The Lesson here is that the denial of modification presents and important opportunity to challenge the practices, authority and viability of claims by parties who seek to collect, enforce or administer loans.
[This decision is dated 11/15/17. Check any future litigation or comparable decisions before using. ]
The goal is foreclosure. There can be no doubt that the modification process over the last 20 years has been largely an exercise in futility. That’s because the parties who are asserting the right to collect, enforce or administer residential loans actually have no interest in making the loan a performing loan.
And that is because they do not have any of the loans as an asset on their balance sheets. Allowing a nonperforming loan to be modified would merely preserve a stream of revenue consisting of principal, interest, insurance and taxes together with fees is attached to that revenue stream.
But a foreclosure results in the sale of the property. This produces a windfall equivalent to the sales proceeds. This windfall is distributed as revenue to all of the players who participated in the foreclosure, including at least one undisclosed player – the investment bank (or the successor investment bank) that started the scheme.
Government laws and regulators, together with public opinion, expects that modifications should be allowed in order to reflect economic realities and enable homeowners to retain home ownership. And when the performance of a loan affected the balance sheet of a lender or bank, workouts were the rule rather than the exception. Frequently the workout was a modification.
So the game plan is to create the appearance of a procedure in which homeowners can apply for settlement, workouts or modification while at the same time setting up the homeowner for failure to comply with the procedure. Failing that, the game plan calls for proceeding with the foreclosure regardless of any pending modification activity.
Attorneys are usually excused under the twisted concept of litigation immunity, which says that an attorney cannot be sued for advocating the position of his client even if the position is based on a line. In this case, the federal judge blasted both the attorney and Bayview servicing, and in the process exposed the pernicious plan that is devoted to achieving foreclosure rather than preserving the rights of a true creditor or preserving the rights of a homeowner.
Hat tip to “summer chic”
see Weisheit v Rosenberg and Bayview Maryland
see Article explaining Weishert v Rosenberg and Bayview
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Maryland homeowner Sherry L. Weisheit handed Bayview Loan Servicing an embarrassing defeat in her foreclosure case.
She filed suit against Bayview Loan Servicing and their law firm Rosenberg and Associates for violating RESPA and FDCPA. Weisheit’s suit revolves around Bayview Loan Servicing’s failure to give her a loan modification.
Bayview Loan Servicing denied the loan modification while proceeding with foreclosure.
However, Weisheit qualified for a HAMP modification. Bayview Loan Servicing just didn’t want to give her one and used a debunked excuse typical of a mortgage servicer.
Bayview Loan servicing explained that it denied Weinsheit’s request for a HAMP Modification because the modified monthly payment was outside the required range of 10-55% of Weisheit’s monthly gross income.
RESPA allows homeowners to appeal their modification denials. HAMP also did when it was in effect. Sherry Weisheit did exactly that. She appealed the decision with Bayview Loan Servicing.
Weisheit sent her appeal to Bayview on November 29, 2016. She notified Bayview that her monthly debt payment, in fact, would be within 10-55% of her income. In other words, Bayview had done the math wrong.
Bayview claimed their unnamed “investor” prevented them from extending the term of the loan. The Response Letter also did not name the investor nor did it describe the nature of the investor restriction.
Bayview’s Response Letter it stated that “[w]e have enclosed all supporting documentation used to complete the review on your account.”
However, the letter did not contain any such documents. Weisheit responded to Bayview stating that she would be appealing the second denial once she had received the supporting documentation.
- So let us stop right there. Bayview is lying about everything.
- First, if forced to do so, it could never produce any evidence that in fact it is authorized to administer the loan by any owner of the debt who paid for it.
- Second, Bayview describes a relationship with an investor that does not exist.
- Third, Bayview implies communication with the “investor” or instructions from the “investor” which does not exist.
- Fourth, Bayview employs a tactical strategy of falsely stating that it is enclosing documentation supporting its representations concerning communication and instructions from the investor.
In this case the federal judge was able to see through the charade. The important thing is that in this decision he characterized the attorney has a tax collector who obviously was not covered by litigation privilege.
A key element of the judge’s decision was that Bayview did not dispute the accuracy of plaintiff’s calculations, “but instead of reversing course and approving plaintiff’s lost mitigation application, Bayview asserted it was bound by an open ‘investor restriction’ that prevented it from extending the term of the loan.”
The judge’s ruling specifically states that “the response letter did not name the investor nor did it describe the nature of the investor restriction, other than to say that a prevented extension of the loan term. Towards the end of Bayview’s response letter it stated that ‘we have enclosed all supporting documentation used to complete the review on your account.’ The letter however did not contain any such documents.”
Even while the plaintiff had initiated the appeals process to Bayview and the attorney had acknowledged that the appeals process was underway, the foreclosure sale was scheduled. Among other things this violated the dual tracking restriction in which “servicers” may not pursue foreclosure while modification procedures are underway.
In his opinion, the judge points out that “a denial ostensibly based on an investor restriction that does not name the investor or explain the restriction has been held to be insufficient. See Nash, 2017 WL 1424317.
Conclusion: plaintiff has alleged sufficient facts to state a claim for relief against Bayview for violation of respirators dual tracking provision, 12 CFR section 1024.41 (g) and notice of error provisions, 12 CFR section 1024.35, and for violations of the FDCPA, 15 U.S.C. sections 1692E – 1692 have. Plaintiff has alleged sufficient facts to state a claim against Rosenberg for violations of the FDCPA, 15 U.S.C. sections 1692E – 1692F. Therefore, Bayview’s and Rosenberg’s motions to dismiss will be denied by accompanying order.
Filed under: foreclosure |
Modifications were a cover up for many reasons. 1. the banks nor the markets could absorb the assets quickly, so they needed a delay. 2. modifications bolstered home prices because it kept a significant number of homes off the market during the housing meltdown, directly related to ridiculous lending programs. Did anyone person go to jail? 3. etc ….
[…] Originally posted by Neil Garfield […]
Kali — you are absolutely correct. Loan modifications are a cover up. They were from the onset.
Well – the government said — lets give these poor “victims” a loan mod.
Loan mods rarely came. But, even more important — the loan mods that did come concealed the true loan ownership and title to the property. So – if the title gets so corrupted – as all of them are — the only avenue is foreclosure. The government KNEW — loan mods were the only possible avenue., because they knew that these loans were classified default debt from onset incapable of real refinance. Loan title is permanently corrupted. People need a break — they will take anything given to them – and they do not understand title.
So we know who promoted these loan mods. To modify a contract with a defunct non-bank stated originator? That contract is gone. It never existed to begin with. What the heck is modified??? Nothing was ever funded. No consideration. Nothing had to be funded — was already classified default debt. You think you paid off the prior loan at last transaction? Think again.
Why? No one ever held the loan as an asset on any balance sheet. WHY? I keep trying to tell you why. Default debt – unsecured – from origination. Nothing funded – no prior loan paid off BY THE BORROWER. NONE. None of these loans are on any balance sheet as an asset – as they should be. NONE.
So, when the judge in this case asks — “Who is the investor?” He will never get an answer. Because the last real investor is no longer to be found – long gone before even origination. They gave away the store, because someone told them that the loan was in default before it was ever in default. Why did this happen? Profit. Always the motive. It can never be fixed unless we thoroughly revisit the issues.
And, sorry sunman — I think we will get there. Still, I agree, it may take a long time. But, I think Neil is getting it. First time I see Neil really talk about balance sheet assets. Right on target Neil. No balance sheet asset – no mortgage. Period.
And, this, my friends, is why I tell you to GO BACK. GO BACK to before the previous transaction, and transaction before that. If you do not – you will never get the truth. Ultimately, truth prevails. Unfortunately, many will remain victims until we get there. But we will get there. .
Thanks.
(Part 4)
Wow! What a win for justice! SNARK…
If my math is correct, each person received $2420.08
That is if the attorneys representing the class action were already paid before doing the math.
I’m sure those that lost homes, had to defend against the fraud were thrilled! I wonder how much they would have gotten if paid by the hour?
That amount would be enough for a down payment on a used car, or 484 Starbucks coffees.
Kalifornia
Let’s see…(Part 3)
Return on investment?
$8 million fine paid out for fraud.
Divide that by 625 defrauded homeowners=’s $12800 to each one.
Total value of properties foreclosed on? (The 400 foreclosed on?)
Each of the 625 would receive $12, 800….
This will continue in some other way. Those 400 lost their homes, WTF..
Cost of doing business write off.
Now if the fines were 8 billion?
Prosecute, prison time, fines that mean something?
Wanna bet on the outcome?
Not sure I would these days.
Is this off topic about law and foreclosure?
I see a direct relationship to it. Corporations, banks, wall street influences in every problem we are experiencing. Laws written by special interests that benefit from it.
You?
What about the INTENT of JUST laws that are being subverted by those special interests? Nit picking technicalities to win in courts that are willfully blind to the fraud do not help any. Not fully disclosing the results of those “WINS”, equally subversive to justice.
The fraud goes away and the payout to losers is pocket change…
Banks/fraudsters 9999, the rest of U.S. , 1.
Call the current system of laws, “JUST-ICE”
[…] via Federal Judge Slams Bayview and Attorneys on Illegal “Modification” Maneuvering — Livinglies&#… […]
…(part six)…ending.
Denial of Modification Complaint:
https://www.classlawgroup.com/wp-content/uploads/Wells-Fargo-Mortgage-Modification-Lawsuit-Amended-Complaint.pdf
…(part five)…
https://scholar.google.com/scholar_case?case=6225185797079068286&q=HERNANDEZ+v.+WELLS+FARGO+%26+COMPANY&hl=en&as_sdt=2003
…(part four)…
Adversarial Proceeding Complaint:
https://buckleyfirm.com/sites/default/files/Buckley%20InfoBytes%20-%20In%20re%20Cotton%20v.%20Wells%20Fargo%20-%20Settlement%202019.02.18.pdf
…(part three)…
Wells Fargo agrees to $8M payout for mortgage miscalculations
https://www.bizjournals.com/charlotte/news/2018/08/06/wells-fargo-agrees-to-8m-payout-for-mortgage.html
…(part two)…
Lawsuits claim Wells Fargo modified mortgages without customer permission
https://www.sfchronicle.com/business/article/Lawsuits-claim-Wells-Fargo-modified-mortgages-11223837.php
@ ALL
On “modification”…
(part one)
Wells Fargo Is Accused of Making Improper Changes to Mortgages
“Even as Wells Fargo was reeling from a major scandal in its consumer bank last year, officials in the company’s mortgage business were putting through unauthorized changes to home loans held by customers in bankruptcy, a new class action and other lawsuits contend.”
https://www.nytimes.com/2017/06/14/business/wells-fargo-loan-mortgage.html?_r=0
As I suspected ANON. She is still in foreclosure hell, with no end in sight…. (Unless you have lots of money?) Even then, she may die of old age before resolution. Get my rights back? Not so sure. There appear to be statutes of limitation on fraud. Really!? Theft is theft and has no run time in my world. Is there a time limit on prosecuting for murder? How about “Life theft”? What is the penalty for grand theft? Kidnapping? Manslaughter? No prosecutions of the fraudsters that I have seen, except the one scapegoat/sacrificial woman…You can get 5-8 years for voter fraud? And no time for stealing peoples homes..
And we call this justice? The law makers/legislature need to be accountable to all of U.S. for this on going shit storm…… Or should I say the bought and paid for legis-haters? No conscience bought offs.
There will be a re-con-ing again, I’m sure… The recipe will have 1 tsp. of sugar to give us the illusion it is palatable, by design, to 10 parts doo and our representatives will puff up saying what a great job they did while lining the pockets of the thieves that continue to drain the life blood from all of us. The CAUSE was never addressed. Corporations run the country. Corporations are psychopathic by design. Profits over everything else. EVERY challenge we are facing in the world is a business decision. Flint/water, oil/air pollution/oil industry, Poison on/in our food/Big ag and pharma/opioid crisis….. any wonder? All of the fixes were ALWAYS known, just ignored for the profits.
I sound bitter don’t I?…..Sheesh! I’m working on getting to sour:)
I guess I am not over having 45 years of my life and work stolen from me. Imagine that.
The system is rigged, and obviously, not in our favor. Our law makers “Public Servants”? Are supposed to work FOR U.S. ….. NOT corporations/banksters. A handful currently are for us. The rest need to be put to pasture and on food stamps/medicare like the majority of us in our gold-less years.. The news at 9;00…. (I have no opinions on this subject:)
Happy 4th.
Not sure what we are celebrating these days (tomorrow) though….
Oh, I forgot…. Tanks and fly overs on our dime…. (AND on the Park Service) Now, THAT was sour….
[…] Source: Federal Judge Slams Bayview and Attorneys on Illegal “Modification” Maneuvering […]
It was, at first, exciting to read this. Finally, it appeared, that some judge “got it.” But the case is still in litigation. Filed in 2017. The link shows that the court decision is from 2017. There are summary judgment motions currently pending.
Nevertheless, this case describes an important and critical problem with modifications as Neil states. Who is any valid modification really with? Who is actually making the decision as to a valid modification? Who is the real investor? (PLEASE STAND UP). How will “title” be affected by any modification if one can even get one?.
The problem with all these non-bank “servicer” loans is that the loan was never a “refinance” to begin with. Behind the scene, the loan was actually a “restructure.” of a loan that previously belonged to the only then existing investor in place. We all know who that is. In effect, there was a “modification” (without borrowers knowledge) before anyone ever asked for a modification.
As I have said many times, and Neil states here – “that is because they do not have any of the loans as an asset on their balance sheets.” In fact, no one has any asset recorded on any balance sheet.
Thus, the loan, as Neil describes as “non performing” was already deemed “non-performing” EVEN when it was actually performing at the time of origination. All we have is restructuring of classified default debt that may or may not be modified again by some “investor” who refuses to come from behind the closed curtain.
ALL ARE MODIFIED AND CLASSIFIED AS DEFAULT DEBT TO BEGIN WITH. Neil is correct. The goal is foreclosure. However, the goal was NOT always foreclosure. The investment banks really believed they could permanently get away with securitizing “default debt” for cash flow pass-through without ever having a source of recorded balance sheet asset to support any cash flow pass-through. Hence, that is the real reason of the collapse and financial “crisis.” Nothing else. When the exposure of the crisis hit, and the “game” was shut down, foreclosures THEN became the goal. Why? Title can never be corrected until the foreclosure wipes out the entire past (false) record.of classified “default debt” by the perpetrators from the onset. .
Will anyone ever go back and revisit these issues? I think it will be revisited by someone with courage.
Happy 4th of July to everyone. Last time I looked — the country still belongs to us. Our rights have been blocked by concealment. We will get those rights back. Know always – you did nothing wrong.
Thanks.
Yeah well after you guys never helped me and the attorney I hired in 2017 did a shitty job – I finally LOST MY HOUSE THIS YEAR – BAYVIEW(WHO NOW WAS SUPPOSEDLY TAKEN OVER BY PLANET HOME LENDING WHICH I KNOW IS ALL BS BUT i COULDN’T FIGHT BY MYSELF ANYMORE NOR HAD ANY MORE MONEY TO PAY A DAMN ATTY EITHER AND WOULDN’T TRUST ONE ANYWAY AFTER WHAT THE FIRST ATTY DID AFTER i FOUGHT ON MY OWN FOR 9 DAMN YEARS) I have LOST my house! and almost became HOMELESS and ended being taken away from the damn sheriff’s dept back in Feb 2019 due to how I spoke on the phone of what I was going to do to myself(my dogs & cats too)
So nobody really wants to help people like myself – you talk a good talk – but when it comes down to helping – its still all about making money for yourselves lots of money — and no atty would take the case on a contingency basis!
So after a 10yr fight with 4 different bank servers including the first being Taylor Bean & whitaker then Bank of America, then GD Bayview Loan Servicers and finally Planet Home Lending – they sold my house on 6/4/19 back to Planet Home Lending when I knew it wasn’t truly their mortgage/note — Bayview FORGED my name onto a COPY of the note that I found out in 2017 in mediation and yet the Sheriff’s dept. wouldn’t arrest anybody because we didn’t know who exactly did the forgery – I said to arrest everybody and they wouldn’t do that – they said start a Civil Law Suit which was $14,000 to $20,000 and the atty wanted another $5,000 to start and continue to pay which he knew I didn’t have the money so I LOST that as well
The banks get away with stealing homes – keeping all the money that was paid on the mortgage and I’m left well I was going to be homeless until a company in Germany saw my plea online and donated some money to me to help me find a place to live(didn’t pay for everything but it helped out big time —- nobody else did anything – nobody cares including LivingLies Garfield)
This windfall is distributed as revenue to all of the players who participated in the foreclosure…JUDGES, ATTORNEYS, INVESTORS, BANKS, GOVERNMENT DICTATORS, CRIMINALS…ALL PARTNERS IN CRIME.
AND….In my own case… I was told the same as the case above. “Lender will not deal” I could never find the “lender” or “trust”.
After the dust settles on this “fraud on the court” then, the next level of fraud will take place by the fraudster attorney and interested party… Obscure the truth… then submit a different means to defraud the home owner.
What exactly are the consequences to the fraudsters? Dismissed with prejudice?
So is this round one of 50? Back to court again later after the fraudsters figure out another angle of attack? I did not see a resolution for the home owner, or did I miss that? Is the home owner still in litigation limbo? The law of no consequences for obvious fraud, seems to still be in play..