The Sun-Sentinel

 Weston's Roy Oppenheim among growing number of lawyers defending struggling homeowners

By Paul Owers, Sun Sentinel

After an hour-long foreclosure defense workshop, Weston lawyer Roy Oppenheim called for questions and turned to Ailene Colini. Laid off, stuck with an "underwater" mortgage and fed up with her lender, she wanted to know about a radical option.

"Strategic default: How do you go about getting involved with it?" Colini asked, repeating a term she heard Oppenheim use frequently to refer to borrowers who stop making at least one house payment. "I've begged for help, and I can't get it."

A dozen people attended the free presentation June 2 in the lobby of Oppenheim's law office just off Interstate 75. About 100 more were watching at home on a live Internet stream. He hopes at least a few will become clients.

Oppenheim is one of a growing number of lawyers who have reinvented themselves as foreclosure defense specialists as the housing debacle has intensified. He said his boutique firm has negotiated nearly 400 foreclosures, short sales and loan modifications in the past two years.

Roughly 10,000 homes and condominiums in Broward and Palm Beach counties were in some stage of foreclosure during May, according to RealtyTrac Inc. of Irvine, Calif. Some longtime foreclosure defense lawyers say their caseloads have tripled or quadrupled from a few years ago.

Clients flock to foreclosure defense lawyers for a variety of reasons. Some want to keep their homes. Others are resigned to losing the properties and just want to make sure lenders don't hound them for the unpaid debts down the road.

Many of the homeowners are embarrassed by their situations, but Oppenheim's pitch puts at least some of them at ease.

At the June workshop, he spoke and dressed casually, wearing a coat and no tie. Oppenheim told the group that 11 million American homeowners are underwater, owing more than their properties are worth.

Borrowers who are underwater are more likely to stop paying the mortgage, experts say. The percentage of foreclosures thought to be the result of strategic defaults was 31 percent in March, up from 22 percent a year ago, according to the Chicago Booth/Kellogg School Financial Trust Index.

Oppenheim went on to slam lenders, saying they misspent billions in federal government bailout money on bonuses and acquisitions instead of modifying bad mortgages, as was expected. He said banks want borrowers to feel "shackled" to their homes, but he told homeowners they don't have to be.

As he spoke, those in attendance were silent, scribbling notes on legal pads.

An initial consultation with Oppenheim costs about $300. He said the typical client spends $4,000 in a year. In some cases, homeowners cover his legal fees from the savings they've amassed by not making mortgage payments.

Oppenheim, a boyish-looking 50 and the father of three, moved to Miami in 1987 after working for a Wall Street law firm. His wife, Ellen Pilelsky, started the Weston law firm two years later, and he joined it in 1990.

Before adding a foreclosure defense practice, he mostly defended builders and developers and handled real estate closings. Then the housing boom went bust.

"By the summer of '08, we clearly realized we were going to have to do this," Oppenheim said. "The phones stopped ringing, and it was deathly silent. It was eerie."

There are no official figures on the cadre of lawyers who have added foreclosure defense practices in recent years. But Richard Gendler, a South Florida foreclosure defense attorney since 1997, said there's now a glut of such lawyers who wouldn't have been able to sustain themselves before the housing meltdown.

To learn about the subject, Oppenheim said he read books, consulted with lawyers and attended an eight-hour course. But other lawyers have been criticized for superficial training from continuing education outfits peddling classes in foreclosure defense.

Another common complaint: Some foreclosure defense lawyers are marketing machines who milk clients rather than find permanent solutions to their problems.

"It's disheartening," said Rashmi Airan-Pace, who joined her father's 25-year-old foreclosure defense practice in Coral Gables in 2008.

Oppenheim insists his firm is using foreclosure defense as a legitimate tool to help clients achieve the best results for them.

"We will not file documents we can't support in front of a judge without our faces turning red," he said.

Oppenheim held the first of his 20 workshops two days after President Barack Obama was elected in November 2008. They're titled Shays' Rebellion 2.0, a reference to the 1786-87 uprising in Massachusetts by poor farmers overwhelmed by debt and taxes.

A similar revolt is happening today as homeowners stop paying their mortgages, Oppenheim said. "They're sending a message to the banks, and they're sending a message to Washington."

Generally, homeowners have to miss at least one payment before the banks will agree to help them, Oppenheim said.

Colini, the unemployed homeowner asking about strategic default, bought her Plantation house in 1999 for $95,500. She blames a 2006 refinancing following a divorce for her now owing $130,000 more than the property is worth. To help make ends meet, Colini rents out a room, but the income is sporadic.

She doesn't know how much longer she'll be able to make her payments. But she doesn't worry anymore about whether it's a moral issue. "For me now, it's how am I going to eat tomorrow?" she said.

Colini and another struggling homeowner said they felt better after attending the workshop. Oppenheim said he can see the relief on faces at the end of each seminar.

"Psychiatrists hate me," he said. "These people leave here feeling like a weight has been lifted off their shoulders. They feel like they have hope, and they're taking back control of their lives."

Staff researcher Barbara Hijek contributed to this report.

Paul Owers can be reached at Powers@SunSentinel.com or 561-243-6529.

http://www.sun-sentinel.com/business/fl-foreclosure-defense-20100611,0,1962822,full.story