it is a lesson again to practitioners like myself who were convinced there was no answer to the “final order” conundrum: No matter how crazy the tactic might sound, you’re only wrong if you lose.

Appeal Your Own Victory? Yes, Indeed!

By Wendell Sherk, Missouri Attorney on Jun 2, 2008 in Bankruptcy Cases of Interest,Bankruptcy Practice and Procedure, Chapter 13 Bankruptcy, Missouri

Strategic Comment: There are two ways for you stop foreclosure, sale and eviction dead in its tracks. One is to file bankruptcy under Chapter 13 which is an opportunity for debtors to reorganize their payments to creditors.

• An automatic stay goes into effect immediately upon filing with the Bankruptcy Court. Creditors who say or do anything in furtherance of collecting a debt are committing a federal crime from the moment it is filed, whether they know about it or not. 
• However, the payments include fees to the Court and Trustee which exceeds 10% of what you pay into the Court for the benefit of your creditors, so since you are strapped for cash it further impedes your ability to work out a realistic plan.
• Also for secured debts like mortgages, the lender can come into Bankruptcy court and ask the court to lift the automatic stay which in the past has been routinely granted and for the most part still is, UNLESS YOU DO SOMETHING ELSE.
• WHEN YOU FILE YOUR PETITION STATE THE MORTGAGE AND NOTE TO BE CONTINGENT LIABILITIES BASED UPON TILA VIOLATIONS. You will need a TILA audit before or immediately after filing to support your position. 
• YOU SHOULD ALSO NAME, AS THE CREDITOR, THE ORIGINAL LENDER, and state the amount of the loan as a contingent liability to them. The fact is, in most cases, you have not been presented with proof of transfer of anything, nor seen any assignment, or what rights or obligations were picked up in transactions after your closing by third parties who own the servicing rights, or the mortgage or the note. The Trustee or other party coming into court or posting notices of sale on your property probably is getting his/her marching orders from someone who either doesn’t have or can’t prove they know the amounts you paid, to whom or what is currently due. PLACE THE BURDEN WHERE IT BELONGS — ON THEM.
• Then you should state the present mortgage servicing entity to whom you are now sending your payments (this applies only where the loan has been sold which is true in 95% of the cases) as a contingent liability in an unknown or unliquidated amount. 
• Then you should add a creditor “john Doe” as also an unknown unliquidated debt as the possible owner of a security under which he has ownership of the mortgage and note.
• Then you should file an adversary proceeding or action under TILA, RESPA, fraud etc. making all appropriate claims for rescission, refund of interest, points, loss of value in the property etc. 

We are still in process of revising our manuscript for publication with all the forms we can think of. Here is a  summary of our findings thus far.

Generally we have two types of jurisdictions — the non-judicial sale jurisdictions and the mortgage foreclosure jurisdictions. California, Arizona and Nevada are non-judicial sale jurisdictions as are many others. Florida is a judicial sale (mortgage foreclosure jurisdiction) as are many others

We also have numerous possible stages at which a borrower can find him/herself

1. Loan not in default but TILA claims can still be made. 
2. Loan approaching default. 
3. Loan in default 
4. Foreclosure suit filed or sale date published 
5. Judgment entered 
6. Sale occurred to either third party or the lender. I have advised people to go to the sale and inform all potential bidders that the matter is in dispute which usually stops anyone from bidding. 
7. Notice to Vacate -Forcible Detainer
8. Eviction notice from Sheriff 
9. Evicted — but TILA claims survive for (a) recovery of money and (b) possibly recovery of house from lender 

Origination of loan:

1. REAL BANK THAT GIVES MORTGAGE AND HOLDS NOTE THEMSELVES. Direct relationship between the lender and borrower and it is not sold, migrated or otherwise transferred in any manner shape or form. Borrower gave honest information, tax returns etc. My guess is that the only claim here would be fraudulent appraisal but even that is weak because the bank is actually at risk. 
2. Mortgage broker steering borrower to worst deal for highest fees. Inflated income and appraisals submitted. Lender is selling off or has entered agreements to provide “inventory” to mortgage aggregators who will sell the aggregated loan portfolio to investment bank who in turn will sell “derivative” securities (CMO - collateralized Mortgage Obligations or CDO — Collateralized Debt Obligations) to investors who are defrauded by representations from the lender, appraiser, mortgage aggregator, investment bank, and intermediate sellers of securities. Bank is NOT in any relationship with borrower but that is not disclosed. Bank has no risk or interest in whether borrower pays on loan or not. 
3. MOST COMMON: A “bank” that is actually a front for one of the major players. In actuality the bank is a mortgage broker steering customers to worst loans for highest fees. 
4. While the “lender” takes the position that they were defrauded by the borrower, the mortgage broker and the appraiser, the truth is that they intentionally defrauded themselves by setting up the structure and giving themselves the position of “plausible deniability.” Their intent was to create a plausible record for the mortgages and notes they were selling to mortgage aggregators and investment bankers. 

Types of Loans:

1. Fixed rate 30 year mortgage fully amortized. 
2. Fixed rate 30 year mortgage amortized but partially negative — i.e. the borrower is paying less than the full payment and the balance owed on the note is going up. Possible TILA violation. 
3. Fixed rate mortgage interest only, negative amortization. Clear TILA violations in most cases. 
4. Adjustable rate mortgage fully amortized. First adjustment after teaser rate in 1, 3, 6, 12 or more months. Borrower “qualifies” for mortgage because income figures support paying the teaser rate. At the first or second adjustment however, they no longer qualify and the lender knows it by definition. TILA violation, fraud, etc. 
5. Adjustable rate interest only, negative amortization 6. Multiple mortgages and notes for multiple properties for speculators — usually involves falsifying information that buyer is going to use the house as primary residence, falsifying income and falsifying appraised values. TILA, fraud etc. 

Authority and ownership of loans — Legal Standing and Jurisdiction

1. Originating lender still servicing the loan, holds note and mortgage. No assignment, sale or other fancy financial tricks. 
2. Originating lender is actually mortgage broker, loan migrates to senior lending institution, to mortgage aggregator to investment banker to seller of securities to investor. 
3. Trustee in non-judicial sale states posts notice of sale based upon information from a source that (a) does not service the loan and therefore does not know if the borrower is in default or not and/or (b) does not own the mortgage or cannot prove that it owns the mortgage and/or (c) does not own the note or cannot prove that it owns the note. In most cases an investor owns the mortgage and note and the people involved in the foreclosure don’t have a clue as to which bundle of mortgages went into which bundle of securities and how many investors bought into that bundle of securities, and there are no proper assignment documents that were designed much less signed in anticipation of being able to establish legal standing in sale, foreclosure or eviction. 
4. Originating lender files foreclosure or posts notice of sale and does not have servicing rights, ownership of mortgage or ownership of note. 

Potential Pleadings:

1. Federal Claim for TILA, respa, RICO, fraud etc. 
2. Memorandum of Law in support of complaint. 
3. State Court claim for Fraud 
4. State court action for stay of sale, eviction etc. 
5. Emergency Petition for temporary Injunctions- State and Federal Courts and memorandums in support thereof. 
6. Motion to expedite discovery. 
7. Interrogatories 
8. Requests for admission 
9. Request to Produce 
10. Notice of deposition duces tecum 
11. Adversary proceeding in Bankruptpcy Court 
12. Memorandum and pleading in opposition to Motion for lifting stay 
13.  Demand letter to Originating lender — for documents tracing where the mortgage went and for refunds and damages, enclosing TILA audit. 
14. Rescission letter 
15. Form retainer agreement for audit an checklist for retaining auditor 
16. Form retainer agreement for attorney and checklist for retaining attorney 

We have received several urgent/emergency requests from people who are so far along in the process of this mortgage meltdown, that they feel hopeless and helpless. We can’t give you a magic bullet, but things are not quite as bad as they seem.

As for stopping the eviction —-

Yes, it is POSSIBLE: It depends upon whether you get a lawyer and it depends upon whether the lawyer knows how to throw some weight around at the courthouse. NOTE: You WILL STILL NEED A TILA AUDIT AFTERWARDS.

1. File petition for emergency temporary injunction alleging fraud: that the lender is not the owner of the mortgage and note, that the trustee is not properly authorized to post the sale notice and that they did so illegally and with intention to deceive the borrower and the Court, causing the Borrower and the Court to reasonably rely upon the statements of facts and procedures used by the Lender/Trustee is posting the notice of sale and going through with the sale. 

2. File complaint alleging the above fraud and denial of due process in that this non-judicial sale forces an unsophisticated borrower to get a lawyer and fight with the lender on sophisticated grounds of lack of standing, TILA violations, RESPA, RICO and other legal theories that a lay person would not be likely to know or know how to use even if they were aware of the theories. 

3. Rescind the transaction and file in the above complaint(s) that you have been denied your right to rescind which you hereby do so, and file lis pendens based upon the rescission. Arguably the lien form the mortgage and liability on the note will be extinguished, but you still need the TILA audit to back up your general allegations and you still need to follow TILA procedures. 

4. File complaint, along with the above for refunds of interest, points, closing costs, attorney fees, court costs etc.

5. Contest the eviction as void or voidable because the correct procedures were not followed or were fraudulently presented such that the court system and infrastructure supporting the non-judicial sale were applied improperly. This is called alternative pleading.

6. If the due process argument is turned down then the Court can still strike down the sale because the lender was not the real party in interest and therefore the Trustee was proceeding based upon “authority” from someone who had neither any interest nor even any information on the payments.

7. NOTE: In most cases the servicing rights to the loan have also been sold to yet another party which means that only they know what the real payment history has been. But if the documents don’t show clear authroity of the new servicing agreement (frequently Countrywide) to receive payments and accountability therefor, the argument can be made that the servicer can only account for the payments they received but can’t guarantee to the Court that the servicer knows if those payments were the only payments made.

8. The borrower could take the position that ALL interested parties — the original lender and the servicing agency and the CDO investor, who is the real party in interest on the mortgage and note, would be required to show documentation of assignment, authorization etc. In most cases this documentation either does not exist, cannot be found or is too vague for them to use. There have already been instances where the result was that the borrower ended up with clear title to the house and no mortgage or note to pay.

9. File Quiet Title action as alternative pleading so that lender, investor and trustee are forever blocked from asserting claims.

10. Consider Bankruptcy — Chapter 13, with an adversary proceeding alleging all of the above.

OBAMANOMICS VS NO ECONOMICS AT ALL

the government is charged with reporting on inflation when it has a vested interest in keep the reported inflation low both for political and financial reasons

The job of the Petitioner in bankruptcy to get a modification of the Chapter 13 plan is therefore double-whacked because of (1) a presumption against him which requires him to show a significant change in circumstances and (2) inaccurate government statistics which call you a liar when you say your basic expenses have shot up 25% just because of inflation.

Homeowners with ARM financing on their homes are triple whacked when the resets kick in. Those people in bankruptcy already should tell their lawyers to file an adversary proceeding based upon violations of TILA and RESPA. There are a number of steps you need to follow (see many posts and links on this blog) before you can file suit.

BKR attorneys are struggling with clients who are complaining that their payment plan is being negatively impacted by the surge in the cost of living. This surge has been understated by, for example, publication of the Consumer Price Index and other indices that are used to set increases in government and pension benefits like social security.

Thus the government is charged with reporting on inflation when it has a vested interest in keep the reported inflation low both for political and financial reasons. If they report it accurately, the government expenses will go up. Up until now, the fact that this was at the expense of the recipients of those benefits (which they paid into and are now being short-changed) has been felt, talked about but largely ignored. That too is coming up front and center. McCain’s statement “I’m not very good on economics” better change to “I just studied up on economics and it is very interesting, Here is what I learned.”

When inflation was comparatively low, even though understated. there wasn’t much conflict. Now, however, the basket of items used for the CPI is literaly out of touch with the real life experience of most Americans — something that Obama has started talking about and which McCain unfortunately doesn’t seem to know or care to know. 

The job of the Petitioner in bankruptcy to get a modification of the Chapter 13 plan is therefore double-whacked because of (1) a presumption against him which requires him to show a significant change in circumstances and (2) inaccurate government statistics which call you a liar when you say your basic expenses have shot up 25% just because of inflation. 

Homeowners with ARM financing on their homes are triple whacked when the resets kick in. Those people in bankruptcy already should tell their lawyers to file an adversary proceeding based upon violations of TILA and RESPA. There are a number of steps you need to follow (see many posts and links on this blog) before you can file suit.

MOST BANKRUPTCY LAWYERS ARE LARGELY UNFAMILIAR WITH TILA, RESPA AND OTHER CONSUMER PROTECTIONS AND THUS MISSING THE LARGEST POTENTIAL BENEFITS TO THEIR CLIENTS. If YOUR lawyer does not know this field then get help elsewhere. For example: www.repairyourloan.com, where you can get help on all the steps before filing suit and even get a referral to someone who can assist your attorney in filing the adversary proceeding. 

From another site where the attorneys appear to be knowledgeable but I know nothing about them —-

Rising prices give rise to chapter 13 plan modifications

By Andy Miofsky, Illinois Bankruptcy Attorney on May 11, 2008 in Bankruptcy Practice and Procedure, Chapter 13 Bankruptcy, Illinois

A helpful article:

WASHINGTON (MarketWatch) — For many people, filing for bankruptcy is seen as a scary, worst-case scenario, but consumer advocates say this last resort could be a real help for beleaguered homeowners.

There is no shortage of proposals in Congress to address the housing crisis: the Depression-era Federal Housing Administration is up for a makeover, and there are other plans to ease the stress of pricey mortgages. Under veto threat is a proposal that consumer advocates see as key to helping more people stay in their homes: allowing bankruptcy courts to modify troubled mortgages on primary residences.

Under current Chapter 13 bankruptcy law, courts cannot modify the mortgage on a principal residence, though they may for vacation or second homes. Consumer advocates and others see bankruptcy, which is meant to adjust debt and make it easier for people to repay creditors over time, as an efficient and established method for troubled homeowners to make good.

“The marketplace is designed so that it will protect owners of vacation homes and second homes, but yet a consumer who is struggling to make their mortgage payments cannot include their home,” said David Berenbaum, executive vice president with the National Community Reinvestment Coalition.

A major strength of court-supervised modifications, consumer advocates say, would be their ability to help people who have “piggyback” loans, which are second mortgages taken on homes at the same time as a first mortgage. Struggling homeowners are often urged to seek a loan modification from their lenders, but many second-lien holders won’t allow loans to be modified without being paid out, said Mark Zandi, chief economist of Moody’s Economy.com.

“Second-lien holders are mucking up the process, they don’t want to be subordinated,” Zandi said. “The other limitation is that some mortgage investors are not allowing these modifications to go through because they don’t think it’s in their best interests.”

Generally, a first mortgage gets paid in full, followed by the second, so the holder of the second mortgage has no incentive to support a modification that could cause it to face a 100% loss, said Eric Stein, senior vice president with the Center for Responsible Lending.

“The holder of the second is better off waiting to see if a borrower can make a few payments before foreclosure,” Stein said. And, he said, dealing with two servicers is a “negotiating challenge that most borrowers cannot surmount.”

About 40% of home-purchase mortgages in the first nine months of 2006 involved piggyback loans, according to a report last year from Credit Suisse. That figure jumps to more than 60% in some markets such as Los Angeles, Las Vegas, and Sacramento, according to the report.

Battle over bankruptcy law

• Changing bankruptcy law to enable loan modification faces strong opposition from President Bush and may have a tough time in Congress. ”Amending the bankruptcy code in this manner would undermine existing contracts, leading to contraction in mortgage credit availability and affordability,” according to an administration policy statement. “These and other bankruptcy-related provisions in the bill would rewrite long-standing tenets of bankruptcy law in ways that would fundamentally alter the expectations of parties to hundreds of thousands of home purchases after the fact.”

• The Mortgage Bankers Association said a bankruptcy proposal currently in the House of Representatives would give “judges free rein to rewrite these contracts without statutory or economic restraint.” The MBA also said the prospect of the bill’s enactment could prompt more foreclosures. “In the short term, lenders will likely move quickly to foreclosure to ensure that they are not covered by the onerous provisions of this bill,” according to MBA.

• However, CRL’s Stein said bankruptcy changes could act as an incentive for servicers and investors to refinance more loans because they may feel they can get a better deal.

• “It will induce some investors to go and accept a refinance program, and it will also get others to agree to modifications outside of bankruptcy,” Stein said.

• Nicolas Retsinas, director of Harvard University’s Joint Center for Housing Studies, said bankruptcy reform should be considered, noting that the infrastructure already exists.

• “Particularly, if you look at alternatives like a large federal program,” Retsinas said. “For any new initiative, the government rulemaking will take months or longer.”

• The Congressional Budget Office estimated that the House proposal could encourage some to file for Chapter 13 bankruptcy, resulting in a 4% to 5% increase in annual filings. But there would not be a run to file for bankruptcy, said NCRC’s Berenbaum.

• “Most American homeowners understand the long-term impact of filing for bankruptcy. You have to wait before you can apply for a mortgage again. It impacts your credit,” Berenbaum said.

• Speaking Thursday, Sen. Barack Obama, D-Ill., offered his support for the modification of loans to avoid foreclosure or bankruptcy.
  • “It’s also time to amend our bankruptcy laws,” Obama said, “so families aren’t forced to stick to the terms of a home loan that was predatory or unfair.”

Ruth Mantell is a MarketWatch reporter based in Washington.

Here is an email I sent to a victim of the mortgage crisis:

So you are in Chapter 13. Do you have a lawyer?

There are some options in bankruptcy court that might be available under current law. The two that I have in mind for you, without any details, are the availability of “cram down” and the use of an adversary proceeding. “Cram down” refers to a process wherein a creditor has terms crammed down his throat that he otherwise wouldn’t accept. There are many theories and bases for cram down but I can tell you it is used consistently in bankruptcy. 

Cram down is always an option in Chapter 11 so you might have to convert from Chapter 13. I am not an expert on BKR law anymore so I would go to your lawyer or www.bankruptcylawnetwork.com as a starting point. It involves equitable and legal factors and if the right case is made, the Court will order it.

Second is an adversary proceeding in which you sue the lender and include everyone in the pipeline who got you into this mortgage and note and the terms that were presented to you as “good terms.” The counter-argument that you signed the documents, that there was adequate disclosure in the documents etc., will fall flat in the context of the vast mortgage meltdown which the bankruptcy judges, trustees, and trustee’s counsel are now very familiar with. Everyone wants to help you. But YOU have to give them a legal reason to hang their hat on. 

The combination of the adversary proceeding, the conversion to a proceeding that allows cram down and the well written brief to cram down the new terms against the lender, will certainly slow things down if there isn’t already a timeline that can’t be moved. Remember that the proceedings, while designed to protect the debtor are also there for the protection of the creditors. And you must take steps to present your cram down proposal to the creditor(s) for their vote. In most cases their rejection will not be presumed — it must be shown on record. 

So when you submit your proposal, you want to submit something that shows that it is in the best interest of EVERYONE to have it done even if they don’t agree. This can only be done by demonstrating that your proposal is the best one you can come up with given your particular circumstances, that you have rights against the creditor(s), that the creditor(s) might not have legal standing to make a claim (because of the sale using documents that did not perfect the sale), and that the creditor is not being cut out of the process and losing everything (even though under TILA and RICO and other laws he might be at risk for exactly that).

But rather, that you have a plan to reduce the principal amount of the mortgage for purposes of amortization, that the lender has contingent equity rights when the property is refinanced at a higher amount than the cram down amount, and that the creditor and other parties have a right to show the mortgage as reinstated and therefore no requirement of a write-down in value is required on their balance sheet. This will preserve not only the due process and property rights of the lender but might actually go to assisting the lender in staying afloat. 

It is even possible that the lender and the holders of CDOs (CMOs) might see the logic of this which requires no expenditure of new money and gets the conflict off the table. 

We received the following plea for help. I have changed the name to protect privacy. But both the plea and the answer are applicable to many people, which is why we are publishing the Garfield Handbooks. I will shortly publish a way for you to down load the books and forms and purchase the book on line or in hard copy. 

“hello my name is John Smith i am currently in chapter 13 bankruptcy countrywide has currently forclosed on my property the bank brought it back and is currently moving to evict me i beleive there were bogus fees and my atorney did not want to argue the issue , my payments went from $1900 to $2800 to $3850 within 18months adjusted twice please send me info so i can fight back”

First thing you need to do is calm down because allowing yourself to be overtaken by anxiety will lead to bad judgment, unclear thoughts and strategies that could make your situation worse.

Second thing is it would be nice if you would order the Garfield Handbook for Borrowers in the Mortgage Meltdown Crisis by sending a money order for $19.95 payable to General Transfer Corporation and address it to Neil F. Garfield, 4980 S Alma School Rd., A-2, Suite 124, Chandler, Az 85248. I will send you via email the  current manuscript and give you free updates for 60 days. If you want it in hard copy, send $29.95 including shipping and handling. Whether you do or don’t buy the book (which helps defray the costs of servicing the thousands of people stuck in your position), I will help you as much as I can right here and right now. 

Third thing you should do is consult a lawyer that is local and knows the ropes. After reading this email a lawyer might be willing to help you without a retainer because of the possibility of getting paid by Countrywide or even in a class action. The lawyer should consider joining one of the many class action lawsuits that have been filed. Make sure you join one that is for borrowers and not for investors in CDOs. If you must proceed on your own, here are some tips that other people are doing:

1. Contact the Office of the Attorney General of your State. Do the same in your county and your city. You might find that an investigation is already underway against Countrywide and lenders in general in this massive fraud — and they might even intervene for you. You are a victim and not a bad guy, so don’t get put off by anyone telling you that you should have known better when you signed the documents. Remember, the largest criminal investigation in the history of economic fraud is currently underway in many states and there is plenty of talk behind the scenes about what to do for people like you. 
2. Contact the Judge’s office in the bankruptcy case and file a copy of whatever you send to the Judge with the clerk of the bankruptcy court. Use letter sized paper, double-spaced with numbered paragraphs. Make sure you send copies of whatever you have sent to the Judge to the Trustee to whom you were supposed to make your payments. Do not expect the Trustee to intervene for you. Adversarial proceedings are expensive and unless you can offer to pay up front, the Trustee is in all probability not going to help you.
3. You might want to ask for a conversion to Chapter 11, which is available for individuals and which allows for certain “cram down” features that are more likely to get you relief that you might get in Chapter 13 or Chapter 7. But the filing fee in Chapter 11 cases is very high. You might want to get  request leave of court to spread the payment out over time. 
4. If the bankruptcy court won’t hear you then try everything below in the State Court in your jurisdiction. The clerk of the court will generally be helpful. 
5. Generally a good time to contact the Judge in person is on a Friday afternoon when the Judge dispenses advise and punishment to lawyers who screwed up in his court that week. At that time you can present your papers (if the Judge lets you) and literally plead with the Judge to help you. 
6. The Judge on the other hand is seeing a geometric increase in these cases and most bankruptcy judges are (a) not pleased with the change in bankruptcy laws passed by congress and (b) don’t like these foreclosures based upon crazy payment re-sets and (c) would offer some relief as long as they were not inventing law, just enforcing and deciding it. So don’t get crazy with your demands, because the Judge will probably not be receptive to what you have to say. 
7. Be respectful and not argumentative withe the Judge. You can show your emotion but make absolutely certain it does not come across that you are angry or ready to fight with the Judge. That can lead to handcuffs and spending a night behind bars to cool off.
8. Do not assume the Judge knows anything about your case (in terms of who you are, where you live, when this case started, when you bought, or what happened when you bought — these are all things you must say in writing, and if you given the chance, out loud in court); but by all means you can assume that the Judge knows the law — better than you do and better than 99% of the attorneys that appear before him or her. In fact, appearing pro se (without counsel) might put you at an advantage because the Judge is likely to use his own knowledge or her own knowledge, to your advantage.
9. Do not assume the Judge is against you if he/she asks you questions or says things that seem to favor the other side. A Judge is supposed to be objective, not automatically in your favor because of your good looks or the severity of the penalty you are experiencing. 
10. Be very scrupulous in obeying all time limits and all other instructions of the court. Don’t think you can play fast and loose with ANYTHING. Bankruptcy Court is Federal Court and Federal Court is a lot tighter on rules than you usually find in State Courts. 
11. Ask the Judge on paper and orally if you get the chance, for a stay or temporary injunction, preventing Countrywide from enforcing the mortgage, filing eviction, or getting an order that would allow  or order law enforcement to come to your house and literally remove you. Do not remove yourself. You might be surprised how long it can take before a sheriff does the eviction. They don’t like this situation anymore than you do, and they are aware of the criminal investigations going on against Countrywide and other lenders.
12. Ask the Judge to allow you to file an “Adversary Proceeding”. You will get instructions in the local rules from either the Judge or his clerk. 
13. Tell the Judge in your paperwork and orally, if you get the chance that you want to challenge the mortgage and the note in that they were not computed properly, that the adjustments were not computed in accordance with law, that the amount demanded from you is wrong (too high) and that you have been defrauded by Countrywide and other co-conspirators) on all of the following grounds:
14. Fraud in the inducement: Countrywide entered into a conspiracy to defraud you and millions of other people to believe that you could, with their help, afford a house that you otherwise believed you could never pay for. You were presented with terms you were led to believe you could afford, but the entire arrangement amounted to bait and switch because the terms being enforced against you now are the not the same terms you started off with. They inflated the price of the home, enlisted an appraiser to verify the value, enlisted a mortgage broker to guide you into a mortgage you could not afford, intentionally distracted you from disclosures that might have alerted you to problems with the mortgage terms and note, and then led you to believe that you had been approved by a financial institution with far superior  information, and upon whom you reasonably relied to verify the value of the home, the reasonableness of the terms of the mortgage, and the lack of any need for an attorney. [Needless to say, if anything here does not apply to you don’t say it]. As a result, you went to a closing where you presented with a pile of papers that you did not understand but which were explained to you by a title agent that was enlisted to tell you the terms of the mortgage and note in such a manner that you would be distracted from understanding that you could not possibly pay for the house, that the house might not be worth what you were paying for, and that the mortgage terms only benefitted the co-conspirators, none of whom assumed any risk in the transaction because they sold the risk to third party investors who were similarly lied to and defrauded. As a result you have been deprived of living arrangements that you could have afforded but which are no longer available, you have spent money improving and furnishing a house that you cannot afford if the price and mortgage terms are maintained, and are faced with the expense and costs of moving, including the threat of literally moving out onto the street and becoming one of the hundreds of thousands of homeless persons displaced by this massive fraud.
15. Fraud in the execution: You were led to believe by the co-conspirators and third parties that you were signing papers that were the same as what you were originally told by the developer, who probably received a rebate on the yield spread premium, the mortgage broker who also received a rebate, the title agent who received a high closing fee, and the appraiser who also received a fee in excess of the amount that the marketplace would have awarded if the transaction had not been fraudulent. 
16. Rescission — only if they can give you back everything they took from you.
17. Usury: The net effect of this scheme was to acquire title to property and sell it at prices that would allow the lender to secure a return that would otherwise be in violation of usury laws.
18. RICO racketeering: This was an interstate scheme involving co-conspirators from many states and perhaps other countries as well. The scheme violates criminal statutes and cicll statutes. Accordingly the case should referred for criminal prosecution and you are entitled to treble damages and attorney fees.
19. TIL (Truth in Lending): The co-conspirators intentionally misled you by distracting you from the real terms of the transaction and as a result violated local, state and federal truth in lending laws.
20. Discovery: The Clerk might help you with this. You want to file requests for Production, requests for Admission, Interrogatories, and a demand for access to the main and ancillary computers containing emails, correspondence and policies of Countrywide for dealing with your case and cases like yours. Get access to emails, correspondence etc. dating back before the loan and relating to the creation of the loan product the borrower eventually was sold. Same for what they know of the other players — developer/seller, mortgage broker, appraiser, relations with investment bankers showing they knew they would not be carrying he risk of the loan ( shows they had not interest other than closing the deal without concern as to whether the deal went bad for borrower or lender). Get screen shots of websites and see if you have copies of web pages that were printed during the loan and sales process. Check for differences. If someone has been fired at the lender for the events leading up to the CDO and mortgage meltdown, get their deposition. Demand copies of drafts of documentation before it was presented to the borrower along with any emails or inter-office memos. Find out if anyone has consulted counsel for criminal exposure, employment litigation, or civil exposure. You can’t get the content of the conversation but you can get the answer to that question if you phrase it right
21. See my other posts on livinglies.wordpress.com for more allegations that might be applicable.

Neil F. Garfield, Esq.

ngarfield@msn.com<mailto:ngarfield@msn.com>

This is not a solicitation for legal services nor legal advice in your particular situation. I do not know what jurisdiction you live in, I have not interviewed you, you have not retained me, and I am not your lawyer. These matters are complex and generally require the services of competent legal counsel experienced in bankruptcy, foreclosures and lender liability. You should consult with local counsel before doing anything. The information contained in this email is general information that may or may not apply to your situation. 

This transmission may be protected by attorney client privilege and attorney work product privilege if it contains legal advice or opinions, and it contains information that are private, trade secrets, protected by non-disclosure and non-circumvention agreements between the parties and is therefore confidential and privileged. It may also be for the sole purpose of compromise and settlement only if it contains an offer and may not be used in any judicial or quasi-judicial or administrative proceeding without the express written consent of the sender.