Appellate Court Wrestling with Inconsistent Facts in Foreclosure Cases

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It should come as no surprise that Judges have been confused since the dawning of the mortgage crisis launched by Wall Street. Wall Street was counting on it. And the problem they are having is that most courts, including appellate courts, are presuming the loans existed in the first place. You can’t blame for that because nearly everyone still makes that presumption. How could it not be true? What do you mean the loan came from someone else? Then why didn’t that third person  make sure they were made the payee on the note and the mortgagee on the mortgage? The real lenders didn’t know about the loan and would never have approved it? Preposterous!

Yes, I concede it all sounds like nonsense. But here is something that does NOT sound like nonsense. If the loan actually existed (between the named payee on the note and the named mortgagee or beneficiary on the mortgage) there is no circumstances under which a lawyer for the “lender” or “investor” would withhold proof of that transaction to the borrower, the Court or anyone else that was entitled to that information. If they had proof of payment on the loan they would rush to show it. If they had proof of payment on the alleged purchase of the loan, they would rush to show it — because that would make them a holder in due course (where the borrower has virtually no defenses).

The problem is that with the shell game of plaintiffs, servicers and trustees, Judges are getting distracted as they start picking at the foreclosure actions and entering some judgments in favor of the homeowners but failing to even consider the possibility that the entire scheme is fraudulent. Instead we see articles like the one below where the paperwork is considered “botched.” It isn’t botched. It is part of a fraudulent scheme. Look for any case where the underlying monetary transaction has been shown or proven. It isn’t there. 6-7 million foreclosures and still no money changing hands. What lender would endorse a note and assign a mortgage without receiving payment for it? (Unless of course they didn’t pay anything either at the loan closing table).

And why would anyone endorse a note or assign a mortgage without a sale of the loan and without receiving payment for it? The answer is very clear. They wouldn’t.

But the Courts are starting with the premise that the loan, and the transfer of the loan is presumptively legal and valid. And part of that presumption starts with the wrong question in the minds of judges — why would anyone file a foreclosure action if they were not the injured party whose legitimate interests were abridged when the borrower stopped paying? That slippery slope leads them to ratify unsigned, robo-signed, fabricated, forged paperwork in the belief that it really doesn’t matter how much is wrong with the paperwork.

Judges still assume that the underlying transactions must be real; hence judgment for the homeowner is necessary to avoid a windfall. It is circular reasoning to assume that the claim must be true if it was filed — that is what our constitution is all about preventing.

see The Fate of Foreclosure Cases

Will botched paperwork affect the outcome of foreclosure appeals? It depends on the judges.

The decisions in three cases came down to paperwork and procedure Wednesday before the Fourth District Court of Appeal.

For BAC Home Loans Servicing LP, botched documentation at the height of the robo-signing scandal cost it a foreclosure judgment when the court ruled the lender failed to prove standing to sue homeowner Rosanie Joseph.

The appeals court reversed a foreclosure judgment issued by Palm Beach Circuit Judge Diana Lewis since there was no evidence to show Taylor Bean & Whitaker Mortgage Corp. owned the mortgage when filing to foreclose on Joseph in July 2009.

The 2008 mortgage issued by Key Mortgage Associates was attached to the lawsuit, but no note or assignments accompanied the filing by Ocala-based Taylor Bean, a leading wholesale mortgage lender. The company reported the note was lost or stolen.

Taylor Bean, one of the spectacular bankruptcies of the housing crash, later assigned the note to BAC, which picked up the foreclosure ball.

In trial, BAC produced the original note and mortgage. The note offered two endorsements by the same person, Erica Carter-Shaw as a Key Mortgage attorney and Taylor Bean “E.V.P.” Neither endorsement was dated.

“A party must establish its standing to bring a mortgage foreclosure complaint by establishing an assignment or equitable transfer of the note and mortgage prior to instituting the complaint,” Judge Martha Warner wrote for the unanimous panel. Judges Carole Taylor and Mark Klingensmith concurred.

No File Review

A different panel split in similar litigation: Gafoor Jaffer and Nina Jaffer v. Chase Home Finance.

The homeowners claimed Chase attached a mortgage note payable to a third party without any proof of transfer and used an amended foreclosure complaint that failed to state a cause of action. However, the Jaffers waived the question of Chase’s standing by failing to respond to the lawsuit before default was entered.

Chase conceded some of its employees signed affidavits about the loan documents without first reviewing the loan file.

But the Fourth DCA upheld summary judgment issued by Broward Circuit Judge Sandra Perlman.

In the 2-1 unsigned decision, Judges Spencer Levine and Klingensmith concurred. Judge Burton Conner dissented, citing Chase’s failure to file an accurate copy of the mortgage note.

Deutsche Bank National Trust Co. wasn’t as lucky when it moved to overturn Broward Circuit Judge Kathleen Ireland’s ruling in favor of homeowner Theresa Boglioli.

Attorneys say the decisions may further complicate already-lengthy and expensive foreclosure litigation.

“Normally you see discrepancies of this nature within different circuits. But what we’re seeing in the Fourth is discrepancies among themselves,” said foreclosure defense attorney Roy Oppenheim of Weston. “It just makes this more complex. When there is cloudiness, it just creates more ambiguity and delays the conclusion of the foreclosure mess. In the end it doesn’t help anybody when you have inconsistent rules.”

“The judges themselves are coming up with different rationale based on the same facts, which makes for wildly different outcomes.”

16 Responses

  1. Here in California a situation that a very close friend who ex had gifted her the property and then stopped making the adjusted payments of 7k[I dont blame him]on an Americas Whole Sale Lender,pick a pay loan that was prepared by JIGGER JUMAMIL,and had a 70k yield spread+10k for his broker,and a 3 year prepayment penalty.Ouch.This home still had a good deal of equity as its very unique and it killed her to sell it,but she was worried that B of A would be comin it was 15 months delinquent and I had begged her ex to fight it and he just didnt have the energy.Longer story a bit short the women across the street a Sotheby’s realtor solicited her to sell and knew about the deal with the ex and colludes and underprices the house then comes 3 days later with a all cash offer from a women who has and had no intention of living there and I believe the realtors in that branch actually purchased the home since I can connect them all from other prop records ,but this is the part that is crazy,Escrow refuses to tell the seller or show her where the funds are coming from or where there going.When she ask to see a wire transfer or cancelled check they refuse to take her calls and this was only 3/4 the way threw the 10 day escrow of that her broker left town for 5 of those days so you see the bs is on all levels.I urged her to cancel the sale but she felt as though she would in a bad place.After filing multiple complaints with all the departments,and associations and getting stonewalled with nothing done Im still trying to get her to file a lawsuit.Im a sick person I think.

  2. Sorry, I meant to say thank you to – The A Man – for the link.

    And here’s a short cut to the audit.

    “Audit of the Department of Justice’s Efforts to Address Mortgage Fraud,”

  3. Thanks for the link Christine. In the link under “Audit of the Department of Justices to Address Mortgage Fraud” Page 11 reads:

    “FBI officials stated that the FBI is unable to address every potential allegation of mortgage fraud but attempts to work higher level cases which involve multiple victims, higher dollar losses or fraud activity, and organized groups involved in fraud. Additionally, some SARs may not provide sufficient information to open an investigation, or they may relate to an individual home mortgage which the FBI would not address…”

    Okay. If they don’t address an individuals home mortgage than what Department does?

  4. As a homeowner do I have the right to request documentation I have never received in relation to Internal Revenue Service (IRS) FORM 8300 & FORM 104 & FORMS 56F and FORM 56, FORM 3940A, FORM 211 and 1099 OID; because the loan was taken out my behalf .

  5. The A Man, that was a great piece you refer on the IG, as its a must read! Thanks!

  6. And CORELOGIC has absolutely no claim for reimbursement from homeowner and no lien on the property.

  7. CORELOGIC is to money what MERS is to paperwork. They have been paying insurance and taxes on my house since I first defaulted, once I sued Servicer a few years ago. They still do. I wouldn’t call any attention to it: all that can result is for them to stop paying. They do not pay on behalf of homeowners but for Servicer’s protection. So long as Servicer has an interest in the house, Servicer will do whatever is necessary to protect it and having the RE and insurance paid is of utmost importance. Servicer’s worst fear is when counties or municipalities initiate FC for non-payment of taxes.

    I’d leave well enough alone… In fact, that’s exactly what I’m doing, with my attorney’s blessing.


    Kamala Harris is being blamed for the same conduct by Oakland, CA activists

  9. Louise, waste of time. Corelogic was spun off from a title company. They handle the escrow payments for T&I for most loan service agents. They are in on it, just like the government.

  10. I just received the receipt from the county tax collector as to payment for my yearly property tax on my home since I am in a lawsuit re breach of contract. I am not making payments of any kind on my house. I called the county tax collector and asked “who paid the taxes?”–$938. I was told Corelogic. I looked up Corelogic, and it says they do some kind of servicing (es) for somebody. After the 15th, I will go to their offices and get a paper receipt with the Corelogic krap on it and see if it has anything further. As far as I am concerned, another layer of opacity as to who is getting paid, i.e., the invisible creditor or just the servicer who is not the creditor.

  11. How hard for me to understand that attorney have not taken what in front of them as in the beginning there was a Note & Debt which allows the Title to have life. It does not matter what an another party claims it they are not a registered lender purchasing the debt.

    Taking the easiest target, that is the Ginnie Mae MBS where we know for a fact that they cannot and did not purchase the debt as they are not a home mortgage lender and are not authorize to purchase the loan debt.

    So you got a party in Ginnie that take as the underlying collateral for the Ginnie MBS the blank endorsed Notes the they are not assigned these Notes on the face of the document, thereby leaving a paper trail on all $1.4 trillion of the MBS, that shows a separation of the Note & Debt.

    There cannot ever a time were the Notes and debt can be reunited because Ginnie is in physical possession using UCC3 as the method of ownership, but in order to call the debt due there must be proof of “holder in due course”!

    One thing that known for sure is that on Sept 25, 2008 that there never an chance that Washington Mutual Bank (WaMu) can ever foreclose on a single loan they placed into the Ginnie MBS and there no way another could ever purchase the debt because it belong to WaMu who did not have a Note. As Wells Fargo Bank was acting as the custodian of record, then they are only an agent of WaMu at the time, and cannot act for WaMu who is no longer, and Ginnie Mae who never was the holder of the debt, causes each loan foreclosed a act of a crime plus it violates the US Constitutional Rights of the homeowners, because it an action taken for the Fed Gov in Ginnie Mae who is the issuer only to the “investors” of the MBS!

    It does not matter about Trust or any other parties because the Notes are separated forever from the debts, making the properties free of a debt in the case of WaMu loan and Countrywide or IndyMac!

  12. I said this for over 2yrs here and have submitted this same claim back in Aug 2011 to the SEC as a whistleblower claim. Now Neil finally realizing why would you create “forgeries” and file them when your suppose to have valid documents and your not presenting them!

  13. Appelate court buying time for the fed and banksters.

  14. Not quite Jan, the notes are definitely assigned to the Depositor to keep them BK remote. As far as Countrywide, the media has everyone believe BANA acquired CWBC and all of its affiliated subsidiaries, whic of course leaves out the SPE were the majority of assets were sent to be cleaned – the garbage stays in the SPE, but the performing assets are forwarded on to the BANA balance sheet.

    P.S. All of the reserve systems banks merged their servicing subsidiaries into the National Associations for tax and reserve purposes. The BASEL Accord will be reversed this year. No way the banks could raise the necessary capital in any condition, and more important, why would they want to if it is easier to change the regulations.

  15. Readers may wish to remember that neither BAC Home Loans LP nor Chase Home Finance LLC are actual lenders. they are so-called “servicers,” entities that paid nothing for any “note” and have no risk of loss. In legalese, these are entities that “have no classic aggrievement,” and the courts are not set up to resolve claims made by persons who are not aggrieved.

    As a stretched example of the concept of “lack of aggrievement,” think of two neighbors up the block, one of which has a tree that has limbs that stretch across the backyard of the other. The one neighbor decides to cut off the offending tree limb at the property line. Now you come along as the fellow from down the block and go file a lawsuit against the tree-trimming fellow on the grounds that you are somehow psychically harmed by his act of cutting that tree limb, notwithstanding that you live several houses away, cannot see that tree from the street, and have no ownership interest in either property (or the tree). Nonetheless, it “somehow harms you,” or at least your inner spirit, and you claim money damages, and want the Court to foreclose the house and hand over title to you.

    Well, the Court will look at that Complaint and dismiss it out of hand, on the reasonable grounds that you, as a stranger to the properties (and their mortgage transactions), have no money at risk, are not influenced in any real sense by the events complained of, and there is nothing that either of those other fellows could do or not do that would materially affect you. Thus, you are “not classically aggrieved.” So, out the door you go, chum, as the Court system is not there to deal with imaginary wrongs.

    And you have the same situation with BAC Home Loans LP, which is in reality the old Countrywide Home Loan Servicing LP re-engineered to get rid of the avalanche of lawsuits against Countrywide. Don’t let the fancy name fool you; you are still dealing with the Countrywide garbage employees and their cute little frauds. A so-called “servicer” (and remember, there is no evidence that these guys are even that) has no business in Court suing you, because they have nothing at risk, and are not classically aggrieved!

    In reality, it is even worse. Any of those “loans” were insured by credit-default surety policies, and were long ago paid off by some insurance company – AIG, Radian, AMBAC, MGIC. There is no subrogation in those policies. What you end u with is a “paid” note tat never gets stamped “paid” – so the credit for the payment is never accorded to the borrower, as it must under UCC Rules. Remember, it is “money,” and who cares if YOU pay it or if your rich aunt pays it? Does any true lender care? Of course not. So along comes bank of America’s managers, they find that paid note sitting in some basket along with a thousand others, and say: “Hey, let’s go file lawsuits, we can stamp these “payable to blank,” and then go foreclose the house and sell it, and add that pile of cash to our bonus pool!”

    And then the local Judge, who should know better but chooses not to, rubber-stamps that ridiculous absurdity. Just lovely.

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