Now It’s the Servicers Betting Against Homeowners

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Editor’s Analysis:

Start with some premises that were speculation but are now known to be true. First, banks and servicers need as many properties in foreclosure as possible. There are many reasons. The banks want it because it covers up the outright bold lies they told investors to get them to “buy” non-existent mortgage bonds most of which involved either no paper certificate at all or they were simply not worth the paper they were written on. Second, the bankers (management) could make a killing depressing Market prices and then relieving the pressure when they wanted prices to go up. Third, servicers make far more money in fees as long as they are “servicing” a loan in default because their fees are higher on loans in distress. Fourth in many cases the servicers actually get to “own” the property if the foreclosure sale occurs.

The tactic used now is that if you miss a mortgage payment or even if you don’t, the servicer can say they were required to obtain insurance on their own because you didn’t. This is forced place insurance and nearly all of it is a bold-faced lie. Now the servicer adds to your mortgage payment the cost of forced place insurance even if they paid nothing. If you are on the edge, the cost of forced placed insurance (many times 3-4 times normal rates) is the straw that breaks the camel’s back. The result? Many homes that were otherwise current in their payments end up in foreclosure.

This can be stopped. On challenge, most servicers back off of forced place insurance claims, but getting them to stop the foreclosure is more difficult — usually because by the time the homeowner challenges the forced place insurance some scheduled payments have been missed. But upon further challenge it can usually be shown that the scheduled payments were in fact made by the servicer to the creditor, meaning that the declaration of a default and notice of sale were bogus — just like everything else in this mess.

Servicers incentivized to bet against homeowners, may hurt housing

by Tara Steele

Insurance policies are not often pointed to as the problem with housing, but one news outlet says homeowners are being pushed off of the foreclosure cliff by force-place insurance.

Force-placed insurance’s impact on housing

“Force-placed” insurance, or property insurance the bank takes out for homeowners who miss an insurance payment has recently come under fire by Bloomberg News Editors1 who say the policies cover less and cost more, and will likely end up putting homeowners into foreclosure regardless of the force-placed insurance policies.

Deeper analysis of the forced-place policies revealed that the loss ratio is much lower than expected, in other words, the percentage of premiums paid out on claims is severely low, paying out $0.20 cents on the dollar, when the average $0.55 cents on the dollar payout of most other types of policies. The implication is that the insurance companies are charging extremely high premiums, and when the policies actually pay out, they barely cover the bank’s losses.

Bloomberg reports that banks not only receive commissions on the forced-place policies, they make even more money by re-insuring them, so the bank takes out a policy to protect the property but is making a more lucrative bet that the policy will never pay out. Fannie Mae has already instructed servicers of Fannie-backed loans to reduce the cost of insurance premiums, but Bloomberg implies that these directives are weak and more can be done.

Although the Consumer Financial Protection Bureau is looking into forced-place insurance, Bloomberg urges the CFPB to require all servicers to pick up the homeowner’s lapsed policy when possible, otherwise seek bids for lower cost options, and notes that Freddie mac should demand its servicers to get competitive bids on insurance policies.

The crux of the forced issue

The CFPB should investigate the commissions made by banks on these policies, says Bloomberg, as they are a major incentive to put homeowners into policies they cannot possibly afford. “Many homeowners who experience coverage gaps have severe financial problems that lead them to stop paying their insurance bills,” notes Bloomberg. “They are already at great risk of foreclosure. Banks and insurers shouldn’t be allowed to add to the likelihood of default by artificially inflating the cost of insurance.”

57 Responses

  1. I was looking for anyone who had filed a claim for the servicing bank placing force-placed insurance on an already foreclosed property. I haven’t found any, so I thought I would mention it here. Capital One, the servicer placed this in my name a month after US Bank acquired my loan at the auction. I called them, they sent me a letter to give to the insurance to prove it was my property so I could get insurance on it myself. (My insurance company would not insure it without me having interest in the property, so I got renters insurance). So, I figured I would add insurance fraud to the list in my claim since they have now started a judicial foreclosure after rescinding the non-judicial foreclosure in July of last year. (they just now informed me of this by the way) I am thinking I can now file summary judgement on the substitute trustee that performed the now rescinded non-judicial foreclosure while I am at it. Of course they said they just did it out of the goodness of their heart, that it wasn’t wrongful…..really?? I should become a para-legal…..
    Keep up the fight….

  2. No matter what they have no business stealing funds due to help homeowners,

  3. So Pratt’s claims here are untrue. The Min # changes, therefore is not the protection he claims. We know the numbers have changed. Either he is not aware of the complexity of it all, or he is ignorant or lieing to the judges. Probably all the above.

    How come he does not know whom owns the Bains loan?

  4. If the states don’t pay the alternative investments due they lose the beneficial interests

  5. SURE while the States were not watching their 401K money purchased common stock of the REMIC’s trading using our promissory notes! Substantive money for extended period of time they were promised has dried up! Now what? Our cash for Promissory Note used to hedge credit risks

    Did you notice how all the company’s who invested heavily into the REMIC’s are hurting now.

  6. Mortgage Servicing Rights sold to Investors are NOTES.
    The # affixed to the Promissory Note does wind up inside of ‘REMIC’s’ the Structured Settlement $ Billion Dollar structured fund cash flow Premier Asset Services’s CTSLink (SM) SECURITIESLink (SM) ….represents alterantive investment settlements, distributions, …

    Fact from RKArnolds Testimony Footnote #2 –
    Wells Fargo & Chase
    do not record retail business sale of NOTES to INVESTORS.
    But, Wells Fargo & Chase require all CORRESPONDENTS’ Business be recorded which includes the exchange of defaults.

    We all start with a Promissory Note affixed Agreement number.
    That Agreement # affixed to Promissory Note that is actively trading inside of REMICs on public exchanges, agreement# Promissory Note listed inside of multple tranches for notes sold to REMIC in which INSTITUTIONAL INVESTOR may have ‘created one loan for a particular CUSIP’ and transmittal tracks sale of notes held by CUSTODIAN.

    goods and services
    through governmental approval of monopolized services – goods and services – placed into public domain for consumer consumption…
    e.g., Notes sold to INVESTORS.

    Mortgage Electronic Registration Systems, Inc. as BORROWER recorded ‘New Registration’ with USPTO and conveyed ‘all security interests’ to Nationsbank N.A. who under FFIEC is BOA. That means all ‘BORROWERS’ security interests ….

    Such security interests would include the $34 Billion dollars 3/1998 that GMAC – Residential Funding Corp received through transfer from equal partners ‘Norwest’ and ‘Wells Fargo Company First Union’.

    ‘June 1998’ goods and services of ‘BORROWER” federal reserve system oversight The Chase Manhattan Corporation (Parent)
    conveyed all ‘security interests’ to Nationsbank N.A.

    Bain & DLJ M&A companies place SPIN to confuse you.

    First 7 digits MERS MEMBER
    Next 10 Digits ‘Agreement #’

    MIN# affixed when existing deal in MERS is repackaged by a MERS Member, .e.g., for a non-member for example.

    All ‘Notes’ real estate receivables are notes
    When you signed the Promissory Note
    You are the BUYER of the DEED in exchange for the Sales Contract.
    DEED in your name is an exchange with CORRESPONDENTS’ who are with title. Anything exchanged falls into secondary market.


    So! The big rush to help homeowners joke on us, rush the settlement for pennies of the restitution required by law, was to really fill the gap for the state government short fall to cover the state exspenses. Where is the outrage? The settlement let the banksters off the hook unless you can afford to go to court on your own, which most can not, then to use the little funds they asked for to fill the gap of the misspent government exspenses. Where is their shame? Not a sign of real help from any of the states to really protect the homeowners. I am going to loose my temper and start to cuss here soon. It really takes me being ticked off to cuss in public.

  8. Nancy Drewe, I am a little confused, still trying to soak this up. Look at the video Bains V MERS, Melissa Huelsman: Pratt the attorney for MERS claims the min# keeps MERS honest. He is a poor attorney by my thinking however. MERS is not an honest company. Pratt boast that MERS was put together to move un movable loans from the 1980″s. Unmovable due to mortgage corruption. Most likely clouded titles and void debt. Pratt can not answer Melissa Huelsman nor the judges question, who owns this loan? He had no idea. Min # or what ever, they get around the number and sell sell sell until the tip of the iceberg is starting to melt with 2.3 billion in losses Dimion is trying to skirt around now, being investigated by the government and the investors. They have ran out of ways to continue their scemes, to hide the losses and the scam. Should start tumbling soon. If our greedy enabling government officials dont bail them out with money out of thin air.


    Any service marks and trade marks and patents are GOVERNMENTAL approved monopolies this one filed new with USPTO is how ‘goods and services’ Uniform Commercial Codes – global commerce.

    http : //

    Scribd is free — if you share a distribution with Scribd – for example,
    your Facebook link, and/or UPLOAD document Scribd allows you to download documents.

    I’ve placed on SQUIBD for your purusal of a very important document.
    But you ‘won’t’ get it if you don’t learn about global commerce includes ‘security interests’ commodites anything ‘exchanged’ in secondary market includes…

    Real Estate Receivables Agreements which are Sales Contracts, sold by you ‘BUYER’ of DEED in Exchange for ‘Sales Contract’ Promissory Note which is a NOTE not a loan when you sell cash to a servicer who is a broker of Goods & Services approved under a USPTO governmental approved monopoly
    Mortgage Electronic Registration Systems, Inc. as BORROWER government approved for Fannie/Freddie/Norwest Insurance and Chase Insurance, Citi Insurance, ….all ‘security interests’ virtual goods and services ‘electronic good entry’ distribution of goods and services under the laws of the COMMONWEALTH of Virgina, where Lawyers Title Services, Fannie, Freddie, Producers (Insurance) Reciprocal Exchange flows.

    Once you understand virtual transactions you’ll understand importance of and ‘extreme value’ of the ‘Security Agreement’ BORROWER ‘security interests of all borrowers which includes you -you don’t need a min# you just need a ‘Servicer Agreement# affixed to your promissory note’ and incorporated by reference is governmental approved monopoly allowing global Goods & Services ‘your Note’ Sale to INVESTOR who purchses CUSIP and guarantees income receivables of portfolios and commitment by a global RECIPROCAL Insurance association, Zucich for example and Maryland ….
    You may not know what I’m talking about but I know what I know and whats hurting you all is you don’t know nor do the lawyers and paralegals who look for law to protect ?
    Regulations and Laws in secondary market don’t apply
    Congress said so
    Civil remedy available

    Now what?

    Parent under Federal Reserve System Chase Manhattan Mortgage of ‘Mortgage Electronic Registration Systems, Inc.’ FFIEC.GOV June 1998- May 1999 signficiant! Federal Reserve Oversight of goods and services -money reported retail for transfer and exchange of notes serviced, assigned, acquired, assumed, relinquished, ….

    Parent under Federal Reserve System Bank of America for NationsBank N.A.

  10. Testing to see if I can post these for people whom need proofof notary signatures of these people: JENNIFER TORRES…ure on file.pdf (983 KB) Download | Remove
    JON FRANKENBERG… LIS PENNET.pdf (575.9 KB) Download | Remove

    If this does not work I have them by email for these two notaries.

  11. re: Scribd: when you click on its link can you download & save as pdf, or do you save as html, or other ways ?? probably many don’t know how to use it!!!

  12. I am able to down load the scribe files without payment. I believe they are free to you unless you are not a subscriber of one of the links to download. I am not real computerized yet, still in kindergarten with computers. However I copie from scribe without having to pay, and I am not cheating in any way.

  13. Any scribd files I find are usually free. Cannot afford to be paying for info.

  14. The chain of title is extremely important , and is one of the biggest issues. The titles were clouded due to the crime to hide the body of evidence so the banksters could commit unlimited crime [shred the notes crime] go to ,

    The county records are being cleaned out of the MERS and RECONTRUST fraud affidavits to steal under a different name. Like the http states a new cloak, like a camellian, to steal, this does not do away with fact the title is clouded. MERS has been under the gun and is proven to have broken chain of title. The MERS and RECONTRUST docs on my sons have all been removed from county records, except I have the copies in the court room. A friend in SanDiego has had the RECONTRUST docs and MERS docs removed before he knew how to protect himself. The only assignment or reversal of assignment states RECONTRUST has recinded the foreclosure and now SunTrust Mortgage is attempting to collect the debt and reforeclose on him. The couple in Buckley Washington the Vos’s that had the BOA man toting a gun that came twice, still had RECONTRUST as their forecloser and MERS docs with the same ROBO signer G. Hernandez and Leticia Quintana on his mortgage. Foreclosing under the forecloser of RECONTRUST, that has left the state of Washington and is under the lawsuit Washington V RECONTRUST, filed by AG Rob McKenna. I have contacted them and just today mailed the copies of all the RECONTRUST AND MERS DOCS of my sons with copies of multiple G. Hernandez as assistant secretary and vice president of MERS, RECONTRUST, AND BOA & more, and the same with Leticial Quintana. All having multiple signatures not matching each other as well. I have a new scanner that is not hooked up yet. So I mailed them to the Vos’s moments ago. To help their attorney save their home. Interesting the Vos’s have emailed now and told me Bank of America told them BOA was recinding the foreclosure by RECONTRUST, pretending to do them a big favor, and then they would give them a modification loan. On a mortgage you and I know BOA does not own. This was a Countrywide loan. The Vos’s are trying to update themselves on all the articles and cases I sent them and have turned it over to their attorney. I mailed them proof of the fraud the next day after the news came out about the gun toting BOA represenative. AND SAID DONT EAT THE FISH! KIND OF.

  15. @ABBY: yes, Certiorari denied, like almost all certs. Probably less than 1% granted. I could not find publicly available link to his 2004 judgment, but he refers to it at top of page 9 of his cert linked below. I think it is possible to find the actual judgment from court dockets online by paying for it. . also, your case postings have been very valuable, but most of them you could just as easily pull the source-files because they are publicly available. The scrib-files apparently need payment when downloaded, right???

  16. I have been atop this for 3-yrs now: I was more curious to learn your take on “broken chain” @ the closing ala breach of contract due to ID Theft, nondisclosure, hidden profits, forged names … fraud is criminal & will catch up to them all, but we must fight collectively + individually. Thanks for the reply.

  17. @Guest
    the certorari was denied recently by the SCOTUS for the Salessi case.

    I was overjoyed and thankful you were taking over posting links to all the original research you were doing.

    But alas, you failed to post any link at all to the 2004 case for Salessi.where he got a judgment.

    So instead of picking at my postings why don’t you put your money where your mouth is. And get your facts straight. You missed the denial of certiorari by SCOTUS.

  18. Goes to show you should not count on one egg in your basket. Put multiple claims and objections in not just one.

  19. Thanks !

  20. @ABBY: Importance is the advance exposures and revelations made in that case & ignored by all. Also, your link is not to outcome of his 2004 case where he got a big judgment, but to the outcome of his 2008 case, which is now in U.S. Supreme Court. anyhow, your linked opinion is unpublished and is worthless, and probably paid for by bank. even assuming it was published–of the 2,000,000 + houses foreclosed in California alone, do you know of a single successful appeal-decision in favor of mortgagors? If you do pls. link it.

  21. @ guest–not so thorough –did you miss the outcome??

  22. @Shelley’s Fannie-Freddie-Fraud Link of May 12: see section 98 of this 2004 Ca. complaint exposing same frauds!!!

  23. @Nancy: Great find: lawyers call these fraudulent scams “law practice” & MBA schools call them “Financial Engineering”; legislators call them: payday!!!

  24. OOPS DID NOT WORK Docs with David Davis and Stephan Broviak and leticia Quintana and G. Hernandez

  25. looks to me like the whole con was like the king who had no clothes, made on a falisy in thin air. No money involved. Just typed in claims of moneys exchanged on computers. Empty PSA’s empty thin air deals. A huge con game a heist by the banks. only they were robbing the global people. Like the book it takes a bank to rob a bank.

    anyone have docs to share WITH THESE ROBO SIGNERS PLEASE FOREWARD. trustees deed M…2009 page 3.pdf (487.3 KB) Download | Remove
    deed of Appoint…stee page 2.pdf (552.6 KB) Download | Remove




    801 GRAND AVE
    DES MOINES IA 50309

    PUB NO: US 2004/0064402 A1


    http: //

  29. Jim, The banks can claim anything they are TBTF(to big to fail)! Plain fraud and lies and cons. Does not mean it is legal. They could not by law.

  30. Yes, that included with multiple additional breaches. Like MERS that held only the trust and no notes. Like non disclosure, your signature for a loan approveal was being bidded and bet on in the stock market. Non disclosure your identity was being tossed around (identity theft) and our predetermined to default loans on credit loans and no money changing hands period, just typed in to the computer, then sold off, to entities you were not disclosed were in the predatory lending chain, Non disclosure we were being set up in advance for predatory default loans, preset up for forced placed insurance to make sure the defalults happened, the fraudsters were betting on, against their own loans to default, then at the same time selling to their own investors customers, stating they were pig crap and to get rid of them to unsuspecting purchasers. Not knowing they had set us up for insurance scams, having twenty mor insurance policy against them preplanned to default to collect the insurance and to give incentive to set us up for default. And on and on and on. If you have not looked up Wall Street and the Financial Crisis; Anatomy of a Financial Collaspe., you are missing out on the proof of all this and the report that should have sent them all to jail with double stainless steal bracletts joinedto gether by a lovely chain. The jewlry they should be wearing.

  31. SE
    If as testified Ahmsi never owned any loans how could Ahmsi transfer the mortgages to deutsche bank ad they claimed to do in many cases

  32. Do you define “broken chain of title” as middle-man meddling, w/o any record of their ownership? Ex: Warranty Deed 6-23-08, yet “closing” 9-22-08 and now “servicer” claiming to be “lender” yet other party acted at “closing” as if a single-transaction? when in fact they did a concealed deal, middle-man never held title thus couldn”t sell what they didn’t own nor could they sell you what you already legally owned as of date of notarized Deed transfer, despite interplay of “lender” + “servicer” concealed around 9-22-08? This is my take. Is it yours?

  33. Re: Forced Place Insurance
    I know of a situation where the former homeowner is being charged for forced place insurance by the big BANK some 4+ years after the foreclosure sale on the home!!

    Of course it is brand new billing for forced place insurance in addition to prior years –all again after the house has been sold at a foreclosure sale. Answer me this–so why isn’t the new owner, namely the securities trustee, being billed for the forced place insurance?

    At the county recorder, the new owner is the bank named as securities trustee. The forced place insurance bill should be going to that bank!!

    The fraud continues…………

  34. Jim, look up They dodge the notes, they specifically state they dont want any notes. In the lawsuit Duetsche V FDIC/Chase/WAMU, Deutsche claims FDIC/Chase& WAMU did not transfer the PSA’s on time and they are faulty. This kicker is Chase then makes claim, Chase is not responsible for the transfer of the notes, cause they only assumed servicing rights and did not assume the loans. In cases against multiple banks like AMHSI the lenders are telling they dont own the loans. They are the servicers/debt collectors. I have not seen one letter from the debt collectors that state the foreclosures are the creditors. They all state they are debt collectors, they cannot be both. It is looking more and more like the FDIC knew there were no notes and therefore did not sell the loans but gave out servicing rights to the debt collectors to con the people to steal the houses on yet another con. The evidence of all the fraud assignments is a tell on this also. Why take chances of traud assignments if you have the notes? Why cause all the fuss in the court rooms that the foreclosers dont have to prove they hold the notes? if they can simply show them and prove them. ONE CAN ONLY ASSUME THEY DONT HAVE THE NOTES AND THEY DONT OWN THE LOAN. They all have the same story. The foreclosers all have the same game of fraud assignments. I have yet to hear of proof made by presentation on a wet stamp note. Only photocopies and affidavits of claims having the notes. THIS TELLS ALL. the banks would not have to buy the judges if they had the proof. In most law suits you are thrown out without discovery. The banksters dont want you in the discovery process or in court infront of a jury. You get five to fifteen minutes and off with your head and out of your house. The push and rush is a coverup.

  35. @mkd

    That’s insane, shocking, and disgusting…and unfortunately par for the course in our totally corrupt financial system.

  36. Yes! The banks are absolute con artist at every peel of the onion. Sophisticated criminally intelligent cons. I was told my son is criminally intelligent. Not that he is a criminal. He is a good person with a good heart, but that criminally intelligent means they can figure out most anything including sophisticated cons and criminal activity. The banksters have used this intelligence to harm,steal, pilfer, and destroy families, and society, to control us.

  37. Carie

    Regarding the may 2011 anonymous quote asserting sales of loans from Hr block to Wilbur Ross. I noted testimony by Ahmsi officials before congress some time ago affiirming (shall we say) that Ahmsi never owned any mortgages

    What does your anonymous have to say to that

    Incidentally quoting someone who can’t or won’t be questioned is what weve been complaining about for centuries

  38. In early 2007, Wells Fargo tried to force place insurance on us 6 months after they became our servicer. We paid our insurance premium in full for the year and Wells Fargo was listed on the insurance. A couple of months after the insurance was paid, I got a letter stating if we did not get insurance they would get their own insurance to cover the house. I called and talked to this idiot who could not get the fact that our premium was paid and they were on the policy. I read the policy to her and faxed her a copy.

    Thought all was taken care of when a week later I got a call from Wells Fargo regarding the lack of insurance. Very forceful call. Explained that we did have insurance and that I sent a copy of the policy showing we had insurance and Wells was listed on it. I had to get my insurance agent involved and finally it was resolved. My insurance agent said he has been seing this happening over and over.

    Then a month later Wells said we did not have flood insurance and we needed to get it. We live on a hill so we were in no danger of being flooded and our mortgage paperwork also stated we were not in a flood zone. Went around on that one also.

    Goes to show you that they will do anything to put you in default.

  39. FDCPA wins and RICO claims are cropping up more and more.

  40. Put this under the “You can’t have it both ways” column.

    Wells Fargo Loses Bid to Dismiss Homeowner Suit
    By CHRIS MARSHALL of Courthouse News Service:

    SAN FRANCISCO (CN) – A federal judge dismissed part of a class action accusing Wells Fargo of offering temporary loan modifications without the intention of ever making the modifications permanent.
    U.S. Magistrate Joseph Spero found the class failed to state a claim for breach of contract or debt collection violations while allowing unfair competition claims to remain. Spero also gave the class leave to amend the complaint to allege damages from the bank’s alleged contract breach.
    Lead plaintiffs Vicki and Richard Sutcliffe claim Wells Fargo offered them a temporary home loan modification after they fell behind on their mortgage payments. The Sutcliffes made the required reduced payments but did not receive paperwork for a loan modification at the end of the trial period. Instead Wells Fargo sent paperwork indicating the loan was in default and another letter stating it was not going to permanently modify their loan. Over a month later Wells Fargo sent another letter offering them a “Special Forbearance Plan,” under which they would make more reduced payments. Plaintiffs made the payments, only to be sent another letter again stating the loan was in default. The bank returned one payment and told the Sutcliffes not to make any more. Soon after they received a letter from a law firm indicating they had been retained by Wells Fargo to initiate foreclosure proceedings. Plaintiffs asked Wells Fargo again to reconsider the loan modification. The bank responded by putting them on another forbearance plan. Plaintiffs accepted the offer and began making payments. They soon received another letter saying the property would be sold at a trustee’s sale.
    Plaintiffs filed suit on behalf of “all homeowners nationwide who received a trial loan modification proposal substantially similar to the TPP (Home Affordable Modification Program Trial Period) from any of the Defendants; made the payments set forth in the proposal; provided true information with respect to all representations required by the proposal; and were either (a) denied a permanent loan modification; (b) offered an illusory ‘modification’ on terms substantially similar to their unmodified loan; and/or (c) who received, entered into, and complied with the above described Forbearance Plans from Wells Fargo, consisting of the Offer Letter and Agreement, in substantially the same form(s) presented to Plaintiffs.”
    Plaintiffs accuse Wells Fargo of unfair competition, breach of contract and bad faith. Claims for rescission and restitution were rendered moot when the Sutcliffes recently accepted a permanent loan modification from Wells Fargo, according to the ruling.
    The court rejected Wells Fargo’s argument that the other claims were not ripe, finding their claims “turn on conduct that had already occurred at the time the action was filed, namely, Wells Fargo’s failure to offer them a permanent modification after Plaintiffs allegedly complied with all requirements of the TPP.”
    The court also noted that “the allegations were sufficient to show that denying judicial consideration would have imposed significant hardship on Plaintiffs because they had received notices that they were in default on their loan and that their file had been passed on to Wells Fargo’s counsel to initiate foreclosure proceedings.”
    Spero similarly refuted Wells Fargo’s argument that by offering a permanent modification, all plaintiffs’ claims are moot. According to the ruling, “claims that are related to a foreclosure but which are based on alleged wrongful conduct that goes beyond the wrongful foreclosure are not necessarily rendered moot where the foreclosure is vacated… The Court finds that is the case here because Plaintiffs’ claims are based on Wells Fargo’s alleged unfair and deceptive conduct in connection with the two forbearance offers and the TPP and not on wrongful conduct committed in foreclosure proceedings.”
    The court found Wells Fargo’s assertion that the relevant conduct in the case did not occur in California to be a factual question that may be suitable at summary judgment but does not support dismissal. Wells Fargo had tried to have plaintiffs’ allegations under California’s unfair competition law tossed on the grounds that the conduct did not occur in California.
    Concluding that the public would likely be deceived by communications from Wells Fargo that claim the borrower would be offered a modification if the borrower complied with the terms of the TPP and forbearance the court found the allegations sufficient to hold up at this stage of the litigation.
    While noting disagreements among courts about whether an enforceable contract was created when the TPP was sent to plaintiffs Spero ultimately found it was, at least for the purposes of surviving a motion to dismiss, rejecting multiple arguments by Wells Fargo, including that the TPP could not create an enforceable contract because it did not set forth the terms of repayment that would apply to the modified loan.
    According to the ruling, “As the court explained in (Wigod v. Wells Fargo Bank), while the TPP did not set forth the specific terms of repayment, Wells Fargo was required to offer a modification that was consistent with HAMP (Home Affordable Modification Program) guidelines and therefore, the agreement did not give Wells Fargo unlimited discretion as to the repayment terms… Because Wells Fargo was required to comply with HAMP guidelines in determining the terms of repayment under a modification agreement, the Court concludes, at least at the pleading stage, that the terms of the TPP are sufficiently definite to support the existence of a contract.”
    And since plaintiffs were required to submit financial documents not required under the original loan and agreed to go to credit counseling they adequately alleged consideration to survive a motion to dismiss.
    Spero did end up dismissing the claim for breach of contract, however, agreeing with the bank that the only alleged damages are the reduced payments made under the TPP and these payments do not constitute damages because plaintiffs had a pre-existing duty to make payments on their loan.
    The court gave leave to amend that part of the complaint, however, noting that plaintiffs represented at oral argument that they could allege other types of damages, including adverse credit consequences in an increase in the principal amount owed on the loan.

  41. My believe the loan account numbers changed was to sell more of the same loan in the securities pools and make more money on the loan. Cause confusion. Make the market think there are two loans for every one and then sell them thirty plus times or cover them with thirty insurance policies for default insurance. The con job has been the biggest largest heist in history.

  42. In Lisa Bridge v. Ocwen Federal Bank, the Sixth Circuit reversed a dismissal in a FDCPA case brought by pro se plaintiffs regarding their mortgage.

    Lisa Bridge, the only person listed on her mortgage, owed monthly payments to Aames Capital Corporation. Her bank, Firstar, refused to honor her April mortgage check. Thereafter, Lisa ordered Firstar issue an “official check” to Aames, but Firstar refused to honor that check as well. Aames then notified Lisa that she was in default and assessed a late fee. Firstar ultimately honored a second “official” check and, additionally, Lisa’s personal check. Therefore, Lisa satisfied April’s payment and paid May’s in advance.

    In the meantime, Aames assigned the mortgage to Ocwen, which the Bridges alleged is a division of Deutsche Bank. Ocwen began “dunning” both Lisa and her husband William (who is not listed on the mortgage). Ocwen repeatedly called the Bridges, despite cease and desist requests made to the federal “Do Not Call” directory; threatened foreclosure; assessed monthly late fees; and reported negative information to credit reporting agencies. Further, Ocwen apparently retained a law firm, which sent a foreclosure threat by mail. Plaintiffs Lisa and her husband William Bridge sued Oscwen and Deutsche and related parties under the Fair Debt Collection Practices Act (“FDCPA”). The district court dismissed the Complaint, holding that defendants did not fall within the Act’s definition of “debt collector.”

    On appeal, the Sixth Circuit reversed, holding that the Bridges alleged facts sufficient to satisfy the statutory definition of debt collector under the FDCPA (15 U.S.C. § 1692(a)(6)), which requires—in addition to persistent collection efforts intended to harass, oppress, or abuse—that the defendant seek collection of debts “owed or due or asserted to be owed or due another” and utilize interstate commerce in collection efforts. Furthermore, the Court rejected as “disingenuous” and “exemplary of an unsettling trend in FDCPA claims” Ocwen’s argument that plaintiffs’ position that the mortgage was not in default relieves Ocwen of liability under the Act. Although the FDCPA does exclude from the definition of debt collector efforts related solely to a debt which is not in default at the time it is obtained, the Sixth Circuit held that defendants could not “have it both ways”—for years demanding payment on a defaulted mortgage then, for purposes of avoiding liability, denying the mortgage was in default to begin with.

    The Court held that “the definition of debt collector pursuant to §1692(a)(6)(F)(iii) includes any non-originating debtor holder that either acquired the debt in default or has treated the debt as if it were in default at the time of acquisition.” This holding, the Court noted, is supported both by the language of the FDCPA itself, which uses the word “asserted to be owed or due another,” and the legislative history suggesting that Congress meant to enact a sweeping reform to a “widespread problem.” These holdings were also applicable to William Bridge because Congress intended to protect family members “who do not owe money, but may be deliberately harassed.” Judge Clay concurred in the judgment regarding one of the defendants, but effectively dissented as to the thrust of the majority’s opinion.

  43. Carie, this all comes down again to the bottom line, the contracts were breached at inception. Undisclosed fraud victimizing the unsuspecting homeowners. The pools were never complied with and the preplanned defaults were never disclosed. Predatory at every peel of the onion. That is another reason i push the breach date for the state statutes of limitations. In my state six years from breach the debt no matter what the debt, or good debt or valid debt, it does not matter who carries the note valid or invalid. if breached for any reason, the debt is uncollectable by statute. Every step after the breach is invalid and void. Invalid notes and contracts were being sold. Which does not even require the statutes of limitations for mortgages or written contracts to be taken in to consideration, which include promissory notes. Void PSA’s equal void contracts right then and there, at the date of invalid [VOID] PSA contract and discharged off debt, Voids the note right then and there, on the 91 day of when failure to transer into the PSA’s. All events after that dont count, they are all fraud and non accountable. Just like any assignment after broken chain of title. Nothing after counts as a valid chain of title, once broken.

  44. “Servicer reliance?? No — servicer manipulation to to falsely “buy” false default collection rights – from GSEs — by manipulating records – and insurance.”

    maybe this is why our “loan” account numbers changed…?

  45. Reposting some of ANONYMOUS’ comments from last year for those who missed them…

    ANONYMOUS, on May 23, 2011 at 6:32 pm said:
    David C Breidenbach
    You do not understand the distinction between “investors” and “security investors.” There is a big difference. This is the major oversight that is ignored and not addressed on this site. .
    It is only the collection rights “investors” that could actually do any write-downs that would include any meaningful principal reductions. And, at this point, complete discharge is warranted – not principal correction — because the “loan” was fraudulent to begin with!! As I now see it — there is no other way than complete discharge.
    Teachers/Police — retirement funds??? — SHOULD NEVER have been invested in subprime “loan” CDO security investments to begin with — it was against their risk-based investment guidelines. They wanted WHO?? to fund their pension — homeowner target victims?? Nevertheless, these were only SECURITY INVESTORS — not the owners of the (false) subprime loan collection rights. Non-diligent??– yes– but NEVER the owner.
    “Reasonable Homeowners” ????? These homeowners are victims of fraud. And, the fraud is widespread — from the onset of ORIGINATION. Involving massive fraud..
    Mediation??? Why??? To benefit the “investors” that hold fraudulent collection rights??? Is this what some here are about??? To get the fraudulent “investor” collection rights proceeds to the fraudulent “investors” — that never had any VALID/LEGAL right to collection to begin with???
    This is the problem — a fallacy that does not end because of the lobbying by these “investor” debt buyers — who fueled the mortgage fraud crisis to begin with!!. And, many of these debt buyers — were investment banks to begin with. But, as these banks “clear” their balance sheets — WHO now holds those rights???
    Any party you may represent?? Hope not – very disappointed if so. Have trusted your posts in past – up until this one. A “middleman” ??? No need for middlemen. Never a need for middlemen when fraud is involved.
    .ANONYMOUS, on May 23, 2011 at 4:09 pm said:
    Oh — how the money was made — on the peoples’ backs.
    Do not want to hear the poor investor story –”investors” — did it!!!
    David C Breidenbach,
    Fraud — Insurance — Fraud — Insurance — over and over and over.
    No record is valid — if that record is fraudulent. Period
    ANONYMOUS, on May 22, 2011 at 4:40 pm said:
    H & R Block — changed their subsidiary (Option One) name to Sand Canyon — when they sold their loans to Wilbur Ross. What??? changed the name — when they sold the loans??? Yep.

    ANONYMOUS, on May 21, 2011 at 6:47 pm said:
    Absolutely accurate — Very good Neil — a couple of points — Quote –
    “the banks are busy burying the bodies in transactions conducted in “private exchanges”
    “But they do have a huge liability created by the sale of credit default swap contracts”
    THOSE swaps are swapped out collection rights — AND those collection rights were orchestrated BEFORE the swaps were even executed – because subprime was nothing more than added debt to already documented collection rights – paid by insurance..
    “So the solution adopted by the banks is the time honored tradition of keeping the “assets” moving.”
    THESE ARE NOT BALANCE SHEET ASSETS — but rather — concealed collection rights INCOME – by private “exchanges” — that are kept going and going.and going by fraud.
    Court?? To prevail is to thwart the perpetrators — – despite the deregulation — Not easy — proof is concealed — by deregulation.
    .ANONYMOUS, on May 21, 2011 at 5:50 am said:
    Credit reports — nearly impossible to fix. Have to examine every fine detail, check addresses, etc.
    Know of incidences where “verification” is sent to a person with a cell phone.
    Carie — Debt is debt — former mortgage now just like a credit card debt. Insurance covers the default – and collection rights are swapped out (of trusts) — or directly sold – to a debt buyer entity. When you pay on any “debt” — you do not know who you are paying — and, therefore, remains — unpaid.
    However, for mortgages — credit reports will show — after insurance kicks in — that the account is PAID – IF there is a “refinance” on the already insurance paid debt. But, if you check the fine details — PAID status cannot be viewed as accurate to potential creditors. Details will likely give this clue
    .ANONYMOUS, on May 22, 2011 at 5:32 pm said:
    The biggest fraud — comes from servicers — who falsely placed GSE loans into default by misapplying payments-perhaps, by misapplied homeowners escrow insurance payments. This occurred — before homeowner ever actually defaulted. And, occurred before homeowner ever “signed” a subprime mortgage (false) “refinance.”
    The fraud occurred before homeowners ever knew fraud was occurring — and BEFORE — they ever actually missed a payment.
    Servicer reliance?? No — servicer manipulation to to falsely “buy” false default collection rights – from GSEs — by manipulating records – and insurance.
    How else do you think Wall Street shifted mortgage market from GSEs to Wall Street??? Fraud, fraud, and more fraud. Insurance — false — carried the day.
    Origination?? At subprime refinance?? Think again. Did not happen. All in place — manufactured default — insurance fraud — all before “Joe” homeowner even blinked an eye at fraudulent subprime refinance so-called “signing”.
    ANONYMOUS, on May 22, 2011 at 4:36 pm said:
    Quote — “The average Joe is both a player and one of the victims.”
    Umm – the average Joe — is WHO???
    Quote — “pension-holders depending upon the the funds manager for the investors, are the victims”
    #1 – Pension holders should NOT have been investing in subprime mortgage “loans” – to begin with. The real “investors” in the subprime fraud were — the perpetrators — and many continue to be the perpetrators. The victims are not security investors — non-diligent pension security investors — who have been paid in full.
    #2 — Accounting is the tip the of iceberg — it goes deeper — because — the bogus accounting was based upon bonus records to start with. Fraud, fraud, and more fraud. Delinquent?? find out when you were actually placed in delinquency. If subprime refinance, it is before you were actually delinquent!!!.
    Accounting fraud ? Yes — but need to go way back – to ascertain false records that falsely demonstrate—– false accounting/manufactured defaults — before “Joe” — ever defaulted.
    This will surface.
    Victims — the average homeowner — was NEVER a “player.” The average Joe homeowner was a victim from the onset of subprime refinance fraud.
    Time for the truth.
    “Investors” trying to continue fraud —- has to stop.
    Game is over.


  47. Neil you forgot the bigger picture! The bankster families gain control of the population. They dont care who is president or who runs the county in any country as long as they have the controlls, the money, the property the power to assasinate, threaten the leaders and control the world. That is the bigger picture here. I believe the majority of the homeowners were pushed off the cliff with this forced placed insurance. The key to forced defaults.

  48. Hello Jennin,

    The plantiff has the PSA so read it & see what states regulates it. The court allowed it to be refrenced which by itself is a positive as some courts are not even allowing it as evidence. Anyway, chances are NY law will be the governing law or possibly Delaware.

    I would write the NY AG & explain the situation. Ask him for clarification if the assignment violated NY Trust Law. Michigan might have different statutes that conflict with NY & the contract states it is governed by NY law than that should trump Mich law. IMO

    I think this would have to be fought in federal court. If you could get something from either the NY AG or NY county attorney stating it violated trust law you might have a shot. I’m not really sure if this could even be accomplished but I’m not sure what else I would do besides having a consult with a foreclosure attorney. I’m not aware of any in MIch

  49. My mother and step-father had Allstate for over 22years and were paying about $365.00 twice a year for their homeowners policy. His daughter closed their BofA accounts, another tragedy, which affected their automatic payments. In short, BofA charged them $11,877.82 per year for coverage. Talk about financial abuse! A two bedroom, 2 bath home built in 1917! They had a reverse mortgage and have since passed away. I’m fighting BofA and foreclosure.

  50. “Verified” in a Foreclosure Case – What Does it Mean?

    Posted on May 10th, 2012 by Mark Stopa

    We all see the term “verified” in residential foreclosure lawsuits on a regular basis … but what, exactly, does it mean? Years ago, there wouldn’t have been a question in this regard. In years past, “verified” meant under oath, or under penalty of perjury, as provided under Fla. Stat. 92.525 … the equivalent of live testimony in open court. Now? The law is much less clear, so much so that plaintiffs’ lawyers are making arguments that are contrary to law.

    The ambiguity began in February, 2010, when the Florida Supreme Court, in response to widespread robo-signing, began requiring that all plaintiffs in residential foreclosure cases verify the foreclosure complaints they file. The intent was raise the bar … to create an additional hurdle for plaintiffs to follow to ensure they would investigate their lawsuits before filing them (and to eliminate garbage pleadings).

    The problem is that the verification required under Rule 1.110(b) is not a normal verification, but a special one created just for purposes of residential foreclosure complaints. To illustrate, Fla. Stat. 92.525 requires a verification be made under penalty of perjury, i.e. sworn to be “true and correct,” whereas Rule 1.110(b) permits a lesser verification, i.e. “true and correct” to the best of one’s “knowledge and belief.”

    The question hence becomes … in what contexts is a verification sufficient if done “to the best of one’s knowledge and belief,” and when is the normal verification under Fla. Stat. 92.525 required? Two specific situations come to mind – Summary Judgments, and Orders to Show Cause.

    Plaintiffs’ attorneys will undoubtedly point to a recent decision from Florida’s Second District, which ruled that verifications on “knowledge and belief” are sufficient in a residential foreclosure complaint, in support of their position that verifications on “knowledge and belief” are satisfactory. See Trucap Grantor Trust 2010-1 v. Pelt, 37 Fla. L. Weekly D 622 (Fla. 2d DCA 2012). However, Trucap merely says a verification on “knowledge and belief” is sufficient in the run-of-the mill foreclosure pleading. It sheds no light whatsoever on the question of whether this type of verification is authorized in other contexts, i.e. Summary Judgment or an Order to Show Cause.

    For instance, when a foreclosure case goes to summary judgment, is this type of equivocal verification allowed? And what about when a plaintiff seeks an Order to Show Cause under Fla. Stat. 702.10 – is the qualified verification under Trucap sufficient?

    In each case, I think the answer is “no” – the verification must be unequivocal, i.e. under oath, as set forth in Fla. Stat. 92.525. Here’s why.

    Fla. Stat. 702.10 has been in existence for a long time – long before Rule 1.110(b) was ever created. In my view, the law clearly requires, to obtain an Order to Show Cause in a residential foreclosure case, that a plaintiff verify the complaint consistent with Fla. Stat. 92.525, not the lesser verification under Rule 1.110(b). In fact, at least one Florida decision has specifically ruled that the verification must be done in this manner. See Muss v. Lennar Fla. Partners I, L.P., 673 So. 2d 84 (Fla. 4th DCA 1996) (not allowing verifications “on information and belief” in the context of an Order to Show Cause).

    Plaintiffs’ attorneys will argue Muss was decided before Rule 1.110(b), and that is true. However, the entire purpose of Rule 1.110(b) was to raise the bar for plaintiffs in foreclosure cases – not to lower it. Hence, to argue 1.110(b) allows a qualified verification in the context of an Order to Show Cause, you’d necessarily be arguing that the Florida Supreme Court lowered the bar via Rule 1.110(b) for Orders to Show Cause without mentioning Orders to Show Cause at all. In my view, there is no way the Florida Supreme Court changed the requirements of Fla. Stat. 702.10 or overruled Muss without explicitly stating so. Rule 1.110(b) requires the verification set forth in Trucap without changing the verification requirements of Fla. Stat. 702.10 and Muss.

    So what does this mean? If you’re facing an Order to Show Cause in a residential foreclosure case, make sure you argue that Rule 1.110(b) might be sufficient for a run-of-the-mill foreclosure complaint, but it’s not sufficient to enable a plaintiff to obtain an Order to Show Cause. For that, an unequivocal verification, as set forth in Fla. Stat. 92.525, is required – not merely one on “knowledge and belief.” At this point, there is not a written opinion from a Florida district court which makes this distinction. Trust me, though – it will happen at some point.

    A similar clarification is important when dealing with motions for summary judgment. After all, long-standing Florida precedent requires that the verifications used for purposes of summary judgment be unequivocal. Quite simply, it is not sufficient for a plaintiff or a defendant to give an affidavit “on information and belief,” or “on knowledge and belief” – the affidavit must be verified under oath.

    To illustrate, in Ballinger v. Bay Gulf Credit Union, 51 So. 2d 528 (Fla. 2d DCA 2010), the Second District reversed a summary judgment because it was based on a verification done “on knowledge and belief.” In other words, the court ruled the evidence supporting summary judgment was not sufficient because it was not “evidence” at all given the qualified verification.

    As such, if you’re dealing with a motion for summary judgment in a mortgage foreclosure case, don’t allow the bank’s attorney to argue they’ve proven their right to summary judgment (or proven you’re not entitled to summary judgment) because their complaint is verified. After all, that complaint is probably verified “on knowledge and belief,” and that type of verification is simply not allowed in the summary judgment context.

    Again, there is not yet a Florida case which makes this distinction, but I assure you – it’s coming.
    Mark Stopa Esq.

  51. They will hide their insurance dealings + payments (aka “$credits” that should be ledgered to YOUR ACCOUNT!!!) and will deny that they placed it. If you ever get a letter from an unknown 4th party insurer, get the information from them & use it in court. CFPB will NOT help you
    and will give all your complaint info to “servicers” or “lenders” and they will then use it against you as evidence: believe me, I know firsthand! Trust your instincts + Neil’s very astute reader-contributors for Truth.

  52. JennInGa- here’s how I would fight this argument: I would endear myself to the judge by telling him/her that “If brains were gasoline, you wouldn’t have enough to fill a piss-ant’s motorcycle doing half a lap around the inside of a Cheerio”. While not a concise legal argument, it may give the judge pause to reconsider, particularly in light of the court’s apparent acceptance of deficient pleadings by banks/nonbank banks/legally nonexistent trusts.

  53. The obvious question arises: is a “loan” a “mortgage loan” as in the language of the Court when there is no mortgage attached to the loan? Seems that if a “mortgage loan” has no mortgage going with it into the trust pool, then it is no longer a mortgage-loan, it might be a mere loan. We call that “the plain language version”.

    The Eastern District of Michigan is a difficult place to litigate. There is a disproportionate number of quite think-headed Judges in the USDC there (Detroit and Flint).

  54. Sorry off topic – just posted this on an older post too and did not want it to get missed. I did not copy the entire thing – just the part that shows how the servicer (LITTON) has won the argument- the borrower just misunderstood – it is “ok” for the assignment to happen YEARS after the trust has closed…

    Saw this last night – from Google scholar – it makes me sick.

    To all with a crazy assignment dated years after the trust closed (a false document used to mislead the courts) please see the case below and be prepared for them to try to use this argument.


    Smith v. LITTON LOAN SERVICING, LP, Dist. Court, ED Michigan 2012

    CHARLIE SMITH, JR., Plaintiff,
    LITTON LOAN SERVICING, LP, a foreign corporation, and DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee Under the Pooling and Servicing Agreement Dated April 1, 2006, Fremont Home Loan Trust 2006-2, Asset-Backed Certificates, Series 2006-2, Defendants.
    Case No. 10-14700.

    United States District Court, E.D. Michigan, Southern Division.
    April 26, 2012.

    Plaintiff argues that Deutsche Trust was not entitled to foreclose on his mortgage because the assignment of the mortgage to Deutsche Trust was void. Specifically, Plaintiff asserts that the pooling and servicing agreement which created the Fremont Home Loan Trust 2006-2 imposed a “cut-off date” of April 1, 2006.[1] Plaintiff argues that this provision invalidates the March 13, 2010 assignment of the mortgage to Deutsche Trust, as the assignment occurred nearly four years after the cut-off date.

    Plaintiff misunderstands the function of the cut-off date provision, which relates to the selection of mortgage loans for inclusion in the trust. See Pl.’s Br. Ex. 1 at 201. It does not restrict the availability of remedies in the event that the borrower defaults on the loan. In seeking to apply the cut-off date provision to prevent assignment of the mortgage, Plaintiff essentially fails to recognize that the mortgage and the mortgage loan are not interchangeable. Plaintiff cites provisions of the pooling and servicing agreement which require the transfer of “mortgage loans” to the trust within a certain time frame. Pl.’s Br. 4. Plaintiff concludes that the assignment of his mortgage to the trust outside of this time frame was untimely, but the cited provision only restricts the transfer of mortgage loans. The mortgage is a security interest in real property which secures the repayment of the mortgage loan. While the pooling and servicing agreement established a schedule for the assignment of mortgage loans to the trust, it did not similarly restrict the assignment of mortgages. The assignment of the mortgage is one step in the process of foreclosure by advertisement, a remedy that is expressly provided for in the agreement. See Michigan Compiled Laws § 600.3204(3); Pl.’s Br. Ex. 1 at 219. Deutsche Trust established a record chain of title through the assignment of the mortgage from MERS, and was thus entitled to foreclose by advertisement. Plaintiff has failed to identify any fraud or irregularity in the foreclosure sale. His interest in the property was therefore extinguished by the expiration of the six-month redemption period on November 12, 2010.

    Plaintiff asserts that Defendants have violated several statutes prohibiting fraud on the courts and fraudulent conveyances of real estate. These allegations are premised upon a finding that the foreclosure sale was improper. The Court has rejected this argument, and concludes that Plaintiff’s new allegations of fraud lack merit.

    The Court has carefully reviewed Plaintiff’s arguments, but concludes that it did not err in granting Defendants’ motion for summary judgment.

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