welcome to start my crisis here to explore how every day  heroes like our new guest list so this is some you know it's a minnow though group here in fairfield new jersey and fairfield jersey is her location because she is a bankruptcy and foreclosure litigation attorney listen we're having still a very big mortgage crisis new jersey is still number one for standard and zombie foreclosures was something foreclosures when the mortgage company really wants to aggressively go after a homeowner to scare them out of their house so they don't have the financial burden of going through the foreclosure process so when a family is facing foreclosure imminently or they're actually now starting to go into default falling behind on their mortgage what is it that you come and how can you help well being there are a number of options of foreclosure or prior to being sued in foreclosure that a homeowner can take avail themselves of for that in the first instance the one thing i need to impress upon homeowners who are on the verge potentially of a falling into foreclosure is to act as early as they possibly can here's why one of the options they have is what we call forbearance what forbearance allows is it it's an agreement between the homeowner and the lender where let's say your mortgage is two thousand dollars a month and you missed the mortgage payment the next month you will o lender four thousand dollars a month this is why i say to act early because the earlier you act the better chance you have at resolving this before because a full blown for closure litigation let me ask you this having been in this realm as my business and two thousand i have been involved in stopping foreclosures i work for an attorney and some let me ask you the easy question the biggest question i've been getting is do i have to be interviewed do i have to be late with my mortgage to get help and so that's going to be my question to you as a foreclosure specific attorney so the someone have to already be you know beers or in late with their mortgage to get help from the mortgage company because they're saying they actually became proactive contacted their mortgage company on their own and their mortgage company said no we can't help you because we're still getting payments from you let us know when you're late that's true that was the trend a while ago but now it has changed you can call your mortgage company in ask either for forbearance or maybe even a loan modification and where in the terms of the loan might be changed maybe the it will become a forty year mortgage maybe the interest rate will be dropped so you can call but the one thing to remember is that the bank always has the last word on whether you will get your modifications another word they hold the cards right you end up the bankers who we owe the money to is the homeowner is of the other question i have for you is when is it too late so we now know someone to get help when they just see hardship coming down the pike perhaps there's no decided they're going to be laid off perhaps they're a business owner who's having difficulties in their business and they're trying to be proactive and get some kind of a break so when is it too late too late you can always try for a loan modification if you try for a loan modification they will want verification of income they will want to know the debt and you really have to open your financial life up to them and let them see all of your finances it becomes too late when the arrearages are so high and the income will never be able to catch up with the arrearages even with a loan modification i actually have a client now where they are in the rears approximately three hundred thousand dollars that's their ears that's the outstanding balance in a situation like that well that's a good question because if you ask the bank they will say over nine hundred thousand if you ask my client he will say that the mortgage at the time of origination was only seven hundred eighty eight thousand dollars so if they had equity does that make them well they don't have equity in this particular case because the home appraised at five hundred seventy five thousand dollars so that's a tremendous amount of water as they say when s it was more money on their mortgage than their house is currently valued at that underwater that's exactly correct in this case and this is a very difficult decision for people to make particularly when they've lived in the house for a long time they've raised their families their children are very comfortable in the school district that they attend it becomes a very difficult decision because you may have to go into a sale now in this case because they are so far as you say under water and you're correct about that term  it will be a short sale and what a short sale is is when you try to sell your home now this home is valued at five hundred seventy five thousand dollars no one is going to come and buy this house for the nine hundred thousand dollars that the bank believes is owed and by the way that nine hundred thousand dollars includes fees and interest i have is that the amount of office over a period of time so it would be unrealistic to think that someone would come in and purchase this property at nine hundred thousand dollars so if the bank were to agree to a short sale they would effectively take a loss of close to four hundred thousand dollars on the sale of this house the bank though in order to be able to sell your home in a short sale the bank has to approve because at the end of the day they're the ones that are going to take the loss on the short sale so they have to approve the sale so i guess my question on that number one it's a two parter now do you see banks that only approving short sales of eager to do it or is it getting more difficult in two thousand and sixteen and than it did when this whole crisis started and two thousand and eight nine and ten you know it better or worse it really depends it's a fact based decision for the banks and it's also the policy of the banks themselves you know there are a lot of factors at work here some of the factors are the banks own financial records and what kind of i'll call it a haircut for lack of a better but what kind of your cut can they take on the outstanding mortgage so it's a case by case basis it depends on the facts but wouldn't one think it's better for the bank to get some money then if it's a foreclosure is it actually better for them to foreclose i've seen a lot of situations as a mortgage modification specialist where the banks seem more even to foreclose thing come to an arrangement with a real estate agent representing someone to do it a short sale agreement now people are wondering why that is going to as a mortgage company really want my foreclosure what do you see i see very much what you see sometimes there are banks that are very willing to to go into a short sale just so they can unload the property not have well remember there's an expense for the banks to maintain properties municipalities are constantly after them to keep up with the snow removal to keep up with the landscaping so for a bank to hold onto a property it can be expensive at least in new jersey we're not going to end up with alligators in singapore like they did in florida that one would hope one would hope that's true but then on the other hand i've seen were banks you know it was a ten thousand dollar loss that the bank would have to take and they refused to go into the short sale for ten thousand dollars and the one wouldn't think that makes sense so here's my question for the situation you have right now with this a four hundred thousand dollars differential borbidge company approved that what has he seen how does that hurt the homeowner because i've heard so many conflicting stories i had a situation where them or mourner receives a ten i know i know and now they're worried about tax issue resulting from the such a large doubt about that the mortgage companies forced to swallow or to come to terms with eating so to speak that's very true and when i consult with a client we have to take into consideration all of those things one of the things i have taken consideration with this client is they actually had children in the school district yeah so my goal was to try the the home was up for sheriff's sale my goal was try to try to keep them in the house as long as i possibly could until the youngest son graduated high school what sort of time was it for that parent family because i just am exacting we care about the kids the most in this particular case and this is extreme i don't have many cases like this is  homeowner that to the extent they could start and you're not paying your mortgage start trying to sock away some funds so that when the eventuality hits and you do have to vacate the premises that you have a place to go you have the wherewithal to maybe put a down payment on an apartment were i rent off some grand to live so i think there's at the end of the day that's exactly right they have to live someplace so here's the thing if the customer asked the homeowner has to for closing a pun in some cases the deed in lieu of foreclosure stops the actual foreclosure from ending up on their record their mortgage their credit report and of course their title so what do you do do you recommend for people to  get the cash for keys and intelligently be foreclosed upon or the deed in the what's better anything it depends again it's very fact sensitive to pending the family situation and a lot of things factor into that the city for instance just so we're clear what a digging the property over to the bank to the lender this is advantageous for the bank because the bank doesn't have to go through a protracted and long and drawn out foreclosure proceedings they can just take the property very quickly without the sheriff's sale and all of again the litigation sometimes it benefits the homeowner too if the homeowner just wants to get out of the house and can negotiate with the lender maybe have oh if that varies there are a lot of factors that go into that so that that very sometimes it can just be ten thousand dollars or a couple thousand dollars now this doesn't happen always just in order to get the deed yes from the homeowner and be able to situate themselves in another house well i just think that's incredible the company the mortgage company who hasn't been receiving mortgage payments in new jersey at least because of course there's all different and other states that are not on the to just because the jersey is a litigious states for foreclosure other states it's much swifter i mean i know that new mexico new hampshire many other states it's coming out ahead to get money is it cash for keys or our own of course please explain kashrut here ok cash for keys is another situation where you hand over the property and the bank will take possession of the property you will get some kind of cash incentive in order to do that and again i hate to sound like a broken record but the truth is that it's really fact sensitive and it depends on each individual circumstance of each family it depends on their finances it depends on where they are in their life sometimes with the pen's on whether they can emotionally separate themselves from a home that they've lived in for so many years particularly if the only reason that they haven't been paying their mortgage is because of some catastrophic event isn't that usually the case though it depends and i'll tell you why some people when they're in a home that's underwater will as a strategy stop paying their  mortgage deliberately deliberately so they can separate themselves if they're using that as the liver tactic some people can but that's very different than people who are very emotionally attached to their homes many people who stop paying their mortgage happens they have no choice but to try to figure out either how long they can stay particularly if they're not going to be able to ever make up the arrears well here's my question how does bankruptcy help someone stay in their home because of course give you chapter takes place first if you will from my viewing audience what is the difference between for a person a chapter thirteen and a chapter seven ok let's stop there ok that's perfect and a chapter seven it's what we call completely quit day ssion well what does that mean that means every asset that we own sometimes it could be a collector baseball collection but everybody have an assett is still not safe well that's true it's not you have to it may be i mean there are exemptions and we're getting very very far into the details of how the chapter seven works but but just globally what a chapter seven is is that you have to take all of your assets you take all of your liabilities generally your liabilities exceed your assets and to the extent you have any assets that have any value ok after we take into consideration exemptions but but the the trustee a chapter seven trustee will be appointed the chapter seven trustee will take account of all of the assets and see if any of the assets can be liquidated now in exchange for this the debtor will get a discharge mostly of their unsecured debt now typically if you own a home that has any kind of equity in it it a chapter seven would not be for you because that would be listed on the asset side by share quickly as an asset equity as an asset in property in real property chapter thirteen so let's say that you do have some equity in your property you might be eligible for chapter a lot of stress for someone to be removed many people won't pick up their phones after a while once they're in debt so badly in the creditors are pursuing them very stressful very stressful and couple that with that you may be losing your home  it's double stress that people sometimes people go through unfortunately illnesses related to the very crying that kind of a stress that's multiplied on itself it's terrible and many times what the parents to do they want to shield the children from this devastation  financial distress of this financial devastation so a chapter of one might go into chapter thirteen if they have equity in their home and they're trying to preserve their home now i want to be clear about this just because you go into bankruptcy doesn't mean that you will never have to pay your mortgage and you can stay in your home forever what it means is that you can try to use bankruptcy as a tool to work out a loan modification with the bank so which bankruptcy tactic that specifically if you have equity or don't either one is an option or does it mean by removing the other debts you have you can more easily make your mortgage payment well here we go try to keep the debtor in the home until the debtor can make other arrangements now again when you're in a chapter thirteen what happens is you're holding your creditors at bay so that you can reorganize your debt and what does that mean reorganize i heard it's paying the lowest percentage is that as low as five ten twenty cents on the dollar to what degree is into the hens on the creditor and it depends on the bank usually there's an order by which creditors will be paid secured creditors will be paid first you're using it we say is student loans are not the chargeable another words if you go through bankruptcy and you have student loans when you enter the bankruptcy you're still going to have those student loans when you come out of the bankruptcy i understand so what other type of exemptions are there as a federal or state tax debts that are exempt from a loan from a bankruptcy no the federal tax liens and the state tax liens would have to be paid right except and again we're getting a little bit for field but except if it's over a long period of time and i don't quote me on this but i think it's two hundred forty days from when the tax amount that you are in arrears on is assessed so there's a calculation and again it's very complicated because now you're dealing with the i r s code tell us while we have everyone who has more questions give you a call what number can they reach you at eight six two two one zero eight zero three six and just one last tip for our viewing audience tell me if someone knows a face a hardship or they're in foreclosure what's the one thing you think everyone should know to do or not do what's better act as early as possible be proactive be as proactive as you possibly can because that debt is only going to mount as time passes in other words don't ever be an ostrich don't stick your head in the sand pull your hand your head out of the sand and be proactive and save the family because it's a long term future that's not going anywhere precisely thank you melissa thank you spills of hazardous chemicals toxic smoke in the air by law every town and county in new jersey must have an up to date emergency response plan available to its employees emergency response workers and the public we can better prevent disaster if we're all prepared for information go dot org or osha dot gov this message brought to you by the new jersey work environment council do you need to blow the whistle on unsafe conditions at work you may be protected by new jersey law and by the federal agency called osha for information go to dot org or osha dot gov this message brought to you by the new jersey work environment council how i work back with stock rubin that scott helps people especially business owners with emergencies money is to keep their money their business going smoothly scott tell me what is it that you help with that banks can when the banks so do you say it is and why is that so yes we do we often are alternative lenders to  consideration it's not a complete factor there sometimes we work off the strength of their business or assets they may have let me ask you this i understand when you told me that it's also about the speed of which they get the money sometimes it's down to the critical crunch perhaps they have to make payroll maybe it's their own payroll is that sure they can get money for someone who is very cooperative in a matter of a couple days absolutely we can sometimes phone between forty eight twenty four and forty eight hours and  you saying in one to two days you can get a business letter cash that sounds like a gimmick how's that not a gimmick not a gimmick it's exactly what we do it's it's work off the strength of their business they get somewhere between twelve and fifteen percent of their annual working out is it really just the cache of the business that matters if you're keeping a business center going by getting them emergency cash tell me do a lot of these business owners have employees it use it do or die situation sometimes it used to float some  some of their employee salaries why i thought times tend to be a little bit tougher throughout the year maybe a slow time during the year maybe it is a seasonal business and they look to float some of their employees so they can keep them throughout the year so they want their paychecks going to out to get their paychecks going so it doesn't select the employees going as well absolutely and so have you ever seen all business where if they don't get this money their personal lives are facing a lot of tragedy absolutely whether it's  either losing the business itself or the possibility they are not able to pay rent and going to be a victim and there's a lot of things that things can come as far as tragedies we've seen a lot have you seen couples because sometimes you have mom and pop businesses small business owners are a lot of times a couples work together do you ever get so involved with a client that you've seen them use these emergency funds this at a necessity more than once absolutely in fact sometimes because it works directly off their processing and sometimes they can even pay them back through their processing that they often will use them almost continually in order to keep the business going and to pay off some stuff even on their personal side we've had a lot of well a lot of unfortunate situations where people just need that money so desperately in order to keep some things move so if you sin couples have you ever seen them so stressed out it maybe end up in the divorce or any kind of unfortunate situation that you've witness while telling the one thing that i have recently had a couple that came in and they were at the point where they their business was struggling so much they couldn't make their their payments on the taxes in their house they are one hundred thousand dollars they had a strong business but not strong enough that they were paying everything they came to us and the guy basically said listen i can't i'm about to lose my house i'm about to lose my wife this everything is starting to crumble i need this money in order to get through this this is bad time we're able to fund him within forty eight hours you got the money in two days two days where is your cape you seem to this business that is because what that then they're not keeping their employees paid so really helps the public as well the average employee who works for a small business owner won't even know they didn't have a job if it wasn't for someone like you getting that person their emergency money thank you for being such a suit do you have any more good stories like  well we have more stories anything p the even these really strong or what people consider really strong functioning businesses a lot of times they use our money just to sort of float some extra stuff do some additions add some pos systems or things in there within their b their business increase everything and they need them there sometimes twenty to thirty thousand dollars so we fund them so they can get those and then get themselves back in a good position so you are saying that cash registers now because they're also computers are much more expensive and for someone just to stay in business they sometimes need to get this emergency money just to meet the technology demands not just payroll demands or rent on their business or the person homes right sure absolutely that's one of the big things right now is keeping up with technology people want an app for their phone to be able to order at restaurants and things of that nature that all cost money all these external companies that are coming in grub and different things what happens is they take a percentage of the online ordering and it can be expensive and so in order to be keeping up with the joneses so to speak it allows you to be able to do that when you get some funding and quickly so you're one of the super secret heroes that we need to know about because it's not just about the business owner it's about keeping the our employees going and i imagine that you probably saved a few marriages by getting them the marriage and see money they need so real quick just i have to ask this question can you also help with other tips emergencies that say to somebody fell behind on their quarterly taxes the iris is a business do they ever use their money for that absolutely they come to us all the time during tax season to to pull some money out and be able to pay their taxes so that they continue most of them are individual businesses ten ninety nine they need to catch up on the money that they owe somebody with raise and one last question i have to ask some people must be terrified starting a new business i mean look at all the new businesses that are creeping up all the time and i understand the statistic is that only one out of five new businesses started stay in business for five years what does that youngest business that you can help do they have to be ashleigh positive so we have different lenders there are lenders that will go to start up companies oh ok it was an s b a loan a similar to an s b a but it will this is this is they work directly with startup companies they don't leverage as much money but they give them some good start up money to get themselves off the ground and as far as the other kind of businesses we can work at least two years into them having a successful business or business in general we can work off of those numbers and get them funding so is there any them one of the people would know if i named it but you know looking for a lot of employees now yes exactly looking for one hundred thousand dollars sometimes it's renovations sometimes people just don't want to go through the paperwork of the bank it is a lot of people say i have to give blood in order to get the money i  you have that i understand like an s b a process or just a regular bank application process for a business loan time consuming and you guys do it in one to two days is that very realistic that's very realistic because the applications sure we work directly or underwriters work very hard about you know finding the strength of their businesses and be able to see just what processing statements and bank statements what the business can really do while you're stopping a lot of crisis at this amazing cash flow that comes from nowhere thank you very much for coming on and explaining that to everyone and to keep doing the great job of being the business hero that you are thank you