How do I defend against a Show Cause Order in a Foreclosure?
A question I seem to be finding a lot of visitors searching for relates to the defense of a foreclosure lawsuit after a show cause order has been entered. Unlike my previous post, it doesn’t just have to be the HOA. Remember, any lienholder can motion the court for a show cause order. A brief refresher as to what it is – a show cause order is essentially a summary judgment. You, as the defendant, are given the burden to show why a final judgment should not be entered in your case. This final judgment, if entered, sets the sale date of your home. As you can tell, it is a VERY serious hearing. I’ll spend a few minutes here laying out some rudimentary options that you have and some downfalls you may face in each.
Hire an Attorney
The more expensive approach, sure, but also the most informed. Also, I’ll admit my bias here – I am a foreclosure defense attorney. Even if you retain another law firm, I still think that hiring an attorney gives you, the home owner, the best chance at successfully defending against a show cause order. Why you may ask? Look at the Complaint you were served with, the order setting the hearing, and the show cause statute. Sitting here, typing this, I can think of at least ten issues to look for on each document. I’ll spare you from the minutia of detail (as most foreclosure cases hinge on technicalities) but a foreclosure defense attorney should be experienced in handling show cause hearings to defend against them. They should also be up to date on the law and now what defenses to bring to a show cause hearing with only those documents. It is important to keep these documents if you are thinking of hiring an attorney, and these may provide some defenses from the onset of the case.
Hiring an attorney also takes a great deal of stress off of you. You aren’t charged with defending your home and winning a very serious court hearing, your attorney is. That being said, it is very possible that your attorney can lose at this hearing, some of the nuances of your case stem largely from your files. It is important, if you are thinking of hiring an attorney, that you provide your attorney with your files and documents that you have received in this case. Certain defenses to a foreclosure case can be broken or made by what mail you received and what mail you did not. Accordingly, if you have kept some items the bank sent you prior to default, you should bring those into your attorney should you retain one.
Another common option. Generally, filing a bankruptcy creates an automatic stay in the foreclosure case and can get the show cause hearing cancelled. There are some times when a bankruptcy may not be your best choice, but an experienced bankruptcy attorney can help that decision. Some things to think about before meeting with an attorney are: (1) what is your debt load like? Is the house your only debt? (2) are there a lot of student loan debts that comprise your debt load? Generally, these are not dischargable. (3) are many of your credit cards in collections? Are creditors calling you constantly?
As you may be aware, I tend to recommend filing bankruptcy when there is a lot of other debt – if it is just the house, you may be able to survive the show cause order and successfully modify your loan or do a short sale of the home. This is mainly because, while the show cause hearing is risk, the credit impact of a bankruptcy can affect you for up to a decade. If it is possible to mitigate harm to your credit and your damages in your foreclosure suit, then fighting the show cause may be a better option. Outside of the credit implications, filing bankruptcy can result in you having to make payments to a trustee for years if you file under chapter 13 of the bankruptcy code.
Going Pro Se
Pro se literally means fighting the bank as your own attorney. I do not recommend this. I have seen many home owners try to defend their suit only to lose their home without working something out with the bank. If you cannot afford an attorney and want to fight the show cause order the statute is very clear on what you must do. You can defend yourself a number of ways, but the statute is very specific. The order should contain this language too:
“State that, if a defendant files defenses by a motion, a verified or sworn answer, affidavits, or other papers or appears personally or by way of an attorney at the time of the hearing, the hearing time will be used to hear and consider whether the defendant’s motion, answer, affidavits, other papers, and other evidence and argument as may be presented by the defendant or the defendant’s attorney raise a genuine issue of material fact which would preclude the entry of summary judgment or otherwise constitute a legal defense to foreclosure. The order shall also state that the court may enter an order of final judgment of foreclosure at the hearing and order the clerk of the court to conduct a foreclosure sale.”
That outlines the basic need for how to defend the case. But, it is imperative you do so properly. If you are going to defend yourself you will be held to the same standard as an attorney. It is important that you find out what you have to do in order to successfully defend your case.
As you can tell, there are a lot of options to defending against a show cause order. I hope this has provided some insight into what can make or break your defense at the hearing. If you are still unclear as to what options you have, I offer a free consultation to go over the show cause order, the complaint, and your situation to determine what the best fit for you