Arbitrary and Unduly Burdensome

The process of moving to New York was hard enough without the ridiculous attorney admission process.

Approximately a year ago, my wife and I made the difficult decision to relocate from our home in California to New  York City.  The move was prompted by my wife’s career- she had secured a wonderful job as a 3-D animator.  The biggest hurdle to our move, by far, was my career.

As an attorney, mine is not a “portable” profession.  Licensing varies from state to state, and my initial review of the bar admission rules in New York gave me cause for pessimism.  The cause of what would be a painful, expensive, and difficult relocation process was the tense relationship between the states of California and New York.

New York, like most states, has a concept called “reciprocity.”  Basically, they will let experienced attorneys from other states join their bar with a minimum of hassle, as long as the other state gives the same courtesy to New  York lawyers.  California, one of few among the states, does not grant reciprocity to anyone: they have the toughest bar exam in the nation, and will not permit out-of-state attorneys to simply “waive in” to practice.

For that reason, New  York treated me as though I was a new graduate, and ignored my five years of legal experience.  In order to practice in New  York, I was required to sit for the New York bar exam, sit for the multi-state ethics exam (which I took and passed five years ago, prior to admission in California), submit to a full, detailed, and unnecessarily burdensome background check, and attend an in-person ceremony to be sworn in to practice.

Total cost: approximately $8,000.

At the outset, it is helpful to remember that we have a fundamental right to practice our chosen profession.  While I’m sure we can all agree that attorneys  should be licensed, and should have to prove ability and character in order to practice, we should also agree that those requirements should not be arbitrary or unduly burdensome.

My first issue with this process was the necessity of re-taking the bar exam.  After five years of successful practice, I believe I had demonstrated sufficient acumen to prove my understanding of the law.  If I lived in another state, it would not have been an issue, but New York chose to punish me, an individual attorney, because the State Bar of California doesn’t play well with others.  This is arbitrary and unreasonable, especially considering that California’s bar exam is, by any rational metric, significantly  harder to pass than New York’s.

Of course, the New York Bar Exam is only offered in the Empire State, so I had to take time off work to fly across the country and sit for the exam, which is administered only twice per year.  As an out-of-state resident, New  York did  not permit me to choose where I took the test, so instead of flying to New York City, where my wife already lived, I had to fly to Buffalo.  In February.  From California.  I did not own a winter coat before that trip, and it is a wonder I was able to perform well in that extreme and unfamiliar climate.  Final point on this: taking the bar exam is not cheap.  They charge several hundred dollars of fees for the privilege of taking this examination.

The ethics exam was another needless exercise in redundancy.  It was- literally- the exact same test I took upon graduation from  law school.  The material is simple, and I did not need to study to pass it: as a practicing attorney, I am more than passably aware of the ethical rules governing my profession.  However, I did have to give up a full day,  pay yet another examination fee, and patiently wait for the results.

The last substantive portion of the admissions process is the “character and fitness” application.  They required certification from the California Supreme Court that I am, in fact, an attorney in good standing.  Small detail: this is public information that any third grader with an internet connection can easily verify within ten seconds, but they wanted me to pay for a certificate, wait a week, and send a sealed, original copy to their offices.  More troubling, they wanted affidavits of character from each and every employer I had ever worked for since graduation.

This part proved tricky for two reasons.  One of my previous employers was out of business, and I had a devil of a time getting an affidavit for that time period.  Worse, I needed an affidavit from my then-current employer.  Now, I had and continue to have a wonderful relationship with my old boss, Gary Fraley.  Frankly, my happiness in that position was the reason we didn’t decide to move much sooner.  However, at the time I sat for the New York bar exam, we had not fully decided to move, and our decision would certainly be contingent on my admission to the bar.  In short, I had not told my current firm that I was thinking of relocating, and did not want to couple that disclosure with a request for an affidavit of good character.  For some applicants, I’m sure such a request could jeopardize their jobs.  Fortunately, I was able to have a colleague not in management fill out the affidavit for me, and I was approved for admission.

The final, unforgivable burden of the admissions process was the swearing-in itself.  Unlike most jurisdictions, it must be done in-person, at pre-set times that are scheduled less than once per month.  Naturally, they are in the middle of the week, necessitating further use of vacation time.  Again, I was not given a choice of locations, so I had to miss visiting my wife again, this time flying to Albany.  None of my friends or family were there to see me, a scowl barely contained, as I took the oath and was sworn in to the bar.

In a way, the admissions process itself was a good preparation for the practice of law in New York, where many of the rules and procedures seem arbitrary, unfair, and designed to kill trees and waste time rather than efficiently produce results.  However, from an applicant’s position, I found the process difficult, needlessly expensive, and unfairly burdensome for no better reason than “your home state doesn’t play nice.”  That a lawyer from California is somehow profoundly less qualified than an attorney of the exact same experience from, say, Kentucky is absurd and irrational.  There is no legitimate justification for this discrimination in the admissions process.

Again, the right to practice our chosen occupation is a fundamental right.  Attorneys already face daunting challenges, including law school, the bar exam, admission in their home state, and an ongoing duty to take classes and pay large annual fees.  Adding arbitrary burdens based on “reciprocity” demonstrates that the actual qualifications of the applicant are secondary to concerns that do not speak to our ability to practice law.

Thank you for reading this diatribe, and I hope that my experience can serve as an example of a broken system sorely in need of a change.

~Andrew

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Published in: on January 20, 2014 at 9:22 am  Comments (1)  
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Kick Them When They’re Down

Wherein I discuss some of the scams and traps that cheat struggling homeowners out of money, and can cost them their homes

(insert cliche about how bad the economy is; we all know it’s pretty rotten right now)

In fact, for many homeowners the economic troubles have given them a double-barreled problem; first, home values are sometimes half what they used to be, so the houses are underwater.  Second, with reduced income, they often cannot afford to make the payments to service those high-balance loans.

The result is that, in unprecedented numbers, people are losing their homes to foreclosures, forced short-sales, or deeds-in-lieu-of-foreclosure.

As an attorney primarily practicing bankruptcy law, I meet with people on an almost daily basis who are at the end of their rope with their mortgage lender.  The sad truth is that not only will many of them lose their homes, a great many of them should never have gotten the home loans to begin with, and wouldn’t have gotten them if they, or the lenders, knew what would happen to housing values.

Though it is very popular to express hope that the government, or the mortgage industry, will help people stave off foreclosure, in many cases there is simply no salvaging the loan.  If even a reasonable payment on the property would be more than half of the borrower’s income, it is in nobody’s interest to prevent foreclosure or a short sale.  Homeownership is a worthy goal, but not everyone can or should afford to be a homeowner.

In many states, including California, the typical foreclosure involves the filing of public-record documents, including notices of default or of a pending trustee’s sale.  One side-effect of these public records is that cottage industries of “foreclosure prevention” services have cropped up around the country, and in many cases, they are scamming desperate people out of money at the precise time they need their money the most.

One of the most pervasive scams involves help with loan modifications.  In the past, I have worked with clients trying to get modifications, and have even handled some professionally.  Here’s what I learned through that experience: no attorney, and certainly no non-attorney, can consistently achieve better results than the borrower would achieve on their own.  There is no secret handshake that allows a loan to be modified; the bank requests documents, you provide documents, they either approve or deny relief.  Yes, the banks lose documents, and yes, they change their processes and give conflicting information.  They do the same thing to third-party modification companies.  Don’t confuse the bank’s ineptitude with your own inability to get the loan modified.

To be clear: if a modification can be achieved, you can attain one without help from anyone, especially anyone who wants to relieve you of several thousand dollars along the way.

Worse than the modification services, however, are the out-and-out scams.  These include forensic loan audits and ownership transfers.  In a forensic loan audit, the company charges the homeowner a hefty fee to review loan origination documents, and then tells the borrower about all sorts of heinous omissions and mistakes made by their lender.  This, they claim, will give the borrower leverage to get a loan modification, or even to sue the lender!  In the worst of these scams, the initial payment will only cover the audit itself, and then the company will ask for continued costs, such as $1,000 per month, in order to hire an attorney to sue the lender.  They tell the homeowner that this will indefinitely delay foreclosure.

Back when he was the state’s attorney general, Governor Jerry Brown filed a lawsuit against some of the largest forensic loan audit companies, accusing them of scamming millions of dollars from homeowners by promising things they could not deliver.  Make no mistake- these do not work.  The promises boil down to either a free house, which you will not get, or an indefinite delay in your foreclosure, which they cannot deliver.  The idea that the bank will be somehow forced to modify to avoid a lawsuit is simply not true.  Companies that promise to add you to a class action lawsuit against your lender are engaging in a similar type of scam, with big investments by the homeowner, big promises, and little if any chance of success.

The final scams involve deeding the property to third parties, often third parties involved in bankruptcy, to take advantage of bankruptcy protections and prevent foreclosure.   Unlike the other scams, which at their worst can cost money and emotional distress, this arrangement is certainly fraudulent, and possibly criminal.  You should never, under any circumstances, sign off on a transfer of ownership to a distressed property, unless it is agreed to by your lender.

I’m sure in a future post I’ll be discussing when and how bankruptcy can help preserve home ownership.  After all, it’s my profession, and I love what I do.  My purpose in posting this today is to warn people against the “too good to be true” scams that are preying on people who are desperate to keep their homes.  Before you spend a dime on foreclosure prevention, you should research the company, get a second opinion, and figure out exactly what your goal is, and what you realistically hope to achieve.  If it sounds too good to be true, (finish cliche here).

Published in: on August 3, 2011 at 6:06 pm  Leave a Comment