Why Ocwen Keeps Failing the Metrics on Modification

When the courts finally come to terms with the fact that the “lenders” are an undefined and undisclosed group of investors who cannot be identified, they will then be required to deal with the the most basic issue of “what is an enforceable loan contract?” What seems obviously true is most probably wrong.

THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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Coupled with a string of announcements about Ocwen, I was recently embroiled in a controversy over the behavior of Shellpoint and whether the parties should have been forced to go to trial even though the modification process was at best confused, and certainly not complete, thus violating the dual tracking provision of the Dodd-Frank regulations.
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Ocwen had been the servicer and was probably one of 2-3 chains of “authority” that was reviewing the current request for modification with Shellpoint. Shellpoint appeared to have no actual authority other than the authority to foreclose — something that did not require a change of servicers.
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Privately several judges have asked me to explain why the servicers are changing so much. They say it doesn’t make any sense. It doesn’t make any sense. The reason is to create a musical chairs environment in which nobody is actually authority do anything and nobody has any actual responsibility for whatever is done in the name of a Plaintiff who most likely has no financial interest in the debt, loan, note or mortgage.
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In my case, and I suspect many others, there were two letters — one I saw and the other I didn’t see. The one I saw came in the mail and the one I didn’t see was read to me, the day before trial, by opposing counsel. The one I received said the reason was that the homeowners had not complied with the request for documents — a statement that was manifestly false, as even the Judge had previously ruled. The other was what opposing counsel read to me, which was that the homeowners did not qualify for loan modification.
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PRACTICE NOTE: I am always disturbed by even going into the process of modification because it corroborates what the Judge already has in his or her mind — if the alleged “borrower” (homeowner) is engaging in loan modification requests ostensibly with the party who is suing them in foreclosure, then how can the court take defenses seriously when the defense narrative is that they had no authority over the loan?
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The answer of course is that a desperate homeowner will often choose to make a deal with the devil rather than lose their home. And despite the faulty legal assumptions, they may be right. In the context of the mortgage meltdown and the foreclosure mess, each time we apply for and accept a modification we are legally digging our own graves unless the legislature pushes a reset button title much the same as they did in the 1930’s with the Murphy Act in Florida.
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The reason is simple. There is now ample evidence that virtually none of the alleged loans were loan contracts, virtually none of the foreclosures were conducted by or on behalf of a creditor, and virtually none of the settlements conveyed any benefit to anyone other than the intermediary “servicers”. All the mortgages and all the foreclosures, with few exceptions, were fictional. The statute of limitations has virtually nothing to do with this. If you have a deed it is good forever. If you don’t have a deed, you have nothing forever.

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This event of denial of modification reveals several things:

1. That Ocwen is sending out erroneous denials of modifications, even where the homeowner never applied.

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2. That the rules require them to state the denial, the reasons for the denial and what facts they based it on. In the version we received it was incomplete documentation. In the version opposing counsel read to me over the phone, they supposedly did not qualify. If the decision was made because they didn’t qualify, Ocwen had to state how they didn’t qualify.

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3. It underscores that the process is not complete: the letter should show what the homeowner can contest and how to do that —thus leaving time for the completion of the modification process.
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“Metric 31, the metric Ocwen failed to correct, tests whether the mortgage servicer sent a loan modification denial notification to a borrower that included the reason for the denial, the factual information considered by the servicer in making its decision and a time frame by which the borrower can provide evidence that the decision was made in error.”

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There is a 4th possibility: and probably the most likely —  that in my recent case and other cases I have reviewed for other attorneys and pro se litigants, there were two letters not one. Perhaps there were more we don’t know about. One was probably automatically generated by Ocwen (and then sent on Shellpoint letterhead), which is the one we received and the other was the one opposing counsel read to me which never appeared because it was probably sent on Ocwen letterhead — which would have been embarrassing for opposing counsel to explain.

This may corroborate our view that there seemed to be multiple chains involved in the review of the modification request and why there were repeated requests for duplicate information. Ocwen was fronting for one or more parties each claiming some stake in the outcome of the foreclosure — especially whoever (Chase?) was claiming servicer advances from the proceeds of liquidation of the property.  But BOA was named as Plaintiff. And Shellpoint was fronting for either the Plaintiff or Ocwen or more likely the undisclosed Master Servicer of an undisclosed Trust that was asserting false claims over the loan.

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The Master Servicer was seeking foreclosure at all costs because they had a claim for “recovery” of servicer advances they never made — not because there was any effort to recover losses borne by investors, who in most cases were either getting paid (from their own money) thinking that the trust was fulfilling its obligations or who received a cash payout from the underwriter who cheated them.

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All this points to the issue of whether homeowners should be allowed discovery into the modification process — not necessarily to fight about the propriety of the standards used for approving or disapproving a request for modification — but to contest whether there was any actual effort or review to determine whether there should be any modification and how many people were involved in the (a) denial or (b) approval with terms that in some cases are far worse than the loan itself. This is a pathway to the holy grail of foreclosure litigation: who is the creditor and did they authorize foreclosure and did they even know about the foreclosure or the request for modification?

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Of course revealing what was involved in the alleged analysis of the file for modification and who was contacted, if anyone, and who was calling the shots would be very revealing about the truth of these alleged loans and the truth about these millions of foreclosures based upon pure fabrication of documents and relying entirely upon the application of legal presumptions attached to the documents.

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In the end, for current and future cases, the truth will eventually be revealed — when most homes have been subjected to false claims of foreclosure through a series of players who have relied upon a false chain of purported ownership of an alleged loan in which the lenders (investors) were unaware of the use of their money contrary to the prospectus they signed for purchase of worthless certificates issued by an entity that is and always has been empty with no history of any business activity, bank account, receipt or disbursement of funds, ownership of any assets and thus with no legal rights to to execute a valid power fo attorney for a foreclosure that benefits the intermediaries instead of the principal parties whose money was used to make the “loan.”

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When the courts finally come to terms with the fact that the “lenders” are an undefined and undisclosed group of investors who cannot be identified, they will then be required to deal with the the most basic issue of “what is an enforceable loan contract?” What seems obviously true is most probably wrong.

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3 Responses

  1. I am looking into Ocwen loan modification problems for clients in Pennsylvania. You can contact me through my website http://www.jmadamslaw.com if you think you’ve been wronged.

  2. I get a Streamline HAMP invitation at least once a week. Even after I have explained in no uncertain terms that I will never enter in to any agreement with Ocwen. Obviously, other consumers feel they have no choice, but to let Ocwen attempt to legitimize their misdeeds.

    http://www.reuters.com/article/idUSFit973331

    https://www.google.com/amp/s/www.thestreet.com/amp/story/13742489/1/ocwen-outperforms-under-the-us-department-of-the-treasurys-new-streamlined-modification-program.html?client=safari

  3. We shouldn’t have to wait for judges to finally get it. If involving a settlement “lender” or servicer the guidelines specifically spell out chain of title, valid transaction, 3rd party issues. This is where again the Schneider/investor v Chase case is important. Any lawyer, agency has to make compliance w these issues a PREREQUISITE to make any deal.

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