Thomas McKay (1L)
Northwest Justice Project
Seattle, WA
Thomas will be working for Northwest Justice Project (NJP) with the Home Foreclosure Legal Aid Project (HFLAP). A partnership with the Washington State Bar Association (WSBA), the program pairs clients facing foreclosure with volunteer attorneys for representation. The attorneys are in turn trained and offered ongoing support through HFLAP. Additionally, NJP staff attorneys also litigate on behalf of homeowners to stop foreclosure sales and predatory lending practices. Thomas will spend his summer interviewing homeowners faced with foreclosure, assessing their cases for legal merit, and assigning qualified cases to pro-bono attorneys. He will further assist by negotiating with their loan servicers and trustees, with the goals of stopping foreclosure and securing loan modifications. In support of litigation, he will conduct case research and prepare pleadings.
Working for several years as a legal aid paralegal in Inglewood, CA supporting pro se litigants with eviction defense, Thomas witnessed the recent uptick in foreclosure-related evictions firsthand. He is excited about the opportunity to provide legal support to people of limited means while acquiring knowledge and skills in a new area of advocacy.
August 2, 2011
Washington State's new foreclosure mediation law went into effect on July 22, 2011. In cases where the foreclosure process has been started, the law allows the homeowner to request mediation with their lender. Many of the major trustee companies have agreed to postpone home sales while this mediation occurs, largely in observance of the duty of good faith that they bear to borrowers under Washington law.
I was given a case on the Tuesday after this law went into effect. The home was to be sold at 10:00 a.m. on Friday. My job was to negotiate with the loan servicer to stop a foreclosure sale because the homeowner had a pending application for a loan modification. This kind of postponement should be a matter of course because it is required under the guidelines for the federal loan modification program. Unfortunately for borrowers who are not either savvy or tenacious, it is routinely ignored and their home sells while they are making a sustained effort to pay their debt. My client had made the request, but it was still pending. I prepared a written request that the lender, one of the largest banks in the country, mediate with the borrower under the new Washington law.
Once again, my task should have been as simple as communicating with the loan servicer and trustee and confirming that the sale would be stopped because of the mediation law. What I did not account for was the computer system, which most major lenders, servicers and trustees can use to instantly communicate with each other, in fact operates to slow the transfer of information from one party to another. This slowdown often provides a shield of delay and plausible deniability to an agent using the system. After two days of constant contact with all interested parties, the request to postpone the home sale was denied on Thursday at 4:30, eighteen hours before the home would be sold.
On Thursday evening I sent another letter to the trustee requesting that the home sale the next morning be stopped. This one named the individual trustee responsible for the sale, and demanded that they stop the sale because of their duty of good faith to the borrower. My supervising attorney suggested that the homeowner contact the media and go to the foreclosure auctioneer with documents proving that the sale, if held would be invalid. The homeowner did not respond to my calls. On Friday morning, after calling back and forth to the loan servicer and the trustee, just over an hour before the home was to be sold, I finally got confirmation that the trustee was reviewing my request. With 45 minutes to spare, the trustee asked the lender if they could stop the sale. No one ever tried to contact me or the homeowner about stopping the sale. The sale was stopped within minutes. The same computer system which had delayed multiple requests to stop the foreclosure sale by days had functioned within fifteen minutes to communicate the order to stop the sale.
I am grateful for my PILF grant, which has allowed me to make a focused effort this summer that really made a difference to homeowners like the one above. I have also been honored to work with a supervisor who supports my individual initiative, independent work, and is open to all means of effective advocacy. This has enabled me to learn through a combination of persistence and creativity to effectively address a client's goals. This atmosphere, along with the rewards of helping homeowners, has made my work this summer truly rewarding.
June 30, 2011
In the first week of work, I learned about the vital role that this office plays in litigating for homeowners. My supervising attorney is currently in litigation against some major lenders and mortgage securitizers. With the help of pro-bono co-counsel, she drafted a complaint on behalf of two homeowners and against mortgage securitizing agents which survived stringent federal pleading standards and was allowed to move to trial. The complaint alleges that the securitizers knew or should have known that the issuer of the loans that it securitized was a predatory lender, and was thus itself liable for the results of predatory loans on the homeowners. After several months of deliberating whether or not to dismiss her case, the federal judge ruled that it could go forward. This is an important milestone, because it carves out a pathway for attorneys of homeowners to litigate the abusive lending practices of investment banks.
My work at HFLAP has already been extremely rewarding. I have negotiated successfully with servicers and trustees to postpone two trustee's sales, attended a strategy meeting about continuing legislative efforts to support homeowners in foreclosure, and attended to a day-long training which thoroughly explored the mechanics of the options available to these homeowners. I manage a caseload of clients who I interview to evaluate approaches to their foreclosure, while keeping abreast of the daily developments in home foreclosure prevention. It took the first two weeks to begin to "get my legs" and have a grasp on some of the legal issues and processes that are at play in these cases.
It is interesting to speak with loan servicers and see the confusion from the homeowner's perspective. Mortgage servicers are first in line, ahead of lenders, to make a large return on each foreclosure sale, and are thus have a conflicting interest with homeowners, who are willing and financially able to stop the foreclosure. I spoke with a servicer for a major national bank that appeared to be deliberately playing a "shell game" with the homeowner. The homeowner had applied for three modifications, but only one was pending, which requires the servicer to stop the foreclosure sale when it is requested. The servicer repeatedly told me that the applications had been denied. When I would point out that the servicer was referring to old denials and that there was a new pending application, I would be put on hold so that a manager could be consulted. The "who's on first" routine would resume after this consultation, and this continued for over an hour. Eventually, the servicer admitted that there was a valid reason to postpone the sale, but did not do so until two days later, after I alerted the Washington Attorney General's Office and sent a demand letter to both the servicer and the trustee. The persistence that it takes to get a servicer to perform a simple task, one that they have already promised the federal government that they will do, underscores how vital, if unglamorous, this work is.
There are two aspects of this work that have been particularly rewarding so far: The small and close-knit staff, and the opportunity that I have been given to work toward resolutions with my own caseload. The lawyers that I work with are tenacious, focused, and dedicated, but always take the time to answer my many questions with detailed explanations, whether about the minutiae of the Washington's Deed of Trust Act or the Making Home Affordable program, or the patterns that particular lenders and loan servicers exhibit towards borrowers. This collaborative atmosphere supports my independent work on my own caseload. I have the opportunity to take the time to thoroughly understand a client's case and to perform complete background research before I speak with a client. I am able to find my own answers before I compare notes with my supervisor so that I am given the freedom and time to really understand each case so that I can competently address each client's needs. I am already getting vital practice with advocacy skills that will serve me in the future. I am grateful for the opportunity to work in this changing area of law alongside attorneys who have made themselves important players in foreclosure defense.
