A homeowner should consult with an experienced foreclosure defense attorney right after receiving foreclosure papers. The earliest stages of the case are the most crucial times to assert and preserve a homeowner’s legal rights for the remainder of the case. It is far more difficult for a foreclosure defense attorney to repair a “damaged” case than to handle the case correctly from the beginning.
An extremely small percentage of homeowners win foreclosure cases and keep their homes through sheer luck. The other winners are usually represented by experienced foreclosure defense attorneys.
In every foreclosure action, the foreclosing bank must have standing to foreclose. A bank only has standing to foreclose if it is the owner of the mortgage loan on the date that the foreclosure action is filed. If the homeowner’s attorney asserts lack of standing to foreclose as a defense in the Answer to the foreclosure complaint, the bank must prove that it has standing to foreclose. If the bank cannot prove that it has standing, the foreclosure action should be dismissed.
Six years after a mortgage is accelerated, the time to file a mortgage foreclosure action expires (with occasional exceptions). If the bank has not won a judgment of foreclosure and no mortgage foreclosure action is currently pending, the homeowner may file a quiet title action to discharge (remove) the mortgage lien from the property. When a homeowner wins quiet title, the property can be sold without paying the mortgage debt. The homeowner keeps the sales proceeds instead of the bank. Debt Inversion accomplished.
In a motion for summary judgment, the foreclosing bank must establish all facts necessary to prove its foreclosure claim and disprove all of the homeowner’s defenses and counterclaims through admissible evidence. The “admissible evidence” submitted by the bank normally includes an affidavit from an employee of the current mortgage loan servicer (not the foreclosing bank) that would be inadmissible at a trial where live testimony is required.
Deutsche Bank’s attorneys made a motion for summary judgment requesting the right to foreclose upon Mr. Codio’s home. The Court denied the motion because Deutsche Bank had failed to prove ownership of Mr. Codio’s mortgage loan, citing forgery of Mr. Codio’s signature and initials on the fake note. The Court’s full decision is attached.
Unless the homeowner’s attorney includes an “affirmative defense” in the Answer to the Foreclosure Complaint stating that the action is barred by the applicable statute of limitations, the statute of limitations defense is lost and the bank can foreclose upon the property even though it started the foreclosure action too late.
A mortgage loan servicer is nothing more than a debt collector, and speaking with debt collectors can only hurt you. When dealing with collectors, it is important not to seem interested in resolving the debt. If you seem interested, they conclude that you have something to lose and focus on you. You want to make a debt collector think you are broke and don’t care what happens. This causes them to conclude they are barking up the wrong tree and to leave you alone. Nothing works better than refusing to speak to them.
Whenever possible, we have our client present when we inspect the alleged original promissory note because the client is the only person in the conference room who saw the original note when it was signed and initialed at the bottom of each page. Clients can easily tell if their own signatures and initials have been forged and they can spot differences between the original document they signed and the document being presented.
The other day a reporter named Natalie Wolcholver from LifesLittleMysteries.com called me out of the blue and asked whether a person could be sued for $1 million dollars for slapping someone. We ended up having an interesting conversation.
Insider dealing at the expense of homeowners and taxpayers continues, and the financial incentives for most types of mortgage-related fraud will be unaffected by the recent $26 billion dollar federal/state foreclosure fraud settlement.
A recent New York Appellate Court ruling may mean that the majority of home mortgages in New York State are “unforeclosable,” and that homeowners may keep their homes without making mortgage payments.
If the Supreme Court decides not to hear the Gomes v. Countrywide case, Mr. Gomes will lose his home to a foreclosing bank that has not proved it owns Mr. Gomes’ mortgage and promissory note. To make matters worse, Mr. Gomes may be sued again for the same debt if the real owner of his mortgage shows up later and demands the money owed.
Justice Schack is known for his continuing investigation of foreclosure fraud and “robo-signers.” He routinely dismisses improperly brought foreclosure cases “with prejudice,” meaning the cases cannot be re-started.
The federal government’s policy of not prosecuting the millionaire and billionaire executives of the major banks leaves the executives feeling “prison proof” and free to commit more crimes to become wealthier.
Don’t settle for a loan modification just because a bank gives it to you without asking first. A generous bank is an oxymoron. You may already own your home free and clear of any mortgage. You may owe the bank nothing.
In fact, another bank may own your mortgage and promissory note. That bank may sue you later even if you make all “modified” payments to the first bank.
“I think that there is a genuine sense out there that there are two sets of rules, one for big and powerful institutions that are deemed to be too politically interconnected or powerful to fail, and the rest of us, Main Street,” says our guest Gretchen Morgenson, the Pulitzer Prize-winning business reporter who has written extensively on how the U.S. government has failed to prosecute any of the top figures who played a role in the economic crash.
Private attorneys do not have your criminal investigative powers and cannot discover, or at least prove, all of the frauds perpetrated against our clients.
When you finally enter the loan servicer’s consciousness as a potential threat, they can be incredibly efficient at correcting your account and restoring your credit.
Mortgage foreclosure fraud causes two terrible things to happen: (1) a home owner may be foreclosed upon by a bank that doesn’t own the mortgage and promissory note; not only is the person’s home stolen, but the real owner of the promissory note can sue the former home owner later for the full amount owed on the mortgage; (2) banks selling foreclosed homes may not actually own them because the foreclosure was fraudulent; this means that 20 years down the road when the person wants to sell the home, they may find out that they never owned it, or worse yet, the real owner could show up after the sale and sue to get their property back.
The debt collection business relies on people not fighting back. If everyone put debt collectors to their proof as we do, they would all be forced out of business.
Once again the federal government is fighting yesterday’s war. The housing and mortgage-backed securities markets have already collapsed and banks will only lend to people with stellar credit. The proposed regulation will not protect against any current risk, but it may come in handy during the next real estate bubble.
“To get judgments against the borrowers, the judge said, a single Mel Harris employee named Todd Fabacher signed 40,000 affidavits attesting to the accuracy of debt claims. Assuming 260 business days a year, Fabacher had to have personally (and purportedly knowledgeably) issued an average of twenty affidavits of merit per hour, i.e., one every three … Read more
Any MERS member bank is allowed to appoint any employee it wishes, regardless of inexperience or incompetence, to sign documents prepared by the bank, not as a bank employee but as a “Vice President” of MERS. During her deposition MERS “Vice President” Beth Cottrell admitted to executing 18 thousand documents per month without any personal knowledge of the contents of what she was signing.
Please write or email your Senator and Representative, as well as President Obama, and tell them that if they vote to “legalize” MERS, you will vote for their opponents in the next election.
What do you get when you cross a Mafia don with a bond salesman? A dealer in collateralized debt obligations (C.D.O.’s) — someone who makes you an offer you don’t understand.
In New York, a debt collection action is neither simple nor cut-and-dried. If the collection action is properly contested, it is frequently possible to win the case and owe no money. It is sometimes possible to force the collector to pay money to you.
“You are talking about tremendous consequences. You are talking about taking people’s homes,” Judge Lippman said. “Those papers have to be accurate. They have to be credible.”
Sincere apologies to the robo-signers, mortgage bundlers, MERS records bunglers, foreclosure mills, crooked foreclosure attorneys, politicians, investment bankers and mortgage bankers, thieves, liars, fraudsters and corrupt judges who had nothing to do with the foreclosure fraud crisis (and didn’t see a thing).
“The absurdity of illegal activity, criminal conduct, and rampant fraud has reached a point where the nation must declare ‘No More.’ We must begin the process of identifying criminal actors — and prosecuting them.”
Mortgage Electronic Registration Systems (MERS) has emerged as the epicenter of the current mortgage foreclosure crisis, despite the financial and real estate industries’ clamor to keep it out of the conversation. MERS maintains the only records in existence of most sales of mortgages from one bank to another. All MERS records are stored electronically and … Read more
The public is not permitted access to MERS records, despite the fact that MERS has the only records in existence of most transfers of ownership of mortgages and promissory notes from one investor to another. Without access to MERS records, it is impossible for home owners to verify which bank owns their mortgage and promissory note.
“Even if the foreclosure was legit, you can’t lock someone out of their home while they’re in it.”
“The average foreclosure hearing in a Florida court is only 90 seconds. Mistakes are common and fraud is rampant.”
If the corporations running the federal government have their way, equivalent legislation will pass after public attention is diverted to the next corporate/government-induced crisis.
Foreclosure fraud causes two terrible things to happen.
“My job is to do justice.” – Justice Schack
When foreclosures are done with faulty documentation, that could leave the new owners of the house vulnerable to claims that someone else actually owns the property they thought they bought.
Excerpt: Chase and GMAC, in their zeal to process hundreds of thousands of foreclosures as quickly as possible and get those properties on the market, employed people who could sign documents so quickly they popularized a new term for them: “robo-signer.”
Violation of any federal, New York State or local criminal law is also a violation of the federal Fair Debt Collection Practices Act, for which you may recover up to $1,000 or your actual damages, plus attorneys fees and court costs.
Of the millions of people in the United States facing foreclosure of their homes each year, few hire an attorney to defend them, assuming that there is nothing an attorney can do to stop a foreclosure. This is often a huge mistake.
Contesting Jobless Claims Becomes a Boom Industry – New York Times http://www.nytimes.com/2010/04/04/us/04talx.html?hp According to the New York Times article, a company called Talx handles more than 30 percent of the nation’s requests for jobless benefits. Talx was acquired three years ago by Equifax, the credit-rating giant, for $1.4 billion. Equifax’s ownership of Talx creates a clear … Read more
Business Week, “The Disposable Worker – Pay is falling, benefits are vanishing, and no one’s job is secure. How companies are making the era of the temp more than temporary” http://www.businessweek.com/print/magazine/content/10_03/b4163032935448.htm
“…these out-of-state law firms and attorneys are committing crimes in New York by practicing law in New York without a license. Committing a crime in the course of an attempt to collect a debt is a violation of the federal Fair Debt Collection Practices Act, for which we sue for monetary damages, attorneys’ fees and litigation expenses.”
http://www.nytimes.com/2010/04/02/business/economy/02garnish.html?pagewanted=1&hp Good article about a disastrous situation for working poor people who are alleged to owe a debt. Here’s an excerpt: For the working poor, losing a lawsuit can mean disaster. Federal law permits creditors to seize as much as a quarter of a worker’s paycheck, though the cutoff is lower for the lowest-paid workers, and a … Read more
For detailed information, read the Rolling Stone article, “Wall Street’s Bailout Hustle – Goldman Sachs and other big banks aren’t just pocketing the trillions we gave them to rescue the economy – they’re re-creating the conditions for another crash” http://www.rollingstone.com/politics/story/32255149/wall_streets_bailout_hustle/1
Read the New York Times Article: “Growth of Unpaid Internships May Be Illegal, Officials Say” http://www.nytimes.com/2010/04/03/business/03intern.html?src=me&ref=general
GREAT WEALTH IS: 1. Nearly always an accident of birth; 2. Virtually unobtainable through legal and ethical hard work; 3. Often amassed through crimes and human rights abuses; 4. Protected by “democratic” governments above all else; 5. Tremendously expensive to protect; 6. Protected with tax dollars paid by the rest of society; 7. Least needy … Read more
The New Poor – For-Profit Schools Cashing In on Recession and Federal Aid – NYTimes.com Commercial trade schools are under fire because they are attracting more students and Pell grants. http://www.nytimes.com/2010/03/14/business/14schools.html?ref=homepage&src=me&pagewanted=all
“[A] 2008 report by MFY Legal Services, a nonprofit law firm in New York, found that defendants in consumer debt cases showed up in court less than 10 percent of the time, raising questions about whether they were ever properly served and about the prevalence of sewer service in the industry.”
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