patrick.net

can you tell us a little more about what happened? just curious...

Details (not too much, though, I'm paranoid about a possible looming lawsuit)...

2008, successful short sale. First lender paid in full. Second lender left short a low six figure amount (but paid 50% via the sale). Short sale acceptance letter did not mention anything about how the deficiency would be handled (although it technically doesn't have to), but some language used puts it in a gray area, in my opinion.

Almost a year later I was contacted by a collections company about the supposed deficient amount. I requested debt validation, which they never provided. I also requested contact only by mail. The collections agency only responded with a copy of the promissory note I signed with the original bank, but nothing to indicate I owe the collections agency anything. The collections agency is demanding I pay them, so they need to show why I should. So, no debt validation, plus they've since sent two letters and one phone call. That's three, possibly four violations of the Federal Debt Collections Practice Act (FDCPA).

I can't afford to pay deficient amount. I would love to settle for a reduced amount, but only after proper debt validation is provided. If the original bank contacts me, I'll deal with them (through a lawyer), but without proper debt validation from the collections company, I don't feel I have any reason to communicate with them. I ignore, yet keep the letters they sent , as well as logs of the phone calls.

If I am sued, either chapter 13 or 7 bankruptcy is the likely option. I can't afford a $100,000 judgment, including any wage garnishments. At this point, I'm resigned to the fact that my credit will be ruined. I just want to be done with this, and if BK is the way to do it, I'll do it.

So thus the need for the lawyer...

1. The collections agency seems to be violating federal law on several counts. If I am entitled to damages, I want to pursue it.

2. Do I legally owe the deficient debt to the original bank? If I do, then I want to deal with it.

3. If I do owe the deficient debt, and a settlement can't be reached, and they sue me, I'll need to declare bankruptcy to stall the lawsuit and force a reorganization. I am fully willing to reaffirm my car loan and credit card balance, as those are legitimate debts I will continue to want to pay as agreed.

interpretame says

In other words, you’re simply ANOTHER asshole who was soooooo desperate to purchase a house that you got yourself into ONE FINE MESS and NOW you want advice/help/compassion.
Boy are YOU barking up the wrong tree.

I wouldn't go that far. I know I got myself into a mess, but that doesn't mean I need to bend over and get reamed any harder than I deserve.

The deficient amount could be contested. That's between the bank and me.

And just because I fucked up doesn't give debt collectors the right to break the law.

If I legally owe the money, then I need to take care of that. I can't pay it all back if there is a judgment/garnishment. Millions of people get into these situations and it's why bankruptcy laws exist.

Believe me, when all is said and done, my credit ass is going to be sufficiently pounded. I'm not getting away with jack shit, but then neither should the lenders or collection agencies.

Now we're getting silly, which I need a little bit of, anyway, at this point. lol

Here's one...

Fair Debt Collection Practices Act!

I'll be here all week. :)

Thanks. I've been scouring google, too, and have contacted several attorney offices, but if anyone has any personal recommendations, those are appreciated, too.

Whaat? You paid off 50% of the balance on the 2nd mortgage but that lender did not agree to forgive the rest?

Was this an all-cash transaction? Otherwise I'd expect YOUR lender to be watching carefully for problems like that, in order to protect their own position.

[Begin Quote]
Does anyone know a good attorney in the San Jose area that can help with…

1. Lawsuits against collections agencies for violations of the Fair Debt Collection Practice Act

2. Real Estate contract law, specifically regarding short sales (including short sales that have already been completed)

3. Bankruptcy

Thanks!
[End Quote]

Hi, You could call Smith Dollar PC (707.522.1100 in Santa Rosa) and ask for a referral to a Real Estate Law practitioner in San Jose. ...although Smith Dollar does CA real estate law anywhere in the State. Being that they also represent in financial services litigation they should also be able to do civil law and may be able to recommend someone in the SJ area (re: your proposed suit against the collections agency).

Keep in mind that they represent the Plaintiff in RE transactional law - that is, banks, lenders, builders, contractors, etc. In other words they represent entities with $$$. So keep that in mind when you call.

They possibly could rec a Bankruptcy Law atty in SJ for you too. Bear in mind that most BK Law attys have a full calendar since there are so many such as yourself. So, whether or not you can get anyone who is "good" would be iffy at this point, although you never know...usually BK law people practice that alone since BK is Federal courts and RE Law is State court which are two different animals.

My educated guess is that for a three proposed actions you listed above, you will need about $15k for everything: RE action ($3-5k+), the BK ($5k+), and the civil suit ($1500).

One thing: Bankruptcy Courts here in the BA have free seminars on bankruptcy filing. You are in the right place since here in the BA there are so many law schools where you can go and talk to a student lawyer who acts under the direct supervision of an attorney-professor.

Although I love Lawyers in the Library (Oakland Public Library), in SJ we have SC School of Law. Here is info from the Federal BK court page in SF=Northern District of CA (http://www.canb.uscourts.gov/court-information/court-resources):

[Begin Quote]
San Jose

Debtors' Rights Clinics
Pro Bono Project
480 North First Street
San Jose, CA
408.998.5298
Pre-bankruptcy advice and limited help is offered on the first and third Tuesday of every month, from 5:00 p.m. – 7:00 p.m. Please contact the above telephone number to schedule an appointment.
Debtors' Advice Clinics
The Katharine and George Alexander Community Law Center
1030 The Alameda
San Jose, CA 95126
408.288.7030
These clinics are sponsored by the Santa Clara University, Law School. The clinics occur on nine Mondays in each of the university’s fall and spring semesters only. The spring clinic dates are: March 30, April 6, April 13 and April 20. Please contact the above telephone number for more information. [End Quote]

Take care and all the best to you,

~Misstrial

If they agreed to the short sale then they're out of luck. End of story. The reason they took the short sale in the first place is because they didn't have the cash to pay the first mortgage, taxes, insurance, ect, and now they've got some collections agency in hopes of screwing you.

They can't do shit. Don't worry about it. This was a collateral-based loan. If they want the rest of their money they can go after the new owners!

knewbetter,

I guess we do not know with certainty whether SJGU was the short seller or the short buyer. I had inferred, perhaps wrongly, that SJGU was on the buying side of the transaction.

Thanks for the advice, everyone. It's appreciated.

And I was the seller in the short sale.

As much as I hate some of the rat bastards on loansafe.org, you might want to look there and see what other people have gone through.

f