Ocwen is NOT Entitled to Invoke the Benefits of a Legal Presumption

Posted on November 16, 2017 by Neil Garfield

The banks are winning  most cases because homeowners choose not to defend. The second most reason for this fraudulent winning streak is the application of legal presumptions that eliminate the need to actually prove their case. 99% of the time they are winning cases in which they should lose and be subject to sanctions for trying to defraud the court and the homeowner.

The bottom line is that if ever there was a source of information that was less than credible in civil litigation it is the case of Ocwen as a servicer. By definition that means that they are not entitled to any legal presumptions. And that means Ocwen must prove everything proffered to prove the truth of any matter asserted.

All statutes on evidence say the same thing: if the hearsay contained within testimony or a document comes from an unreliable source,  no legal presumptions should apply.  So a facially valid document is not presumptively correct as to its contents. And a payment history is not presumptively correct merely because it supposedly came from the records of the servicer.

In plain language, no document from Ocwen should be allowed in evidence without the testimony of a person who either prepared it or who witnessed its preparation and no entry of transactions should be allowed in evidence without the proper foundation by a witness with personal knowledge.

“Familiarity” with the books and records of Ocwen is NOT knowledge of the books and records of the foreclosing party in all events. THAT is where the 3d DCA in Florida and most other courts are getting it wrong. There is no foundation ever laid for showing that the books and records of the servicer are the complete books and records of the named foreclosing party (frequently a trust). What we are seeing is, in reality, fabrications of a slice of a slice of third party records.

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THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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Practice Hint: Ask for the party to whom payments are made on the subject loan account. Ask whether those payments s stopped. In most cases the payments have not stopped even though the borrower has not paid anything. That is because of “servicer advances” where the debt is once again illegally shifted to the benefit of the underwriting bank that is also the Master Servicer. The named foreclosing party is used as a proxy for the Master Servicer to recover “servicer advances.” This is yet another reason why the named foreclosing party is not the real party in interest or, alternatively, the named foreclosing party is only one of many entities who have an exclusive interest in the proceeds of the foreclosure.

Note this paragraph in the Massachusetts consent order:

WHEREFORE, Ocwen, at all relevant times herein was a wholly-owned subsidiary of Ocwen Mortgage Servicing, Inc., which was a wholly-owned subsidiary of Ocwen Financial Corporation, has engaged in the business of servicing residential mortgage loans in Massachusetts. These activities generally include collecting or remitting for any lender, noteowner, noteholder, or itself, payments, interest, principal, and trust items on a residential mortgage loan in accordance with the terms of the residential mortgage loan, as well as the additional servicing activities further described below. Ocwen has also engaged in the business of residential mortgage lending.

The MMC Examination found that the effectiveness of Ocwen’s Management Control Systems (MCSs) failed to keep pace with growth leading to a material increase in operational deficiencies including the failure to timely date borrower correspondence, the failure to timely pay borrower escrow items, the failure to ensure the accuracy of escrow statements, the failure to timely reconcile consumer custodial accounts and the failure to ensure licensure of an affiliate that provides servicing related activities. The MMC Examination review of these operational deficiencies revealed that as Ocwen attempted to assimilate MSR purchases, deficient MCSs caused consumer harm, led to violations of federal and state regulations and resulted in non-compliance with servicing standards required by the 2012 National Mortgage Settlement (NMS). (e.s.)

… the number of Ocwen’s comment codes has ballooned to more than 8,400 such codes. Often, due to insufficient integration following acquisitions of other servicers, there are duplicate codes that perform the same function. The result is an unnecessarily complex system of comment codes, including, for example, 50 different codes for the single function of assigning a struggling borrower a designated customer care representative.” (e.s.)

The MMC Examination found that Ocwen has engaged in a pattern and practice of unsafe and unsound loan servicing by manipulating the lender-placed force-placed insurance market and artificially inflating the premiums and then passing the improperly inflated amounts onto consumers.

If they refuse to give information on remittances to an alleged creditor, how can they claim to be a servicer? What are they hiding?
Who are the “affiliates” that provide service related cities? What are those “service related activities?”

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Hat tip to Dan Edstrom:

Massachusetts consent order against Ocwen from April 20, 2017:
The further you get into this Consent Order the better it gets (unless you have stock invested in Ocwen).
This pretty much sums up the Consent Order
CONCLUSIONS OF LAW
“Based upon the aforementioned Statement of Facts, Ocwen has failed to demonstrate the financial responsibility, character, reputation, integrity, and general fitness that would warrant the belief that the business will be operated honestly, fairly, and soundly in the public interest in violation of General Laws chapter 93, sections 24G, 24I, General Laws chapter 255E, section 4, 209 CRM 42.03, and 209 CMR 18.03.”
From the editor: Note that these are independent administrative findings by a government agency.  Courts are required to defer to the agency’s determination. In the case of an out of state agency ruling, courts are required to extend comity — i.e., accept the ruling unless it is plainly not relevant to the case at bar. Even without such doctrines, the finding casts serious doubt on any evidence proffered through Ocwen, thus eliminating the ability of the foreclosing party to claim the benefit of legal presumptions. All such named foreclosing parties must establish foundation not through presumption but through actual proof of the facts asserted.
Mass. to sue Ocwen:

Filed under: foreclosure |

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7 Responses

  1. Greetings, on November 17, 2017 at 12:45 pm said:

    I follow and love your posts and information…. From personal experience I would say the problem with most all of the legal actions, or lack of pursuing them- is MONEY !!! Most homeowners facing foreclosure or whom have lost their home can’t afford to hire a lawyer and probably don’t qualify for any public assistance because they have jobs. The system is totally stacked against them..

  3. Mary C Schnibben, on November 16, 2017 at 9:27 pm said:

    I have to take issue with your opening statement about “most homeowners *choose* not to defend…” I call BS as I spent nearly 3 years and too way much money and gas interviewing lawyers (and the one I wound up with, while talking ‘big’, didn’t do a damn thing – not even a discovery) to save my home from Ocwen’s clutches.

    The real problem is that Ocwen was and still is a large company, with a lot of expensive legal firepower on its side. Most local “foreclosure defense” lawyers seem to still be of the mindset of having clients file for bankruptcy, rather than make an honest attempt to defend them, from discovery onward, against having their home stolen through fraud.
    I don’t think there really are many truly knowledgeable, experienced lawyers out there capable of standing up to Ocwen and winning.

    You should also be aware that many people have gone through whatever is left of their savings trying to fight back – with little success. The courts are still very much skewed in the banks’ favor.

    Yes, I knew about the robo-signing, among other servicer shenanigans, and had pretty strong proof that fraud had happened and should have rendered at least some of the docs null and void due to fraud (one of the sig’s on my docs including MERS on that so-called “allonge”, matched up with one of the so-called “Scott Anderson (‘VP’) signatures.”)
    By the way, I did ask this column back in 2014, or even earlier, I believe, for legal references/ help and never heard anything back.

  4. ANON, on November 16, 2017 at 6:39 pm said:

    Sue — best comment I have seen.

  5. Charlene Brinkerhoff, on November 16, 2017 at 5:50 pm said:

    Ocwen is not the only one. Bay County Florida Circuit Court case number 13000158CA

  6. louise, on November 16, 2017 at 4:12 pm said:

    Judges want to believe the attorneys for the servicer/trust who are lying and creating fraud on the court.

  7. Sue, on November 16, 2017 at 2:06 pm said:

    Now all we have to do is get the Judges to REALIZE what has taken place behind closed doors.

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