is there a cap on what an attorney can charge for forclosure in kentucky?

by Thaddeus Dicki 4 min read

What are the laws for foreclosures in Kentucky?

Mar 29, 2012 · Kentucky Deficiency Judgment Laws. In a foreclosure, the borrower's total mortgage debt frequently exceeds the foreclosure sale price. The difference between the total debt and the sale price is called a "deficiency." For example, say the total debt owed is $450,000, but the home sells for $400,000 at the foreclosure sale.

Are attorney's fees collectable in foreclosures?

Jun 17, 2015 · A Kentucky lawyer sought to foreclose a loan for a client who had a mortgage on a parcel split from an old family farm. The Master Commissioner's report stated that the foreclosure would be recommended if the lawyer could prove satisfactory title to the parcel of property split from the master deed. The title to the original

What is an servicer in a Kentucky foreclosure?

Dec 08, 2021 · E-5-04: Allowable Foreclosure Fees (02/12/2020) Share this answer. The maximum attorney fees that Fannie Mae allows for legal proceedings related to foreclosures appear in the Allowable Foreclosure Attorney Fees Exhibit. Generally, Fannie Mae will not reimburse the servicer for any attorney fees that exceed or are not included within Fannie Mae's maximum allowable …

What is reinstating a foreclosure in Kentucky?

Jun 21, 2013 · A foreclosure lawyer with hourly rates often charges an initial retainer fee of around $5,000 and charge a minimum of $250 per hour. Filing Answers and Affirmative defenses can take more than 4 hours, and the cost would be half of your retainer.

What happens if you pay your mortgage late?

If your mortgage payment is late, your servicer may charge you a late fee. But servicers sometimes incorrectly assess late fees—either inappropriately or in the wrong amount—which can add hundreds of dollars on to the amount you owe on the mortgage loan.

How long is the grace period for mortgage payments?

The servicer assesses a late charge during the grace period. Most mortgage contracts include a "grace period" of around ten or fifteen days. If you make your payment late, but during the grace period, there shouldn't be a late fee. The servicer delays posting your payment to your account.

Can a servicer assess late charges?

The servicer assesses post-acceleration late charges. In most cases, the servicer is prohibited from assessing late charges after the loan has been accelerated. (When a loan is "accelerated," you have to immediately pay the entire balance of the loan, not just the past due amounts.

What is a mortgage servicer?

Mortgage contracts generally allow a servicer—the company that handles the loan account—to charge late fees, inspection fees, foreclosure costs, and other default-related fees to your account under certain circumstances, like when you are late on a payment or are in foreclosure. If the servicer charges fee and costs in excessive or incorrect ...

How much is a late fee on a loan?

Most prime, conventional loan contracts allow the loan servicer to assess a late fee equal to 5% of the payment due. However, state law may limit the fee to, say, only 4%. If the loan documents and state law allow for different late fees, the servicer can only charge the maximum allowed by state law.

Can a borrower raise late fees?

Borrowers may raise any number of defenses regarding improper late fees or other incorrect default-related fees. While some may constitute a full defense to the foreclosure, others will reduce the amount owed on the debt, thereby potentially decreasing any deficiency owed to the lender. (Learn more about deficiencies after a foreclosure .)

What is a property inspection?

Most mortgage contracts allow the servicer to take necessary steps to protect the lender's rights in the property, including conducting property inspections to determine the physical condition or occupancy status of the mortgaged property. Inspections are generally ordered automatically once the loan goes into default. The charges for the inspections are then added to the total mortgage debt.

What is the Cost of Foreclosure Defense?

For most facing foreclosure either now or in the future, something has changed in their lives that is already causing more than enough stress without any help from the looming loss of their home.

There are Three Ways to Pay a Foreclosure Defense Lawyer

The cost of foreclosure defense comes down to three basic three types of payment methods employed by foreclosure defense law firms that will determine your cost of foreclosure defense:

When to Pay a Foreclosure Defense Lawyer an Hourly Rate

Some homeowners believe they were harried through the mortgage process or were unjustly foreclosed upon. These homeowners will often choose to hire an attorney to sue their lender.

Foreclosure Defense Lawyers Charge Flat Fees

Some foreclosure defense law firms charge a flat fee of $3,000 to $4,000, which must be paid when the firm is hired. A flat fee for foreclosure defense can give homeowners a feeling of security, because they have paid their lawyer and have no further financial obligation until they have a mortgage to pay again.

Monthly fees protect you

Most responsible homeowners will hire an attorney that charges monthly fees. One of the benefits to paying your attorney a monthly fee is that you have confidence that you know what your attorney's costs are. The amount you pay will never fluctuate.

How Much Should You Pay a Foreclosure Lawyer?

The average cost of foreclosure defense varies based on each homeowner's personal decisions. Most homeowners choose to pay their attorney a monthly fee.

Robert Franklin Dean

The maximum amount is $100, according to the Office of the U.S. Trustee in Baltimore.

Dorothy G Bunce

Non attorney petition preparers fees are regulated by the office of the United States Trustee. I have never heard anyone claim that there is a secret as to the amount. Each local office can establish the amount a petition preparer can charge.#N#As to attorney fees, in Chapter 7 the amount is limited to a dollar amount. Hope this perspective helps!

Evan A Nielsen

Don't believe there's a maximum - fees must be reasonable considering the scope of the representation, skill, training and eduction of the attorney and the nature of the matter. It's like asking what the maximum price of a house in MD can be - depends on the house and the market...

Deborah F Bowinski

There may not be an answer. If that's the case you can research for four more years and still not find it.

Helene Thaissa W. Bergman

There probably is no definitive answer. Depends on District, judges, what kind of filing, how complicated. Like legal fees.

What is reinstatement in Kentucky?

" Reinstating " is when you catch up on the missed payments, plus fees and costs, to stop a foreclosure. Under Kentucky law, you don't get the right to reinstate before the sale—unless the loan is a high-cost home loan. Before filing a complaint to foreclose a high-cost home loan, the lender has to provide a notice of default to the borrower that gives 30 days to cure the default and reinstate the mortgage. (Ky. Rev. Stat. Ann. § 360.100).

How long do you have to redeem a foreclosure in Kentucky?

In Kentucky, if the home sells for less than two-thirds of its appraised value at the foreclosure sale, you get six months to redeem the property. (Ky.

Can you reinstate a mortgage in Kentucky?

Under Kentucky law, you don't get the right to reinstate before the sale —unless the loan is a high-cost home loan. Before filing a complaint to foreclose a high-cost home loan, the lender has to provide a notice of default to the borrower that gives 30 days to cure the default and reinstate the mortgage. (Ky.

What is the mortgage in Kentucky?

The mortgage is the document that gives the lender a security interest in the property. If you fail to make the payments, the mortgage provides the lender with the right to sell the home at a foreclosure sale to recoup the money it loaned you.

How long is the grace period for a mortgage?

Most mortgage loans give a grace period of ten to fifteen days, for example, before you'll incur late charges. To find out the grace period in your situation and the amount of the late fee, review the promissory note or your monthly billing statement.

Can you get a deficiency judgment on a foreclosure sale?

Sometimes, a foreclosure sale doesn't bring in enough money to pay off the full amount owed on the loan. The difference between the sale price and the total debt is called a "deficiency balance." Many states, including Kentucky, allow the lender to get a personal judgment, called a " deficiency judgment ," for this amount against the borrower.

What is a promissory note in Kentucky?

The promissory note is the document that contains your promise to repay the loan along with the repayment terms.

Purpose

  • Mortgage contracts generally allow a servicerthe company that handles the loan accountto charge late fees, inspection fees, foreclosure costs, and other default-related fees to your account under certain circumstances, like when you are late on a payment or are in foreclosure. If the servicer charges fee and costs in excessive or incorrect amounts, this will unfairly increase the t…
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Premise

  • Read on to learn about how servicers assess late fees and other costs when you default on your mortgage, and how to challenge improper fees in a foreclosure.
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Risks

  • If your mortgage payment is late, your servicer may charge you a late fee. But servicers sometimes incorrectly assess late feeseither inappropriately or in the wrong amountwhich can add hundreds of dollars on to the amount you owe on the mortgage loan.
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Service

  • The servicer assesses a late charge during the grace period. Most mortgage contracts include a grace period of around ten or fifteen days. If you make your payment late, but during the grace period, there shouldnt be a late fee.
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Issues

  • The servicer assesses an incorrect late charge amount. Late fees can only be assessed in the amount specifically authorized by the loan contract. The late charge amount is usually found in the promissory note. Even then, state law may limit the amount that can be charged. If the state limit is lower than what the contract allows, it will generally override the loan contract.
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Example

  • Example. Most prime, conventional loan contracts allow the loan servicer to assess a late fee equal to 5% of the payment due. However, state law may limit the fee to, say, only 4%. If the loan documents and state law allow for different late fees, the servicer can only charge the maximum allowed by state law. In this situation, the late fee would be limited to 4% pursuant to state law. I…
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Cost

  • Limits on late fees. Late fees are often limited by: The loan servicer may also assess costs for preserving the value of the property. For example, property preservation costs may include fees advanced to: Generally, foreclosure costs must be reasonable and actually incurred before they are recoverable against the borrower. Acceptable foreclosure costs include, among others: Mos…
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Operation

  • The servicer assesses post-acceleration late charges. In most cases, the servicer is prohibited from assessing late charges after the loan has been accelerated. (When a loan is accelerated, you have to immediately pay the entire balance of the loan, not just the past due amounts. This sets the stage for the foreclosure procedure to begin.)
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Results

  • The amount charged for each inspection, which is generally drive-by in nature, is typically minimal ($10 or $15). However, inspections might be performed monthly or more often, so the charges can add up quickly. Some courts have found that repeated inspections when the servicer is in contact with the homeowner, knows the property is occupied, and has no reason to be concerne…
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Significance

  • Most courts have held that such fees must be reasonable in order to be collectable from the borrower.
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Advantages

  • Borrowers may raise any number of defenses regarding improper late fees or other incorrect default-related fees. While some may constitute a full defense to the foreclosure, others will reduce the amount owed on the debt, thereby potentially decreasing any deficiency owed to the lender. (Learn more about deficiencies after a foreclosure.)
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Usury Laws by State – Legal Maximum Interest Rates A Lender Can Charge

  • Each state has a Usury law that limits the amount of interest a lender can charge. It is a good idea to check your state’s usury laws before signing loan agreements. The loan agreement should not have an interest rate that exceeds the state’s usury limit. *FRDR= Federal Reserve Discount Rate – more info here
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Alabama

  • Interest Rate Limits
    The limit is 8%.
  • Exception
    Principal loan balances over $2,000
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Alaska

  • Interest Rate Limits
    The limit is 10.5%. is the limit.
  • Exception
    For express contract agreements, the limit can be 5% above legal rate.
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Arizona

  • Interest Rate Limits
    The limit is 10%.
  • Exception
    There is no limit for rate contract in writing.
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California

  • Interest Rate Limits
    For consumer loans, the limit is 10%; for non-consumer loans, the limit is 5% above the FRBSF Discount Rate
  • Exception
    no exceptions
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Colorado

  • Interest Rate Limits
    For consumer loans, the limit is 12% ; for non-consumer loans, it is 12%.
  • Exception
    No exceptions
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Connecticut

  • Interest Rate Limits
    12% is the limit.
  • Exception
    Mortgages of real property greater than $50,000, the maximum legal interest rate for a business loan between the value of $10,000 and $250,000 may not exceed 17% plus the Deposit Index.
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Delaware

  • Interest Rate Limits
    5% above current FRDR
  • Exception
    No limit on the interest rate if the loan is greater than $100,000 and the loan is not secured by a mortgage against the principal residence of the borrower.
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Florida

  • Interest Rate Limits
    For loans less than $500,000 the limit is 18% and for loans greater than $500,000 is 25%.
  • Exception
    No exceptions
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Georgia

  • Interest Rate Limits
    For loans less than $3,000 the limit is 16%, and for loans of $3,000-$250,000, the limit is 5% per month. (must use simple interest)
  • Exception
    no exceptions
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