It’s like baseball. 3 Strikes and they are out (not you)

Batter up! When a player steps up to home plate to take a pitch it doesn’t matter that he tends to hit a lot of home runs. No run or point is tallied in the absence of actually hitting the ball over the fence. And if he swings and three pitches and misses, it doesn’t matter that he could have hit the ball or that dust got in his eye. Each miss is a strike and three strikes mean he is out of the lineup until the rotation puts him back at home plate.

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I am coming back to the original strategy and tactics I advocated in 2006. But I would be more pointed about it by asking voir dire questions directed at the judge. It is not a common procedure but it ought to be.

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The question is whether the judge has already made up his/her mind that the transaction was a loan and that there is an unpaid loan account owned by the named claimant — or if the court is open to the possibility that the attributes of a loan transaction were dropped and the payment to or on behalf of the homeowner might have only been part of a payment due to the homeowner for participating in a securitization transaction.
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Another way of asking is whether the court agrees that the burden of proof, at least in UD, is on the party claiming to have procured legal title without fraud. The subcategories of questions are basically accounting and auditing questions.
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Does the court agree that the prima facie requirement for a UD claim is that the claimant must have owned an unpaid loan account receivable due from the homeowner when foreclosure proceedings were commenced? Does the court agree that in the absence of such an unpaid loan account there was no basis for starting the foreclosure proceeding and therefore no legal foundation for the sale?
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The strategies and tactics of the banks in these cases is the Texas two-step. They never come out and say that the named claimant is a creditor. They say it is a holder. They never come out and say that the creditor lost money when the homeowner didn’t make a scheduled payment. But everyone assumes that the loss is implied. They have built their entire legal strategy on implied assertions plus legal arguments that certain presumptions apply. You have never seen an assertion that the owner of the unpaid loan account is XYZ and here is a copy of the unpaid loan account and balance due — not since 1995.
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The reason is that going into the transaction with the homeowner, the investment bank (acting through intermediaries), was launching a securitization transaction and not a loan transaction.
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We measure that by intent. If the intent was to start a loan account why is there no loan account? Again the implied assertion is that the FINTECH compilation that is proffered in court as the “Payment History” of a designated company acting as servicer is the loan account. But if that was true it would show withdrawals to pay investors or beneficiaries.
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And as the CFPB just confirmed, these FINTECH companies (CoreLogic, FiServe, Black Knight, et al) are the only ones who actually interact with homeowners and keep records. What is produced in court or in answer to QWR or DVL is not a record of business activity conducted by the company designated as servicer. As such, those reports are not records at all, much less business records, that could be proffered as an exception to the hearsay rule barring out-of-court statements without being subject to cross-examination.
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The “servicer” has no interaction with homeowners and handles no money paid by homeowners nor any disbursements to investors or beneficiaries under the alleged trust agreement which is rarely proffered because that would disclose the beneficiaries as the investment banks that handled the underwriting of the certificates.
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The actors who really perform work are paid by the investment banks, not the designated “Servicer.” Now that the CFPB has recognized FINTECH as the source of servicing functions, both homeowners and their lawyers should sit up and take note. When they ask for discovery or demand answers to a QWR or DVL, they should be asking for the identity of the FINTECH that actually received payments, that actually recorded conducting that business, and that actually made disbursements.
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But be careful. The answer is likely to surprise you and the judge if you ever get to it. All three functions might be performed by three separate companies all answering to the investment bank but whose separation creates an additional layer or ladder (as Goldman Sachs likes to call it) through which the homeowner, with limited resources, must pierce before he could discover that there is no loan account and there never was.
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But you don’t need to prove that. You need to prove by clear and convincing evidence, that the opposition has failed or refused to corroborate the existence, ownership, and status of the alleged or implied loan account.
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  • Tactically and strategically you only need to get the judge or nudge the judge into the position of calling balls and strikes.
  • No answer to discovery is strike one.
  • No answer after order compelling the answer is strike 2.
  • And no answer even if the judge gives them a third chance to comply with the rules and the court order is strike 3.
  • Both economic and evidentiary sanctions are available then. 
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You want evidentiary sanctions that prevent the lawyer for the foreclosure mill from introducing any evidence that the unpaid loan account exists if he continues to withhold any corroboration that the account exists. The direct sanction would be loss of the use of the legal presumptions arising from documentation used and relied upon in the foreclosure.
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With no ability to rely on the fabricated conveyance documents, the lawyer for the foreclosure mill has nothing.
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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

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One Response

  1. How many times can a bank repeat non judicial process against the homeowner in 12 years?

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