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Submitted by Ann

Legal twist forces foreclosure redos
Creates second chance for former owners
Zepheniah Taylor lost his Dorchester three-decker to foreclosure two times in 17 months. Now the 59-year-old grandfather has returned home to stay. The scenario, once implausible, is becoming more common in the crazed and fast-changing world of foreclosure
Foreclosures spread outside Boston
Hundreds — and possibly thousands — of Massachusetts homeowners are facing back-to-back foreclosures as lenders realize there were problems with property titles the first time around. Those lenders, often unable to obtain title insurance, are opting to start from scratch with what is being called a “re-foreclosure.’’

The prospect of going through a foreclosure all over again may seem nightmarish for homeowners, but in a growing number of cases the do-overs are creating opportunities for them to repossess their homes.

Such was the case with Taylor, who decided to fight the second foreclosure. The tactic paid off: He won the right to repurchase the home at current market value.

“I’m starting over fresh,’’ said the father of eight and grandfather of nine. “It feels good. It is a new chance.’’

Not all tenants enjoy such an outcome, however, and those who receive notice of a re-foreclosure often are confused.

“They are weirded out,’’ said Zoe Cronin, a staff attorney with Greater Boston Legal Services, which provides legal representation to low-income people. Cronin said she knows of about a dozen recent re-foreclosures. “I’ve met former owners [who are] saying, ‘What is this? I got a letter saying I own my house again,’ ’’ she said.

The recent burst in re-foreclosures can be traced to a 2009 Massachusetts Land Court ruling that called into question the validity of a home’s ownership in cases where foreclosure paperwork was incomplete or inaccurate.

The finding is now being reviewed by the state Supreme Judicial Court. Its decision could determine whether tens of thousands of homes with foreclosures in their backgrounds have valid titles.

At issue is who technically owns a property on the day it is seized by a lender. It’s often difficult to know for sure because during the housing boom millions of mortgages were bundled into bonds and sold to investors. That process, repeated over and over, created a twisted paper trail. As the number of foreclosures increased dramatically across the nation, the morass worsened.

Many lenders believed they could still proceed with a foreclosure and later sort out the legal mess by proving they held the mortgage. That premise was rejected by the Land Court.

While it is unclear how many property takings have been done over, Elizabeth J. Barton, chairwoman of the Massachusetts Bar Association’s Foreclosure Legislation Task Force, estimated the number could total in the thousands, based on action taken by lenders that was prompted by last year’s Land Court decision.

She said lenders are primarily targeting properties for which they have been denied title insurance because the original foreclosure did not comply with the court’s ruling.

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“Title insurance companies hesitate to extend protection to a loan that violates the ruling,’’ said Barton, title counsel at Connecticut Attorneys Title Insurance Co., which has offices throughout New England. “A lot of lenders have had to re-forecloseThe problem of cloudy title histories also is providing a boost to an increasing number of homeowners who are going to court to force lenders to prove they have a legal right to seize their properties.

Typically, homeowners argue against foreclosures by citing what they believe to be lenders’ shoddy paperwork and fraudulent documents. Concerns about such practices recently prompted 50 US attorneys general to spearhead an investigation into foreclosure practices, while some major lenders — including the nation’s largest, Bank of America Corp. — temporarily halted foreclosures to scrutinize their own practices.

Housing advocates argue that even if homeowners have not paid their mortgages — which is almost always the case by the time a foreclosure is underway — lenders must still be able to prove they have a right to a property before taking it.

The growing skepticism about foreclosure practices is helping more homeowners win their legal challenges, housing attorneys say. And lenders, hesitant to bring more questionable business practices to light, are more frequently retreating from court battles over foreclosed homes, making settlements with homeowners a more attractive option.

“Banks are less and less anxious to go forward in front of a jury,’’ said Maureen McDonagh, a director at the WilmerHale Legal Services Center of Harvard Law School, a Jamaica Plain-based organization that provides legal help to low-income people. “People don’t trust the industry.’’

Taylor’s foreclosure story began like millions of others nationwide. He and his daughter, Suzette, refinanced their mortgage in 2004 with a subprime loan, the kind of toxic debt that pushed the US economy into a tailspin in 2008. They borrowed $325,000 from Ameriquest Mortgage Co., at a two-year fixed rate of 6.99 percent. Taylor lived on the first floor with four of his children and two grandchildren; Suzette lived on the second floor, with her three children.

When the mortgage reset in 2006, monthly payments rose to more than $3,000, from $2,160. That was too much for Taylor, who worked as a handyman at a local nonprofit and Suzette, a restaurant cashier. They tried to renegotiate the loan and even attempted to sell the property as a way out. Neither tactic worked, and in March 2008 the foreclosure went through.

Or so they thought. The tangled foreclosure process came to work in the Taylors’ favor.

Public records at the Registry of Deeds show that Wells Fargo, not Ameriquest, actually foreclosed on the home. That’s because the mortgage had been bundled into an asset-backed security and sold by Ameriquest, which did not file paperwork indicating the transfer to Wells Fargo until two months after the foreclosure..

Wells Fargo said it could not comment on the Taylors’ situation because it only served as the trustee to the loan. The bank referred questions about the dual foreclosures to the company that serviced the loan, HomEq Servicing, which was sold earlier this year, leaving no one to respond to questions about particulars of the case.

Wells Fargo said it could not comment on the Taylors’ situation because it only served as the trustee to the loan. The bank referred questions about the dual foreclosures to the company that serviced the loan, HomEq Servicing, which was sold earlier this year, leaving no one to respond to questions about particulars of the case.

In June 2009 — more than a year after the foreclosure — the Taylors received a letter from Wells Fargo saying they were being foreclosed upon again. Just as before, their attempts to work out a deal with the lender went nowhere.

The Taylors decided it was finally time to go. Zepheniah moved to an apartment with three of his sons; his adult daughters found separate apartments with their young children.

But the story did not end there.

Soon after the family left the three-decker, community activists from City Life/Vida Urbana knocked on the door. It was part of a canvassing effort by the Jamaica Plain housing group to urge residents to remain in foreclosed homes and fight eviction.

They found a tenant upstairs and left a message for the Taylors — come home now.

Zepheniah Taylor heeded their call and returned several months after leaving. He challenged the eviction in Boston Housing Court with the help of attorneys from Greater Boston Legal Services, claiming Wells Fargo made additional errors in the second foreclosure and still could not prove it had clear title to the home.

Judge Jeffrey M. Winik postponed the Taylors’ eviction to allow the case to go to Land Court. But Wells Fargo instead sold the house to a nonprofit lender, Boston Community Capital, for $188,000. The nonprofit resold it to Taylor and another adult daughter, Tisa, for $233,900 — about $91,000 less than the 2004 mortgage.

Taylor lives on the first floor with three sons — ages 9, 19, and 22. He rents out the second floor and is renovating the third.

Housing advocates say the Taylors prevailed mostly because they were tenacious.

“The problem is that so many of the homeowners already moved out and didn’t know the foreclosures were unlawful,’’ said Nadine Cohen, managing attorney for the consumer rights unit at Greater Boston Legal Services. “Those are the people who have really been harmed in all of this.’’

Jenifer B. McKim can be reached at

24 Responses

  1. A lock out is a lock out. No use breaking and entering and getting into more trouble – unless you have some legal solutions???????

  2. Just curious – some homeowners could never be “locked out” unless the windows are boarded up.
    How hard is it to force a lock? Come on, no house, especially an older single family post war is hard to get into.

  3. Thank you all for your support. I am living in a motel now. I left half my stuff in the home. PLEASE stay in touch and post on this blog. I am open to any and all help. I have living proof of fraud – BLACK AND WHITE!
    Please let me know what ever you guys come up with. Thank you so much. And Neil – I sure do love you too.

  4. My understanding from the news that the AG’s are attempting to negotiate a deal between the banks and homeowners who were wrongfully foreclosed. Should know something tomorrow or the next day. Diana may win yet.

  5. Aurora Loan Services is ever so SNEAKY. I do believe the courts, the AG are in cahoots with the banks and servicers.

  6. Dee……….thank you for your offer of help. I live in Sacramento, CA. my email is I contacted the CA Attorney General’s office and told him of the fraud and wrongful foreclosure. I was told “sorry, we can’t do anything. Seek legal counsel elsewhere.”

  7. DIANA??

    I will come help you. I will do what I can. I am in Sacramento. Where are you? Please let me know.
    Hang in there. It is still NOT over.

  8. This phenomenon has been been going on for decades in the world of tax sales as well.

    ANY deviation from the exact standards prescribed by the state can be grounds for overturning a tax deed.

    These lines can be crossed by not only the counties but tax lien buyers as well.

    And, as they are now, title companies have long refused to insure most tax deeds until a quiet title action has been completed – much to the dismay of many beginners who go to flip their first property bought at tax sale.

  9. I wish I knew more about your case and I sure wish one of those attorneys would have answered your question – what do they mean there is nothing you can do. The attorneys are just so corrupt and they have only agenda and that is to support the banks. That of course does not go for all attorneys so you must get to the right one. I am going to call a legal aid in Sacramento to see if one of them will come to the phone. Do you feel confident you were wronged by the Court, if so, then an appeal needs to be made and quick. How can you handle all of this now that they have taken possession of the house? The two attorneys you talked to should have been able to better explain why you have no options.

  10. Thanks Joyce. I have already been locked out. Is there still hope for me. I tallked toa couple of attorneys and they tell me there is nothing I can do.

  11. I understand and feel that you did fight a very good fight. This has been a national issue for the past six months and it is growing more and more each day. Did you file an appeal. It is not too late. Sounds like you have what you need and being pro se, they are going to take a very close look at what this judge has done while it was well know that the bank’s paperwork was questionable. Go to legal aid and ask the question with your Court order or whatever they gave you and find out. There is a certain amount of time for you to file which does not require a whole lot and then you can get an attorney – I know you have no funds, but the legal aid people are going to either step up to the challenge on your behalf or they funds need to be cancelled. You must have something that you overlooked that can be considered new evidence to try another route. Get to the legal aid. They are not my favorites but you need to try to stop the eviction another way. Someone has already given you the name of a group, did you call them?

  12. I fought a good battle. Aurora is too big. They have many highly paid attorneys who know all the loop holes and keep making new loop holes. They wrote up a stipulation which they wanted me to sign. I just needed an extension of SEVEN days so I could move. In exchange for the 7 days they wanted me to give up all my legal rights to a trial and to complaints. Under duress I signed the stip. Their own stip was signed by their attorney and not by Aurora. So, the judge denied their motion – until Aurora signed the stipulation. I immediately mailed via certified registered letter AND faxed Aurora’s attorney A STATEMENT WITHDRAWING MY OFFER TO THE STIP. The judge accepted it but again ONLY UNTIL AURORA SIGNED THE STIP. A month later Aurora backdated the document, got a ROBO signer to sign it, sneaked it passed me. The pro-temp judge didn’t even review the paperwork I had resubmitted and he granted Aurora’s request to evict me. I got 4 days to move. I am an accident victim and getting ready for cancer surgery. NOW I AM HOMELESS AS WELL.

  13. Those that are being foreclosed on now probably had sufficient evidence against the loan servicers for the treatment and abuse they received before the foreclosure was even activated, but were unable toget an attorney to help them. Why have none of the people being foreclosed on not gone to the local district attorney’s office particularly with reference to their foreclosure practices. If we are not careful, they are going to get away with calling it technical or flawed rather than the fraud that it may have been in so many cases. . Theft is theft and if you have proof there has been theft, (and it is not easy to do but it can be done), then you should have gone to the DA. I would sure like to hear Diane’s story of how she faught Aurora if she cares to write to me.

  14. It is very frightening to me that American citizens are being suppressed by our very own Justice system. This cannot be and if the Judges don’t step up this time around, then what do we need Judges for when financial institutions have taken such blatant advantage of the people, masses of them, who are not able to get the representation they need to fight the good fight from the time the loan was booked until the homeowner was sent to the gates of Hell with the SErvicer and then down the path to the slaughterhouse of the foreclosure mill attorneys. Don’t think other countries are not looking in and seeing how our people are being suppressed by our very own so called justice system. Who was that President that said we should not allow the banks to be come whatever. How many of you can finish that line, because that is what is happening?

  15. The banks are going to have to step us, especially the four largest and they will fair a lot better if they do rather than having to face all of the legal ramifications that are piling up. It appears to me that the nation’s public now ‘gets it” thanks to Living Lies, Brian Davies and all of the rest of the people who have put this before the nation. They have and are doing an incredible job. Would sure like to use their ingenuity in either checking out the merits of my plan or coming up with a another resolution since our President and his administration and the Congress have not been able to do it. They just keep on keeping on because, there surely was another agenda and if our justice system does not work for the people this time around, then they may very well get it.

  16. I am introducing a plan that would have prevented 75% of this fiasco in the mortgage industry. Perhaps it is not too late to save those that are employed and still have a job, but cannot afford to pay, to Senator John Cornyn of Texas. This plan has a lot of merit and one that the banks and the homeowner will be able to live with and which should be the compensation that homeowners who were harmed by the banks and their actions during this economy. Stop the current foreclosures. Let’s not get away from the goal that the foreclosures need to be stopped, but when they are it is done in such a way that an acceptable resolution and strategy can be effective. Hopefully senator Cornyn will “get it”.

  17. What will be the result of homes that were foreclosed on wrongfully, but not discovered and/or corrected by a reforeclosure? What happens when those lenders require that the foreclosure attorneys file deficiencies against these people? The very people that they have harmed from day one. This will be a critical issue but if the mess is not straightened out now, then that could happen to thousands of homeowners. Deficiency recoveries will be part of the Trust Fund proceeds that have been earned but not collected until the people have been filed on. It will continue to ruin their credit as well as be the ultimate insult to what is happening to them. I hope I am wrong about the possibility of deficiencies being filed. If people have not made their payments, and with falling values and auction bids, more than likely they are going to be hit hard.

  18. I am glad Mr. Taylor was able to purcahse his property back for less than what he owed on it in 2004. The non profit who bought was kind to let him buy it back at such a good price. My concern also goes to the taxpayers whose bailout money was used to assist investors to buy homes that had foreclosed. I know the non profit was not an investor so to speak, but I would love to see the general ledger of the lender that sold it to the none profit. Did they get any of the 75Billion allocated to help move the inventory. Only the general ledger will tell. Did the bank have to eat the difference between their loan and what it was sold to the non profit for? And what kind of deal did the non profit get. We have to remember that we do not know how these transactions are being handled once the home is foreclosed and then resold to someone else. Is the government subsidizing these sales?

  19. Diana,

    I feel for you. I am so sorry to hear of your troubles. I am right behind you. My house is due to be auctioned in December.

    Us Californians are screwed unless something positive happens here soon.


    Our spirits are broken. We do not have the resources it takes to challenge these foreclosures. How can the conscience of those who have the power to help allow them to do nothing?

    Somebody please step forward and help Diana. Sheesh. It’s getting too cold for tent cities anymore and we need the help.

  20. A must see.
    Thank you Please watch the Judges in Florida in action. I am speechless as to Judge Soud comments.

  21. Diana,
    There is a Law Firm called, “The Bottom LIne Law Group”. They cover Sacramento, CA They are
    excellent, and they “get it”!

  22. Call a Lock Smith and move back in.

  23. Mitch Abdallah?

  24. After a LONG battle with Aurora Loan Services, fraud on their part, MERS, Cal Western, Robo signers – Aurora and the courts won. Got locked out loday.
    Is there any ethical and attorney in SACRAMENTO, CA
    who can help me?

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