“The Dog Ate Your Mortgage” — Gretchen Morgenson (NY Times) Hits it Again

If you want a summary of about 75% of what we cover at the seminar in Clearwater, Florida on November 1-2, just read this article. I’ll explain how we got to this point, the legal points to be raised and how to aim for the same result — no mortgage, no note, no obligation — and clear title. No guarantees on that result but you are NOW in a position to present a very credible threat by which you can restructure your mortgage with a substantial principal reduction and reasonable terms.
Federal Judge Robert D. Drain wiped out a $461,263 mortgage debt on the property. That’s right: the mortgage debt disappeared, via a court order. — “I think that I have a more than 50 percent doubt that if the debtor paid this claim, it would be paying the wrong person,” he said. “That’s the problem.
–dubious proof-of-ownership tactics may no longer be accepted practice. They may even be viewed as a fraud on the court.
some judges are starting to scrutinize the rules-don’t-matter methods used by lenders and their lawyers in the recent foreclosure wave.

The United States Trustee, a division of the Justice Department charged with monitoring the nation’s bankruptcy courts, has also taken an interest in the White Plains case. Its representative has attended hearings in the matter, and it has registered with the court as an interested party.

October 25, 2009
Fair Game

If Lenders Say ‘The Dog Ate Your Mortgage’

FOR decades, when troubled homeowners and banks battled over delinquent mortgages, it wasn’t a contest. Homes went into foreclosure, and lenders took control of the property.

On top of that, courts rubber-stamped the array of foreclosure charges that lenders heaped onto borrowers and took banks at their word when the lenders said they owned the mortgage notes underlying troubled properties. (Editor’s Note: INFORMATION VS. EVIDENCE: THE REPRESENTATION IS USUALLY A FINESSE ACCOMPLISHED BY A LAWYER REPRESENTING THE BANK MAKING THE REPRESENTATION OF OWNERSHIP. The representation is not only false, it isn’t evidence unless the lawyer is a competent witness — i.e., one who has personal knowledge through personal perception of the facts being asserted, and swears to it under oath, subjecting himself or herself to cross-examination)

In other words, with lenders in the driver’s seat, borrowers were run over, more often than not. Of course, errant borrowers hardly deserve sympathy from bankers or anyone else, and banks are well within their rights to try to protect their financial interests.

But if our current financial crisis has taught us anything, it is that many borrowers entered into mortgage agreements without a clear understanding of the debt they were incurring. And banks often lacked a clear understanding of whether all those borrowers could really repay their loans.

Even so, banks and borrowers still do battle over foreclosures on an unlevel playing field that exists in far too many courtrooms. But some judges are starting to scrutinize the rules-don’t-matter methods used by lenders and their lawyers in the recent foreclosure wave. On occasion, lenders are even getting slapped around a bit.

One surprising smackdown occurred on Oct. 9 in federal bankruptcy court in the Southern District of New York. Ruling that a lender, PHH Mortgage, hadn’t proved its claim to a delinquent borrower’s home in White Plains, Judge Robert D. Drain wiped out a $461,263 mortgage debt on the property. That’s right: the mortgage debt disappeared, via a court order.

So the ruling may put a new dynamic in play in the foreclosure mess: If the lender can’t come forward with proof of ownership, and judges don’t look kindly on that, then borrowers may have a stronger hand to play in court and, apparently, may even be able to stay in their homes mortgage-free.

The reason that notes have gone missing is the huge mass of mortgage securitizations that occurred during the housing boom. Securitizations allowed for large pools of bank loans to be bundled and sold to legions of investors, but some of the nuts and bolts of the mortgage game — notes, for example — were never adequately tracked or recorded during the boom. In some cases, that means nobody truly knows who owns what.

To be sure, many legal hurdles mean that the initial outcome of the White Plains case may not be repeated elsewhere. Nevertheless, the ruling — by a federal judge, no less — is bound to bring a smile to anyone who has been subjected to rough treatment by a lender. Methinks a few of those people still exist.

More important, the case is an alert to lenders that dubious proof-of-ownership tactics may no longer be accepted practice. They may even be viewed as a fraud on the court.

The United States Trustee, a division of the Justice Department charged with monitoring the nation’s bankruptcy courts, has also taken an interest in the White Plains case. Its representative has attended hearings in the matter, and it has registered with the court as an interested party.

THE case involves a borrower, who declined to be named, living in a home with her daughter and son-in-law. According to court documents, the borrower bought the house in 2001 with a mortgage from Wells Fargo; four and a half years later she refinanced with Mortgage World Bankers Inc.

She fell behind in her payments, and David B. Shaev, a consumer bankruptcy lawyer in Manhattan, filed a Chapter 13 bankruptcy plan on her behalf in late February in an effort to save her home from foreclosure.

A proof of claim to the debt was filed in March by PHH, a company based in Mount Laurel, N.J. The $461,263 that PHH said was owed included $33,545 in arrears.

Mr. Shaev said that when he filed the case, he had simply hoped to persuade PHH to modify his client’s loan. But after months of what he described as foot-dragging by PHH and its lawyers, he asked for proof of PHH’s standing in the case.

“If you want to take someone’s house away, you’d better make sure you have the right to do it,” Mr. Shaev said in an interview last week.

In answer, Mr. Shaev received a letter stating that PHH was the servicer of the loan but that the holder of the note was U.S. Bank, as trustee of a securitization pool. But U.S. Bank was not a party to the action.

Mr. Shaev then asked for proof that U.S. Bank was indeed the holder of the note. All that was provided, however, was an affidavit from Tracy Johnson, a vice president at PHH Mortgage, saying that PHH was the servicer and U.S. Bank the holder.

Among the filings supplied to support Ms. Johnson’s assertion was a copy of the assignment of the mortgage. But this, too, was signed by Ms. Johnson, only this time she was identified as an assistant vice president of MERS, the Mortgage Electronic Registration System. This bank-owned registry eliminates the need to record changes in property ownership in local land records. (Editor’s Note: Many foreclosure mill law firms are now establishing “one-stop shopping” where the assignments are fabricated, executed by their own employees, who then file affidavits in court. The defense lawyer or bankruptcy lawyer who takes this “information” at face value has forgotten basic rules of evidence. His client is prejudiced by his ignorance)

Another problem was that the document showed the note was assigned on March 26, 2009, well after the bankruptcy had been filed.

Mr. Shaev’s questions about ownership also led to an admission by PHH that, along the way, it had levied an improper $450 foreclosure fee on the borrower and had overcharged interest by an unstated amount.

John DiCaro, a lawyer representing PHH at the hearing, was in the uncomfortable position of having to explain why there was no documentation of an assignment to U.S. Bank. He did not return a phone call seeking comment last week. Ms. Johnson, who couldn’t be reached for comment, did not attend the hearing.

According to a transcript of the Sept. 29 hearing, Mr. DiCaro said: “In the secondary market, there are many cases where assignment of mortgages, assignment of notes, don’t happen at the time they should. It was standard operating procedure for many years.” (Editor’s Note: This is why a COMPLETE forensic review and analysis is required rather than just a TILA AUDIT).

Judge Drain rejected that argument, concluding that what had been presented to the court just did not add up. “I think that I have a more than 50 percent doubt that if the debtor paid this claim, it would be paying the wrong person,” he said. “That’s the problem. And that’s because the claimant has not shown an assignment of a mortgage.”

Mr. Shaev said he was shocked when the judge expunged the mortgage debt.

“We are in uncharted territory,” he said. “Right now I am in bankruptcy court with a house that has no discernible debt on it, yet I have a client with a signed mortgage. We cannot in theory just go out and sell this house because the title company won’t give a clear title on it.”

Among the next steps Mr. Shaev said he would take is to file an amended plan or sue to try to get clear title to the property.

Late last week, PHH appealed the judge’s ruling. But Mr. DiCaro and PHH are in something of a bind. Either they will return to court with a clear claim on the property — including all the transfers and sales that are necessary in the securitization process — or they won’t be able to produce that documentation. If they do produce it, they will then have to explain why they didn’t produce it before.

Oh, what a tangled web these mortgage lenders weave.

18 Responses

  1. “Randal Hammonds, on February 18th, 2010 at 8:26 am Said: – I have a court date of Feb. 25th. I have already been foreclosed on. They filed unlawful detainer on me to get me evicted out of the house. Do I still have any hope with this court date only a few days away? Thank you”

    @ Randal Hammonds – Sadly, UD Discovery is only 5-days so you’ll have to be quick on your feet.

    If you haven’t already, you’d better do your homework on your own mortgage documentation so you have an idea of what went wrong, when it went wrong, and who actually did wrong.

    For the Quick & Dirty – Be sure to look to see if there is a difference between who is listed as your “lender” on your mortgage and who is bringing foreclosure against you.

    If yes, this suggestion may not be of any help.

    If not, be sure you Check Your local county records to see if there is any congnizable chain-of-title relative to your property and pull all records.

    Next: Did you Check signatures? Did you Check dates? Did you notice the same notary used over and over? Did you Check to see who did what when? Did you Verify whether or not endorsments where made under oath? Did the documents endorser’s actually do what they said they did on those documents endorsed under oath? Did the party who is foreclosing on you ever proporley aquire title to your property prior to undertaking foreclosure? Was an eviction attempted prior to a Unlawful Detainer being filed?

    Every case is different so Know your case.

  2. I have a court date of Feb. 25th. I have already been foreclosed on. They filed unlawful detainer on me to get me evicted out of the house. Do I still have any hope with this court date only a few days away?
    Thank you

  3. Here is the response to the lenders objections PHH Mortgage

    http://wp.me/PFWnq-3L

    Here is the Judges order for the above case

    http://wp.me/PFWnq-3J

    4closureFraud

  4. David:

    You might also want to file an information and criminal complaint with the local U.S. Attorney detailing your defendant’s violation of 18 USC 1341 – 1346 by using mail or wire fraud to deprive you of the intangible benefits of honest services.

    Apparently, the lender’s transferee did set up a trust that securitized your note. Otherwise, where HAS that pesky note gone to? IF the trust made a bunch of dough of the sale of security certificates, don’t YOU have some entitlement to it?

    Doesn’t this particularly make sense if the securitization shenanigan and associated collapse of inbound revenue streams to the trusts caused the collapse in real estate values? Your property suddenly became worth less in spite of your best effort to keep it worth more (such as by mowing your lawn, keeping the house painted, etc). Why should YOU bear the full brunt of the investment gone bad?

    Why indeed, when the trust made a fortune off the phony sale of your payment stream? They made a fortune while only YOU lost a fortune. How does that make sense? And if they knew they would do this, why did they NOT offer you a piece of the action as part of the mortgage loan deal?

    Oh, you didn’t actually HAVE any loan deal? You have NO bilateral agreement with any lender stipulating that it will lend money and you will borrow and repay it and give up your house as collateral? Does it not seem a tad unconscionable that you would agree to such a deal, even implicitly, when the lender fully intended to securitize your note and make a pile of dough on the sale of it while your real estate value collapses, which IT FULLY KNEW would happen?

    And, DID the lender actually have PRIVITY OF CONTRACT in making such a lopsided agreement, particularly when it did not lend money of its own? At best it might have contributed only 10%, but it most likely contributed nothing and lent you somebody else’s money of account, if you can actually call that “money”. And how much fairness did you get when you had to repay the alleged loan in money of exchange – the hard-earned dough you pulled out of your law practice? Does not the lack of privity void the contract?

    Does not the fraudulent nature of the implied contract between you and the lender also void the associated and dependent unilateral adhesion mortgage agreement and promissory note? If not, why not?

    Looks like a house of cards to me, David. We’ll enjoy watching you make it crumble. Keep us posted.

  5. David:

    I saw your livinglies comments. I’d love to have a copy of your complaint, AND your discovery.

    I hope you have included these in your discovery notice:

    • Depose the Treasurer and President of the defendant companies – probe their knowledge of the below items
    • All SEC filings for defendant companies
    • Highlighting of all plans to separate the mortgage from the note (like securitization)
    • Accounting of earnings from sale of security certificates on the stock market or to private investors (like China), including details of money distributed to other parties from those earnings.
    • Identities of and contact info for all investors
    • Proof that the trust manager purchased the note back from the investors, and that the investors no longer own any interest in the note
    • Accounting of all security insurance premiums made and insurance payoffs made or received
    • Mortgage insurance policy (see item 10 in the fannie mae standard mortgage agreement)
    • Accounting of mortgage insurance or Loss Fund premiums the borrower paid , including any deposits into the non-refundable loss fund
    • Accounting of AFTER-closing yield spread premiums and kickbacks to mortgage brokers or other parties
    • Identities of all “Vice Presidents” of the servicer, lender, transferee, or law firm associated in any way with your mortgage loan.
    • Proof that the lender lent you actual money instead of mere credit.
    • Proof that the lender did not violate the requirements of Article I Section 10 Clause 1 (Gold or silver coin).

    Note the FRCivP Rule 27 (or state equivalent) opportunity to depose prior to litigating. Gives you a powerful Shock and Awe tool against the perps BEFORE you file suit. Convince the court you have to depose now or the targets might shred the information or run off to Tahiti.

  6. Usually when people are sad, they don’t do anything. They just cry over their condition. But when they get angry, they bring about a change. Are you sad? Are you Angry? I am pissed!! I am still looking for my change!!

  7. As I have posted on this board before, I have filed my own lawsuit in my own name (with my wife) against our original lender (now servicer) and MERS. I am a lawyer. We have not defaulted.

    It is clear my original lender, who sold my note to Fannie Mae, has no financial interest in my mortgage and neither does MERS. They have no standing to litigate any of the defenses they are attempting to assert in their Motion to Dismiss. They are asserting the defenses of whomever may own my note. They are imposters, posing as the parties who own my note.

    If you want a pdf copy of my complaint and a pdf copy of my 38 page response to the Defendant’s Motion to Dismiss, email me at davidgmillsatty@hotmail.com.

    I have asked for the cloud on my title to be removed, I have asked for a cease and desist order preventing the servicer from sending me demands and I have asked for all of my money back.

    Judge Drain said he was more than 50% certain that the homeowners did not owe the parties seeking to foreclose. In my case it is a 100% certainty that I do not owe these parties who are making demands and clouding my title.

    I have a hearing on the Motion to Dismiss on Wednesday October 28. I am ready. If the judge decides I have a case, I smell big trouble for the Defendants who have had six months to produce my note and haven’t yet when it would have helped them considerably to do so.

  8. Neal Garfield has posted content on Livinglies.wordpress.com that explains why the courts show increasing disdain for mortgage foreclosers – lack of standing because the mortgage servicer has no pecuniary interest in whether or not the mortgagor pays the note payments, And, neither does the lender, in many cases, because the lender transferred interest in the note to another bank. And neither does the recipient bank, because it transferred interest to a trust. And neither does the trust, because its manager securitized the note and transferred interest to many certificate holders.

    When this whole mess gets to quiet title, foreclosure, or bankruptcy court, do you suppose the note’s holders in due course (the certificate owners) show up in court to protect their interest? NO, they do not. They have no clue that the matter has gone to court. And therefore they have no available remedy against the mortgagor’s default. The securitization thereby invalidates the mortgage, but don’t rely upon a judge to rule so.

    In effect, the mortgage servicer, often unable to produce the original note, says the same thing to the judge that many have felt the temptation to say to a school teacher over missing homework: “The dog ate my mortgage.” Gretchen Morgenson discusses this in the NY Times article below, highlighted by Debbie. Using fraudulently means to “re-establish” the lost or missing note (See Florida Statutes 71.011 Reestablishment of papers, records, and files; and 673.3091 Enforcement of lost, destroyed, or stolen instrument, from UCC Article III), the mortgage servicer often inveigles the judge into accepting a copy of the original note as the original. Then the judge and plaintiff run over the defendant borrower. The judge orders the real estate sold and the proceeds handed over to the plaintiff.

    Some judges, have begun to say NO to all this craziness, as the below discussion shows. While many homeowners, particularly pro se litigants and some “unschooled” attorneys point out that judges typically run right over the mortgagor in court. Neal rebuts that by explaining that judges have begun to take the mortgagor’s side.

    This seems like good news, but never think the finance industry is going to skulk away with its tail between its legs. A Tampa court gave Bruce Thornberry his home through a with-prejudice dismissal of the foreclosure because the plaintiff mortgage servicer could not produce the note, and failed to renew it under 71.011 (see above link). A few months later the lender (not the same plaintiff) filed suit to foreclose, and this time the lender produced the original note as proof of interest in the property.

    This means mortgagors and their defenders need to turn up the heat. To do this, they must produce the SEC filings of the lender, prove with them that the lender or a transferee securitized the note, and demand proof from the plaintiff not only that the plaintiff can produce the original note, but also that the security certificate holders have sold that note (out of the bundle of notes) back to the plaintiff. That might take some doing.

    That explains why I believe mortgagors should seek the assistance of a competent mortgage loan forensic analyst to gather the proof documents and learn what actually happened with the note and who owns it now.

    At the very least this debacle and the associated discoveries give mortgagors leverage to negotiate lenders who still own interest into restructuring the mortgage to reduce the balance on the note, reduce the interest, and reduce the payments to some tolerable level. But if the lender forecloses, a disclosure to the court of the frauds the lender and servicer have committed might suffice to provoke the judge to dismiss the foreclosure altogether and wipe out the associated debt.

    U.S. Bankruptcy Judge Robert D Drain in Southern New York did that to a $461,263 mortgage debt recently. The morgtagor’s attorney tried to get PHH Mortgage to restructure the loan. After months of delay, the attorney attacked the delay in bankruptcy court, demanding proof of ownership of the note and claiming that a securitization pool, not PHH Mortgage, owned it. See the story and comments below.

    Note that we have 5 objectives when we go into foreclosure or bankruptcy court:

    1. Get the mortgage invalidated
    2. Get the promissory note expunged
    3. Get the lien released from the property
    4. Get the credit report cleaned up
    5. Get the foreclosure dismissed with prejudice

    I know of no one who has achieved all 5 objectives. After a judge dismisses the foreclosure case, the mortgage still exists, the lien still exists, the note (and debt) still exists, the credit report still has a negative entry in it. A mortgagor must mount an aggressive legal action (such as quiet title or slander on title) to achieve the other objectives. I believe the respondent in such an action has a good chance of prevailing, but the legal fees will constitute a strong encouragement for the parties to renegotiate their deal.

    For the above reason, I would want to pursue a different strategy – attack the mortgage servicer FIRST, through quiet title action, joining every possible party who might claim right to the subject property – don’t wait for foreclosure. Accuse the plaintiffs (lender and mortgage company) of fraud in the inducement, of bilking thousands in Yield Point Spread after the transaction, such as through earnings on the sold securities and any mortgage insurance premiums, and of defrauding the borrower by lending non-existent money of account with the demand that the borrower repay it in money of exchange, and abusing the Article I Section 10 requirement that states use nothing but gold or silver coin as tender in payment of debt.

    You see the biggest fraud of all in America’s money system, which makes all national banks agents of the private owners of the Federal Reserve Banks. I know of no one who has prevailed in court on that issue, but I consider it the most salient issue of all.

    —————————————————————————————–
    Bob Hurt
    2460 Persian Drive #70
    Clearwater, FL 33763
    +1 (727) 669-5511

    Subscribe to Lawmen Newsletter FREE – send email to lawmen+subscribe@googlegroups.com

    —————————————————————————————–

  9. Just a little warning.

    Some states are requiring Mediation rather than decide issues of fraudulent foreclosures. Not all judges are as brave as the good judge from NY.

    For those that are sent by Court to mediation/housing counselors, any loan modification in the name of the wrong party is simply not valid.

    The TILA was amended in May of this year to assure the real creditor (mortgagee) be identified to the borrower. The intent of Congress (believe Senator Boxer wrote this provision) is to prevent foreclosures and allow homeowners to negotiate with the real creditor. The TILA amendment has not yet been tested in court.

    To get around identifying the actual creditor in loan modifications the “servicer” is writing “trial” modifications for 3-6 months – then renewing the trial modification. Any permanent loan modification in the name of the servicer, trustee, or trust is not valid.

    Neither the servicer, trustee, nor trust (which is likely dissolved), is defined as a “creditor” under the TILA definition.

    If you negotiate a loan modification, make sure it is in the name of actual creditor – and inform any mediator/housing counselor of the same.

  10. Blogospshere Viewpoint on recent Drain Decision: This judge was OUTRAGED ……

    snip from Yves at Calculated Risk:

    Morgenson offers an interesting new sighting, involving a Federal judge in the Southern District of New York. This is significant because the Federal bench is generally pretty high caliber, and the Southern District of NY is particularly well respected. Moreover the ruling can’t be dismissed as a judge favoring the locals over the big bad out of town servicer:
    …..on Oct. 9 in federal bankruptcy court in the Southern District of New York. Ruling that a lender, PHH Mortgage, hadn’t proved its claim to a delinquent borrower’s home in White Plains, Judge Robert D. Drain wiped out a $461,263 mortgage debt on the property. That’s right: the mortgage debt disappeared, via a court order.

    Yves here. Translation: the judge was pissed. He could have dismissed the case without prejudice, meaning PHH could get its ducks in a row and try again, but he sent a much stronger message.

    Back to the story:

    ……. I know I have said this before, but I am gobsmacked every time I read this stuff. When I was briefly in the securities business (early 1980s), even a teeny weeny error in a securities offering was completely unacceptable, a career limiting event for lawyers and bankers involved. And even though due diligence wasn’t what it should have been, there were certain steps that were absolutely necessary to avoid liability (having the deal counsel read the issuer’s board minutes and having someone from the lead manager visit the major facilities of a first-time issuer, for instance).

    …….. So you see what happened? The securitization industry decided to impose the convenience of “street name” holdings of securities to mortgages, simply ignoring hundreds of years of precedent and a thicket of local laws (no joke here, the US precedent on the primacy of title documents goes back to at least 1818 in the US. No deed is like “no tickie, no laundry.”)

    …….. Again, I know this has been rumbling around in the news for months, but it is hard for me to believe this has gone on as long as it has. I have heard (from my attorney first hand on situations she has been involved in, not urban legend) of a corporate lawsuit being thrown out of court because the contract between the parties had the name of the entities wrong….by a comma! Now real estate law is a different area, but title is one of its fundamental principles. Selling securities in a trust when the trust does not have clear title to assets in the trust is fraud. If judges keep nixing foreclosures based on the servicer (acting on behalf of the trust) not being able to demonstrate ownership, we could see a very interesting knock-on, of investor litigation against the trusts. But it’s too early to tell.

    But it isn’t surprising that judges are plenty unsympathetic, and in cases, outraged. The law is all about sanctity of process, both the underlying law and court proceedings. Cases typically revolve around disputes of fact or grey areas of the law. This isn’t grey (whether a party has standing to file a suit is fundamental) and the law in this area is well established. Basically, the securitization industry tried creating rules outside any established legal framework and judges are having none of it.

    …….the case is an alert to lenders that dubious proof-of-ownership tactics may no longer be accepted practice. They may even be viewed as a fraud on the court…..

    ……. Lawyers can correct me, but I believe “fraud on the court” would mean that lawyers that bringing that sort of action could be sanctioned.

    ——————————-

    Late last week, PHH appealed the judge’s ruling. But Mr. DiCaro and PHH are in something of a bind. Either they will return to court with a clear claim on the property — including all the transfers and sales that are necessary in the securitization process — or they won’t be able to produce that documentation. If they do produce it, they will then have to explain why they didn’t produce it before.

  11. MERS and Pretender Lenders are audaciously seeking the court to credit them with a “touchdown” despite the obvious fact that they do not and never did have possession of the “football”. However; (a) actually being in possession of something and (b) alleging the right to be in possession of something are two very different things.

  12. Neil,

    Can you clarify something for me?

    You state ” It’s fact that there was a massive fraud on both the investors and the homeowners. In this country we don’t punish the victim. Our laws seek to restore people to the position they were in before the fraud took place and remove the benefits from those who committed the illegal act.”

    It is reasonably assumed that the Broker, Table funder(broker 2), originating lender, and Depositor lender among anyone else I cannot identify got paid significant amounts through the closing, transferring and inclusion of my mortgage in the Trust. It is also reasonably assumed that the Depositor(at least in my case) may have discounted the price of the note prior to depositing it into the Trust as well as buying insurance for it upon default.

    Layer that with the absorption of both the Servicer and the Trustee by Chase and B of A respectively and sprinkle some TARP funds over the rest of it and I can assume most of my obligation has been taken care of by third parties.

    Now comes my question, If the law is written to unwind things back to the original position before the fraud took place and considering the massive drop in value which would be classified as ” inequitable” for tender purposes, How is it that Damages could be rewarded to the borrower to offset the amount due? Would the various monies paid to all of the parties simply need to be returned, all be it nearly impossible, or does the borrower have the right to the unjust enrichment?

    This case is a fantastic win as it shows that there are judges willing to remove the debt altogether as a remedy. The parties have scored huge windfalls from this process let alone the trading of the problem securities in private placement trades outside of the knowledge of most Americans.

    Storm,

    Desperate Borrowers are not the only force fighting back against this injustice and as I see it much of this situation was caused by those that were on watch to protect those borrowers. The court system is all we have left to fight for our homes and most cannot receive adequate justice if they cannot afford representation.
    Yes most Americans bought expensive homes with unsustainable money but most have also lost everything from jobs or businesses due to the systematic failure of this corrupt system created to roll the dice on the default of their notes. Those that have capitalized on their ignorance should not get to walk away leaving the cost to be paid again by the taxes taken from their checks after having to start over.
    This will start to grow and as much as the system wants to hide us we are many and we are not going to go down without pulling out all of the stops. The loopholes were always there for the lenders to rely on and if a homeowner finds one to fight back why should he be a bad guy for taking back what they attempted to steal from him to just line their pockets even more.

    I have met with quite a few attorneys that take the same stance”why should you get to remove the entire amount of the debt that seems unfair” I say that is fine and if it is the pill I have to swallow then so be it but not until I get a complete and absolute accounting of each and every dime that was created or taken on the back of the debt I incurred. Prove it to me that it was equitable and not the largest scam ever created and I’ll be happy to pay my share.

    If it cannot be done then it is only fair to give back to me the home that I built with my own sweat that is now 35% of its original value and 50% of its actual cost because they have broken the back of the real estate system.

    They are still claiming the homes are worth the original appraised values in their monthly investor reports so that they can keep trading the securities until they can squeeze every last dime out of my misfortune before they get my house back to use for the “office party”

    Kuddos to the judge, to Neil and to every person that contributes to this site!!

    Sorry for the rant.

  13. Neil..
    ANONYMOUS… i believe that this is very important to prevent a return visit
    that STORM maybe Only pointing out,that very rarely will the Bank just walk away from the money just because a judge may rule in favor of the homeowner. Hence No point leaving the door ajar for reentry .
    Of course on ruling for WHO – plaintiff or defendant ,this may also prove to be the most important strategic position re ;viable [ triable ] claims and defenses including raised [ affirmative defenses ] ,that must be pled and determined early on. Unlike myself fumbling around the court [my case] in the dark unaware of many of the tactical methods that can and should be employed to maneuver the legally cluttered landscape to success.
    for example after filing , either complaint or answer…what would the OTHER-SIDE be responding with & to,Avail over win these issues has less to do with equity & justice as to procedure&rules..ie posturing of the case.

    we unlawyers need a list of strengths & weaknesses of issues to raise or not raise because of a dead end claim ..wow … like dodging a bullet .

  14. STORM: It seems you are in denial of the STORM that is a brewing…

    You can deny it all you want… the TRUTH is… they can NOT return to court with a clear claim… because that is simply just not possible.

    It is YOU sir… that just does not know what you are talking about.

    Please retain your comments until a time that you can learn the truth about what is going on.

    NEIL: Thanks for setting the record straight so quickly…

    HOMEOWNERS: You have a superior right and claim over everyone else out there to YOUR HOME. Dont let these other types lead you to give up. It is worth the fight… especially now that we are winning in large numbers.

    Folks! There are 6-7 MAJOR case wins like this so far in 2009 alone!

    Expect more false information from the establishment to lead homeowners like the “pied piper” away from their homes, and into the streets, by telling you there is no hope… that you did your best through “loan modification” attempts.

    If you need REAL help… seek it from the many of us that have a PLAN for you to remain the owner of your home… even if you do not have any $.

    God Bless America

    Under Reserve,

    Allan Hennessey
    FreeStopForeclosure.com

  15. Problem is that the mortgages were likely “table- funded” by mortgage originator for the actual lender. The true lender (most likely a Wall Street firm) was concealed from the borrower from the onset. Thus, there was a violation of RESPA – and the original contract is fraudulent.

    Borrowers have to not only show that the current party trying to collect is false, but should also demonstrate that the contract was in violation of federal law from the onset.

    This should keep them from coming back.

  16. STORM: Your information is not consistent with ours. Our information shows that once the pretender lenders are thrown out of court they don’t come back. They just move on to the “low-hanging” fruit. The reason is simple: they don’t have clear title, they never had clear title, and they know that upon examination of documents they could be accused of fabricating the documents, forgery and fraud on the court. Judge Drain’s statement that payment would probably be to the wrong party is the point. The real party who is owed real money is the investor who advanced the money for the “loan.” And that is the one party who never shows up in court seeking enforcement.
    All the others are pretenders, impostors or interlopers seeking to profit from an apparent default by the borrower, knowing that the true party either has been paid through federal bailout, insurance, guarantee or other contract or has chosen not to enforce their interest because they don’t want to be answering a counterclaim for predatory lending, identity theft and fraud.
    So I conclude that you are either mistaken or that you are doing the dirty work for those who are trying to discredit the lawyers and judges in thousands of cases that have questioned the dubious claims of these intermediary participants in a securitization chain that just keeps on giving more and more profit to anyone who lacks conscience.
    This is real hope, and your comment is an opportunity for everyone to see that there are still plenty of people speaking from ideology, ignorance or both to establish and support for millions of fraudulent foreclosures that are draining the country of its financial life-blood and giving it to those who caused the problem in the first place. It’s fact that there was a massive fraud on both the investors and the homeowners. In this country we don’t punish the victim. Our laws seek to restore people to the position they were in before the fraud took place and remove the benefits from those who committed the illegal act.
    Thank you for the opportunity to present the truth, which as George Orwell said, is a revolutionary act in a world based on deceit.

  17. QUIET TITLE- MR Garfield could you please write an article and give a complaint template for suing for quiet title? It is hard to find out the “how” as pro se.

    p.s. do we need to sue for quiet title and recession at the same time?

    thank you for your blog.

  18. Like most other cases, they will return to court with a clear claim on the property. Anyone who thinks this doesn’t happen in 99% of cases, doesn’t know what they’re talking about, or are just trying to con people, by giving desperate borrowers false hope! (Editor’s Note: See reply below)

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