Foreclosure-Gate Screw Tightens: Banks Face $17 Billion in Suits Over Foreclosures

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EDITOR’S COMMENT: Here is our problem writ large. The commentary written by Shedlock (see below) is basically on the side of punishing the banks for their wrongdoing, but not giving any relief to borrowers. The logic behind the position is that anyone who does not pay their mortgage should expect to lose their home. On its face, it would seem that nobody could reasonably argue to the contrary. The problem we face is the assumption behind that sentiment. The presumption is that the payments were due, that the creditor was not getting paid, and that the homeowner should lose the house for which they paid a “stupid price” — a slam at homeowners who accepted the lender’s appraisal of the property.

My premise goes deeper than the shallow waters of Shedlock’s position, who clearly represents the feeling of a majority of people who just take a quick glance at the problem. My premise is that anyone who has a debt that is due has the responsibility to pay it to the party to whom it is due, less any legally meritorious defenses for bad behavior on the part of those who induced him into the transaction.

So if you enter into a transaction where you get funded for $100,000, you have agreed to repay that $100,000. If you have a claim against the party who wants to enforce the obligation, then you should repay the net amount due after computation of damages for both sides. And if the amount due from the “enforcer” (pretender) is more than the amount claimed by the enforcer, there is no debt to pay from the borrower’s perspective. The borrower in that scenario is owed money which is an unsecured debt. I don’t think anyone could reasonably argue with that position either.

The first issue, though is whether the debt is due, and to whom. The debt might not be due at all if the creditor has received, directly or indirectly, payment or settlement from bailouts, insurance, credit default swaps, guarantees, etc. Shedlock’s mistake is the same as most people — assuming that because the homeowner stopped paying, there must be a default. In ordinary times with ordinary mortgage lending practices that would be true. In the context of the illusion of securitization and following the actual money trail, it is not true.

At the time of the declaration of default, the servicer is probably continuing to make the payments to the creditor, which means that from the creditor’s perspective, the obligation is NOT in default. Because the securitization scheme involves multiple obligors on the obligation, only one of which is the homeowner, it is not possible to determine a default unless one gets an accounting from all levels of the securitization chain. If the servicer is making the payments, then the original obligation to the creditor is NOT in default, but the servicer MIGHT have a claim for restitution against the homeowner for making his payment — but that claim is not secured and not  liquidated unless and until the servicer proves the actual money trial. So my premise is based upon making decisions based upon the actual facts rather than a set of incorrect presumptions.

The most serious defect in Shedlock’s position is that taken at face value, it would allow anyone to take the house away regardless of whether or not they are the creditor. Assuming the creditor is the investor-lender. Just because the actual lender refuses to enforce the obligation, and the obligation is “perceived” as due, does not give a license to ANYONE with some knowledge to make the claim in lieu of the real creditor. That is insane. If that were the law, then our marketplace would be filled with uncertainty inasmuch as it would virtually guarantee multiple claims on the same debt by multiple parties. In a race to the courthouse the first one to initiate proceedings to enforce the obligation would arguably be the winner — even though they never loaned any money and never purchased the obligation — and even though the obligation has potentially been paid in full or is being paid current by the servicer. Nobody can reasonably argue with this point either.

The last major point I would make is that Shedlock presumes the original transaction was properly documented and recorded in the form and content required by law. This is not the case in virtually all securitized loans. The documentation shows that homeowner-borrower (HB) was funded by originating lender (OL). In truth OL was merely acting as stand-in for undisclosed parties contrary to federal and state laws. The money trail clearly shows that the investor-lender (IL) was the source of the funds and was the intended beneficiary of the transaction.

So the documentation shows a transaction (HB-OL) that never existed since OL did not lend or otherwise even handle the money involved in the funding of the loan, most of which work was done by the closing or escrow agent. The documentation should have identified IL as the lender but didn’t. In fact, there is no documentation in which both IL and HB appear as parties, neither one actually knowing about the other nor the terms of the transaction by which IL advanced money and HB received the benefit of money.

And here is the rub: the investors don’t want any part of the predatory lending practices and faulty underwriting that was custom and practice in the industry during this mortgage mess, so they seek no remedy from the homeowner. IL does not want to limit itself and collect from HB because IL knows that the investment banker who sold the mortgage bonds didn’t use all the money for funding mortgages. Instead they used the money to claim fees and profits part of which funded bets against the very loans that they said they were selling to the IL but in fact never transferred from OL.

If  Shedlock’s premise were accepted, then the pretender lenders score a great victory for themselves at the expense of the IL whose money they used to fund the scheme and the HB whose obligation has been partially or entirely extinguished by trillions of dollars in payments received by the securitized parties on behalf of the IL but which was neither reported nor paid to IL. IL therefore has chosen to sue not the homeowner, where the damages would be reduced to near zero, but rather to sue the investment bank, where the damages are 100% of the money they advanced. If they went for the HB, they would end up with at best a home worth a small fraction of fraudulent appraisal OL used to get HB’s signature. Both the loan amount and the security for the loan would already be substantially lower than the money advanced by IL. So given that they are looking at 20 cents on the dollar if they go after the HB, less offset for predatory lending claims, they have chosen to sue the investment banker for 100 cents on the dollar.

The void created by the choice of IL not to enforce against HB has been filled with pretender lenders who see an opportunity to gain a free house. It is the banks who have created the choice of a free house (or HB relief for the borrower) or a free house for the pretender lenders. Given the equities and the fact that all of the fees and profits of the securitizers and pretenders are ill-gotten based upon fraudulent statements it hardly seems right to say that the collateral benefit from all this should flow to the banks rather than homeowners who were duped into the transaction to begin with.

from Mish Shedlock,

Foreclosure-Gate Screw Tightens: Banks Face $17 Billion in Suits Over Foreclosures; Common Sense Says $5 Billion is Very Generous

State attorneys general are not happy with a $5 billion offer by major banks to settle lawsuits regarding robo-foreclosures and other alleged grievances. Some officials want as much as $20 billion. The compromise threat is on the high end.

Please consider Banks Face $17 Billion in Suits Over Foreclosures

State attorneys general told five of the nation’s largest banks on Tuesday they face a potential liability of at least $17 billion in civil lawsuits if a settlement isn’t reached to address improper foreclosure practices, according to people familiar with the matter.

The figure doesn’t cover additional billions of dollars in potential claims from federal agencies such as the Department of Housing and Urban Development and the Justice Department. State and federal officials haven’t proposed a specific comprehensive settlement figure, but Tuesday’s discussions represented the first effort to formally quantify potential liability.

Banks have proposed a $5 billion settlement that would be used to compensate any borrowers previously wronged in the foreclosure process and provide transition assistance for borrowers who are ousted from their homes. Federal and state officials have dismissed that as insufficient. Some officials have pushed for a total price tag of more than $20 billion to resolve foreclosure-handling abuses that surfaced last fall.

The U.S. Trustee Program, a part of the Justice Department that oversees bankruptcy cases, has asked for an additional $500 million to $1 billion in penalties, according to people familiar with the matter. Officials of the unit have raised questions in several cases over the authenticity of foreclosure documents.

Banks have argued that their problems are largely technical and that few if any borrowers have faced wrongful foreclosures. State and federal officials have faulted mortgage companies for not hiring enough staff to provide assistance to millions of borrowers that have fallen behind on their mortgages.

The latest development comes as state and federal officials are intensifying their scrutiny of other parts of the mortgage machine. Attorneys general in California and New York have announced wide-ranging mortgage investigations.

What are the Damages?

This is what I want to know:

  1. How many people lost their home to foreclosure out of an error? By error I mean the wrong person, a home with no mortgage, or a major procedural error.
  2. How many people think they deserve a free house and clear or a principal reduction over “show me the note” nonsense or other problems including unemployment?
  3. How many people did banks string along for many months with promises of work-outs, where the person paid their mortgage for months, then lost their home.

Throw Category #2 in the Ash Can

I am sure category #2 is the largest. Throw those cases in the ash can where they belong.

No one want to admit they were stupid. Yet people paid stupid prices for homes. Others were unlucky. Some lost their jobs. Even then, one can ask “did you have a year’s worth of living expenses saved up in the bank, in case you lost your job?” Regardless of the answer, banks should not be on the hook for people losing their jobs or having medical problems.

Here’s the cold simple truth: If you do not pay your mortgage, it is reasonable to expect to lose your home. There is no other realistic way of looking at it. Robo-signing may not be right, but it is irrelevant.

Category #1 the Real Problem

I have deep sympathy for those in cases where banks foreclosed on the wrong home, the wrong address, or on homes with no mortgage at all. Those people deserve their home paid free and clear and some huge penalty on top of it.

I suspect the number of such cases is minuscule. They receive enormous publicity but is the number 10,000? 5,000? 500? or 50? I suspect the number is far closer to the lower end than the higher end. 50 might easily be on the high side.

Whatever the number is, banks should pay mightily and punitively for it. The money should go to those wronged, not to the states. Even with massive penalties I doubt the total would come close to $200 million.

Category 3 is Where the Uncertainty Is

I do not know how big the “strung along” category is, but the only ones in this category who were genuinely harmed to any significant degree are those who continued to make mortgage payments, strung along on a promise, when instead they could have and should have walked away.

How many is that? You tell me. However, the harm is easy to quantify. The harm is extra payments people made (if any), while the banks engaged in deceptive practices or were simply understaffed.

Assume banks engaged in deceptive practices and people made extra payments instead of walking away. Would those extra payments amount to as much as $1 billion? I rather doubt it.

$5 Billion is Very Generous

What is a valid penalty? $4 billion seems like a lot of money to me. That would be a 400% penalty if the total wrong-doing amounted to $1 billion which I doubt.

The sad truth of the matter is we have a full scale witch-hunt over robo-signing and other alleged grievances even though there was little actual damage caused by banks.

If you disagree then total up the damages. However, I insist you start from two essential points.

  1. If you do not pay your mortgage, it is reasonable to expect to lose your home.
  2. Robo-signing may not be right, but it is irrelevant as per point #1.

So total up the damages, add a huge penalty, and let me know what you come up with.

No doubt, many will accuse me of siding with banks. The reality is I am siding with common sense. No one fought against bank bailouts harder than I did. Banks should have been allowed to go under.

Unfortunately they were bailed out. However, two wrongs do not make a right.

I am all for punishing banks provided the punishment is based on damages rather than the widespread belief “we need to stick it to the banks”.

Mike “Mish” Shedlock

90 Responses

  1. Thanks Anonymous I appreciate your input.

    I am in a state where Judges still have their dead beat home owner mentality.

    The Pretender lender offered a modification after they foreclosed to try an avoid court case I had filed in BK Court. They said they would recind foreclosure. It was a great offer but I needed to reaffirm a Jumbo loan that is 40% under water! I am not doing business with someone who will not prove how they came into the picture nor will I reaffirm to a debt buyer so I met them in court and they got sanctioned for ignoring a court order.

    It is no longer about my house it is about right and wrong and the greater good for all. I can live anywhere they can’t hurt me anymore then they already have. They have destroyed my fresh start and I am not letting them get away with it,

    I saw a bumper sticker I loved as I got out of court

    Truth is Truth even if no one believes you
    A Lie is a Lie even if everyone believes it.

    This about sums up what we are all up against!

  2. It has been my understanding that if a lender’s deed of trust states they will follow applicable law and do not, then in that event, even if a subprime borrower, he would have a voice even if the loan is in default..

    It is possible that the violation of the applicable law in question caused the default in the first place and before the default or in the event of negligent loan servicing technique. If proven to have caused the default, it would seem they would have a voice and should act on it. I do hope that is correct.

  3. Pat

    Can you reopen your BK for fraud??

  4. Pat

    To add — know of cases that have beat the foreclosure by demonstrating false chain — not compliant with SEC filed docs. Emphasize — this is a very important beginning.

    But, if you get a judge with his head still in the false notion of possession of the note — a problem.

  5. Pat

    Combo title and Securitization audit is a definite start — it will show that the path that was supposed to be taken — was never taken.

    But, after that, it goes further. And, my focus is on subprime refinances (or loans that were once GSE loan — but no longer — or for loans that falsely claim to be GSE loan).

    There are two major problems as I see it. One, homeowners who may have missed any mortgage payments on subprime refinance — despite falsely placed in default BEFORE subprime refinance — have no voice in courts.

    Two, Attorneys who take on cases for foreclosure victims — are not powerful law firms — and, therefore, receive little respect — most importantly – valid discovery. is denied.

    Thus, in addition to competent attorneys,
    it will take government agencies to completely and thoroughly investigate. To date, that has not happened.

    With an audit — it is clearly apparent that the false “note” never followed the path of the fraudulent MBS (they were NOT MBS). It will take judges that are astute — to not fear a precedent decision.

    In the meantime, there are happenings behind the scene. But again, major party to step up to the plate — should be the US government – and courts

    Most importantly, it will take Congress — to force Mortgage Servicers to open up their records — and records going way back. It will take Congress to force Mortgage Servicers, in accordance with already established law, to identify the CURRENT creditor – and complete history. To date, no mortgage servicer feels the obligation to do so — despite laws that mandate. They will twist and turn in court — to divert court’s attention. Called — technicalities.

    Can proof be found??? Yes — but extremely difficult when currently in default. Unfortunately — NO respect. Dealing with a nightmare.

  6. Anonymous,

    What is the best plan of action for a home owner to prove what you are saying?

    Should we get a combo title and Securitization audit and if yes

    Which loan number do I get it on the one that I did when I did the refi or the new one that was assigned with the new servicer?

    Received full discharged in BK 7 two and half years ago and assigned new servicer after default was 2 years old. I am still in the house and owe someone but I know I do not owe this debt collector just need to prove it!

  7. @all;

    Anon & others are clearly correct——sounds like a true forgery with implicit intent. This situation should be crefully documented as to chain of custody-preserve finger-prints.

    I would think that you should get a QDE to examine it if nothing else to verify that the signature on the 2nd document is not yours—

    This is red-hot. The question is who created it?

    Can you walk it to the Senate banking committee in DC? etc-ill help you get it to the committees but dont let it out of your sight–chain of custody is critical-they will say you created it yourself to make them look bad–etc.

    You should file a full report with FBI and post a copy on this and other sites–however if YOU faked it-it would be a crime to file a false report.

  8. Eafleeye,

    You stumbled upon — but many do not what really exists under their names.

    Subprime loans were default debts — I will shout this over and over again. The “Note” fabricated at refinance closing were not NOTEs — they were simply modifications (or reaffirmation) of collection rights to a default debt- with additional debt added to collection rights. Collection rights can only be transferred by assignment — which is why the “Notes” were never endorsed to the REMIC trusts with complete chain of endorsement — they could not be — they were not Notes. Assignment is only done when there is actual default — on the collection rights. Note possession is irrelevant – because fabricated note is not negotiable. .

    Years ago, when prior mortgage loan was not paid-off at a closing — the first suspect was the attorney — who may have absconded with the money. Borrower would quickly find out that the prior loan was never paid off.

    But, that does not happen with subprime — borrower never finds out that the prior loan was not paid off by them — because it was paid off — by someone else via insurance. So records will show “satisfied” — but this is not by the borrower – and borrower will never know this.

    So — loan they are trying to foreclose upon — is not a secured note — because there was never a valid note. You cannot have a valid negotiable note on charged-off default debt.

    All was easily concealed because the banks that purchased collection rights (and that is what they did – although likely have since sold elsewhere) — counted on eventual actual default and relied on courts complying treatment of default homeowner.

    Just because someone else “paid-out” by insurance on a borrowers loan — does not mean the debt is not owed by borrower to some party. It DOES mean that the debt is unsecured, borrower was defrauded at subprime loan origination, real party is not before court, and unsecured “loan” can be discharged in BK without loss of home. And, of course, the whole process is hugely fraudulent.

    Cannot have an “Amended and Restated Note” —

    Never mind that a valid current modification is also — impossible.

    Is the government aware of this??? Yes. And, they do not know what to do.

  9. David C B
    my son 25 yrs said to me ” mom keep your head up ” your son will grow from this stay string. Yes your story is devastating and I am praying for you and your family.

  10. Sorry Jim

    Don’t know how I did that. Must have hit those keys and the computer must have had an anxiety attack—et voilà!

    To Mr Breidenbach

    We so seldom voice our personal emotional torment. I remember once a professor on the first day of class long ago said, “the things people do to each other beggar the imagination”. I wonder about a country where these cruelties are standard business practice

  11. David, I just read your post and started crying…my heart and prayers go out to you and your family…I know there are so, so many people that have been through hell like that…I wish to GOD we could get these stories in the media—FRONT AND CENTER! How can we do it? Something has to change…we need to give kids like your son some power…show them they DO have a VOICE, and JUSTICE and LOVE are REAL…The world is NOT going to let the thieves and fakers RULE…It WILL HAPPEN…it MUST!!!

  12. @ Marie

    “Thank you. A lifetimes work and expense in breeding a strain of arabians destroyed in less than a week”

    1st I pleaded with AHMSI’s California rep one Luis Trejo to let my family leave without a deficiency within 60 days of the notice of complaint—to reduce the stress on my family early on in 2009–he was calling me while the answer was coming due–“dont worry, he answered “Iv never seen a deficiency pursued”

    Then, I asked for writing-he said need to get that from our local atty–lets just try to work it out—-then as days to deadline on answer drew near–sure well look at mod—-more days go by—-then he comes back with the balloon in a couple years–but not sure—–I filed answer and never heard from him again

    I looked up the felon———-literally pleaded guilty—DOCX Korell Harp—-then months go by—-I tried to settle—-let my youngest son graduate in a little over a year with his HS class-60 farm kids grew up together-well pay monthly whatever

    No absolutely not–want that house now—-

    Finally they do a motion to enforce settlement—-Enforce settlement? What settlement? The one that your attorney verbally agreed to –you give a DIL——in exchange for ???? nothing specified

    A few thoughts like failure of consideration came to mind—-then it came to me from the dim past ——-my attorney agreed verbally to bid me to give a deed??? Thats a statute of frauds issue!!!

    Why waste time on this——they demanded my own attorney testify that HE had agreed to me giving a DIL!!!1

    Atty gone-

    $$$ wasted

    Let my son stay pls

    No way

    So we gave them possession of functioning house—–they let it freeze —-my wife goes by –ice and water coming under the door—house frozen

    So now house empty destroyed and my son who was a happy kid that got good grades is failing —cries quetly at nite in his little room in the little apt

    Talking suicide says “whats the use?” and I barely know what kind of story to make up to tell him how great the future will be —what a wonderful country we live in —-what is law worth?—–what is govt for?

    THE morons try to enlist him in the military to go sit amidst piles of depleted uranium —-

    As if he or any other kid that has seen this would lift a finger to defend this

    Maybe as much as those russian boys wanted to defend the supreme soviet in 1988.

  13. Fq? Geez, Marie what’s that about?

  14. Fq

  15. Ok, so, I’m no expert but I think I just stumbled upon something from Countrywide / Bank of America. I signed a note in May 2006 with Countrywide at the time of my closing. I have a copy o this note in my files from the closing. THe SAME not is posted online in my Bank of America account (inherrited from Countrywide). There’s also a second “Amended and Restated Note” on my file with a signature that is NOT EVEN CLOSE to mine, that was supposedly signed on the sae date of my closing. Now, there are 3 MAJOR issues here besides the fraud.

    1. The terms of the second note are very different from payment address, loan amount, payment amount and most of all… the DATE the first payment is supposed to be due. Remember, this note was signed in May 2006. The fake note says the first payment is due in October of 2007 but matures the same year as he prior note.

    2. With a note that I actually signed and a fake note wth a fradulent signature on it… what’s the odds of the bank selling two notes from my property into a security instrument?

    3. According to MERS, the BAC Home Loans Servicing, LP is both the servicer and invester for my mortgage. It appears that they “aquired” the note after they created it and changed the information in MERS. Bank of America produced the fradulent document sometime during 2009 or early 200. countrywide has deceptive practices, but they were pretty clear when it came to keeping mortgage docments online fo viewing at anytime. This document NEVER exisited with Countrywide, only when BofA assumed (I’m assuming) the servicing from Countrywide.

  16. My understanding is that in order to file a suit in federal court, like a RICO complaintt, all defendants need to be “foreign” to the state you live in. If you want to include even one in-state entity as a defendant, then file your suit in State Court. HOWEVER I AM NOT AN ATTORNEY.

  17. well maybe before I get foreclosed upon, I should file an intent to file a lawsuit per John Gault, then Jim keep informed on your suit, and maybe I will file for RICO as well.

    i always thought to do a RICO on these collection companies that send me pieces of paper saying I need to send them some money on some charged off credit card I have.

  18. Jim, I like this

    “modeling a battle between an informed minority and an uninformed majority.”

    What say you TNHARRY?

    Who is the informed minority and un-informed majority in our housing market?

  19. Jim,

  20. Thanks, Jim…I have always thought that the whole set-up seemed like racketeering…

  21. Carie:

    I filed a lawsuit in Federal Court pro se (without a lawyer) against IndyMac and MERS. The complaint alleges violations of the RICO act. I won’t discuss or comment on the case here in this public forum, of course, but I’m OK with calling attention to it as an example (not a blueprint) of how folks can fight back. Yes we’re all dealing with one big fraud but each individual foreclosure is different.

    Dockets and pleadings for federal court cases are available for viewing by the public… but you need to have a PACER account to access them.


    This case is not a blueprint for fighting back, just an example.

  22. Carie

    Thank you. A lifetimes work and expense in breeding a strain of arabians destroyed in less than a week….

  23. Sorry, I meant to write JOYCE…not Joice…

  24. I’m SO sorry for your loss, Marie—pets are like beloved family members, and I can’t imagine the anger and frustration you must feel…there has to be a way to stick it to these ***holes…sorry for the language, but this is beyond the pale…so disgusting, makes me want to scream!


    I looked at some statements again, and it appears that the “debt collector” phrase only began appearing on the statements AFTER OneWest Bank “took over” IndyMac…

    @ Jim:

    What are you trying to say with regards to PACER account???

  25. Re: DBreidenbach post

    The Fraudsters “took” my farmette property in march pursuant to an obviously forged assignment. Among other outrages they turned off the water and killed one of my beloved and valuable Arabian stallions before I even knew what had happened. Everything you wrote today is painfully, frighteningly true. Every day I feel sick over the suffering they wantonly inflicted on my horses

  26. Carie:

    The difference of why Indy Mac did not show debt collector and then did at a later date is because there was a fed law passed sometime in there that states what the debt collector is and if you are a debt collector, you best note it on your paperwork.

    Perhaps someone on the cite can recall that law.

  27. @JJ
    “robosigning *does* matter, unless we just want to discard the rule of law when convenient to appease powerful interests.”

    If you discover it in your investigation –its a failure of due diligence not to resist—if you turn over your home to a frader—–the real guy with a real note can come along and really collect on the note–and too bad for you if your asset is gone

    They had to know robosigning was occuring everywhere——–and that the situation created an opportunity for frauder A to steal the property under false pretenses -then party B comes along and seeks recovery on the FULL AMOUNT OF THE NOTE–not just deficiency.

    The entire robo-signing thing could be an intentional setup–to facilitate double recovery

    Preservation fraud

    1st step——require in settlement that home-owner “maintain casuaty insurance–maximum–90 days after vacate

    2nd step;
    Then the ist “preservation” crew comes in and “secures” the property –plaster a sign on front door—-change a lock—leave a couple doors loosely closed or unlocked—-and lets place freeze–get stripped—-home destroyed

    3rd step——servicer demands casuaty insurance on home-owners insurance–destroys home-owners insurance history–future problems with getting affordable insurance

    4th step;—–servicer sells to affiliate at cents on dollar because home is destroyed

    5th step; preservation crew pops back up and gets contract to rennovate and repair the damage they allowed/caused

    6th step; ———vulture investor sells the home after minimal rennovation for huge markup

    he can probably help arrange financing and title insurance through captives as well—this is a frau scheme that is presently operating full throttle—and they need to let the homes deteriorate some more so that the bottom feeding is not so obvious

    This scheme is the next robo-signing-like major systemic fraud. Wall Street never sleeps–please regulators, newspapers etc—- get ahead of the curve for a change—-look for distressed asset “investors” associated with servicers and/or preservers———–

  28. This is interesting—
    My “mortgage” statement from Indymac before I refinanced in 2006 does not say “debt collector” anywhere on it—but the subsequent statement from Indymac AFTER the refinance DOES say “This company is a debt collector…”

  29. Finally the Banks are getting squeezed on all sides…

    I am working with a producer in Hollywood on a under ground

    documentary called

    “Smoke and MERS”

    its about foreclosure Fraud, robo, BS, etc?

    The Producers are looking for homeowners who are willing to tell their story …

    If interested email me

  30. cubed2k:

    Did your friend ever try to fight it by using any of the tactics mentioned here?

  31. This is a must see. We must show this to our friends who are paying their mortgages. They are in trouble too. They migth not be able to sell or refinance their homes and worse once they pay their mortgage off they might not have title to the house.



  32. A friend of mine finally got kicked out of his home, after not paying for 2.5 years on his mortgage. It is in the 2005 new development on Mare Island, Vallejo, Calif. Here is a typical home in the development:,+vallejo,+ca&cd=1&hl=en&ct=clnk&gl=us&

    All those homes sold for $600-$800K during the 2005/6 years. Now look at their prices – $250-300k.

    The city just last year or so upped the property taxes because of some stupid reason, on appraised values from 2006. The people had to pay an additional $10k in property taxes. The city closed the post office, the firehouse, all local services in the area.

    My friend told me that a few years back from now a couple that foreclosed on last year, well, when the left, they plugged the upper bathtub, turned on the water, and left. A few days later some other neighbor walking on the street noticed a flood of water coming from the house and spilling all over in front and down the road. While I don’t agree with that, I do understand.

    The houses, people, etc mean nothing to the banksters, they only want their credits, to balance their books and make nice salaries and bonus’s.

  33. My most recent experiences over the past year have brought a new look at what some of the clients are doing.

    They are filing small claims charges against the lender/servicer for basically what the client considered fraud, negligence and so on even though they had not tied their issue to that. They just felt the servicer was wrongful in what they were doing to them. This helped the client forestall the foreclosure process until a determination was made. It did not cost the client very much to file and could have cost the lender if they lost, $10,000 in damages. The mediation worked great for the time being until the attorney shows back up with what is needed for them to prove they did not do anything wrong. It was great.

    On these two cases, they ask me to go to their mediation to argue their servicing issues. It was a piece of cake because we knew far more than the attorney representing the lender/servicer. They never had a chance. I think it cost the client $75.00 plus service fees. Now the homeowner has time to get his bearing and allows the advocate to submit their summary of findings in case it becomes a court issue. Personally, the homeowner will probably get their modification. We will see.

    I had not run into this before but it may be something that others can use. Will research it more.

    The client paid for $20.00 to the advocate for gas to the court.

  34. Tacoma:

    Yes, we have been wanting to see the general ledgers for sometime now since all of the fraud came out in 2006-07 and particularly when the creditors were going after deficiencies. How would a borrower know that the deficiency was truthful and that they were now being victimized yet a 3rd and 4th time, all as a result of the fraud.

    I am with you on this one all the way and so are a lot of other people.

    I tried to give the story to a newspaper reporter years ago but they had no interest in reporting it, or should I say, investigating the issue.

  35. The third party making payments to the creditor does not have a cause of action against the borrower, certainly not contractual. In equity? I doubt it. Guaranteeing or making payment is a voluntarily assumed risk. That party has no rights against the borrower under the note, that’s for sure.
    If a volunteer pays 4500 which reduces a, say, 100k note accordingly, he can’t claim the note balance is still 100k. If he can claim anything, and I say he can’t, he may not claim w hat he has paid is owed on the note, per se. It isn’t. If anything, it’s a separate claim. Period.

    That party is a ‘volunteer’ under the law and probably doesn’t even have a right to a tax deduction for its volunteer payments any more than I would if I made your payment. If I or MaryJane, say, guarantee or make your payment, what’s the difference? You have no contract with us. Did you agree to pay us back? No, you didn’t. Therefore, while our payments reduce your note balance, we are volunteers. Look up legal definition of ‘volunteer’.

  36. For a couple years, Mish was my favorite blogger as I found his education about the deflation/inflation debate to be top notch. I must say, the guy is down right brilliant and does seem to have the entire world banking system in a spreadsheet in his head. He has so eloquently crushed the silly arguments of the “inflationistas” so many times that I grew to love the guy and his dry wit.

    In July and again in September last year, I personally emailed Mish respectfully urging him to cover mortgage fraud as I found his silence deafening. I even proded Neil Garfield to contact him and persuade him to cover the topic.

    The substance of Mish’s reply was entirely based on his reference to a dead blogger, “Tanta” who seemed to think the whole mortgage fraud was indeed just sloppy paperwork. I believed, and still believe Mish has never researched a single material thing on the subject. There’s no way a guy with his brain and research skill has covered this topic.

    Understand that Mish is very much against the big banks and the Fed, and still has my respect on those topics, which incidentally are the super-topic encompassing our obsession with mortgage fraud here on LivingLies. Mish has often called for indicting Bernanke, Geitner, Goldman Sachs, and the gang, and pulls no punches against those guys. He often rips both political parties when they need it. His second biggest crusade is against corrupt public unions.

    In my opinion, Mish is a victim of his own pride in his intelligence and dominance of the inflation/deflation debate. His ego got so big on that topic defeating so many big names, that he has turned blind to the single biggest treatable symptom to the disease.

    The true disease in the country is an entirely corrupt financial/government oligarchy. The biggest symptom of the disease is foreclosure fraud, the single biggest fraud in the history of the world.

    My current opinion is that the conspiracy is less organized, and really more of a corrupt pervasive culture. I believe the culture probably originates with the combination of fractional reserve banking and fiat currency. After all, the power to print and loan to friends and politicians is too great of a temptation for anybody.

    In the same way the founding fathers asserted we should be ruled by laws and not by men, they were also adamant in the constitution, Article 1, Section 8 that Congress shall have the power to coin Money, regulate the Value thereof . . . For a great expansion on this topic, please borrow or a buy a copy of The Creature from Jekyll Island by Griffin.

    Think about it, we’re fallen creatures. Do you want to be ruled by “the man”, or by law?

    In that same line of thought, shouldn’t our currency, the one commodity that is the medium of exchange for all our labor, and other commodities, shouldn’t that be ruled by “law”, something external, objective, a disinterested standard? Like Gold or Silver coin perhaps? Anybody that thinks there’s free-market capitalism in this country doesn’t realize that the entire monetary system is controlled and manipulated by a centrally-planned, private cartel. And that cartel’s weapon against the masses is always obfuscation and diversion of our interests, just like we’ve all found out with the mortgage fraud. Those guys are very slick and invisible. Very good at getting us to fight each other.

    I’m sure most of you share my frustration when you try to explain mortgage fraud to others because the vast majority of them, like Mish, instantly assume the worst about you trying to scam a “free” house.

    NEVER AGAIN (Thanks A-Man) will I begin that conversation talking about mortgage fraud.

    No, the conversation needs to start with the Bailout. Depending on whose accounting you use (Bloomberg, MotherJones, can’t remember the third one), the bailout is on the order of 8 to 20 Trillion Dollars. Begin with this topic, and then mention that this bailout for bankers and their bonuses is roughly the size of the entire mortgage debt of the USA. Oh, and by the way, as a homeowner with a mortgage, shouldn’t you be entitled to a true accounting of your loan? After all, to whose ledgers did all those Trillions go? And did you know nobody has ever gotten a true accounting of their securitized mortgage showing insurance / CDS payments, or that your loan doesn’t even exist, but the collection rights were probably bought for pennies on the dollar by a hedge fund and a huge law firm and they’re causing the destruction of the economy. And the true providers of the money for your home who bought MBS probably settled for pennies and lost their retirement funds? The funds didn’t even come from the servicer or bank. I think this is the way to approach the subject with others.

    The oligarchy has controlled the narrative for so long. We need to start with the bailout and bankers bonuses to focus the listener on the evil, get the audience angry about the national debt issue, raise the question about where did all that bailout go, then point out that the only true way to transfer the bailout from Wall Street was to unravel the mortgage fraud. We’re not talking about winning on any kind of legal loophole or technicality. Just enforcing the laws and insisting that we’re not going to pay again a house that was likely paid off with a bailout if we could only know the truth..

    Incidentally, Karl Deninger is the man, and Market Ticker is far and away the best blog in the universe. It’s the best way to keep up on all the inter-related topics, and the guy is relatively concise (Note to NG). Mish is still good on the inflation/deflation debate, but screw him on the other stuff. Mish lost a lot of credibility with his crowd, including me with his posts against the “free house” people.

    BTW, for fighting the fight, I am still Dave Krieger’s biggest fan. Buy his book, and get an attorney to use it.

  37. 2:11-cv-00867-RSL

  38. zurenarrh:


    2:1-cv-00867-RSL. Federal. Western District of Washington.

  39. Jim–I have a PACER account.

  40. Carie:

    Focus up. We all know the problem. Let’s get at the solution. Pacer = Public Access to Court Electronic Records. Google it.

  41. Yes, what do you do? 2009 arriving here is where Soilman had link his website pointing out clients loan application were missing.

    He was dead on. Now how does a guy in LA 3 hours from me know my loan app is missing?

    Ran to my DA’s office (prior foreclosure) and that’s what they looked for too. Now how did my DA’s office know what to look for? They knew what to look for before I even had a chance to explain why I was in the office.
    My DA tried to get original from Title Escrow Agent but Escrow wanted a subpoena. So my DA quit. can’t afford to help you.

    Funny after all this disclosure the Calif. DRE says we found nothing wrong with your loan. I wrote back asking what did they find. I never did get an answer.

  42. Does anyone here have a PACER account?

  43. Carie:

    Do you have a PACER account?

  44. Keep talkin’ A Man

  45. Jim—so am I…what pray tell is your “action”?

  46. Everybody is taking this personally. The whole system is out of whack. From overinflated Taxes, Overinflated Car Prices to overinflated Tuition for kids University, To overinflated Electrical bills etc………… Gas Prices.

    If there was a problem any business or household could borrow its way out of the problem.










    I could go on and on.

    They use the same propoganda against the homeowners that the Nazi Germans used against the Jews Gypsies and Communists.

    If it wasnt for their Propganda and Millions of Foreclosures they would get away with it.

    Be Strong and Courageous.

    But just like every Fascist it is short lived

  47. Carie:

    I’m at 3. Talk on…….

  48. @M.Shedlock

    “The sad truth of the matter is we have a full scale witch-hunt over robo-signing and other alleged grievances even though there was little actual damage caused by banks.”

    You Mr. Mish apparently never had that personal experience which puts ths “little damage” in perspective.

    . So what does an informed borrower do when a party they never heard of sues her to sieze her home, she checks out SEC filings-finds missing loan lists in the purported trust? —then also finds that the primary signer on the assignment is a convicted 24 yr old felon plead guilty a few months earlier to identity theft and possession of false identity documents -dozens—-forged documents.

    The other signer turns out to turn up in background checks as having multiple male and female identities—-and the felon arrested with a group of transvestites. And both seem to have more hands than a Hindu god—–what do you do? what do you think?

    Oh well Im behind on my pmts—since these out of state felons want my house-ill just tell my kids to pack up and hit the street.

    so you go to court–they all look at you strangely and say “what difference to you who gets the house”

    “not your business”–well Mr Mush whose business is it?

    Sorry I cant actually send this to him.

  49. TNHARRY, you stated this”

    “I take issue with the statement “they paid a “stupid price” — a slam at homeowners who accepted the lender’s appraisal of the property.” I see this issue brought up over and over here. The problem with that premise is that it begins with the assumption that the buyers were somehow required to accept the lender’s appraisal. Buyers are fully able to commission their own independent appraisal prior to closing. The premise plays into the victim mentality. No one was forced to sign the documents at closing and no one was forced to rely on the the lender’s appraisal. Buyers have responsibility as well, both in the transaction and to themselves. You don’t get to bury your head in the sand, not read the documents, and then claim fraud in the inducement. By the same vein, not doing your own due diligence does not automatically make everything the banks’ fault. The banks and servicers have plenty of fault to bear in this mess. But let’s take a time out for some personal responsibility.”

    do you realize we are dealing with middle class people, not high finance people, not wall st hucksters. We are dealing with people who go to jobs 9-5 or whatever and make some money doing work, not doing work based on leverage and high finance, just people. Do you realize that? These people get approached by brokers, media, letters in the mail saying to refinance, buy a home, no money down, media saying home prices going up and up, better buy now. TNHARRY, do you realize that these people trust in that meadia and brokers and bankers – why they know what they are doing – they drive nice new cars and wear nice suits. Oh, but the borrower signed the bottom line, sign here.

    Pure contract law law would mean if I signed the credit card slip that said I borrowed the money-credit on the transaction just transpired. Why if I default, one would think the credit-money issurer would have that piece of paper showing I signed for approval, or digital sign nowadays. So what if the issurer lost the original signature, whether digital or hand written. Now what? Courts just side with the issurer because they are a bank or business or public company? TNHARRY, you tell me? What is right or wrong here?

  50. “The debt might not be due at all if the creditor has received, directly or indirectly, payment or settlement from bailouts, insurance, credit default swaps, guarantees, etc.”

    If equitable doctrine of unjust enrichment applied but counter is that it is equally unjust enrichment to COMPLETELY set-off liability on the note

    And if nobody owns the note–that does not extinguish it—-ii suggests state should receive the escheat———the abandoned or ownership unproven note.

    Id rather the house proceeds go to the state than a pretender claimant.

  51. Anyone have a past refinance that provided escrow for property taxes???

    Hmm — not paid directly by servicer. Servicer HIRES another servicer — that servicer HIRES another servicer agency -likely in the tile (or fraud) business. This “chain” of “servicers” connected to WHO??????

    So easy – no one watching. Payments went WHERE?? Taxes, payments, forced placed insurance????? All before – what they called a “refinance??” Before actual default -which occurs after the refinance (by usury rates). If put a ribbon on refinance — guess regulators did not care – no one watching.. One BIG party- all at homeowner expense. .

    Insurance?? — had been watching the fraud for years — but nothing done. Then, too busy bailing out banks – who were purchasing collection rights on false defaults — confident of eventual default — of course, no explanation would be necessary — then farming those rights out to their proprietary friends. Hey – what a disaster if they left them on banks books. Of course, banks must keep false securities on books — until all derivatives are cleared — because derivative do no transfer the security. There is no change of hands at default for the false security — only change of hands in collections rights. Oh yeah, those were the investors that supported (funded) the fake trusts to begin with — those darn bottom tranches.

    As former President Bush once said — those “darn derivatives” — — he meant those bottom credit enhancement tranches — that falsely provided triple A — even though every one knew — it was junk debt.. And, everyone knew — these bottom tranches transferred (swapped) collection rights out of fake trusts — DIRT CHEAP. What a profit to these “bottom feeders.”

    That is — everyone but the homeowner victims knew– they did not have a clue what was happening.

    But, — as the world of power turns — only investors cries of fraud — are being heard.

    Signed on dotted line?? FOR WHAT INSIDE??? Ribbon said it was okay – hey — borrowers could not tie the ribbon themselves. Someone else did.

    Let’s finally open up the package. . . .

  52. You’re right, Jim…it goes in 3 steps:

    1. Knowledge

    2. Volition

    3. Action

    Everyone here is in various stages of these 3 steps…!

  53. Neil: Excellent analysis of Shedlock’s comments. And we obviousy have (mostly) intelligent and articulate responses to it. But just talking about it will not solve the problem, folks. You need to do something about it.

  54. New book: “Reckless Endangerment”

    Already a best seller—just came out—a must read!

  55. And, for the last time — 100% of subprime loans were REFINANCES — not new purchases.

    However, those that bought new homes during the subprime fraud — were defrauded by fraudulent appraisals perpetrated by the subprime “refinances” (were NEVER a refinance).

    Think these guys are getting scared. Maybe their investments in fraudulent default debt — purchased dirt cheap — but huge profits by foreclosure — are finally doubting their own “investment.” (not securities investment — but INVESTMENT).

    Time for the banks to “out” them.

  56. This is what I have been discussing with David.
    Everybody wants a piece of the pie for damages — “investors” especially — when the only REAL victims were/are the homeowners.

    Neil — nice piece — and I agree — Quote — “My premise is that anyone who has a debt that is due has the responsibility to pay it to the party to whom it is due.” BUT………….

    The big problem is that no debt is due to any stated party at origination — or by foreclosure. And, any debt that is due — is unsecured debt — because it was either unsecured debt at origination — or is unsecured now due to charge-off.

    NO ONE is entitled to collect any debt that is not due to them. No one is entitled to claim that debt is secured — when it is not. No one is entitled to collect any debt that was procured by fraud. No one is entitled to fabricate default by misapplication of payments. No one is entitled to fraudulent modification of any fraudulent contract to begin with. No one is entitled to insurance fraud. And, no one is entitled to foreclosure by fraud to borrower and fraud upon the court.

    Any debtor that pays under fraudulent conditions — is subject to ongoing and continued fraud.

    Mr. Shedlock — by promoting continued fraud — you are “sticking” it to America. Without punishing the fraud, and restitution to the victims, America will not recover. So if you have stock in the banks, and restitution to victims does not occur — I would be very worried about your stock investments in the near future. .


  57. leapfrog I will take a look at the link.

    To make you feel better people who are paying their mortgages that thought I was crazy regarding the Banksters are beyond believe me.

    Thanks to 60 Minutes, NBC News, Dan Edstrom, Neil Garfield (behind the scenes) etc………

    It is finally hitting the mainstream.

    People and finaly The Attorney General of California and the Mayor of Los Angeles are listening to their constituents.

    People were screwed with by who I believe were a bankster scam, to fool people into believing that they can still get a loan modification.

    Dont forge money can’t buy you love or elections.

    The Republicans who lost in this election backed the banksters. The Tea Party was supposed to go against the banksters but didnt they will be voted out.

    People are broke. It is hitting the Jumbo loans Prime Loans big time. The banksters wait at least two years in many cases to give NOD’s. Not because they are nice.

    Again People in the Mainstream are getting it.

    The banksters are making more and more mistakes.

    Enjoy your weekend leapfrog and I hope I take your advice and rest from all this at least for the weekend.

    Be strong and Courageous.

  58. Oh, Mr. Mish, how we try so hard to hide and forget the fraud in the origination. That’s one website I know never to visit.

  59. tnharry, People invovled in the crisis are here looking for help. Your points valid or not are at times provacative. Your compassion however, for a struggling fellow American, checked out a long time ago.

  60. A-man: Did you see this one? Mandelman article on book, “It Takes a Pillage.” I’m relaxing for the holiday weekend and I’m gonna read this…of course, maybe I shouldn’t, it will just get my BP up. I do like the title though. It certainly does take a pillage…

  61. tnharry still believes that the banksters who run multi billion dollar companies got their because of or despite of sloppy paperwork.

    tnharry still believes in the tooth fairy.

  62. A good bankster is a jailed bankster

  63. The Banksters are no different than common Gang Bangers that push Dope.

    Today in Elementary and Middle Schools they offer kids lollypops laced with heroin or Meth. Small Doses.

    My wife does not allow my children to take candy even from their friends.

    So the kids with parents that do not worn the kids not to take lollypops from friends.

    According to TnHarry’s logic the kids who take candy from their friends deserve to get hooked on drugs.

    Tnharry is an Anarchist. We should be tolerant to his views even if we dont accept.

  64. The sleepers here are going to be the countries that were also taken when they got involved with the Wall Street Boys and our banks who helped pull it off. Yes I know they played a part, but soon we will hear the rumblings of countries who feel they were affected by what has happened. I could be wrong, what do I know?

    You the people will get a pittance and the AG’s will claim – we did the best we could. I do hope I am wrong, but I see a settlement has been made by an AG for WF to supply modifications but only after the borrowers have processed through HAMP. oH MY, ANOTHER PLOY – SURELY THE AG DID NOT AGREE TO THAT. Can’t remember the state, but I will look it up.

    The government has no place in any of these negotiations – they had their chance and have blown it time and again since 2001 – why? They can’t and won’t answer the question.

    The feds agencies, HUD, FTC, JD’s, etc., will step in to collect their penalties, etc. Money which they can use for more spending and wasteful programs that do not help the homeowners.

    The $150 Billion given to Fannie and Freddie will not be repaid and in fact they may still need another 6 billion as we speak. How is it that we can give Fannie and Freddie $150 B to pay the bills and commitments – well, just let them answer the question. They are the ones in 1998-99 that took us off the path that was our guiding light with respect to honesty, integrity and ethics and the idea that you are not to harm your brother for your own profit. What happened to that?

    I am mad alright, but I am mad at the American citizens who have been harmed both directly and indireclty and we have not had the voice or the strength to assure these negotiations are what they should be. To use 5B as a starting point is so far out there, that it simply cannot be allowed.

    What are the people going to do?. Some are trying hard, but there is no leadership to pull us together so that we set forth reasonable and practical solutions. The AG’s have their ideas, but quite frankly, they won’t get the job done to the satisfaction of the American people. The people have been harmed by this failing economy – as one writer above said, how do trillions sound for a settlement?

    Now to the Sleepers. This economy was greatly harmed, but the other countries will come out the winners to collect their dues and as such, any settlments to America will be an effort to minimize the amount with the thought that these banks are not through paying yet when the other countries step up.,

    Those at the top of our Government will be waiting in the wings to start that negotiation just as soon as they put their stamp of approval on the “pittance” that will most surely be offered to those harmed in America.

    The American people would have to be able to position themselves as though they were as strong as those countries who might place claim. Maybe I am wrong here, maybe other countries weren’t affected by this global demise. Someone must surely have a comment to set us straight by this aspect of the cost to the banks.

    I just don’t think the banks are through even when they force a settle with us. My oh my.

  65. Looks like the Banksters are starting to get squeezed from all sides…

    I am working with a producer in Hollywood on a under ground documentary called

    “Smoke and MERS”

    its about foreclosure Fraud, robo, BS, etc?

    The Producers are looking for homeowner to tell their story on camera…

    If interested email me

  66. done wasting my time with you—have a nice day!

  67. Carie – you haven’t been damaged by MERS in the least. As for whether your docs were to be “legally recorded” – check your local listings, but assignments aren’t required to be recorded everywhere. Many states do not require recording of assignments. And if you are in one of those states, the MERS issue is a dead end. There’s no fraud of MERS. What is your measure of damages if you think you can prove fraud on the part of MERS?

    A quick and dirty definition of fraud :
    -an individual or an organization intentionally makes an untrue representation about an important fact or event;
    -the untrue representation is believed by the victim (the person or organization to whom the representation has been made);
    -the victim relies upon and acts upon the untrue representation;
    -the victim suffers loss of money and/or property as a result of relying upon and acting upon the untrue representation.

    The only element you can satisfy is “victim”.

  68. And you know what? This IS “high drama”. It doesn’t get any more dramatic than what happened to the American people…and it ain’t over yet…

  69. You do attack, tnharry, in your little sarcastic, subtle way…and you know it.
    “Reading the closing docs”…hmmmm…the closing docs were a LIE…hello?

  70. Take your medication Carie. You attack me daily and I do not do the same. I’m pointing out some of the same “victim” claims used by the readers of this site : I didn’t read my note and it’s fraudulent, the appraiser was in bed with the lender and I got hosed, I lost my job and the bank won’t modify…..None of those trains of thought have just the lender/bank as the bad guy in them. As I’ve said before (and in fact stated in my post) there are plenty of valid issues without resorting to high drama. Each of the things I mentioned above could be address by reference to personal responsibility : reading your closing docs, getting an independent appraisal, etc.

  71. Okay, tnharry, I guess i should have realized when I signed the paperwork that I didn’t have a “real, legal mortgage” situation—I should have realized the fraud of MERS, and the fact that there was no true creditor, and the fact that this was not going to be legally recorded in the county recorders office to avoid taxes, etc…yeah, whoops, MY BAD!!!

  72. tnharry

    How the does an unwitting victim of a MASSIVE MORTGAGE PONZI SCHEME PERPETRATED BY BANKS AND WALL STREET take “personal responsibility” for believing the GIANT LIE?????

  73. @Trespass – what does your signature mean?

    “Trespass Unwanted, corporeal adult, life, free, freeman, live born, born alive, whole blood, in jure proprio, in jure divino”

  74. I read this on Mish’s site. The commentors there were very educated about the process and one posted a very good rebuttal. For the sake of respecting his site and the comments as copyrighted material for his site, I won’t reproduce it, but there are many who were upset with his shallow vision and said they didn’t agree, or was not going to read his blogs anymore.

    I think people, learn as they go, on some things. Mish is not ‘keeping up’, he’s only gathering information from some sources and forming his position for the crisis.

    I’ve kept up, before it became known as a crisis, so I have a better depth of understanding. I agree with Neil.

    It will still take a while for all of this to iron out, but we are approaching or in the quiet before the storm. We need enough people to ‘wake up’ to who they are and how this is happening to them. We are not ‘person(s)’. But how many know the ‘legal definition of that word.

    A person, for legal purposes, is generally more broadly defined to refer other than just a natural person. A person may also include a corporation, company, partnership, firm, association or society. For example, when a company incorporates, it has standing as a legal person to sue and be sued in courts of law. The precise definition of a person may vary by state and applicable laws.

    The following is an example of one state’s statute governing the definition of a person:

    “When the word “person” is used to designate the party whose property may be the subject of a criminal or public offense, the term includes the United States, this state, or any territory, state or country, or any political subdivision of this state that may lawfully own any property, or a public or private corporation, or partnership or association. When the word “person” is used to designate the violator or offender of any law, it includes corporation, partnership or any association of persons.”

    When we wake up without getting religious, but just knowing who we are…a body, with a spirit, that spirit is the energy that powers that body, that needs that body to see and do things, but is ‘not of the body’. When we realize whether we are the ‘body’ or the ‘spirit’, and we realize that this world does things to the ‘body’ and ignores the ‘spirit’, and we wake up to the fact that we must ‘know who we are and tell others we deal with, who they are dealing with’, then the system can break on the fact that they can’t hide behind doing things to the ‘body’ and ignore there is a ‘spirit’ affected by those dastardly deeds.

    T.V. and organized religion has led many astray. I used to wonder why only 144,000 before the ‘lo and behold a multitude of which I could not number’. Well there are many who ‘know who they are’ and ‘know that by following’ they are being led by who they trust that hasn’t proven to be trustworthy.

    We’ll get there, but not by t.v. nor radio, nor peers who are all ‘blind’ too.

    Light and Love,
    Trespass Unwanted, corporeal adult, life, free, freeman, live born, born alive, whole blood, in jure proprio, in jure divino

  75. **** JUST IN ****
    ***** BREAKING NEWS *****

    Florida pulls plug on rocket-docket foreclosure courts

  76. It seems that “show the note” is all important to the pretender lenders at closing but when they want to take your house, showing their possession of the note is somehow ridiculous and unwarranted. The banks need to learn that what’s good for the goose is good for the gander!

  77. “2. How many people think they deserve a free house and clear or a principal reduction over “show me the note” nonsense or other problems including unemployment?”

    So the house is up for grabs to anyone without any lawful claim, without any beneficial interest and whoever gets there first walks away free and clear and the homeowner is tossed out. Hmmm. People who are not paying now (the ones who “deserve” to be tossed out) may have paid for many months, years, decades – principal, interest, points, fees, title, escrow, taxes, insurance, maintenance, utilities, and on and on. They and their families live there and support their local economies and communites. Then on top of that there is still that little issue of the “paperwork” showing there is no creditor – even if you don’t get it that there may be no debt either. So if no one has a claim on the house and all parties are in line to get a “free” house – who “deserves” be first in line? Seems a lot of people think it ought to be big banks. How about homeless people instead? How about the homeless homeower himself instead?

  78. Mr. Shedlock is what might be referred to as a religious economist. He believes things that have no basis in fact, but he proffers them as if valid.
    If the AG of California states $640 billion is a round number, settlement offers of $5 to 17 billion are not adequate for even one state of the 50.
    If we do the math, it becomes obvious to anyone that understands percentages. It is far less than one penny on a dollar for actual expense, and ignores punitive damages, treble damages for the violation of FDCPA and State consumer protection law.
    What do you think Neil, would $10 trillion be a more reasonable starting point?

  79. oh never mind, saw you posted Karl’s rebuttal over on the other story…my bad.

  80. Two wrongs don’t make a right, but three rights make a left……..

    and this guy’s an asshole.

  81. Karl ripped Mish a new one:

  82. This is a nasty depiction of borrowers. The author seems to claim that : Because borrowers didn’t have extensive knowledge (law, real estate, contract law, changes in regulations, MERS, etc) they deserve what they got. What crap, many borrowers worked with a “trusted” institution within their own communities to buy their house – we know now that the brokers and institutions weren’t even lending with regard to risk. NO ONE would have signed anything based on what we know now.
    No one wants a “free” house, and robosigning *does* matter, unless we just want to discard the rule of law when convenient to appease powerful interests.

  83. How is it “nonsense” to require a pretender lender to produce the note? The note is the legal evidence of the obligation. If there’s no note, there’s no evidence of the obligation. Simple as that. If the note and the holdership thereof is such “nonsense,” why even have “borrowers” sign notes? Why even have the
    UCC? Why have a clause in a note that says a “note holder” has to take the note by transfer?

    This mainstream idea that the note–and who holds it–is somehow irrelevant when foreclosure comes up is rather disingenuous. If the note is not important, why all the fake MERS assignments of DOT/mortgage that purport (but fail) to assign the note along with the security instrument? As Carpenter v. Longan states, the note, despite what Shedlock says, is “essential.”

  84. I take issue with the statement “they paid a “stupid price” — a slam at homeowners who accepted the lender’s appraisal of the property.” I see this issue brought up over and over here. The problem with that premise is that it begins with the assumption that the buyers were somehow required to accept the lender’s appraisal. Buyers are fully able to commission their own independent appraisal prior to closing. The premise plays into the victim mentality. No one was forced to sign the documents at closing and no one was forced to rely on the the lender’s appraisal. Buyers have responsibility as well, both in the transaction and to themselves. You don’t get to bury your head in the sand, not read the documents, and then claim fraud in the inducement. By the same vein, not doing your own due diligence does not automatically make everything the banks’ fault. The banks and servicers have plenty of fault to bear in this mess. But let’s take a time out for some personal responsibility.

  85. Hi Neil:

    If you think your readers would be interested I wrote an article today on MARS and what loan mod firms cannot do!

    This is the link:


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