Please ensure Javascript is enabled for purposes of website accessibility
Home / News / Foreclosures / Firm creates foreclosure defense dept.

Firm creates foreclosure defense dept.

While law firms have long represented banks and other mortgage holders in foreclosure proceedings, at least one local law firm has seen opportunity on the other end.

Pheterson, Stern, Calabrese, Neilans and Spatorico LLP have announced the creation of a foreclosure defense department, which will specialize in fighting foreclosures they see as illegal, egregious and overaggressive.

“With the boom in foreclosures and irregularities in banks’s legal paperwork, we believe there is a growing need in the community,” said Derrick Spatorico, a partner with the firm.

Rebecca Case-Grammatico, senior staff attorney with the nonprofit Empire Justice Center praised the development, saying that changes in the law enacted by Gov. David A. Paterson now give for-profit attorneys like Spatorico an incentive to take a role in assisting beleaguered homeowners.

Among other changes, the law now allows property owners to collect legal fees from banks when they prevail in foreclosure disputes. “It’s a phenomenal shift in the approach to these cases,” she said.

Real estate law previously heavily favored the mortgage holders, Spatorico said. The new changes in the law provide a much more level playing field, he said. “When you go from nothing to something, that is a big deal,” Case-Grammatico agreed.

Over the past few years, Spatorico said his firm has been successful in negotiating modifications of the terms of existing mortgages, in cases where the homeowners want to stay, or negotiating short sales, in cases where the homeowner does not, on an as needed basis.

In one case, he was able to negotiate a 42 percent reduction in a mortgage payment, saving the Pittsford-based homeowner $127,000. They were also able to get the bank to agree to pay the defendant’s legal fees, he said.

The creation of a formal department to deal with future cases was the next logical step, he added.

Over the next few years, Case-Grammatico believes other firms may follow Spatorico’s lead.

Both nationally and regionally, fallout from the ongoing mortgage crisis has left as many with loans they cannot possibly pay back — as many as 250,000 entering foreclosure every three months, Spatorico said. “There is a tremendous need in our community for this type of service.”