I wonder, with the extremely high foreclosure rate we are currently facing, how many homeowners represent themselves? The courts, at least around here, attempt to get the homeowners involved and provide a simple fill-in-the-blank Answer to file. But is that really sufficient and do homeowners actually benefit from it?
Let's face it - if you are getting foreclosed on, you most likely can't keep up with your mortgage payments. Can you really afford to hire an attorney to represent you? Many know that they are in default on their mortgage and they probably figure that there isn't much an attorney can do anyway. But that isn't necessarily true in all cases.
I think it is good that the court provides a means of response with their Pro Se Answer form. It at least allows the homeowner to submit a written statement that will be considered an Answer in the case. It allows the homeowner to indicate whether or not they intend to keep the home and explain the reason for their default. The downside, of course, is that it gives the homeowner a sense that they do not need representation.
The biggest flaw with the Pro Se Answer form is that it doesn't provide the homeowner with any information about legitimate defenses to the action they may have - such as promissory estoppel, laches, and waiver. Furthermore, it doesn't provide clear instruction for how to assert any counter claims against the lender that they may have. What if the lender violated the terms of the agreement, or a consumer protection statute, with its collections practices? Most likely the average homeowner isn't fully aware of his rights.
What it does do, is involve them in the case and allow them the opportunity to mediate their case through a conciliation process. This gets the homeowner and the lender talking about a possible workout in the presence of a court representative. Still, though, they go through the process without representation and this puts them at a disadvantage.
If there are legitimate defenses or counter claims that could be asserted, it could help the homeowner negotiate a fair and reasonable modification. It is important to consider that even while the homeowner is in negotiations for a modification, his default is continuing to grow if full payments are not being made. The lender may even agree to accept less than the full payments during the negotiation process, but if a modification agreement isn't reached the homeowner could be falling deeper into default.
There must be a better solution. I am glad that the courts try to help homeowners with some basic do-it-yourself instructions. But I think they need more than that. I think they may need to have information that will help them decide if they should talk to an attorney, rather than attempt to represent themselves in a foreclosure case.
Best,
Robert A. Franco
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