not a nuisance because in order to prove a nuisance, you must prove a series of bad or inappropriate acts. One incident, no matter how stupid or dangerous on the tenant’s part, does not a nuisance prove.

According to this judge, the landlord screwed up by claiming nuisance when he should have claimed that the tenant breached a substantial obligation of the lease by committing an affirmative act of waste.

In New York civil practice, there is a general rule holding that when you file a legal complaint, the facts are the most important thing, rather than the “legal theory” you apply to those facts. For example, if you file a complaint claiming that the defendant deliberately made false statements to you about something important, and if you are specific about the what, when, who and where of the matter, then most courts will say that your complaint makes out a claim of fraud – even if you don’t identify your claim as one for fraud.
Not so for this Manhattan housing court judge, who apparently is willing to let tenants get away with setting fires in their apartments with gas ovens and stoves burning away.

Apartment owners and residents beware, and make sure your fire and tenant’s insurance is paid up.

Not every apartment in Brooklyn is insanely expensive. There is "affordable housing", but not everyone will qualify, and you might have to spend significant energy on doing paperwork and stroking The Bureaucracy.

​Here are two links to articles on two rental opportunities. One is in Bushwick, for as little as $519/month. The other is in Clinton Hill, Ocean Hill and Brownsville, and offers apartments for as little as $689/month.