Search Site
Foreclosure-Related Issues

Guidelines to Proactively Address Foreclosure-Related Issues

The economic downturn and the significant drop in prices in our local real estate market has forced many property owners to face the possibility of a mortgage foreclosure, whether such foreclosure would affect their primary residence, their second home, or an investment property.

A borrower facing mortgage foreclosure as a result of the inability to continue to make the monthly payments on these properties has several options to resolve this problem:

1) Continue to make monthly payments

Whether this payment relates to an investment property, a second home, or unfortunately, in many instances, a primary residence, this may or may not be a viable alternative.  If at all possible, efforts should be made to continue to make payments or immediately initiate contact with the Loss Retention Department of the lender(s) who holds the mortgage(s) on the subject property to determine if there is a way to resolve the issue prior to the mortgage going into default and the commencement of a foreclosure action.

2) Alter the mortgage by refinance, forbearance or modification

The borrower should consider a number of opportunities to rectify its mortgage problems, which could include:

a)  A refinance, if sufficient equity exists in the property;
b)  A forbearance which is an agreed upon period of time for abatement of monthly payments or a reduction in monthly payments for an identified period of time until the borrower has the ability to recover from whatever economic factors are preventing the borrower from making payments.
c)  A Loan Modification to alter the interest rate or payment amount to enable the borrower to maintain payments on its mortgage.

Although many lenders are willing to address these particular options prior to a mortgage default, the frustrating aspect of this process is that many lenders nonetheless fail to adequately do so or to respond in a reasonable period of time.  Part of this delay is based upon the volume of foreclosures in process and staffing issues with lenders.  As such, many lenders don’t have the ability to promptly respond to a borrower’s request.  This results in forcing the borrower to cease payments and enter into default before any meaningful contact with the lender is made.

3) Discontinue making payments

Unfortunately, this is an option that sometimes is forced upon the borrower based upon the simple economic inability to continue monthly payments.

If a borrower is unable to continue mortgage payments, the same proactive format should be utilized as above set-forth, which would include efforts to refinance, modify or seek forbearance with the lender.  Those borrowers with primary residences may consider seeking assistance through the new government “Making Home Affordable” mortgage modification program, which would require:

a)  That the property be the borrowers primary residence;
b)  That the first mortgage amount not exceed 105% of the current market value of the property;
c)  That the total mortgage expenses after the modification are no more than 31% of the homeowner’s gross monthly income.

There may be some opportunity for the borrower to obtain assistance through governmental programs, such as the FHA Secured Mortgage Program or the Obama Administration’s Make Home Affordable program.  (  Unfortunately, in many troubled economic areas that have been hit hardest by the foreclosure crisis, such as Lee County, Florida, the mortgage balance-to-home-value ratio far exceeds the 105% requirements.  Further, in many instances, the borrowers need some additional relief given their financial status and, as such, their total mortgage expenses may, in fact, exceed 31% of their gross monthly income.  Lastly, in many hard hit communities there are many borrowers who need assistance as to their second home or investment property.

4.) Short Sale

One foreclosure alternative is for the borrower to list the property for short sale.  A Short Sale by definition is a situation in which the net closing proceeds of the sale is not sufficient to payoff the full mortgage balance.  In such case, the contract must be presented to the lender for approval and the lender has the choice under such short sale scenario to:

a)  Release its mortgage on the property and further release the borrower;
b)  Release its mortgage on the property and demand payment from the borrower the difference between the net proceeds from the sale and  the mortgage balance; or
c)  Release its mortgage on the property and obtain a negotiated amount from the borrower for the deficiency amount which results from the short sale (either cash or promissory note or some combination of both).

In order to utilize an effective short sale, the borrower should seek the assistance of a real estate professional, preferably a real estate attorney, along with a qualified licensed real estate agent who is familiar with the short sale process (see website “Anatomy of a successful Short Sale” program).

5) Inability to obtain refinance, forbearance or modification

In the event a proactive approach proves to be unsuccessful relating to efforts to obtain lender approval for a refinance, forbearance or modification and a short sale is not able to be timely completed, a borrower’s next step might be to address the forthcoming issue of a mortgage foreclosure action initiated by the lender.

Barring circumstances giving the borrower a claim or defense to the foreclosure of the mortgage, the borrower still, nonetheless, has the opportunity to address the mortgage foreclosure issue, even if suit is initiated.

Attached is a Motion to Compel Mediation, which the borrower should consider utilizing at the initial step in the mortgage foreclosure process.  A simple filing of the Motion to Compel Mediation and scheduling it for hearing will allow the borrower to present to the Court, whether the borrower is represented by counsel or representing themselves (Pro Se) that the borrower is making a good faith effort to speak with a decision maker of the lender.  Going to the mediation, either through stipulation or court order, would be the one opportunity for the borrower to actually speak with a decision maker of its lender to determine if there is any way possible to resolve the mortgage foreclosure issue, which could include, but is not limited to, the following ways to resolve a mortgage foreclosure problem:

a) Reinstatement of the mortgage and an agreement for payment of past due mortgage payments on amounts structured to meet the persons income level.
b) Modification of the mortgage and potential reduction of the mortgage.
c) Reduction of the principal balance up to 90% of the current fair market value of the property (guidelines as set forth in FHA Secure Program, FHA Hope Program and Section 109 of the “Bailout Bill”).
d) Reduction in principal rate up to 90% of the current fair market value of the property (guidelines as set forth in FHA Secure Program, FHA Hope Program and Section 109 of the “Bailout Bill”). 

e) Agreement to allow to a short sale on the property with release of mortgage and retention of liability against mortgagor.
f) Short sale of property with release of mortgage and with waiver of liability for any deficiency as against the borrower.
g) Stipulation as to entry of agreed upon foreclosure judgment with the retention of liability against the borrower.

h) Stipulation of entry of judgment of foreclosure with a waiver of liability against borrower.
i) Stipulation for obtainment of deed to the property and release of the mortgagor (deed in lieu of foreclosure format).
j) Stipulation in regard to acceptance of deed to the property and an agreed upon and adjusted payment for any deficiency in a lump sum payment (deed in reduction format).
k) Promissory Note in lieu of cash payment for settlement of the deficiency amount.

In the event that there is no possible way to refinance the home, obtain a forbearance, modify the mortgage, or work out any other structured plan with the lender, it should be understood that the borrower should then focus on minimizing and mitigating damages both for itself as well as the lender.  Minimizing and mitigating damages unfortunately may result in the borrower agreeing to allow the lender to proceed expeditiously to obtain a foreclosure judgment and eventual foreclosure sale, as well as making arrangements to vacate the premises.

If the borrower absolutely has no other alternative and a foreclosure ensues, it’s clearly in the borrower’s best interest to mitigate damages early on in the process.  The borrower can do so by agreeing to provide marketable title to the lender, which allows the lender to cease the foreclosure process and eliminates the accrual of interest, attorney fees, court costs, taxes and maintenance on the subject property.

A program developed by the Law Office of Kevin F. Jursinski & Associates, titled “Deed In Reduction©/Modification In Lieu©” can be obtained by going to and requesting information on the program.  This program provides the borrower with the opportunity to take a proactive position and provides the lender with marketable title to the subject property prior to facing a long foreclosure delay with the attendant increase in expenses, all of which exposes the borrower to a larger potential deficiency judgment or, alternatively, a larger tax forgiveness amount (1099 – Forgiveness of Debt).

In summary, there is a variety of positive and proactive procedures that can be undertaken by a borrower, either by themselves or, alternatively, by a borrower utilizing this information and discussing this with a Florida attorney who can assist them in the process of minimizing and mitigating damages.  If structured properly, the program can minimize and mitigate damages for the borrower, as well as be a positive result for the lender.

Kevin F. Jursinski, Esquire
Florida Bar Board Certified Real Estate Attorney

©Law Office of Kevin F. Jursinski & Associates

Kevin F. Jursinski, B.C.S. Attorney Photo
Kevin F. Jursinski, B.C.S.
Principal Attorney

Kevin F. Jursinski is recognized by the objective rating services of Martindale Hubbell as one of Southwest Florida's premier attorneys. He has concentrated more than 35 years of practice in the area of real estate, business and construction law in Naples and Fort Myers.

Kara Jursinski Murphy, LL.M., B.C.S. Attorney Photo
Kara Jursinski Murphy, LL.M., B.C.S.

Firm Partner, Kara Jursinski Murphy, focuses her area of practice on Real Estate Litigation, Business Litigation and Real Estate and Business Transactional Law. Kara has earned the highly-esteemed designation of Board Certified Specialist (B.C.S.) and Expert in Real Estate by the Florida Bar.   This certification recognizes attorneys who have special knowledge, skills and proficiency in various areas of law, including Real Estate, and professionalism and ethics in practice... 

Michelle "Micki" Hurvitz, Esq. Attorney Photo
Michelle "Micki" Hurvitz, Esq.
Associate Attorney

Associate Attorney, Michelle “Micki” Hurvitz, practices in the areas of Real Estate Litigation and Business Litigation.

William  R.  Murphy, Esq. Attorney Photo
William R. Murphy, Esq.
Associate Attorney

William Ryan Murphy focuses his practice in the areas of Real Estate, Business and Construction Law.

Justin  T. Mooney, LL.M. Attorney Photo
Justin T. Mooney, LL.M.
Associate Attorney

Attorney Justin Mooney concentrates his area of practice in Taxation and he handles a wide variety of Estate Planning and Probate related legal issues. In addition, Justin assists clients with civil taxation matters to include tax compliance for individuals, businesses and estates regarding federal and state tax issues as well as resolving legal issues with the Internal Revenue Service to include tax collection alternatives as well as international tax compliance with the Financial Crimes Enforcement Network.

  • After attempting to handle my foreclosure case on my own for months, I found James McQuade. With a trial scheduled on Friday, I hired him on a Tuesday with about zero preparation time. My expectations were not high this late in the process. I was only hoping for the possibility of a postponed trial, and even that was slim less than a week out. Instead, the entire matter was resolved just two days later.

    - Vicki

    Disclaimer as per, Florida Bar Rule 4-7.13 (b)(8): Testimonials are the actual experience of real clients, but prospective clients may not obtain the same or similar results.

    See All Testimonials
  • This is my second time using law firm of Kevin Jursinski as a client in the past two years , first kevin and Lisa closed on a condo i purchased in march of 2013 and now again December 2015 on my estate home. This office is very professional ,timely and ,efficient,. They keep you in the loop with phone calls and text. I would highly recommend. great people

    - Gordon

    Disclaimer as per, Florida Bar Rule 4-7.13 (b)(8): Testimonials are the actual experience of real clients, but prospective clients may not obtain the same or similar results.

    See All Testimonials
  • This law firm is a super star. Aggressive but extremely professional. Excellent communicators. We were always part of the process and well informed. Their legal knowledge and experience provided us with total trust and confidence from the beginning. We could not have asked for a better legal team or successful outcome to our tenant dispute.

    - Phillip

    Disclaimer as per, Florida Bar Rule 4-7.13 (b)(8): Testimonials are the actual experience of real clients, but prospective clients may not obtain the same or similar results.

    See All Testimonials
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
in the news
  • What are your rights if you are renting a home damaged in a storm?

    NBC-2/WBBH, September 22, 2017

    If you're dealing with a hurricane-damaged home or apartment and you're a renter, you still have rights.

    Florida law gives tenants the right to demand repairs from their landlords or to withhold rent payments if the landlord doesn't take any action...

    Read More
  • NBC2 Investigators: School district hits snag with Bonita Springs HS land

    NBC-2/WBBH, June 07, 2017

    It’s only a sliver of the 77-acre project, but the Lee County School District doesn’t own part of the land it had planned for the Bonita Springs High School.

    Superintendent Greg Adkins says the tenth of an acre parcel on Shangri-La was planned to be a turning lane into the school once it’s complete. But he says he’s hoping for a simple solution...

    Read More
  • NBC2 Investigators: Buyer claims to be ripped off by Fannie Mae

    NBC-2/WBBH, March 23, 2017

    The hustle and bustle of Miami was just too much for Renate Manns and her family sometimes. They wanted a place to escape.

    "Our plan was to get something out here to be able to be coming out here every weekend," Manns said...

    Read More
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
Contact us

Important Notice and Disclosure. While we welcome inquiries about potential representation, please do not send any confidential information about any matter before we agree to represent you in that matter or we request information. Pursuant to Opinion 07-3, dated January 16, 2009, any information sent to us unilaterally may not be treated as confidential information and, depending on the circumstances, could be used against the person sending the information. Accordingly, before sending any confidential information to us, please contact us so that we may determine if we have any conflicts of interest and if we are otherwise able to represent you.

Quick Contact Form

Please fill out form below and one of our attorneys will contact you.
/*We Speak French Script*/ /*End We Speak French Script*/