“Fighting To Keep Your Home In The Wake Of Superstorm Sandy” The Suffolk Lawyer, May 2015 , by Melissa Luckman, Staff Attorney Touro Law Center’s Disaster Relief Clinic

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In the wake of a natural disaster or financial crisis, oftentimes the first bill that goes unpaid is the mortgage. Homeowners who struggle to pay their mortgage payments face tough choices—do you stay in a home causing extreme financial hardship or do you walk away from a life you once knew?

On October 29, 2012, Superstorm Sandy pummeled the East Coast, leaving a trail of devastating destruction in its wake. Superstorm Sandy was a major catastrophic event responsible for multiple fatalities and significant damage and disruption.  Roughly $80 billion worth of homes across eight states were put at risk by the storm’s surge, according to Corelogic, a residential property information, analytics and services provider (www.corelogic.com).

Just one year after Superstorm Sandy, New York homeowners were drowning under a wave of foreclosure notices. A October 29, 2013 report from RealtyTrac (www.realtytrac.com), a leading sourse for comprehensive housing data, reported that foreclosure activity in the first nine months of 2013 was up 33% compared to the first nine months of 2012 in the seven county region including the five boroughs of New York and Long Island.

Today the interplay of real property devastation along with the delays in homeowners receiving flood insurance proceeds is creating a class of storm-related foreclosures.  When a mortgage is in arrears and a homeowner is facing foreclosure, there are options to stop the foreclosure process through loss mitigation, an alternative process in which lenders work with borrowers to mitigate, or arrive at an agreement to resolve, past-due mortgage payments.

In the aftermath of natural disasters, disruptions of traditional communications, devastation or loss of all personal and/or real property can add to the obvious difficulties of distressed residents to meet their mortgage payments on time.  In these situations, it is not uncommon for there to be a temporary reprieve of debt obligations until normalcy can be restored.

Under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, the President has the authority to declare a national disaster.  All the National Disaster Areas identified by the Federal Emergency Management Agency (FEMA) will be subject to a moratorium on foreclosures following the disaster.  The moratorium applies only to those mortgages on properties that were directly affected by the disaster, and are effective as of the date the President declares a disaster.  The moratorium expires ninety (90) days from that date, unless extended by United States Department of Housing and Urban Development.

The most recent example of this was a moratorium on foreclosures on mortgages in the aftermath of Superstorm Sandy. For those homeowners affected by Superstorm Sandy, mortgage servicers were authorized to take extreme measures, including extending a forbearance for up to 12 months and implementing a 90-day foreclosure sale suspension and a 90-day eviction suspension for properties located within FEMA-designated areas eligible for individual assistance.

When a homeowner is still experiencing financial hardship beyond the moratorium, there are various loss mitigation options including: (1) HAMP modifications; (2) deed-in-lieu of foreclosure; and (3) short-sales.

In February 2009, the Obama Administration introduced the Making Home Affordable Program (MHA), a plan to stabilize the United States housing market and help struggling homeowners get relief and avoid foreclosure. The portion of MHA that addresses loan modification is the Home Affordable Modification Program, also known as HAMP. Under HAMP, servicers apply a uniform loan modification process to provide eligible borrowers with affordable and sustainable monthly payments for their first lien mortgage loans.  The end result of a successful loan modification produces a new mortgage agreement whereby the lender and the homeowner are bound by new terms. Affordability is achieved through the application of interest rate reduction, term extension, principal forbearance and principal forgiveness.

For those homeowners who do not qualify for a HAMP modification there are other options to avoid foreclosure.  Home Affordable Foreclosure Alternatives (HAFA), is part of the MHA which addresses the need for homeowners who cannot afford their monthly mortgage payment and who would transition out of their home.  HAFA provides two options for transitioning out of your home: (1) a deed-in-lieu of foreclosure or (2) a short sale.

A deed-in-lieu of foreclosure is a property disposition option in which a borrower voluntarily deeds their collateral property in exchange for a release from all obligations under the mortgage, to satisfy a loan that is in default and avoid foreclosure proceedings.

The other HAFA option is selling a property as a “short sale”.  A short sale occurs when a homeowner sells their home to a third party for less than the total debt remaining on the mortgage.  With a short sale, all negotiations are between a potential purchaser and the lending institution, in which the lender agrees to accept the proceeds from the sale in exchange for releasing the lien on the property.

With both a deed-in-lieu and a short sale, a disadvantage to a homeowner is the possibility of a deficiency judgment.  In most cases, the HAFA options will release the borrowers from all obligations and liability under the mortgage, but this is not always the case. To avoid a deficiency judgment with both a deed-in-lieu of foreclosure and a short sale, the agreement must expressly state that the transaction is in full satisfaction of the debt and that the lender waives its right to the deficiency. If the agreement does not contain this provision, the lender may file a lawsuit to obtain a deficiency judgment.

The widespread mortgage foreclosure threatens the very fabric of families and communities. It is the unfortunate reality that two and half years since Superstorm Sandy, many survivors have still not moved back into the place they once called home, and the risk of them losing their properties to foreclosure is rising.

The Suffolk Lawyer, May 2015: http://www.scba.org/eva/displayFile.php?id=3120

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Touro Law Center Disaster Relief Clinic’s Melissa Luckman, in collaboration with the Office of Senator Kirsten Gillibrand held a presentation on Wednesday, May 27 to walk homeowners through the FEMA Sandy Claims Review Process.  Representing Senator Gillibrands’ office,  Regional Director Deborah Tinnirello and Regional Assistant Melanie Sinesi assisted with the program.

Ms. Luckman  spoke about the need to understand your policy coverage and its limits,  the administrative review process for Hurricane Sandy claims, document submission and duplication of benefits analysis.

The Disaster Relief Clinic wants to educate as many homeowners as possible in obtaining the maximum amount of flood insurance proceeds to assist in moving back home and/or alleviating the stress of current and growing bills. Homeowners can contact the Touro Law Center Disaster Relief Clinic for assistance with any claims stemming from Hurricane Sandy, including flood insurance, New York Rising assistance, contractor issues, and FEMA recoupments etc., by calling…

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On Wednesday May 27, 2015, at 5:30pm, Touro Law Center‘s T LC HeartDisaster Relief Clinic, in collaboration with Adopt A House and The Office of United States Senator Kirsten Gillibrand will be hosting a FLOOD INSURANCE CLINIC: UNDERSTANDING THE FEMA SANDY CLAIMS REVIEW PROCESS.

In early 2015, the Federal Emergency Management Agency (FEMA) agreed to reopen claims filed by nearly 142,000 homeowners whose properties were damaged by Superstorm Sandy.  The FEMA review pertains only to those claimants who did not litigate. Please join us for a presentation that will walk homeowners through the FEMA Sandy Claims Review Process, along with the variable factors that must be taken into consideration prior to entering into the review process, such as the overlapping duplication of benefits analysis with New York Rising.

May 27, 2015, 5:30pm-8:00pm

5:30pm-6:00pm: Sign-in and welcoming

6:00pm-7:00pm: FEMA Claims Review Process

  • Documentation to be submitted
  • How to organize receipts, invoices, proposals
  • How to organize a contents claims
  • Discussing the HUD NYR DOB analysis that each person must be aware of

7:00pm-8:00pm: Q&A Session

Touro College Jacob D. Fuchsberg Law Center Auditorium

225 Eastview Drive, Central Islip, NY  11722

For More Information about the Flood Insurance Clinic, contact:

Disaster Clinic Hotline: (631) 761-7198

visit www.facebook.com/TLCDisasterRelief


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Touro’s Disaster Relief Clinic Invited to Senate Panel on Hurricane Sandy Task Force Meeting

On April 28, 2015, the Disaster Relief Clinic traveled to Washington DC as they were invited to participate in the first meeting of the Sandy Task Force to examine problems within the Federal Emergency Management Agency’s (FEMA) National Flood Insurance Program (NFIP) arising in the wake of Superstorm Sandy and develop recommendations for short- and long-term fixes.

Members of the task force include the four Senators from New Jersey and New York, their staff, FEMA Administrator Craig Fugate, FEMA officials, outside experts, Sandy victims, and other stakeholders.  Participating in the meeting were: Sens. Menendez, Booker, Schumer and Gillibrand; FEMA Admin. Fugate; Assistant Professor Benjamin Rajotte, Touro Law School (N.Y.); Executive Dir. Sue Marticek, Ocean County (N.J.) Long-term Recovery Group; George Kasimos, founder of Sandy victims’ advocacy group “Stop FEMA Now”; and Assistant General Manager Denise Neibel, Breezy Point (N.Y.) Cooperative.

Along with the Clinic Staff came two clinic students Whitney Steiner and Ambika Raghunandan, who were able to experience the Sandy Task Force meeting first-hand.

Ms. Raghunandan expressed that in the midst of all the chaos between Hurricane Sandy victims and the Federal Emergency Management Agency, there seems to be some hope for those that have been left homeless or those struggling to keep their home because they have depleted all or most of their savings in order to hold on to their property; or what is left of it.

Recognition from both the Senate and FEMA proves that Touro Law Center’s Disaster Relief Clinic has played an important role in seeking justice for homeowners who truly deserve it and who have been inundated with circular answers to their concerns. We have forced a “meeting of the minds” to create a system that works equally for the people and the government in times of crisis. The not-for-profit community, especially Touro’s Disaster Relief Clinic should be held in high regard. Benjamin Rajotte, Melissa Luckman, and Dan Strafer, all attorneys who go above and beyond for their clients’ best interests, have propelled Touro’s Disaster Relief Clinic into national reverence.

Clinic student Whitney Steiner describes her “trip to Washington D.C. with the Disaster Relief Clinic was by far the cherry on top of an amazing clinical experience”.  It is not every day you are handed the opportunity to meet four U.S. senators, the Federal Emergency Management Agency’s (“FEMA”) Administrator and Deputy Associate Administrator for Insurance, and several representatives from other non-profit groups united in the common goal of resolving what many have referred to as the “storm after the storm.” The meeting itself was a true learning experience.  Having spent the semester with the Clinic researching the issues discussed, looking for possible solutions, and assisting Sandy victims in a virtual tug-of-war over funds wrongfully denied, recouped, or in dispute with various parties, I was fascinated to see it fuse into one bitter-sweet conversation pushing towards a solution.  Looking around the room, I saw mixed emotions such as tears streaming down victims’ faces, heads alternating between nods and shaking in disagreement, and occasional bursts of excitement as hope for relief seeped in.

The meeting also induced a revelation of how important the work done by the Disaster Relief Clinic really is, receiving praise from the senators as well as from FEMA.  I am not only proud and honored to have been a part of this experience, but extremely thankful that I was given such an opportunity.  After spending a semester working with this group of individuals and seeing them in action during our trip to D.C., I can describe them as no less than assets to the Touro Law Center learning experience. It is her hope that the incoming Disaster Relief Clinic students will take advantage of opportunities such as this and have the chance to see that the hard work they do is worth the reward of helping those in need.

— Melissa H. Luckman, Staff Attorney

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Please take a moment to view the new edition of our Clinics Newsletter

Clinic Newsletter


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Melissa Luckman of Touro Law Center’s Disaster Relief Clinic speaks on the second anniversary of Superstorm Sandy

The American Red Cross announced more than $2 million in additional funding to members of the Long Island Long Term Recovery Group who are helping people affected by Sandy on Long Island recover. Touro Law Center and other leaders of nonprofit organizations will also highlight the collaborative efforts being made to assist Sandy survivors, which will continue as long as Long Islanders are navigating the recovery process



Here is the Newsday coverage


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