Livinglies's Weblog

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I’m afraid I need to throw little water on our parade here. Yes its true that the bell has rung — but it isn’t the end of the boxing match, it’s just the end of the current round. We bloodied them up a bit but they have their own strategies and they are not as stupid as we would like — just as we are not as stupid as they would like. They are setting up a trap-door for us. BEWARE!

The current round of “we’re stopping” foreclosures is nothing more than a PR stunt much like the “stress test” that was done at the time that everyone thought the whole financial system would collapse. Then the stress test results came out and not surprisingly the results were favorable — the banks were OK and the system was not in imminent danger of collapse — or so we were led to believe. Some of us believed it some didn’t but the strategy worked.

You can expect that the banks are going to come out very soon and state that based upon their review and inspection of the documents etc. they have found that in most cases the paperwork is in order. They will apologize for using improper procedure (lying on affidavits) but the foreclosures will now go forward with the correct information on the affidavits, assignments, endorsements,, powers of attorney etc. Don’t try to make more of this than it is. They will make fools out of you if you go into court expecting the Judge to throw the book at them and declare you the winner.

Some of you might make the mistake of believing them. It’s the same lie recycled. AND you still are required to prove it. But you just made some headway in being able to prove it as Judge’s give due consideration to the fact that these foreclosure mills were manufacturing paper rather than doing the proper due diligence before initiating foreclosure. The presumptions in favor of the banks just got weaker  but they are not gone. Presumptions in your favor as homeowners and borrowers are still some distance away. There is still the nagging wrongful belief that the borrowers are immoral in defending these actions, walking away from underwater homes, and otherwise finding relief from fraudulent transactions that rarely get any front page news unless the BANKS do something. No it isn’t fair. It’s reality.

Use this event strategically to press for discovery. Don’t argue with the them about their representation that the information on the affidavit was true but that they just used the wrong procedure. Your reply should be that you understand that incorrect procedure does not change facts, but it DOES make it an issue that needs to be investigated. Their credibility is now an issue by their own admission and if the information they are presenting is all correct they should have no problem with allowing you to conduct discovery.

The essential problem for them is still the same: ANY affidavit will be wrongful and fabricated and based upon wrongful and fabricated documentation created long after you closed on the loan. The borrower never signed a note payable to any pool and the pool never received a proper assignment and didn’t want it. What they wanted was the money, not the documents. But that means they were just splitting up the receivables and not the ownership of the loan. So in each case the obligation from the borrower runs to some obligee that is neither the payee on the note nor the mortgagee or beneficiary of the security isntrument. It exists but it is unsecured and subject to set off from loss mitigation payments from third parties.

They can’t get away from the fact that the loan documents were intentionally destroyed or lost, that they never had any assignments, endorsements or powers of attorney executed, that they never sent the paperwork anywhere and that representations in SEC documents that the loans were transferred and fit the descriptions contained in those self-serving documents are just plain wrong. They are lies. Your goal should  be to get a live person swearing under oath under penalty of perjury about the facts of your loan, the status in the securitization infrastructure, and the location of the documents that prove those assertions, as well as the time that such documents were created, where, and who the people were that signed them.

As for the docket, well, if every time a lawyer does discovery he ends up proving the the case of the other side the requests for discovery will stop. Press hard and use these admissions of GMAC, BOA, Chase (and the others to come) as proof of your right and need to more information about the identity of the creditor and getting an accounting from that creditor and not just from the servicer. Do NOT think this news cycle will put you over the top  to win your case.

Also I am concerned about the whole wrongful foreclosure thing. People might get surprised if they don’t know what they are doing. I don’t think you can get damages for wrongful foreclosure just because the paperwork was wrong. I think the elements of the tort are a full breach of duty and that would mean proving that the pretender lender had no colorable right to foreclose either because the “lender” was a complete fake and/or because nobody could foreclose. This is like legal malpractice cases where there is a case within the case. You have to prove they did wrong AND that they caused you damage which means that but for them you would never have lost the house or have had a cloud on your title. In my opinion most Judges won’t agree that because they lied you are entitled to damages for wrongful foreclosure. But you might get them for frivolous pleadings under Federal Rule 11, Florida Statute 57.105 or the equivalent. As far as I know the recovery would be limited to attorney fees and costs, which isn’t a bad idea for lawyers.

Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud | Tagged: LITIGATION, strategy |