Why Everyone Should Support Principal Corrections on Mortgages

First, let’s talk to the guy that says homeowners shouldn’t get a break because it would be unfair to him. After all he paid his mortgage and he is still paying his mortgage and nobody is helping him, right? Wrong. Everyone who has a mortgage is getting a federal subsidy. They get to pay less in taxes and the more they owe, the less taxes they pay. That is the interest deduction for home ownership. So the question is not whether homeowners should get help, because they all get help. And if the guy who still has his home doesn’t wake up to the fact that foreclosures mean fewer homeowners and fewer homeowners means that those who want to eliminate the home mortgage interest deduction will get more traction. They already have a number of people in high places who would like this federal subsidy eliminated because it does nothing for big business and big banking. Putting your support into whatever it takes for people to stay in their homes and pay on mortgages, even if they are lower, means more people that would join you in opposition to eliminating the interest deduction. Oppose them and it will cost you thousands of dollars in additional taxes.

Next, those who are ideologically opposed to any relief for someone who stops paying on a loan. They say that if we don’t hold the borrower’s feet to the fire, we will undermine the entire concept of credit because borrowers would think they could walk away from any debt and would do so. The evidence is in. Most borrowers don’t want to walk from their debt. They want the deal they were sold on by the banks — an affordable loan. They didn’t get it because the originators were not acting as banks. The originators were getting paid for signatures not good loans. What is undermining the credit industry is that nobody trusts the creditors and won’t take the deal on hedge products and swaps. It isn’t that the financial world trusts the borrower any more or any less. They don’t trust the banks because they corrupted the loan underwriting process and because it was the banks who screwed up real estate title and obscured the ownership of loans thus freezing the once liquid credit markets that were running very well on the Uniform Commercial Code. Now we are parsing words and splitting hairs — what is a possessor, holder, holder in due course, what is the effect of fabricated loans, assignments, substitutions, notices, auctions, credit bids, deeds and evictions? If you want confidence in the credit markets restored, we must show that we can control the banks so they can’t do this again.

The main reason everyone should support principal correction is that it is a correction. The values used were pure fabrication created to induce pension funds to throw money down a rabbit hole called a “REMIC POOL” and to induce the homeowner into thinking that he was getting the deal of a lifetime. That was fraud. And in this country when someone is defrauded we take the bounty away from the perpetrators and return it to the victims.

51 Responses

  1. CALIFORNIA AG KAMALA HARRIS ARRESTS 3 NORTHERN CALIFORNIA ATTORNEYS FOR LOAN MOD SCAM. TODAY.

    http://www.scribd.com/doc/84553358/AG-Kamala-Harris-Arrests-3-Attorneys-in-California-for-Loan-Mod-Scam-March-8-2012

  2. 117

    2012-03-04 15:50 (UTC)

    DUBAI, March 4 (Reuters) – The board of Saudi Arabia’s al Rajhi bank accepted the resignation of its chief executive, Abdullah al-Rajhi, replacing him with Suleiman al-Zain, according to a statement on the bourse website on Sunday.

    The statement said the resignation, for which it gave no reason, would be effective from April 1 and that he would continue to work on the board.

    (Reporting by Isabel Coles) Keywords: RAJHI CEO/RESIGNATION

  3. Ian
    Mortgage notes were not typically transferred to the trusts, (“PSA” section 2.01, Article II) as required by law. Further, there is no clear “chain of title” for these notes–which are actually presented with the fake and fraudulently, manufactured endorsement and allonges only to conduct illegal foreclosure.
    The Chain of transfer is not perfect and raises many legal questions, which court can look in providing the justice whoever deserves.
    Allonges can only be used if there is no space left on the note and made attached with the original note. The allonges do no require the notarization. By not recording the Note in the lands record, they have sold unregistered and unregulated security

  4. Likely To Default And Need A Taxpayer Bailout In The Next 5 Years »
    Sunday
    Sep252011
    Bill Black: The Banks Are Still Insolvent, And Obama Is Not Only Covering It Up, He’s Taking Credit!

    Bill Black says you’re doin’ a heck of a job, Mr. President.

    A look back at a Bill Black op-ed from last Fall. Nothing has changed.

    As part of their TARP propaganda tour, Obama officials from Tim Geithner to the president himself keep repeating the same lie statistic — that solving the financial crisis will cost far less than the 2.5% of GDP it took to clean up after the S&L crisis. In this piece, Bill Black gives withering criticism of Obama for playing extend and pretend with the TBTF banks — the very same game the S&L regulators played during the 1980’s. It didn’t end well back then, and it won’t end well this time.

    Regardless, says Black in a new op-ed, the results, are clear:

    For reasons that only Summers, Geithner, and Obama can know, they chose to adopt Pratt’s disastrous and dishonest anti-regulatory strategy and parrot his dishonest claims of brilliance and success. Congress passed the Prompt Corrective Action (PCA) law in 1991 for the express purpose of outlawing any repeat of Pratt’s refusal to close insolvent banks. Congress, at the behest of the Chamber of Commerce, the American Bankers Association (ABA), and Chairman Bernanke, successfully (and shamefully) extorted the Financial Accounting Standards Board to change the accounting rules so that banks no longer had to recognize losses on their toxic mortgage paper appropriately until they sold the assets.

    Covering up the losses had three real (carefully unstated) purposes: (1) permitting evasions of the PCA [Prompt Corrective Action law], (2) allowing the banks to remove themselves from the strictures of the TARP program even if they are, in reality, insolvent, and (3) allowing insolvent and impaired banks to pay their senior executives huge bonuses on the basis of the (fictional) income that results when a bank does not recognize its losses.

    The Bush and Obama administrations have consistently refused to apply any of the successful lessons learned in responding to the S&L debacle – even though the response has been praised by experts in public administration and Treasury Secretaries from both parties for decades. Both administrations refused to even discuss the current crisis with the senior S&L regulators that contained that crisis before it caused a recession. Obama thinks his response to the crisis was brilliant because it did not follow the S&L regulators’ much more expensive strategy. Obama cited the comparison to the S&L debacle as the most telling demonstration he could make of why his administration deserves praise.

    It’s a Miracle!

    What Obama does not understand is that his “cover up” strategy and his claims of brilliant success are direct steals from Dick Pratt’s playbook. Dick Pratt was the top S&L regulator in 1981-83. When he left (to join Merrill Lynch) he claimed that he had contained the crisis through innovative resolution strategies that slashed the average historic costs (from over 20% to less than 5% of the S&L’s assets). Pratt’s “resolutions” were accounting scams that did not resolve anything. They did, however, transmute real insolvencies into fake assets and create guaranteed (fictional) accounting income. The scam was so crazy that the more insolvent the S&L acquired, the greater the fictional income that the deal created. Pratt did so many of these scam resolutions that they created so much fictional income and capital that the industry reported it had suddenly returned to profitability.

    The reality was quite different. There was no miracle, only the cumulative results of multiple accounting scams. Pratt’s resolutions did not resolve failed S&Ls. They were still insolvent.

  5. The upper video is of Bill Black’s testimony before Congress, in April 2010 (2 full years ago!!!)

    At the time, he spelled out exactly what needed to be done and who needed to go. To date, it hasn’t been done. We’ve wasted 2 more years to act and redress what WE caused, worldwide.

    I hope Geithner, Bernanke and all of them will be thrown in jail and made examples of. Otherwise, we’re in for some serious riotting…

  6. My loan is fannie mae refi/GSE with cash out super high FICO but
    Alt-A state income (with all screwed up info and closing ofcourse).

    I need to check the satisfaction of old loan. Saw mortgage satisfied info that was recorded but need to look at it. Never got old note back as far as I know.

    The thing that is wierd is they never funded title insurance for lender. Servicer owns title insurance company. Strikes me as odd bec maybe they only funded $50k cash out on $300k deal. Old title policy was $250k already.

    Makes me wonder.

    They are in a pickle bec I am holding firm. I dont care if it was lender policy or not. I paid for it on the HUD $1500 premium. I want PROOF title insurance was funded/purchased.

    They don’t have the proof so it is insurance fraud. Somebody stole the $1500 premium.

    We will see. Everyone says I am nuts but I am onto something.

    Also they screwed up the title chain as we all know via MERs so I want protection via lender’s title policy.

    We will see.

    Folks I am just saying look at the title insurance because Stewart not only funds the insurance policy but they also handle the settlement. And they are owned by Wells Fargo.

    Originator was piddly company.

  7. chas404- you said that perhaps the old loan was never paid off when you refi’d:

    If the mortgage loan which you were refinancing was a defaulted loan, a GSE reject, or some other scratch-and-dent loan whose collection rights were purchased for say 10cents on the dollar, here is how it would look;

    > you have a $200,000.00 loan, which is placed into false default.
    > pretend lender gets insurance payout for defaulted loan.
    > sells collection rights to Aurora Borealis loan servicing for 20k
    > they collect for 2 years at 9.50% interest
    > you refi to get 40k cashout
    > they charge you 12k in fees, bait and switch cash out to 20k
    > they are in it for 40k, collecting 2k per month, 24k per year
    > you think they have a 30 year secured mortgage
    > they know they don’t.
    > they want you to sign away your legal rights, and admit that you owe them 240k in writing. You don’t. You never did.
    > This is what the HAMP program was designed to help. To help the servicers get signed documents whereby you verify the debt. And for you to sign away your legal rights.

  8. chris and others,

    In my case I believe I have discovered that the title agent and/or title insurance company Stewart Title pocketed my lender’s title ins premium while never funding the policy.

    I am currently working with the state insurance review people to nail them on this in hopes that I will get the file from the title agent and discover more.

    FYI Wells Fargo owns 23% of Stewart Title and was fined in other states for breeching RESPA vis a vis title insurance kickbacks etc.

    I simply stumbled upon this myself by spending sleepness nights rechecking my settlement papers.

    Maybe this won’t be the smoking gun but i have a gut feeling that this title issue will lead to discovered that the old loan was never paid off via the refi as some here have suggestd.

    Anyhow, what chris says is right. keep sifting thru the paperwork. maybe u will yield nothing but maybe u will. I dont have an answer yet but i will soon and will share.

    C

  9. to all-
    Does anyone know whay BONYmellon is, in some cases, reverting to their former name, Bank of New York? After studying their websites, it seems as if there is no (legal) “Bank of New York” entity of any type.

  10. I agree, Enraged…the judges need to be educated too. My philosophy, stay at the basics, move slowly and tie things together. Stay away from 1031’s, trusts and securitization, in the beginning. It is somewhat complicated.

    Most of us are laymen and we need to stay with what we know to be true, go from there. The fraud reveals itself over time.

    For me, I read everything, the insurance cases, the audits, the suits against MERS, title claims, etc…it is very revealing and many times there is information that is useful to one’s case as they do tie together at some point. People need to think out of the box and understand, every case against the banks have enlightening aspects to them, that help clarity and the complaints are very much about the same or similar behavior. Some of them have discovery that can help. I encourage all to read anything and everything. It helps formulate your case, file it and fill in the blanks.

    My $.02

  11. Bank of America In Trouble?
    POSTED: March 2, 10:44 AM ET

    Comment 41

    REUTERS /CHRIS KEANE /LANDOVIt looks like Bank of America might have started circling the drain before the Occupy movement even had a chance to launch its campaign against the company. For weeks now there have been ominous signs of trouble at the bank, and yesterday we heard yet another dark piece of news.

    Last year, there was an uproar when Bank of America announced a plan to slap customers with a monthly $5 fee for debit card usage. The bank eventually backed off that plan when the public and some politicians cried foul.

    Now it seems the company is going to try to put a new package on the same crappy idea and sell it again. This time, the plan is to add charges that range from $6 to $25 a month. From an MSNBC report:

    Pilot programs in Arizona, Georgia and Massachusetts are experimenting with charging $6 to $9 a month for what’s called an “Essentials” account. Other account options being tested in those states carry monthly charges of $9, $12, $15 and $25, but give customers opportunities to avoid the payments by maintaining minimum balances, using a credit card or taking a mortgage with Bank of America, according to an internal memo cited by the [Wall Street] Journal.

    It’s a very bad sign that a bank is in a desperate cash crunch when it tries repeatedly to gouge its customers. David Trainer, an analyst for Market Watch, a WSJ publication, wrote that the new fees are a sign of series trouble at BAC. He writes:

    In my opinion, there are four actions taken by financial services that signal the company is headed to serious trouble.

    1. Management shake-up and major layoffs – lots of layoffs over the past year

    2. Exploiting accounting rules to boost earnings – SFAS 159

    3. Drawing down reserves to boost earnings: to the tune of $13.3 billion in 2011 and 2012

    4. Bilking customers with new fees: tried it before and trying it again

    Bank of America has taken all four steps. Bilking customers with new fees is a desperate measure of last resort because it requires exploiting the one asset the bank has left, namely its customers.

    Trainer in an earlier column urged investors to dump Bank of America for a number of reasons, but mostly because he had reservations about some of the numbers in the bank’s most recent SEC filing.

    According to him, the bank aggressively exploited a new accounting rule called SFAS no. 159, which allows companies to enables banks to “arti­fi­cially boost earn­ings when the value of their own debt declines.” In other words, BAC was able to artificially re-state earnings when its own credit quality went into the tank.

    Trainer also believes that Bank of America’s recent rise in share price is based on a series of impossible, pie-in-the-sky expectations, including “20% annual revenue growth for 18 years.”

    All of this comes on the heels of an announcement that Fannie Mae was cutting off Bank of America, news that itself came after Bank of America, in its annual report, had earlier announced that it would no longer sell loans to Fannie Mae. Basically, Bank of America tried to quit Fannie Mae before it got fired. It seems Bank of America in the last quarter of 2011 was slower even than usual in honoring repurchase requests, yet another sign of a cash crunch.

    Why does all of this matter to the rest of America? Because what happens with Bank of America will be an important litmus test going forward for how we deal with any Too-Big-To-Fail behemoth that gets itself into trouble. We’ve already seen that the recent foreclosure deal was a huge boon to Bank of America – it spared it from the uncertainty of a generation of robosigning suits.

    But what happens if Bank of America is still headed for bankruptcy? Helping the bank avoid a few lawsuits is one thing, and allowing it to move its dangerously toxic derivatives portfolio onto the federally-insured side of the company is another. But a full-blown crash of this firm would require a massive bailout. What will the Obama administration do if faced with that dilemma? One way or another, it will be a momentous decision.

    Read more: http://www.rollingstone.com/politics/blogs/taibblog/bank-of-america-in-trouble-20120302#ixzz1oBzI6WlK

  12. […] Filed under: AMGAR, bubble, CORRUPTION, currency, Eviction, evidence, expert witness, Fannie MAe, foreclosure, foreclosure mill, GTC | Honor, investment banking, Investor, MODIFICATION, Mortgage, Occupy Movement, securities fraud, Servicer, STATUTES, Student Loans, taxes Tagged: foreclosure fraud, Modification Fraud, mortgage fraud, mortgages, principal correction, principal reduction, taxes, wrongful foreclosure Livinglies’s Weblog […]

  13. @Chris,

    Did I ever tell you that my loan originator… is also the title insurance company? Different LLCs but same officers and directors.

    I will tell you what most people’s problem is: they conducted the investigation, the found huge holes in their loan and in their contract, they have documents after document proving it but… because they couldn’t find an attorney, they can’t use the info adequately or they end up giving away the house because they can’t formulate adequately a theory on which a judge can sink his teeth. That’s why i have warned everyone not to scream “fraud, fraud” too fast. It is not that judges are necessarily corrupt to the core but that it is nearly impossible for them to even accept the fact that such fraud and of such magnitude may have been committed by banks and may still be committed right under their noses.

    But that make-believe AG “settlement” is a serious set back for everyone! Unless something really serious is going on behind the scene and we see solid arrests soon, that AG settlement makes absolutely no sense whatsoever.

    And I believe that AGs have rolled over pretty quickly. When I listen to Schneiderman, Biden and Coakley and I see that “settlement” 2 months later, I believe that they were tipped off on something big, something huge coming down soon. That is the only explanation for it. And that would fall into place neatly with all the bank resignations I keep posting… and that little quip about Geithner’s arrest last week.

  14. Allonges- having read practically everything available regarding allonges, there are alot of questions to which I cannot seem to find answers, so any help would be greatly appreciated!
    1. Does an allonge have to be dated and notarized? ( apart from the standard boilerplate ” allonge, to a certain note dated July 1st, 2003″)

    2. Is an allonge supposed to be attached to the original wet ink note?

    3. The allonge is not evident on a certified copy of the note from the courthouse last week, yet is purported to have been affixed to the note as of Sept. 30th 2011: how is a court to determine when it was to have come into existence?

    4. Why isn’t the note with new, alleged owner via allonge recorded in the courthouse? In other words, someone new owns the loan, yet it isn’t recorded. I know, I am asking for legal explanations to all these fraudulent, illegal actions, but am trying to at least understand what the law requires.

  15. Again, just my piece;

    In my situation, I believe my loan was in default before I closed. There was no trust to put the note and deed in to securitze and lien the property…the trust was created 9 months later. I have never been able to find the mortgage. The funds for the “supposed” mortgage were borrowed from a third party and the assignments are all bogus. I have much of this on paper, a lot of investigating, to say the least. I have QWR-d anyone who touched my paperwork and it is very clear what the scam is….very close, but am missing a couple of pieces, which I am asking for in discovery. We’ll see what happens. But I have to impart to all here…most of the mortgages, DO NOT EXIST. You are paying originators or servicers and the money is NOT, going into the trust that was created and paying investors, within 90 days of closing (If that was the case). The mortgages are either MBS or CDS and sold multiple times, cheating the investors and homeowners. These products that were sold, in no way conform to REMIC trusts and some are down right fraud, illegal…keep checking the paperwork it is out there…at least enough for the judge to listen.

    Another point, yes, many of us have defaulted, but some of the defaults happened when the originators withheld the payments, without our knowledge and subsequently collected insurance for the losses, they intentionally created…they were defaulting the loans, long before we were and got payouts for it, by cooking the books and paperwork. And many of the payments we are making are not going to a lender…trust me…I know this for certain! I’m trying to keep a low profile with names and dates, ’cause folks are watching this blog and I am in 3 different courts, while filing a claim on my title insurance, for an unmarketable title and fraudulent assignments/transfers. I’m fighting until I can’t anymore and hope someone will listen and check this stuff, even if I lose, someone else can carry the torch!

  16. chris and carie:

    chris, on March 4, 2012 at 1:01 pm said:

    @ carie,

    “In some states you have up to 10 years to back at the foreclosure. Please check this out, in your state.”

    Not sure but isn’t it true in every state there is no statute of limitations on fraud? Have no idea.

    I hope every foreclosure, modification, refinance, or “sale” for the last 7 maybe even 15 years gets overturned. I know Iknow dreaming but just saying.

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  18. chris, on March 4, 2012 at 8:40 am said:

    “Just my $.02

    If the assignments and transfers are legitimate, then why forge documents? This is the $64.000. question.”

    Exactly. More like the 13 Trillion dollar question.

    It is the question the AG’s, the admin, congress, the courts, the IRS, SEC, OCC, FDIC, Federal Reserve, investors, homeowners, 99%, attorneys and law schools, moms and pops and the press, ect. ect…..evey citizen needs to ask and answer. Discovery could come from many sources other than a helpless homeowner lawsuit railroaded through the courts.

    Banks and attorneys structured it and facilitated it from origination through foreclosure and they are the “experts” who know the laws and who know better. They should be exposed and held accountable. It was not mere “paperwork” error or carlessness on the part of dummies.

    There can be no legitimate modification, refinance or sale until that question is investigated and answered. Even the legitimate application of payments is now in question.

    There should be a moratorium until it is answered and there should be no time wasted getting to the the bottom of it.

  19. @Enraged,

    I had the same situation–unendorsed note in discovery. When I made a big stink about it, they produced an endorsed two weeks before trial. Of course it’s completely fake, which is what we’re wrangling over now. Just saying, be prepared for the fake, endorsed note to be produced.

  20. @ carie,

    In some states you have up to 10 years to back at the foreclosure. Please check this out, in your state.

  21. So, as I once said: heads, they win. Tails, we lose. But we already knew that.

    March 3rd, 2012, 11:00AM Foreclosure settlement a failure of law, a triumph for bank attorneys
    Barry Ritholtz
    Washington Post February 25 2012

    ~~~

    After many months of wrangling, a foreclosure settlement has been reached between 49 state attorneys general and a consortium of banks.

    It is an epic failure of law and a triumph for bank attorneys.

    It will accomplish little of value, as I’ll explain. First, let’s recall what the “robosigning” foreclosure scandal was all about.

    Foreclosure is an extremely serious issue in American jurisprudence. As a nation of laws with strong respect for property rights, we have always treated this process appropriately. After all, having a sheriff forcibly evict a family that typically made a down payment, moved into a home, lived there for some years, made payments, etc., is disruptive — for the family, the lender and the neighborhood.

    Foreclosure laws vary from state to state. However, all are specific and precise as to the legal steps that must be followed, from the homeowner’s initial delinquency onward. There are benefits to giving the homeowner a chance to “cure their default.” It is in everyone’s interest for the homeowner to catch up if possible.

    We never want to see an innocent party “accidentally” evicted from a home. The legal system has evolved so this has become a “legal impossibility.” Imagine returning home from work or vacation to find the front door padlocked, the belongings strewn all over the block, a big orange sticker screaming “FORECLOSED” on the garage door, with an auction sign in the front lawn. Now imagine that this occurred even though you are not in default or even delinquent on payments. Thanks to the robosigning banks, this legal impossibility has happened repeatedly, even to homeowners who paid cash for their houses and had no mortgages. Imagine that — foreclosed with no mortgage.

    Before any foreclosure can proceed, a lender must run through a checklist of specifics for the court to move forward. This review can take 45 to 120 minutes per file and addresses, for instance:

    • When was the original loan made, and for how much?

    • Who is the borrower? Who is the original lender?

    • What is the address of the property?

    • Which bank holds the mortgage note? Was the note transferred? When?

    • When was the last payment made?

    • How much is owed on the loan?

    • Was the borrower notified of the delinquency? Default?

    • Has the borrower been served notice? When, where and how?

    Banks review these details to make sure there was not an administrative error. (Oops! We applied payments to wrong account!)

    The banker who reviewed these files fills out and signs an affidavit, which is then notarized. It is the written equivalent of sworn testimony in court. Judges take affidavits extremely seriously. False affidavits bypass the entire fact-finding and legal process, and the result can be a miscarriage of justice. Anyone who lies on one commits perjury, a felony punishable by jail time.

    At least, they used to get jail time.

    Before the settlement, we learned that nearly every aspect of the robosigned documents was false. None of the details were ever reviewed. The signatures attesting to the review of the documents were fabricated — made by someone other than the person whose name was on the document. Neither person — the supposed signatory to the document nor the hired forger — ever validated the facts of each case. All of the safeguards put in place to make sure foreclosures were done correctly and legally were bypassed. Even the notary stamps were bogus — they were not real, and not signed by a notary to validate that the signer and the signature matched.

    How did this happen? Instead of a careful review, people were hired to rubber-stamp hundreds of foreclosure documents an hour. Former burger flippers were paid $8 to $10 an hour to violate the law, file false affidavits and commit perjury. Some of the information was correct, but much of it was wrong — and none of it was verified for court purposes.

    And now we have this grand settlement.

    What will the impact be?

    Economically, it will have no effect. The dollar amount is small relative to the U.S. economy. Indeed, the total impact of the settlement is less than one ten-thousandth of annual gross domestic product.

    Then there’s the “math.” The number touted is $26 billion, but that’s wildly misleading. At most, it’s $6 billion, paid out by a consortium of banks. The other $20 billion is for capital write-downs for delinquent homeowners that were going to happen anyway. These were homes that the banks anticipated taking a $50 billion-to-$100 billion hit on. Only now, they get a tax benefit for it.

    As far as the U.S. housing market goes, the impact will be minimal. About one out of five mortgages are underwater — meaning the house is worth less than is owed on it. Today, more than 11 million mortgages are underwater.

    The settlement won’t affect the majority of these homes. Depending on which analysis you believe, the borrowers who receive a principle write-down will get $2,000 to $20,000 off their mortgage. This will not appreciably change the situation for most borrowers. They owe many tens of thousands more than the house is worth; some are hundreds of thousands of dollars behind in payments. Most will be as likely to default after this write-down as before. The impact on the overall underwater-mortgage issue is almost nonexistent.

    The bigger issue is the economics of criminality. Most people who get caught committing crimes are punished. Commit a felony — if you run a bank — and your shareholders pay a monetary fine. Violating the law has merely become the banker’s cost of doing business.

    Thus, the robosigning agreement has allowed the mass production of perjury. It has gone unrecognized and unpunished. It has made perjury a business expense, like travel or office furniture. The same reckless approach to giving loans to unqualified people was institutionalized, leading to another reckless approach to foreclosing homes.

    We still don’t know who ordered these crimes, who is responsible for this, whether they still are in their jobs — or whether they are in a position of authority to do the same thing again.

    Last, politically, the settlement reveals the corrupting influence of bank bailouts. Government is supposed to enforce laws equally and fairly. Instead, it is protecting its investments in rogue banks. They are committed to their original error and are loath to admit it. This is the reason that after a surgical accident, a new surgeon does the repair. He is objective and has nothing to hide. Conflicted governments, though, are focused on their reputation and reelection.

    The robosigning agreement will serve as an exemplar to future generations of what not to do when confronted with failing banks.

  22. @ Carie,

    I know and i feel terrible about it. That’s why I kept on harping on the fact that you needed to attack in federal court, rather than get lost into the Nancy Drewe theories that no judge can warp his/her head around. But I also know that states are not equal, that CA is a landmine for homeowners and they have made it so difficult for homeowners to dinf attorneys willing and able to file that the deck was stacked against you right from the get go.

    That’s why you need to join http://www.the99declaration.org

  23. @e

    Well, “they” stole my house with NO proof of ownership or whereabouts of my promissory note…nada….just “we are of the opinion we are following all applicable laws…” Their “opinion” has become law.

  24. So… In the discovery phase of my Tila, Respa, Fdcpa, Ucc, etc. lawsuit and the bank has started to “release’ a few docs. Like the note, for example. Which, incidentally, is only a copy of a fax of a scan. Now, check that: the “note” has no endorsement to the servicer I paid for 4 years. No allonge, no transfer, no mention of that servicer whatesoever in the doc. What is really, really funny is that the only allusion to the servicer’s involvement… is that the loan number of the previous servicer has been crossed out (by hand) and replaced with the loan number of the new guy. Don’t know when, by whom, or anything.

    According to the lawyers, it is what the bank gave them. There is nothing else to produce, notewise…

    So, the bank is making my case that, under the circumstances, they should never have collected my money, they owe me every penny and then some and no one can take the house since ownership of the note has disappeared into lala-land…

    I really didn’t think it was going to be that easy.

  25. @ chris, exactly. Adam Levitin puts it very well in a post he made last year:
    To understand what’s going on here, think of the scene in Star Wars when the rebels are attacking the Death Star and the imperial officer says to Grand Moff Tarkin:

    We’ve analyzed their attack, sir, and there is a danger. Should I have your ship standing by?

    The authors of the PEB report are like the nameless, cautious imperial officer. They are lawyers who have realized that there’s a real danger to the banks in the foreclosure process because the banks failed to comply with the law (the bankers themselves don’t get this–for them this is all technicalities that don’t or shouldn’t matter. Or as Grand Moff Tarkin responded:

    Evacuate? In our moment of triumph? I think you overestimate their chances!).

    It seems that the PEB report has been underway since around the fall of 2010–when the robosigning scandal broke. Some bank lawyers realized that there was something to the arguments being made by consumer attorneys and law professors that the banks had screwed up the chain of title and paper work in so many different ways that they really couldn’t foreclose if courts were to take the law seriously.

    So the PEB Report is Plan B for the banks’ lawyers. Plan A was for the banks to comply with the law. But if that didn’t work, then plan B is to make the law comply with the banks. The idea here is to twist the law to make it appear as if the banks are in compliance. If the banks don’t fit the law, make the law fit the banks. Hence the attempt to sound very official about the enforceability of (negotiable) mortgage notes in the hope that no one would notice that mortgage notes are non-negotiable. Instead of rule of law, it seems, we have rule of banks.

    Professor Levitin puts negotiable in parentheses in that last paragraph because he spent a lot of time in his post explaining how notes aren’t negotiable, as was the topic of discussion on LL recently. So this really does boil down to whether we as a society choose to “take the law seriously”, or simply allow this major fuck up to go unchecked. How can one feel patriotism towards a system comprised of pillaging? It doesn’t work that way. Especially when one is residing on a curb.

  26. Just my $.02

    If the assignments and transfers are legitimate, then why forge documents? This is the $64.000. question.

  27. It’s becoming exceedingly clear the more that this fraud unravels….the only way this can end is a standoff with the powers that be. When the facts are finally undeniable, and there’s absolute proof on the table that Wall Street raped and pillaged with the tacit approval, no, complete complicity of the federal government, they will simply want to continue the charade, as if there’s nothing that can be done about the problem at this late stage, especially considering the enormity of the issue. Thery’re doing that now.

    It’s there that we, the people, will have to draw the line in the sand and demand that each and every one of the players from Wall Street to D.C. is taken away into detention until they can one by one be cleared as to flight risk and so on. Then let the Financial Fraud Tribunal begin, staffed not with do-nothings like Angelide or criminals like Bachus, but with known regulators with experience like W. Black.

    There can be no modification, no principal correction or reduction, no mediation, no reconciliation, absolutely no justification for these crimes. Otherwise, mankind will forever be ruled by the maxim that crime does pay, as long as you’ve got the money to wash the facts afterwards. No Peace. Lengthy stays for all the players. Tribunal then Jubilee.

  28. Yes, that’s where I found the old payments were being, not the changed, adjustable rate. It is in your face.

    One of the things I am asking for in court is to get my first mortgage back and the outrageous fees off. Do not want a free house, just stop the fraud and lies. My mortgage was only $743.34. Put a lot of upgrades ($65,000) in the house, 30% down payment and that belongs to me.

    When the adjustable kicks in, if it was legal, who knows, what they will try?

  29. @ Chris

    Did you request accounting ledger related to your loan history.

  30. One other thing: I have the original transfer of funds and have 6 entities…listed on the funds transfer. The Servicer claiming to be the lender is not the bank listed on the HUD statement and the bank named as the lender was bought by the servicer with, non-assets/loans acquired, in 2005. To further that, the wire, which is a copy, has dates listed on the bottom of the page December 21, 2006, when the loan was “supposed” to be funded on February 27, 2007.

    What I think, the loan was in default, before the closing. The closing paperwork and wire transfer were a scam, to get insurance money on the default.

    No matter where I go, what I read and find, I come right back to that…

  31. Confidence Game – The Film Unraveling Mortgage Fraud

    Posted on March 3, 2012

    Are Promissory Notes actually Securities before the homeowner signed the mortgage documents? That’s a heavy thought isn’t it? Listen to short clip here.

    As DeadlyClear interviewed Blue Chip Films Producer/Director Nick Verbitsky about his new documentary film Confidence Game based on the demise and collapse of Bear Stearns, there emerged a confirmation to a missing piece of the mortgage-backed securitization process long suspected by foreclosure defense researchers and analysts that may expose a whole new avenue of fraud and even invalidate/void mortgage loan documents.

    DeadlyClear interviews Nick Verbitsky and discusses his new film Confidence Game which explores the last week in the life of Wall Street investment bank Bear Stearns in March 2008.

    You can listen to the interview in its entirety here.

    Nick remarks that “a shadowy group of hedge fund investors” was alleged to have taken down the firm, but the more he investigated the collapse, it became apparent that there was a lot more to the story. This film is the inside view of what was really going within the mammoth Wall Street firm with an in-depth perspective.

    See the Confidence Game Trailer here.

    The rumor of conspiracy that evolved with the help of CNBC and the pugnacious nature and greed of the firm’s rough and tumble reputation that Bear Stearns could do whatever they wanted while they took on crushing debt in questionable securities may have led to a karmic boomerang as an 85 year old firm dropped to its knees and died in what felt like an overnight murder. When Bear Stearns went down there were $400 Billion in financed ”assets” (many toxic MBS) and only $12 billion in tangible equity – truly unbalanced and likely what other Wall Street firms are experiencing today covered up by tons of cash poured into them at the will of the administration by the Federal Reserve.

    Verbitsky found people who had worked on the “factory floor” of Bear’s mortgage operation in Dallas, TX that were willing to talk about the what transpired. As Nick says he felt that, “it was almost cathartic… they felt they were part of something that wasn’t something to be proud of and they were willing to talk about it – they wanted to set the record straight.”

    DeadlyClear asked Nick if he felt the mortgage-backed securities are what took down the Wall Street giant. Nick takes it back to what led up to their loss of image and caused investors to look closer at their balance sheets. The fact that Jimmy Cayne, who CNBC named as one of the “Worst American CEOs of All Time,” ended up in a Wall Street Journal article deemed to be out smoking pot and playing bridge as the investment deals were crashing, didn’t help to build investor confidence in the firm as it struggled to regain momentum.

    “There were bells and whistles going off,” said Nick, “in advance of the firm’s eventual collapse.” Listen to excerpt clip here. The money was flowing in to fund the trusts/bonds and mortgages were being written as fast as they could to fill the orders. This is starting to confirm what has truly been suspected for several months, that the investors’ funds had already funded the monies to purchase certificates and their funds, the “Use of Proceeds,” were flowing directly to the borrower. But… in order to invest pension and retirement funds there must have been a vehicle already created. No doubt it sounds like the Trust documents went to the printer long before the borrowers, for the most part, signed the loan documents. Inside those trust documents (in most cases) was a list of identified loans or a Mortgage Loan Schedule that the investor was supposed to have reviewed… due diligence.

    Think of it this way. The application for a loan turns into unsigned or hypothetical loan documents that are identified inside the Trust to attract investors’ approval to fund the Trust – i.e., pay for the loans. The Trust is or was already created. The promissory note is identified on paper printed in the trust documents. Once the note is in the Trust, it becomes a security. The investors funds are applied and the loan documents (mortgage and promissory note security) are then provided for the borrower to sign and whisked away (God, only knows where). The mortgage got recorded and the note – well… the note does not appear again, if then – until default and foreclosure.

    It’s the chicken or the egg syndrome – and it sounds like a duck, only the borrower has no disclosure that his promissory note was already sold and inside a trust as a security. We’ve always questioned how a loan could be signed, calculated into formulas for the trust, printed and circulated around to investors in a 2-week period of time… kinda unrealistic. And if the unsigned notes were sold or funded by investors – that appears to be Nemo dat… and probably a lot of other violations for investors buying sight unseen, questionable due diligence, pension fund investment guidelines and securities rules and regulations… not to mention state laws.

    Think about this as you watch the Confidence Game when it airs in a theater or Film Festival near you. Stay tuned to DeadlyClear for a sequel interview with Nick Verbitsky.

    Nick worked in conjunction with his brother Paul Vebitsky on the film. Paul is a founding partner of Blue Chip Films in Norwalk, CT. He manages all phases of production and works in many capacities from producing / directing to editing and project development.

    Blue Chip has produced TV, commercial spots, and interactive work for VH-1, WEtv, Food Network, PepsiCo, Kraft, and Unilever to name a few.

  32. No, the servicer, claimed they were the owner of the note and has the right to foreclose. If so, why are they still making the original mortgage payment, not the modified one and to whom?

    Very curious?

  33. @ Chris

    Your original lender is still in business?

  34. Naturally, before being bestowed the honor of consideration for such a correction, Mr. Alleged Lender will require Mr. and Mrs. Deadbeat to furnish reams of verified income documentation. In this scenario, unless Mr. Alleged Lender is required to furnish verified discovery documentation you wind up in a “quid” with no “quo” situation.

    On January 5, 2012, Federal Judge John J. McConnell issued a “Stay Order” on foreclosure cases embedded in the Hamlet link below.

    The Playing Field Has Been Leveled

    From the Order:

    “Order the appearance of any persons necessary to settle any claims…”.

    This suggests that Motions of Protective Order will not be permitted. Mr. Gander…meet Mrs. Goose.

    If these conditions are not met; you might wind up making another deal with the Devil…

    What I find to be the most disturbing trend in this sad foreclosure affair is the recent rush for legislators to change (modernize?) laws. If successful; what was once entirely illegal will suddenly become entirely LEGAL.

    Brand spanking new “laws” are being goose-stepped down our throats in Florida, and Massachusetts appears to be next. The proposed legislation in MA will render the Ibanez decision moot.

    The Bankers are coming! The Bankers are coming! They are coming for YOU!

    What we are witnessing here folks, is a modern day Beer Hall Putsch. I’m not really sure if anything matters anymore; but the time to be heard is now. Florida is just the beginning of the end.

  35. Just a tidbit here:

    I just got my loan history and found out the servicer who adjusted my 30 year fixed mortgage to an 5 year adjustable…did not have any authority or permission to do it. The reason I know this: The “original” mortgage payment is still being put on the accounting history, for the same amount, after the “supposed” change in terms of the mortgage.

    The modification of the mortgage is invalid, so it seems on the ledger. Why would they not credit and apply the new amounts? “cause they had no authority to change the terms…if the judge doesn’t see this something is very wrong! We’ll see. Just another indication of the fraud.

  36. “And in this country when someone is defrauded we take the bounty away from the perpetrators and return it to the victims”

    That’s right, they call it restitution in criminal law.

  37. So with all of the eloquence that is abound here Neil….what do you propose is the best course of action for the Homeowner ?

  38. 3 Things

    Fire Holder !
    Jail the Banksters !
    Let the Big Five fail !

    Clean out any connections to the Clinton & Bush Adminstration.
    Finally – Do not vote for Obama !

    Remember H.O.P.E. – There is no Hope. it did not work
    Remember H.A.M.P – Hamp you out of your house. Just a joke
    H.A.R.P. Just more lip service.
    $ 25 Billion Dollar Settlement – It will not help if you are still under water 200% LTV
    Freddie & Fannies. Thye have your laon and will continue the foreclosures.

    Obama & Holder want you pay for their crimes !

  39. Neil—principal corrections with a third party debt collector of false default debt??? Really???

  40. This is very interesting…and sad…

    I came across an old Promissory Note form that my father in law had (I think it could be from the 60’s), that says on the bottom of the page: “This form furnished by Safeco Title Insurance Company”…anyway—this is what it said on the top of the form:

    DO NOT DESTROY THIS NOTE: When paid, this note, with Deed of Trust securing same, must be surrendered to Trustee for cancellation before reconveyance will be made.

    NOTE SECURED BY DEED OF TRUST

    …back in the days “BM”…”Before MERS”…seems positively prehistoric now. The Promissory Note means NOTHING these days…how the hell did this happen? I know, I know…

  41. Neil please answer E. Tolles’ question with whom?

    NEVER AGAIN

  42. Sign a piece of paper re-affirming a debt with an entity who never transferred your note into the trust so that they could multi-pledge it and still have it to foreclose upon you? WTF kind of reasoning is that?

    And afterwards I guess we should also appreciate the austerity programs we’ll have to endure the world over now that we’ve refinanced the banks and made them whole again. Besides, debt peonage only hurts for a few generations.

  43. Principal corrections with whom?

  44. OH I FORGOT THE BANKSTERS ARE ALSO PARASITES

  45. The reason we should support principal reductions is because it will expose the Ponzi Scheme. the Banksters are only servicers who dont know who the real lender is. So they cant do a principal reduction.

    THE DEADBEAT FREELOADING BANKSTERS MUST BE PUNISHED
    NEVER AGAIN

  46. I don’t know what it is about interest payments, but instead of giving some people in society a “break”, in which others will look at it as a handout, or helping out people who were trying to “flip a house”, why not fight for ultra low interest rates on that mortgage?

    Over the course of a thirty year mortgage, between 1/3 to 2/3’s of all payments are going towards the interest payments, so even if someone is paying on a house that costs too much, lowering the interest rate low enough could effectively lower the monthly payment to virtually what it would be if the homeowne were given a handout.

    Anybody who pays back a debt, even at ultra low interest rates, is NOT getting a handout, and anyone who thinks that they are are just banker scum supporters.

    Lets back off on freebies and attack interest rate charges instead.

  47. I’ve been saying this for the last two years! Everybody looks at me like I’m hallucinating. Do you realize the revenue generated from the extra tax from the “new” middle class? The 1% will gain an extra 20% in the end. And do you know who is going to be the Patsy? Customer service workers and our “Hawaiian” President. How’s that for a Conspiracy Theory?

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