1.5 Million Seniors Foreclosed — Most Illegally

What’s the Next Step? Consult with Neil Garfield

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Editor’s Comment and Analysis: As I predicted (along with many others), the foreclosure scam is reaching further and further to all segments of the population. With more than half of all homeowners under 40 being “underwater” and the release of information showing that widows are being hit hardest, the statistics showing 1.5 million foreclosures on people over 50 are hardly surprising. But they don’t tell the whole human story of grief, confusion and disbelief that the banks would engage in large-scale fraud.

It is ironic that many of the millions who were hit with foreclosure were the same people who joined the public outcry against mortgage relief because they were playing by the rules, making their payments, and also losing money. They failed to educate themselves and their naive belief that the debts were legitimate and the borrowers were deadbeats led the public, the media, and those who pull the levers of power in Federal and State government to conclude that the debts were legitimate and the market simply went sour.

To call these debts legitimate in the face of absolutely incontrovertible facts regarding appraisal fraud, forgery, robo-signing, and lies told in in court is akin to drawing the distinction between rape and legitimate rape. You can argue all you want about what a woman should look for to “detect” a possible criminal and and argue circumstances when she “asked for it” but rape is rape.

And you can argue all you want about how homeowners should have read a pile of papers 6 inches thick to determine what was really going to happen to their lives if they signed those papers and that they should have investigated who was behind the easy money, but in the end they were the victims, just like many investors were the victims.

And until we agree that the money the banks received should have been allocated to the investors on whose behalf they received the money we won’t know the amount of the debt of the homeowner, if any, that is remaining. Allowing foreclosures to start, foreclosure “sales” to be conducted, foreclosure deeds to be issued “for cash received” when they accepted a credit bid from a non-creditor, and then allowing evictions was and remains wrong.

In fact, while I have not seen a study analyzing this, I’ll bet you will find that the same people who were foreclosed were on pensions paid by managed funds that bought the bogus mortgage bonds that enabled the mortgage meltdown in the first place.

So the same people were both losers in investing in mortgages and then losers when their own money was used against them in deals that were impossible to be viable.

The tragic irony here is that most borrowers still don’t get it. They also think the debts are legitimate and that any claims of fraud or predatory loan practices are just ways of delaying the inevitable foreclosure and eviction.

Precious few homeowners have any idea that they have legitimate defenses and remedies that would lead to a mortgage-free house or a modification that uses fair market value as a basis for the loan balance and applies the payments received by creditors from insurance, credit default swaps and federal bailouts.

In what I have called Deny and Discover, lawyers following this blog or who have arrived at the same conclusions on their own are winning case after case. Mark Stopa published an article about 14 cases in Florida in which 14 different judges entered summary final judgment FOR THE BORROWER!

As the banks plant articles warning against strategic defaults, ultimately, there is no debtor’s prison in this country and they can’t do a thing about it. And widows, pensioners and others who are on fixed incomes and facing rising medical and living expenses are forced into default. This mess will take decades to clear up unless government does its job of governing and applying the same set of rules to everyone. If you commit fraud, you owe restitution and you are punished either civilly or criminally.

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39 Responses

  1. Take a look at this petition to the Obama administration. It makes perfect sense. This could rightfully put 1 million real estate buyers back in the market.

    Follow the link at the bottom to read the entire petition. If you agree, sign it and pass it on.

    Require credit reporting agencies remove foreclosure information when such foreclosures were deemed illegal or wrongful …

    https://petitions.whitehouse.gov/petition/require-credit-reporting-agencies-remove-foreclosure-information-when-such-foreclosures-were-deemed/FY7TXLzj

  2. I agree with Jan, these politicians want us to believe ALOT of crap. It’s garbage in…garbage out…. Show me the receipts that prove you banksters paid for anything, and proof that initial downpayment I handed you, and all of those payments I handed you for 18 years, went where they should have gone or, the law says, you have to give it all back +++ because not only did you sell me fraud, you committed fraud in my name, with my unauthorized signature, without my knowledge or consent and you are all felons. Time for the America people to take out the trash.

  3. The “Federal Corporation” that was referenced by a poster is a creature of the US Congress, such as Amtrak. In special-purpose cases, such as the desire of the Congress to have a national passenger railroad service, the Congress will create, by Statute, a special-purpose entity and install special powers. In the case of Amtrak, that is the power to force the freight railroads to grant passage of the Amtrak trains over the freight rails. In housing, the Congress by Statute created the Government National Mortgage Association, GNMA, for the special purpose of buying locally-originated loans and providing liquidity to the mortgage market. Those entities are called “Corporations” and are created by the Congress with a Charter, all passed by Statute.

    To suggest that the U.S. Government itself is a “corporation” is not accurate. The Government consists of three branches, the legislative, the administrative, and the judiciary. They are established by the U.S. Constitution, which takes its authority from Revolution against the King. In other words, authority by force of arms, or point of cannon. That does not make the Government a “corporation.” I am not going to get into a debate over it. I am not going to re-post further on this topic.

  4. I see evidence the OCC are engaging in a cover up so these FEDSTER crooks can seize all of our property. I wouldn’t accept any help from any of these corrupt agencies. They are certainly not our friends.

  5. We need those OCC requests HONORED !

    They have not even been mentioned in the Federal budget talks !

    Did we put hope in something mythical or will they act in good faith ?

  6. How scurvy to only value a person based on their income. That is inhuman. The best things in life are free. Those are the things in life that are so valuable that you can’t put a price tag on them. I learned alot from my Grandparents who always put their family first. We have become a very shallow nation who only thinks in terms of those who generate income have value.

  7. It is not only a disgrace but it is criminal the way this Government by way of these politicians treats its Citizenry in general and here is why ….Because the American people pay for everything upfront.

  8. I agree with lies…I can’t find any contract that I signed that disclosed the originator was going to go into default in my name and swap credit with their business partners to gain unjust enrichment by overselling investments in credit to the tune of a quadrilllion dollars.. Charles Biderman, a Wall Street portfolio manager on CNBC talking to Rick Santelli. Mr. Biderman said he believes the U.S. Govt is guilty of committing financial fraud and Obama and others are covering it up.

  9. Ian,

    I’m sure there are many people who take care of their parents but it is not the norm. All we have to do is listen to Congress trying to screw them out of their insurance and retirement. If people didn’t, in the great majority, agree with what Congress is planning, they wouldn’t elect those A.Hs and they would react violently at any hint of taking anything away from grandma. People we put in office represent the country’s mentality. We get the representatives we deserve.

  10. Christine- Of course you are generalizing. The last 6 years of my mother’s life, I paid for everything, to the tune of 30k per year, with no help from anyone. Owning my business gave me the opportunity to work 6, and then 7, days per week. No choice when all 3 of my properties were in “foreclosure”. Sold one, ‘cured’ the other two. Have been struggling ever since. Of course, a nursing home or tiny rental for my mother wasn’t an option. Neither was public assistance. So I cheerfully persevered. As you said, (sic) ‘ our parents worked their whole lives, and they are being fleeced, abused,etc.’ I too am appalled at the turn society has taken. What does it bode for our children? I also abhor the abuse that veterans, ether active or inactive, are being subjected to. Disgusting, makes my stomach turn. Both my parents served in WWII, my dad having been in on the liberation of 2 concentration camps, and surviving the Battle of the Bulge in Belgium. They never asked for a dime from a soul. I try to carry on that selfless lifestyle. And help others at the same time.

  11. Thanks for sharing. Oneheart

  12. Stephen,

    My biggest pet peeve ever.

    Senior citizens gave us life: we wouldn’t be here without them. We owe them to be here, whether we make it on our own or not. They taught us everything they knew, bad and good, but they also believed that education for which they dearly paid taxes and didn’t get themselves would give us the ability to figure it out when needed.

    They did as right as they could by us: no one makes babies to screw them up and profit from them. No one, in any culture.

    In this country, unlike in any other developed and undeveloped country in the entire world, seniors become a burden as soon as they stop earning and giving us money. They become a liability. They have “entitlements”. Never mind that they paid ahead for everything they are claiming: they don’t work. Therefore they cost money. We stick them or places I wouldn’t throw my dog in, in order to take what they worked so hard for. We lie to them. We cheat from them. In no other country do we hear of seniors being attacked and robbed: it simply doesn’t exist. Elders are venerated everywhere but here. And you know what? Those same people who threw grandma in a pissy and smelly nursing home are now losing it all. The 50-55 year old of today are paying for what they did to their own parents.

    Despicable. In this country, people treat their toy poodle and siamese cat better than their parents.

  13. Thank you for exposing that. Government and banks are one.

  14. Very much in point.

    DISADVANTAGES OF THE REVERSE MORTGAGE

    Compiled by Nancy B. Detweiler

    Advertisements for reverse mortgages are everywhere, proclaiming “Seniors First.”

    Don’t fall for it! In blunt language, “Seniors First” means “Screw seniors first.” Even more distressing is the fact that reverse mortgages are advertised as government sponsored. Cities list the reverse mortgage as one means for the elderly to pay their real estate taxes. Government joins with the banks to cheat the elderly.

    ********

    The following list of disadvantages of the reverse mortgage is taken from a report by The Consumers Union West Coast Regional Office

    1. High up-front loan fees and potential lender windfalls. Fees and interest on financed fees can quickly use up a substantial portion of a borrower’s equity, before the borrower actually receives much cash.

    2. The origination fee is based on the home’s value, which is much greater than the usual loan amount. Thus, the borrower pays an origination fee that is often higher than that charged for a traditional mortgage.

    3. Accrued interest is compounded into the principal of the loan rather than paid off in installments. The interest rates tend to be high and may exceed the rates of a standard 30 year mortgage by as much as 3-5%.

    4. Some reverse mortgages also charge higher closing costs and higher mortgage insurance payments than a standard mortgage.

    5. A borrower who must suddenly move out of his home (for dire medical reasons, for example) will be hit hard with the costs of a reverse mortgage. This person will owe a substantial amount in fees and interests, while he may have received very little in cash advances. A 1995 study released that 60% of reverse mortgages are paid off for reasons other than the borrower’s death.

    6. A reverse mortgage can drain off the equity in the house, leaving little or nothing to bequeath to the borrower’s children.

    7. As an agency comes to rely on revenue generated by referral fees, it will have more of an interest in encouraging borrowers to take out reverse mortgages.

    8. Over a period of 10 years, the borrower may receive $36,000 (for example) but by the time he does so, he will owe approximately $70,000 to the lender.

    9. Reverse mortgages are typically adjustable rate loans, with a life-time cap. [We are now seeing the adverse impact of adjustable rate mortgages on those who cannot afford them. The elderly cannot afford them as evidenced by their need to take out a reverse mortgage.]

    Taken from Ms Financial Savvy

    10. Seniors report being lied to, subjected to heavy handed tactics by the mortgage brokers, and scammed. They have reported their mental status being placed at risk because they are constantly monitored by the lender. For example: One client related having to take his wife to the hospital and coming home to find real estate appraisers measuring his home.

    ********

    The list of disadvantages and horror stories goes on and on.

    IN MY OPINION: It is unconscionable for our local media and government to assist in propagating the reverse mortgage. AARP should be ashamed of its organization for allowing such mistreatment of the elderly to occur. The AARP lobby on capital hill is very powerful, yet we have a government backed banking program that recommends the reverse mortgage and its corrupt practices to the elderly as a means of solving their economic difficulties. What a disgraceful lie!

  15. One more point about the CONTRACT, Hmmm, most of the application was in blank, at least mine was, they filled in the information and I ended up Sub-Prime…the only way that could have happened is it they lied, imagine that! I put 30% down and had a credit score of 713, another Hmmm. When I signed my contract I had no idea it would be altered and forged. Right now ,I have 7 entities claiming authority. Now figure that one out?

  16. @ lies is all they tell

    Oh no, contract 101…they borrowed money on my behalf. Used my name, ID, personal and financial information to get lines of credit (in most cases) to fund loans. When you have 3 parties to a contract, where one borrows for another and the other is not aware of who they are borrowing from, nor are they tied together with acceptance, agreement and CONSIDERATION, there is no contact, nor do we have a perfected lien if the paperwork is not recorded properly, lawfully. One loan for one house with one lien…multiple sales of notes put the “borrower” at risk for multiple liabilities.

  17. Jane,

    Yale came up with a really interesting article in 2006 about how the different branches of government were interacting with each other and with corporations. If it doesn’t spell out “corporate government with seriously split loyalties” to you, I don’t know what will. Corporations within our federal government trying to deal with corporations outside of federal governments are tantamount to felons having escaped prosecution handing out to convicts the keys to the penitentiary.

    http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?article=2348&context=fss_papers

    In the past few years, there has been a mushrooming of people going after “the truth”. More than ever before in history. And they all appear to come to the same conclusion: there has been a systematic selling out of individual responsibility toward humanity so that money would be the ultimate goal everywhere.

    Coincidence?

    And by the way… why is it that, in certain states, towns are actually called “corporations”? Washington, Mass, N. Carolina, Ohio, California, Arkansas, Kentucky and many other states have incorporated towns and cities. No responsibility for anything but profit is the name of the game. The real question is… did this trickle from the federal government down or was it designed from the grounds up?

  18. @Jane van Eyck,

    Point well taken. Yet, when we all can feel that everything is amiss at every level in a society and none of the systems we have come to rely on appears to bear any weight, everything becomes a possibility. We know we can’t rely on justice: it is one-sided. We know we can’t rely on government: same one-sided decisions. We know we can’t rely on education: it’s taught us only what we need to know to tip-toe and barely eke out a lousy living and has taken all joy out of learning while failing to equip us to actually understand what the f*%$ is really going on.

    You can’t fault anyone for looking for information we know we won’t get anywhere. Not even here. Not many people come here to declare victory.

  19. modern equivalent of putting us in icebergs–they should at least give us each a cheap single shot pistol when they push us off on the berg—its better than freezing

  20. Jan van Eck, on December 5, 2012 at 6:39 am said:
    The rest of the absurdities, that the branches of the US Government are “corporations,” are hogwash. Pure pulp.

    Really?

    TITLE 28—JUDICIARY AND JUDICIAL PROCEDURE

    PART VI–PARTICULAR PROCEEDINGS

    CHAPTER 176–FEDERAL DEBT COLLECTION PROCEDURE

    SUBCHAPTER A–DEFINITIONS AND GENERAL PROVISIONS

    § 3002. Definitions

    15) ‘‘United States’’ means—

    (A) a Federal corporation;

  21. ” We The People” need to start bringing “real” “charges” to the court. I have seen too many dismissals stating “failure to state a cause of action where relief can be granted” Some examples in the case of my mortgage con job would be “Lack of Consideration” (quid pro quo), “CONVERSION” , “Extrinsic Fraud” , “Racketeering” (RICO)….. It’s not “where is my note” but rather, “what is my note”

  22. D Wynn

    its a glorified renter really. Abosolutley . Once we depart from this world we leave it all behind…

  23. [...] Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: appraisal fraud, credit bid, Eviction, foreclosure sale, foreclosure scam, fraud, legitimate debt, pension funds, seniors foreclosure, underwater, widow foreclosure Livinglies’s Weblog [...]

  24. to Miss Christine: Please try to avoid listening to pulp on the blogosphere. In your radio link, the “host” starts off by a “declaration” that US Citizens are enshrined to rights to life, liberty and property pursuant to the Bill of Rights. When I hear this, I already know the man has no clue and is blowing his own preconceived ideas. The Bill of Rights says no such thing: the rights enunciated therein apply and extend to all persons found on “U.S. Soil,” any territory (including up to 12 miles out to sea) over which the United States asserts jurisdiction. That includes: citizens, registered residents, visitors, aliens, undocumented persons, “illegal” persons, and even enemies of the State.

    When people start blabbing about the “rights of US Citizens,” then I already know they do not understand the concept. These are clueless people who cannot think, cannot understand, cannot fathom. These are quacks. Rights extend to all; they are not constrained by a person signing a citizenship document in front of a Judge.

    This is what is behind the big legal fight over prisoners at Guantanamo. Are they entitled to the protections enshrined in the Constitution (including the bill of rights appended thereto)? ACLU (and me) says “yes;” absolutist authoritarians within the Dept. of Justice (a bit of a misnomer there) say “no,” on the grounds that Gitmo is not “US Soil.” Well, we’ll just see about that.

    An analogous case was brought by the US Attorney’s Office into federal court in New York, on a person in transit through JFK airport to Canada from Europe; he was intercepted, arrested, and placed in detention. The govt argued (with a straight face) that the arrested person was not under the protections of the Constitution as he had not “entered” the USA, not having cleared Immigration at the airport border inspection. The NY Judge, a bit cynical of such pleas, asked the U.S. Attorney: “Well, whose flag flies over that airport?” Why, the US Flag. OK, if the US Flag is flying over the place, then it is US Soil, and your argument is Denied. Constitutional protections apply to everyone, without distinction.

    The rest of the absurdities, that the branches of the US Government are “corporations,” are hogwash. Pure pulp.

  25. obamas home ownership spin was inducement into a liability we could not foresee, and my reasoning and experience after owning real estate since i was 22yrs old is that its a huge psychological trick,its a nice feeling but look what they did, read some of these stories, elderly, reverse mortgages ect ect ect and now more so with the presence of MERS we have clouded title and a cloak around what was done with the instrument- obviously bad, so if banks can decide to create their own law and circumvent the real land/property/consumer law albiet with blessings of the court which should be run with justice and the overall public interest at heart, the people, being the peoples court then whats the point of home ownership, its just a word, its a glorified renter really.

  26. bob marley said it like this, ” they will eat the bread of sorrow and the bread of sad tomorrow:”

  27. hey BSE
    im with A man- NEVER AGAIN

  28. Starting over at 53. Never to own a home again.
    .

  29. thanks to the Federal Reserve Mafia:
    Book by Dean Henderson:
    http://www.veteranstoday.com/2012/12/04/the-federal-reserve-cartel-part-i-the-eight-families/

  30. I lost my home of 13 years to a false (payments were current) foreclosure by Guaranty Bank in ’99. Sued, judge refused to look at my proof of payments, ruled “It’s your own damned fault” and I ended up homeless and catatonic. Starting over at age 57 is impossible. I, too, thought consumer protection laws were enforced, that contract law was enforced, but I was wrong on both counts. Seniors are prime targets for false foreclosures and always have been.

  31. Santans helpers who removed Glass Steagall
    Alabama

    Sessions (R-AL), Yea

    Shelby (R-AL), Nay

    Alaska:

    Murkowski (R-AK), Yea

    Stevens (R-AK), Yea

    Arizona:

    Kyl (R-AZ), Yea

    McCain (R-AZ), Not Voting

    Arkansas:

    Hutchinson (R-AR), Yea

    Lincoln (D-AR), Yea

    California:

    Boxer (D-CA), Nay

    Feinstein (D-CA), Yea

    Colorado:

    Allard (R-CO), Yea

    Campbell (R-CO), Yea

    Connecticut:

    Dodd (D-CT), Yea

    Lieberman (D-CT), Yea

    Delaware:

    Biden (D-DE), Yea

    Roth (R-DE), Yea

    Florida:

    Graham (D-FL), Yea

    Mack (R-FL), Yea

    Georgia:

    Cleland (D-GA), Yea

    Coverdell (R-GA), Yea

    Hawaii:

    Akaka (D-HI), Yea

    Inouye (D-HI), Yea

    Idaho:

    Craig (R-ID), Yea

    Crapo (R-ID), Yea

    Illinois:

    Durbin (D-IL), Yea

    Fitzgerald (R-IL), Present

    Indiana:

    Bayh (D-IN), Yea

    Lugar (R-IN), Yea

    Iowa:

    Grassley (R-IA), Yea

    Harkin (D-IA), Nay

    Kansas:

    Brownback (R-KS), Yea

    Roberts (R-KS), Yea

    Kentucky:

    Bunning (R-KY), Yea

    McConnell (R-KY), Yea

    Louisiana:

    Breaux (D-LA), Yea

    Landrieu (D-LA), Yea

    Maine:

    Collins (R-ME), Yea

    Snowe (R-ME), Yea

    Maryland:

    Mikulski (D-MD), Nay

    Sarbanes (D-MD), Yea

    Massachusetts:

    Kennedy (D-MA), Yea

    Kerry (D-MA), Yea

    Michigan:

    Abraham (R-MI), Yea

    Levin (D-MI), Yea

    Minnesota:

    Grams (R-MN), Yea

    Wellstone (D-MN), Nay

    Mississippi:

    Cochran (R-MS), Yea

    Lott (R-MS), Yea

    Missouri:

    Ashcroft (R-MO), Yea

    Bond (R-MO), Yea

    Montana:

    Baucus (D-MT), Yea

    Burns (R-MT), Yea

    Nebraska:

    Hagel (R-NE), Yea

    Kerrey (D-NE), Yea

    Nevada:

    Bryan (D-NV), Nay

    Reid (D-NV), Yea

    New Hampshire:

    Gregg (R-NH), Yea

    Smith (R-NH), Yea

    New Jersey:

    Lautenberg (D-NJ), Yea

    Torricelli (D-NJ), Yea

    New Mexico:

    Bingaman (D-NM), Yea

    Domenici (R-NM), Yea

    New York:

    Moynihan (D-NY), Yea

    Schumer (D-NY), Yea

    North Carolina:

    Edwards (D-NC), Yea

    Helms (R-NC), Yea

    North Dakota:

    Conrad (D-ND), Yea

    Dorgan (D-ND), Nay

    Ohio:

    DeWine (R-OH), Yea

    Voinovich (R-OH), Yea

    Oklahoma:

    Inhofe (R-OK), Yea

    Nickles (R-OK), Yea

    Oregon:

    Smith (R-OR), Yea

    Wyden (D-OR), Yea

    Pennsylvania:

    Santorum (R-PA), Yea

    Specter (R-PA), Yea

    Rhode Island:

    Chafee, L. (R-RI), Yea

    Reed (D-RI), Yea

    South Carolina:

    Hollings (D-SC), Yea

    Thurmond (R-SC), Yea

    South Dakota:

    Daschle (D-SD), Yea

    Johnson (D-SD), Yea

    Tennessee:

    Frist (R-TN), Yea

    Thompson (R-TN), Yea

    Texas:

    Gramm (R-TX), Yea

    Hutchison (R-TX), Yea

    Utah:

    Bennett (R-UT), Yea

    Hatch (R-UT), Yea

    Vermont:

    Jeffords (R-VT), Yea

    Leahy (D-VT), Yea

    Virginia:

    Robb (D-VA), Yea

    Warner (R-VA), Yea

    Washington:

    Gorton (R-WA), Yea

    Murray (D-WA), Yea

    West Virginia:

    Byrd (D-WV), Yea

    Rockefeller (D-WV), Yea

    Wisconsin:

    Feingold (D-WI), Nay

    Kohl (D-WI), Yea

    Wyoming:

    Enzi (R-WY), Yea

    Thomas (R-WY), Yea

  32. @ lies is all they tell…how appropriate,
    yes its contract law but we signed the darn thing, BUT why , because we thought it meant what it said, but it did not, and we thought rights to land and clear title were a given, its was dishonored, we thought the collateral property covered our debt, it did not in reality, and so we have this huge problem of complexity of how to plead for best outcome, not one bit easy as ” contract law” per se.
    im so sorry you got fooled at signing, we all did.

  33. First they came for the “deadbeats” and they came for those who thought they played by the rules. And still most do not get it. What a bunch of dopes.

  34. I never hear anyone discuss contract law. I am part of the masses where wells fargo told me not pay my mortgage if i wanted to apply for a hamp loan. I was current. i had just paid month 5 of of a modification . I was running out of money after being under employed due to hours cut after the BP oil spill. that is when they told us not to pay. if you are told to break a contract, the contract should be broken. null and void. no ifs ands or buts. so why are the judges having such trouble with these cases. they afre cut and dry. we are not deadbeats we were told not to pay. i dont get it. should be a dismissal with prej. , done deal

  35. A number of points made on this discussion are worrisome at best. I had no idea that every single branch of government, Congress included, is a corporation. I never considered what a corporation really is made of (inventory and employees) and what was so significant about each state having a department of human resources. What’s remarkable about the discussion is that it spells out many things we may have thought about but never could clearly enunciate. Listen and draw your own conclusions.

  36. this is sweet to see now if they actually do something about it, time will tell…good for NY wish all states would get on the same “love train”

  37. JPMorgan Gets Some Mass. Foreclosure Claims Dismissed
    By David McLaughlin on December 03, 2012

    JPMorgan Chase & Co. (JPM), Citigroup Inc. (C), and Wells Fargo & Co. (WFC) must face claims over home foreclosure practices in a lawsuit brought by the Massachusetts attorney general, a judge ruled.

    Allegations that the banks violated state law by conducting invalid foreclosures can proceed, according to a decision by Justice Judith Fabricant of Suffolk County Superior Court in Boston dated Nov. 30.

    Invalid foreclosures resulting in properties with clouded titles may have caused harm to third-party purchasers “and the real estate market as a whole, and thereby to the public,” Fabricant wrote.

    The three banks along with Bank of America Corp. (BAC) and Ally Financial Inc. (ALLY)’s GMAC Mortgage were sued last year by Attorney General Martha Coakley. Coakley accused the lenders of using fraudulent documents in home foreclosures, foreclosing without legal authority, undermining public land records and misrepresenting loan-modification programs.

    Some of the claims in the lawsuit were settled as part of a $25 billion agreement between the banks and 49 states reached earlier this year.
    Consumer Law

    Coakley claimed the banks violated the state’s consumer protection law by initiating foreclosures on homes before holding the mortgage. Fabricant said that claim could move forward against the banks except Bank of America. The judge said the state didn’t identify “any instance” in which the bank conducted a foreclosure sale when it didn’t hold the mortgage, the judge said.

    Fabricant dismissed claims related to the registering of real estate records.

    Bank of America spokesman Lawrence Grayson said the Charlotte, North Carolina-based bank is pleased with the decision. Wells Fargo spokeswoman Vickee Adams said the San Francisco-based lender “will continue to represent our point of view” in the litigation. Danielle Romero-Apsilos, a spokeswoman for New York-based Citigroup, declined to comment. Representatives for GMAC and JPMorgan didn’t respond to requests seeking comment.

    Brad Puffer, a Coakley spokesman, said the office was reviewing the decision.

    The case is Commonwealth of Massachusetts v. Bank of America NA, 11-4363, Suffolk County Superior Court (Boston).

    To contact the reporter on this story: David McLaughlin in New York at dmclaughlin9@bloomberg.ne

  38. And in the beginning people thought Neil was out of his mind! Just crazy! What he was saying was just impossible! Yeah right! He’s the only one that had it right from the very beginning.

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