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CHAIN OF TITLE by David Dayen. Available on Amazon

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Pretender Lenders: How Tablefunding and Securitization Go Hand in Hand” By William Paatalo and Kimberly Cromwell. CLICK: http://infotofightforeclosure.com/tools-store/ebooks-and-services/?ap_id_102

Fannie Introduces “Innovative Solutions” so Millennials Drowning in Student Debt can Buy a Home

http://www.fanniemae.com/portal/media/financial-news/2017/student-loan-debt-6546.html

The massive student loan bubble the Feds created has resulted in a generation that is unable to afford a home like previous generations.  Millenials are often not able to find a job that provides a living wage and the ones that bought into the hype that an over-priced college degree provides value often graduate with tens of thousands of dollars in debt.  In order to address this issue, the Feds have whipped up a faux-solution: Lenders can simply ignore student debt!!!

Fannie Mae  released new borrowing rules  to allow millennial borrowers to EXCLUDE student loans, credit cards and auto loans that are “paid by someone else” when applying for a new mortgage.  In addition taxpayer subsidized mortgage loans can be used to repay student debt!  Thank you American Taxpayers for subsidizing a solution that will result in an even larger real estate bubble!

“Fannie Mae announced new policies that will help more borrowers with student debt qualify for a home loan. These innovations address challenges and obstacles to homeownership due to a significant increase in student loan debt over the past decade and provide access to credit for qualified borrowers. The new solutions give homeowners the opportunity to pay down student debt with a mortgage refinance, allow borrowers to exclude non-mortgage debt paid by others as part of the loan application process, and make it more likely for borrowers with student debt to qualify for a mortgage loan by allowing lenders to accept student debt payments included on credit reports.”

“Solutions” include:

Student Loan Cash-Out Refinance: Offers homeowners the flexibility to pay off high interest rate student debt while potentially refinancing to a lower mortgage interest rate.

Debt Paid by Others: Widens borrower eligibility to qualify for a home loan by excluding from the borrower’s debt-to-income ratio non-mortgage debt, such as credit cards, auto loans, and student loans, paid by someone else.

Student Debt Payment Calculation: Makes it more likely for borrowers with student debt to qualify for a loan by allowing lenders to accept student loan payment information on credit reports.

Fannie justifies its irresponsible practices by stating that, “We understand the significant role that a monthly student loan payment plays in a potential home buyer’s consideration to take on a mortgage, and we want to be a part of the solution,” said Jonathan
Lawless, Vice President of Customer Solutions, Fannie Mae. “These new
policies provide three flexible payment solutions to future and current
homeowners and, in turn, allow lenders to serve more borrowers.”

Just what the millennial need- a way to take on more debt while being unable to earn a living wage.  These policies serve to decrease housing inventory, increase prices, and maintain interest rate increases until the entire deck of cards comes tumbling down.  The interesting question would be, what happens after millenials start defaulting on both home and student loans- can the debt be erased through bankruptcy or a deed-in-lieu of foreclosure?  If so- this may be a great deal for millenials who are saddled with debt for a good percentage of their lives!  In effect, a millennial could buy a home, roll in the student debt through a refi (see http://www.sofi.com) and then file for a Chapter 7 bankruptcy thus extinguishing all debt.  Since student debt is not extinguishable through bankruptcy except through hardship, this may be a viable strategy.

The federal government in collusion with the big banks invariably finds a way to artificially inflate markets, put the tax payer on the hook when the market tanks, and then profits from faux-settlements because of a failure to enforce its own laws.

 

Housing’s Echo Bubble Now Exceeds The 2006-07 Bubble Peak

If you need some evidence that the echo-bubble in housing is global, take a look at this chart of Sweden’s housing bubble.

http://www.zerohedge.com/news/2017-04-25/housings-echo-bubble-now-exceeds-2006-07-bubble-peak

A funny thing often occurs after a mania-fueled asset bubble pops: an echo-bubble inflates a few years later, as monetary authorities and all the institutions that depend on rising asset valuations go all-in to reflate the crushed asset class.

Take a quick look at the Case-Shiller Home Price Index charts for San Francisco, Seattle and Portland, OR. Each now exceeds its previous Housing Bubble #1 peak:

Is an asset bubble merely in the eye of the beholder? This is what the multitudes of monetary authorities (central banks, realty industry analysts, etc.) are claiming: there’s no bubble here, just a “normal market” in action.

This self-serving justification–a bubble isn’t a bubble because we need soaring asset prices–ignores the tell-tale characteristics of bubbles. Even a cursory glance at these charts reveals various characteristics of bubbles: a steep, sustained lift-off, a defined peak, a sharp decline that retraces much or all of the bubble’s rise, and a symmetrical duration of the time needed to inflate and deflate the bubble extremes.

It seems housing bubbles take about 5 to 6 years to reach their bubble peaks, and about half that time to retrace much or all of the gains.

Bubbles have a habit of overshooting on the downside when they finally burst. The Federal Reserve acted quickly in 2009-10 to re-inflate the housing bubble by lowering interest rates to near-zero and buying over $1 trillion of mortgage-backed securities.

When bubbles are followed by echo-bubbles, the bursting of the second bubble tends to signal the end of the speculative cycle in that asset class. There is no fundamental reason why housing could not round-trip to levels below the 2011 post-bubble #1 trough.

Consider the fundamentals of China’s remarkable housing bubble. The consensus view is: sure, China’s housing prices could fall modestly, but since Chinese households buy homes with cash or large down payments, this decline won’t trigger a banking crisis like America’s housing bubble did in 2008.

The problem isn’t a banking crisis; it’s a loss of household wealth, the reversal of the wealth effect and the decimation of local government budgets and the construction sector.

China is uniquely dependent on housing and real estate development. This makes it uniquely vulnerable to any slowdown in construction and sales of new housing.

About 15% of China’s GDP is housing-related. This is extraordinarily high. In the 2003-08 housing bubble, housing’s share of U.S. GDP barely cracked 5%.

Of even greater concern, local governments in China depend on land development sales for roughly 2/3 of their revenues. (These are not fee simple sales of land, but the sale of leasehold rights, as all land in China is owned by the state.)

There is no substitute source of revenue waiting in the wings should land sales and housing development grind to a halt. Local governments will lose a majority of their operating revenues, and there is no other source they can tap to replace this lost revenue.

Since China authorized private ownership of housing in the late 1990s, homeowners in China have only experienced rising prices and thus rising household wealth. The end of that “rising tide raises all ships” gravy train will dramatically alter China’s household wealth and local government income.

If you need some evidence that the echo-bubble in housing is global, take a look at this chart of Sweden’s housing bubble. Oops, did I say bubble? I meant “normal market in action.”

Who is prepared for the inevitable bursting of the echo bubble in housing? Certainly not those who cling to the fantasy that there is no bubble in housing.

Powell v. Wells Fargo: The Party seeking foreclosure must demonstrate that it has standing to foreclose

In this case the Bank was required to prove a chain of transfers starting with the indorsee, GreenPoint Mortgage to the current servicer.  The Bank failed to prove the series of transactions through which it purportedly acquired the note from the indorsee and the judge ordered an involuntary dismissal.  However, because this is Florida and statute of limitations are not upheld, it is likely that Wells Fargo will have time to regroup, create a new strategy, and file to foreclose again on the tortured homeowners.

https://scholar.google.com/scholar_case?case=15240496488023418351&hl=en&as_sdt=2006

MARA POWELL and GLENN KENNETH POWELL, Appellants,
v.
WELLS FARGO BANK, N.A., as Trustee for Structured Asset Mortgage Investments II Inc., Greenpoint Mortgage Funding Trust 2006-AR2, Mortgage Pass-Through Certificates Series 2006-AR2, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., CITY OF FORT LAUDERDALE, FLORIDA, and CITY OF LAUDERHILL, Appellees.

No. 4D15-3013.District Court of Appeal of Florida, Fourth District.

April 19, 2017.Appeal from the Circuit Court for the Seventeenth Judicial Circuit, Broward County; Barry J. Stone, Senior Judge; L.T. Case No. CACE08052451.

Rachel M. Coe of Polaris Legal Group, Lighthouse Point, for appellants.

Elliot B. Kula, W. Aaron Daniel and William D. Mueller of Kula & Associates, P.A., Miami, for appellee Wells Fargo Bank, N.A.

DAMOORGIAN, J.

Mara and Glenn Powell (“Borrowers”) appeal the trial court’s entry of a final judgment of foreclosure in favor of Wells Fargo Bank, N.A. as Trustee for Structured Asset Mortgage Investments II, Inc., GreenPoint Mortgage Funding Trust 2006-AR2, Mortgage Pass-Through Certificates, Series 2006-AR2 (“the Bank”) following a bench trial. Because the Bank failed to establish standing, we reverse the final judgment and remand for entry of an order of involuntary dismissal.

In 2005, Borrowers executed and delivered a note and mortgage to Bankers Mortgage Trust, Inc. (“the original lender”). In 2008, the Bank, in its capacity as trustee, filed a two count complaint against Borrowers after they defaulted on the loan, alleging one count for mortgage foreclosure and one count for reestablishment of a lost note. Therein, the Bank alleged that it was the “legal and/or equitable owner and holder of the Note and Mortgage and ha[d] the right to enforce the loan documents.” The copy of the note attached to the complaint contained no indorsements, however an allonge affixed thereto contained one undated, special indorsement from the original lender to GreenPoint Mortgage Funding, Inc. (“GreenPoint Mortgage”). The Bank later amended the complaint and dropped the lost note count.

In October 2013, nearly five years after the filing of the original complaint, the Bank filed with the trial court the “true and correct” original note. That note reflected the same affixed allonge bearing a special indorsement from the original lender to GreenPoint Mortgage. The back-side of that allonge, however, also reflected an additional undated, special indorsement from GreenPoint Mortgage to the Bank. A second, separate allonge was also filed with the original note and bore an undated, blank indorsement from the Bank.

The matter ultimately proceeded to a bench trial. At trial, the Bank presented its case through the testimony of a single witness, Pamela Bingham (“the witness”). The witness worked as a home lending research officer for JP Morgan Chase Bank, N.A. (“JP Morgan”) which serviced Borrowers’ loan on behalf of the Bank. Through the witness, the Bank introduced the original note and two allonges, including the allonge bearing a special indorsement from GreenPoint Mortgage to the Bank. The witness, however, was unable to testify as to when the special indorsement to the Bank was placed on the back-side of the first allonge, when the blank indorsement from the Bank was placed on the second allonge, or why the back-side of the first allonge and the second allonge altogether were not attached to either the original or amended complaint.

As to how the Bank purportedly became the holder of the note, the witness explained the following series of transactions. On January 17, 2006, an entity named EMC Mortgage Corporation (“EMC Mortgage”) purchased and acquired Borrowers’ loan and began servicing the loan. The witness was unable to specify from whom EMC Mortgage purchased Borrowers’ loan. The witness then testified that on March 1, 2006, Borrowers’ loan was placed in the “Structured Asset Mortgage Investments II, Inc., GreenPoint Mortgage Funding Trust 2006-AR2, Mortgage Pass-Through Certificates, Series 2006-AR2” trust via a pooling and servicing agreement (“PSA”). The PSA, which was thereafter admitted into evidence, listed Structured Asset Mortgage Investments II, Inc. as the Depositor, EMC Mortgage as Servicer, and the Bank as trustee. The PSA did not reference GreenPoint Mortgage or the Borrowers’ loan, nor was a mortgage loan schedule attached thereto. The witness then testified that in May 2008, JP Morgan acquired EMC Mortgage and all of its assets, including Borrowers’ loan. According to the witness, the original note had been in the continuous physical possession of either EMC Mortgage or JP Morgan since January 25, 2007.

At the close of evidence, the Bank candidly acknowledged that it could not establish standing as holder of the note in light of the witness’s testimony. The Bank therefore moved to amend the complaint to conform to the evidence presented at trial and to change its theory of standing from holder in possession to nonholder in possession with the rights of the holder. The court granted the motion and ultimately entered final judgment of foreclosure in favor of the Bank.

On appeal, Borrowers argue that the court erred in finding that the Bank had standing as a nonholder in possession with the rights of the holder because the Bank failed to prove the series of transactions through which it acquired the note from the original lender. The Bank counters that the witness’s testimony that Borrowers’ loan was purchased and placed in the subject trust in 2006, coupled with the PSA which reflects an effective date of March 1, 2006, sufficiently established the Bank’s standing as nonholder in possession. We disagree with the Bank.

“A crucial element in any mortgage foreclosure proceeding is that the party seeking foreclosure must demonstrate that it has standing to foreclose” when the complaint is filed. McLean v. JP Morgan Chase Bank Nat’l Ass’n, 79 So. 3d 170, 173 (Fla. 4th DCA 2012). “If the note does not name the plaintiff as the payee, the note must bear a special [i]ndorsement in favor of the plaintiff or a blank [i]ndorsement.” Id. “When specially indorsed, an instrument becomes payable to the identified person and may be negotiated only by the indorsement of that person.” § 673.2051(1), Fla. Stat. (2015) (emphasis added).

“Where a bank is seeking to enforce a note which is specially indorsed to another, the bank is a nonholder in possession.” Bank of N.Y. Mellon Tr. Co., N.A. v. Conley, 188 So. 3d 884, 885 (Fla. 4th DCA 2016). “A nonholder in possession may prove its right to enforce the note through: (1) evidence of an effective transfer; (2) proof of purchase of the debt; or (3) evidence of a valid assignment.” Id. As this Court has made clear, “[a] nonholder in possession must account for its possession of the instrument by proving the transaction (or series of transactions) through which it acquired the note,” starting with the first holder of the note. Id. (citing Murray v. HSBC Bank USA, 157 So. 3d 355, 358 (Fla. 4th DCA 2015)).

In the present case, and because neither party disputes the validity of the special indorsement appearing on the allonge filed with the original complaint, the Bank was required to prove a chain of transfers starting with the indorsee, GreenPoint Mortgage. Aside from the witness’s testimony that EMC Mortgage purchased and acquired Borrowers’ loan from “someone,” the only evidence admitted at trial purporting to transfer the note was the PSA. The PSA, in turn, did not reference GreenPoint Mortgage or Borrowers’ note. Moreover, absolutely no testimony was adduced at trial which explained how the Depositor, Structured Asset Mortgage Investments II, Inc., acquired mortgage loans to convey in the first place. At most, the evidence at trial established that EMC Mortgage acquired Borrowers’ loan in 2006 and placed the loan in the trust, and that the Bank became the trustee. There was nothing, however, connecting the indorsee of the note, GreenPoint Mortgage, to EMC Mortgage or the Bank. In other words, the Bank failed to prove the series of transactions through which it purportedly acquired the note from the indorsee.

Accordingly, we reverse the final judgment and remand for entry of an order of involuntary dismissal of the foreclosure action.

Reversed and remanded.

MAY and CONNER, JJ., concur.

Not final until disposition of timely filed motion for rehearing.

A Plea To These Conspirators – You Have The Power To End This Nightmare.

Bill Paatalo has written a heartfelt plea (see his post below) for at least one person to be relieved of stress that is about to literally kill her. In so doing he has again demonstrated his research and forensic skills as a private investigator and one more thing, his humanity.

The link to internal emails shows, without any reasonable doubt, both the conspiratorial linkage in creating fabricating documents AND the absence of any reference to any actual transaction in which money was paid or anything was purchased.

The lax audacity of these people is astonishing. Here they are actually conspiring to change the paper chain of title — which will be used for a foreclosure of property and the eviction of the owners of the property.

====================       =====================

Posted by Bill Paatalo on Apr 25, 2017 in Uncategorized | 0 comments
I received an email yesterday morning that starts out with this:
On Mon, Apr 24, 2017 at 9:18 AM, the author wrote:
Please help save longtime Sandy Oregon resident Robynne Fauley’s life. She had major cancer surgery less than two weeks ago is getting chemo and is VERY ill. She will be evicted from her home on May 1st if we don’t help.  She has nowhere to go. The ordeal is very likely to kill he[r;].
I happen to have some knowledge about this case, as I was called in as an expert last year to assist an ABC News investigative journalist in Dallas, TX. Unfortunately, after all the time spent conducting interviews and laying out the evidence of fraud on a platter, corporate counsel for ABC News quashed the story. I’m sure this surprises no one. The reality is that the media will continue to plug its ears, while law enforcement will continue to view and categorize crimes of counterfeiting, forgery, tax evasion, and mail/wire fraud as “civil matters” in the context of foreclosures.
So with the clock ticking, I thought I’d throw up a “Hail Mary” plea in the direction of “Diane Meistad” and the rest of these conspirators. Diane, Michael, and the rest of you –  if you’re out there and see this, fix it!
The following email strand (2008 Internal Emails – MGC – RFC – Quality Loan Servicing – Fauley Case) is a rare glimpse of bank employees conspiring to forge, back-date, and fraudulently produce a chain of title.
July 11, 2008
From: Monica Hadley – MGC Mortgage
To: Chris Malapit – (Trustee) Quality Loan Service of Washington
Hadley: Chris, Does this loan have title issues? I was going through the original documents and the chain of title seems to be missing some assignments. It could have been that this was missed in the file and all is well. I want to make sure.
July 11. 2008
From: Chris Malapit
To: Monica Hadley
Subject: *12125 Se Laughing Water, Sandy, OR 97055* Robynne Fauley
The DOT was assigned to WAMU,FA as of 5/3/2007 by instrument#2007-038181. Once we are able to proceed we will then need an assignment from WAMU, FA in LNV Corporation.
July 14, 2008
From: Monica Hadley
To: Chris Malapit
Chris, That is what I see too. We received the loan from Residential Funding Company, LLC and have an AOM from RFC to LNV Corporation. Why did RFC assign the loan to WAMU? Do you have a contact at WAMU who will assign the file to LNV Corporation?
July 14, 2008
From: Chris Malapit
To: Monica Hadley
Doing more research I don’t think Residential Funding Co, LLC had the authority to transfer the interest as the last bene of record per our title report was Deutsche Bank Trust not Residential Funding Co.
July 16, 2008
From: Monica Hadley – MGC Mortgage
To: Chris Malapit – (Trustee) Quality Loan Service of Washington
Subject: Subject: *12125 Se Laughing Water, Sandy, OR 97055* Robynne Fauley
Here is a copy of the most recent title update from the attorney office and the email chain from our attorney.
[FAST FORWARD]
October 17, 2008
From: Michael Barnett (MGC Mortgage, Inc.)
To: Shanda Foreman (entity unknown)
Cc: Carissa Golden (entity unknown)
Subject: Intervening Assignments to Deutsche Bank
Shanda, I have 2 RFC loans that are needing assignments from Deutsche Bank to RFC. Please check to see if they are on the list you sent to RFC. See the loan numbers below.
17103058/Robynne Fauley, Oregon
17102692/Stuart Berg, New Jersey
October 24, 2008
From: Michael Barnett
To: ‘Meistad, Diane’ (entity unknown)
Diane, this loan was last assigned to Washington Mutual from RFC but, prior to this assignment was assigned from Washington Mutual to Deutsche Bank and recorded in Clackamas County, Oregon. We need an assignment from Deutsche Bank to RFC and from Washington Mutual to LNV Corp. I have templates for both assignments. We will be re-recording the assignment from RFC to Washington Mutual to correct the chain of title with both of these assignments. Also, please find Note Allonge from Deutsche Bank to RFC as well. Please forward these signed assignments back to me via our federal express account #252870180. Thanks Michael.
(Assignments & Allonge attached)
[Note: WAMU no longer existed on October 24, 2008. This is a huge problem! But this doesn’t stop MGC from creating the necessary “templates” to solve this problem. Furthermore, Diane Meistad is believed to have been employed by RFC. Yet, MGC creates an “Alonge” from Deutsche Bank to RFC seeking RFC’s execution, not Deutsche Bank.]
October 27, 2008
From: Diane Meistad
To: Michael Barnett
Subject: RE: Default Assignment Request loan #7889719/17103058 (Fauley, Robynne)
Michael, If the assignment was recorded from WAMU to DB and another assignment f/RFC to WAMU – technically the second assignment is ‘invalid’ because RFC was not in title to record the second assignment and it should not effect title.
Because of the assignment was invalid technically it didn’t transfer ownership.
October 27, 2008
From: Michael Barnett
To: Diane Meistad
Diane, since the assignment from RFC to WAMU is of record we have to correct the chain of title. At this point the county recorder’s office shows that WAMU is the assignee of record for this loan (which is wrong), right? RFC did assign this loan and shouldn’t have but, in order to fix this one the correct chain should be from Deutsche to RFC, then from RFC to WAMU, then WAMU to LNV Corp, which will correct the chain of title. Litton Loan Servicing LP prepared and recorded the assignment from RFC to WAMU, which should not have been recorded. We still need to get this loan from RFC to LNV to properly convey this property, since we purchased it from RFC. Please call me if you still concerns about the chain of assignments. Borrower loan #7889719/17103058 – Robynne Fauley. Thanks Michael.
[NOTE: This was a WAMU originated loan. WAMU sold this loan in a number of undocumented transactions that wound up in the hands of “Deutsche Bank as Trustee.” This means that the Fauley loan was securitized into some trust years prior, to which Deutsche Bank was acting as Trustee. MGC is claiming they purchased this loan when they clearly do not have clear title. They admit in this email that in order to correct the chain of title, they need the final transfer from WAMU to LNV Corp, which at this point in time is an impossibility. The next responsive email shows that Diane Meistad disagrees with MGC’s position / request.]
October 27, 2008
From: Diane Meistad
To: Michael Barnett
Subject: RE: Default Assignment Request loan (Fauley, Robynne)
I disagree since RFC was not in position (title position) to transfer the asset.
I will need to refer your request for this assignment to our Records Services team in Iowa to begin the process. Diane
[NOTE: Meistad, who is believed to work for RFC, does not believe RFC was in title position to transfer the Deed of Trust. The reference to the “Records Services team in Iowa” means it is likely that Wells Fargo was involved as a master servicer / custodian for the unidentified trust for which Deutsche Bank was Trustee.]
October 27, 2008
From: Michael Barnett
To: Diane Meistad
Subject: RE: Default Assignment Request loan (Fauley, Robynne)
Okay Diane, I had my manager look at this file with me and we have determined that we need the following assignments to correct the chain of assignments:
 
1) Corrective Assignment from WAMU TO Deutsche Bank (to correct the assignment from RFC to WAMU, which was recorded in error) & Note Allonge
2) Assignment from Deutsche Bank to RFC & Note Allonge
3) Assignment from RFC to LNV Corp (Note allonge in file already)
 
The assignment from RFC to WAMU was recorded in error so it is not needed. We also have 2 endorsements on the original Note WAMU to RFC to Deutsche Bank which should be cancelled, to correct the Endorsement chain on the Note. We will just need the okay from you via email to cancel these endorsements. Will this work for you? Thanks Michael.
[NOTE: MGC has decided what was done right and wrong in prior transactions for which it has no knowledge, and what now needs to be done in its own best interest to steal and harvest the home. The transfers to and from WAMU as described above would be fraud due to WAMU being defunct. Then there is the request to have RFC cancel out the endorsements and replace with allonges. The third request in the sequence states that an allonge is already in the file from RFC to LNV Corp even though there are no assignments, yet, to support that allonge. That allonge created by MGC is fraudulent, and represents yet another broken sequence in the chain of title.]
Four days after this last email on October 27, 2008, the following two attached assignments are recorded simultaneously in Clackamas County, Oregon (Recorded Assignments – October 31 2008 – Fauley). The first assignment (and I call it the “first” because of its fraudulently back-dated) is executed on “March 10, 2008″ and notarized as such by “Diane Meistad” – Notary Public – State of Minnesota.” The assignor is “Residential Funding Company, LLC fka Residential Funding Corporation” with no Assignee named. NO ASSIGNEE! However, the second assignment is executed on October 27, 2008 with the Assignor named as “Deutsche Bank Trust Company Americas (formerly known as Bankers Trust Company) and the Assignee – “Residential Funding Company, LLC.” This assignment is also notarized by “Diane Meistad.” As admitted by Meistad above, RFC was not in title position to transfer the asset as of October 27, 2008. Yet, she acquiesced to MGC’s fraudulent conspiracy to forge, fabricate, and alter documents.
So, Diane Meistad, Michael Barnett, and all the rest of you who where involved in this deceit, this one’s on you. You are the only ones who can put a stop to this injustice. Robynne Fauley, who is elderly and very sick, has suffered immensely from your actions. In six-days she is scheduled to be evicted from her home. Fix this!
Bill Paatalo
Private Investigator – OR PSID$ 49411
BP Investigative Agency, LLC
(406) 328-4075

http://bpinvestigativeagency.com/a-plea-to-these-conspirators-you-have-the-power-to-end-this-nightmare/

Ocwen Sued by Multiple State and Federal Agencies

The CFPB complaint makes it easy for lawyers to put together private actions for violations of federal law and with few revisions violations of state law. You have a template here that will go a long way toward establishing credibility to homeowners who are victims of intentional malfeasance by servicers, master servicers, trustees and others. At the very least this data in the lawsuit firmly establishes that there was reckless indifference to the consequences visited upon homeowners and the investors whose money was at risk.

Ocwen pursues the goal of foreclosure at the behest of banks that have no actual interest in the alleged loans. These lawsuits represents actual findings of misbehavior in the “servicing” of purported loans including wrongful foreclosures. It is a pandemic problem not limited to Ocwen. At some point, perhaps now, the question that needs an answer will be answered: Why pursue foreclosure at all costs to the detriment of both the the owner of the debt and the debtor?

The corollary question is why does Ocwen (and others) need to resort to illegal tactics if the loans are real and the paper is authentic?

The only logical answer is that Ocwen was not acting on behalf of “the investor” nor the “borrower” nor in compliance with basic tenets of law. This is a cancer growing on our legal system and our financial system wherein the financial markets have become addicted to a lie, to wit: that the MBS were really mortgage backed securities, that the common law sham REMIC trusts owned loans, and that the sales of nearly all “derivatives” were fraudulent at their base.

Get a consult! 202-838-6345
https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
—————-
Quotes from CFPB Lawsuit: (see Ocwen)

H. Ocwen has engaged in unlawful foreclosure practices.

177. Ocwen has long touted its ability to service and modify distressed loans, claiming, “helping homeowners is what we do.” In fact, Ocwen has failed to accurately maintain foreclosure-related information necessary to ensure that it provides borrowers with required foreclosure protections. As a result of these and other failures, Ocwen has wrongfully initiated foreclosure proceedings and wrongfully conducted foreclosure sales.

183. In addition, a servicer is prohibited from engaging in unfair, deceptive, and abusive acts and practices, including in the context of foreclosure activity, under the CFPA.

2. Ocwen’s deficient foreclosure policies and procedures violate Regulation X.

200. …Ocwen has inappropriately conducted foreclosure sales on the homes of borrowers who were performing upon agreements for loss mitigation options, such as a loan modification. The borrowers accepted and were performing upon the terms of the options—for example, by making trial payments according to the terms of a loan modification. Even though the borrowers had been doing everything they were supposed to do, Ocwen unilaterally breached the terms of its loss mitigation agreements with borrowers and foreclosed on their loans.

4. Ocwen’s foreclosure failures have caused significant borrower harm.

201. Aside from the obvious harm to any borrower whose home is wrongfully foreclosed upon, Ocwen’s illegal foreclosure practices have also caused significant financial harm, emotional distress, negative credit reporting, and other harm to borrowers.

It committed numerous violations of Federal consumer financial laws that have harmed borrowers. Among other things, Ocwen has improperly calculated loan balances, misapplied borrower payments, failed to correctly process escrow and insurance payments, and failed to properly investigate and make corrections in response to consumer complaints. Ocwen has compounded these failures by illegally foreclosing upon borrowers’ loans and selling loan servicing rights to servicers without fully disclosing or correcting errors in borrowers’ loan files.

The Bureau brings this action against the Defendants under: (1) Sections 1031 and 1036 of the CFPA, 12 U.S.C. §§ 5531, 5536; (2) Sections 807(2)(a), 807(10), and 808 of the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692e(2)(a), 1692e(10), and 1692f (the “FDCPA”); (3) Sections 6 and 19 of the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. §§ 2605, 2617, and the regulations promulgated thereunder at Regulation X, 12 C.F.R. part 1024 (“Regulation X”); (4) Section 105(a) of the Truth in Lending Act (“TILA”), 15 U.S.C. § 1604(a), and the regulations promulgated thereunder at Regulation Z, 12 C.F.R. part 1026 (“Regulation Z”); and (5) Section 3(b) of the Homeowners Protection Act of 1998, 12 U.S.C. § 4902(b) (the “HPA”).

3. The Bureau brings this action to obtain permanent injunctive relief, restitution, refunds, disgorgement, damages, civil monetary penalties, and other relief for the Defendants’ violations of Federal consumer financial law.

In 2009, Ocwen spun off its internal technology department into a separate company, Altisource Portfolio Solutions (“Altisource”). As a result of this spin-off, Altisource owns and maintains the REALServicing platform. Ocwen has contracted with Altisource for technology services. In 2012 and 2013, while Erbey was the Chairman of the Boards of both Altisource and Ocwen, Ocwen extended this technology- services contract through 2025. {Editor’s note: This essentially contradicts the assertion by Ocwen Robo-witnesses that Ocwen maintains its own records and that the testimony of the robo-witness is sufficient foundation for the “records” to be introduced into evidence and that the “records” were “boarded” after “careful and through auditing.}

A. Ocwen loaded inaccurate and incomplete information into REALServicing and serviced loans using this information.

35. When Ocwen acquires servicing rights for loans, it moves, or “boards,” the records for those loans from the prior servicers’ systems of record onto REALServicing.

Ocwen boarded inaccurate and incomplete loan and payment data from prior servicers into REALServicing.

32. No other mortgage servicer uses REALServicing.

59. …REALServicing requires the use of more than 10,000 comment codes and flags. Yet, Ocwen lacks a complete data dictionary defining its comment codes, flags, and data fields. As a result, Ocwen personnel do not share a common understanding of what these comment codes or flags mean or how Ocwen personnel should use them.

61. …In 2015, an Ocwen consultant concluded that REALServicing had limited workflows and lacked automation. As detailed in the next subsection and Section III, in certain areas, such as payment processing and escrow, this lack of automation has resulted in significant and excessive manual workarounds that have created errors in borrowers’ accounts. {Editor’s Note: This was no accident. It allowed them to manually manipulate data for foreclosures under the cover of being required to do so. In fact neither RealServicing nor Ocwen were ever correcting errors. They were creating them. In other words, this was an intentional act of misrepresentation hiding under multiple layers of entities and practices}

  • With respect to loan modification processes: “[u]pon review of a [loan modification] package, terms are found to be incorrect approximately 80% of the time (e.g., NPV miscalculation, final modification date incorrect)”;

Ocwen’s use of inaccurate and incomplete information to collect mortgage, tax, and insurance payments, communicate with borrowers about loss mitigation issues, proceed with foreclosures, and when selling the servicing rights of borrowers’ loans to new servicers has resulted in significant harm to borrowers.

Ocwen also delayed verifying the 1.7 million Residential Capital loans it previously acquired in 2013, and which it moved from Residential Capital’s servicing platform and boarded onto REALServicing on a rolling basis beginning in early 2014. Ocwen did not even begin the verification process for the Residential Capital loans until September 1, 2014; at that time, Ocwen was servicing more than 1.1 million unverified Residential Capital loans on REALServicing.

In November 2014, Ocwen determined that it was taking, on average, 261 days to complete its verification process for each loan it boarded. In some cases, the verification process has taken more than a year, far beyond Ocwen’s expected 60-day time period.

41. As of 2014, in addition to boarding loans with inaccurate loan information, Ocwen also boarded loans that contained payment history data that it had reason to believe was inaccurate or incomplete. Ocwen, for example, boarded incomplete or incorrect payment histories onto REALServicing, such as payment histories that include misapplied payments and transactions that occurred before the loan was even originated.

As of 2014, Ocwen had also failed to verify whether the prior servicers’ corporate advances or fees for servicing-related expenses—such as attorneys’ fees, property inspection fees, property preservation fees, force-placed insurance charges, and foreclosure-related expenses—were valid and actually owed by borrowers. In many instances, Ocwen has charged borrowers for these charges and fees, even though neither Ocwen nor the prior servicer had invoices or other documents to support these charges and fees, and even though Ocwen was receiving disputes from borrowers claiming that these charges or fees were not owed.

In June 2015, Ocwen also learned that it did not have documentation to support $58 million out of $85 million in corporate advances that it had charged to borrowers whose loans it transferred to new servicers.

47. Even when Ocwen completed its verification process and identified inaccuracies in loan data, in many instances, Ocwen has failed to accurately correct the errors in REALServicing. For example, in November 2014, Ocwen conducted an internal audit and found that its loan verification personnel were not properly correcting or updating the information in REALServicing in 63 percent of loans the audit team reviewed. The audit found that Ocwen personnel had failed to properly correct critical data fields such as loan maturity date, loan term, first payment date, balloon term, and first interest rate cap.

48. In 2015, Ocwen’s outside consultant identified additional deficiencies in Ocwen’s loan boarding process, such as:

  • “High volume of loans error out of the automated process for unknown reasons requiring manual revision”; {Editor’s note: “manual revision is a euphemism in this context. It is actually fabrication of data to reflect what is necessary to foreclose}
  • “Limited available data fields cause various groups to use and reuse same fields for different information”; and
  • “Limited system functionality in place to accommodate SCRA [Servicemembers Civil Relief Act] requirements (e.g., unable to stop fees if fee was in place prior to customer becoming SCRA eligible).”

an internal communication in 2014 with Ocwen’s Chief Executive Officer, Ocwen’s Head of Servicing described Ocwen’s technology as:

An absolute train wreck. I know there’s no shot in hell, but if I could change systems tomorrow I would. I can’t tell you the number of hours I and others spend on basic servicing technology blocking and tackling. I’m not talking about differentiators here. I’m talking about getting system to stay online, escrow analysis to work, letters to print, etc. It’s ridiculous.

By treating the allegations of these agency lawsuits as evidence of administrative findings, it could be argued that there is presumption of wrongdoing. Even without the presumption, the evidence of Ocwen’s track record should be presented to courts to counter the presumptions that are applied in favor of the foreclosing party. Actual proof of actual monetary transactions should be required instead of presumptions attached to pleadings, testimony and documents.
*
And fundamental to the analysis is that Ocwen is merely doing the bidding of banks that are “underwriters” of MBS and Master Servicers who are diverting money away from investors. In the final analysis, the inescapable conclusion is that the real party in interest is those banks. And when the analysis is complete there is only one logical conclusion: the banks are pursuing a strategy of making their claims for themselves under the guise of an encumbrance in favor of someone else.
Quotes from Ocwen Lawsuit; (see Ocwen)

86. …in January of 2016, Ocwen found that “$8,420,208 in payments were received but not posted to customer’s accounts.” Ocwen concluded: “Management has identified that not applying received payments or loading payments multiple times has become a common occurrence.”

89. …Ocwen has misapplied borrowers’ payments and miscalculated borrowers’ loan balances and amounts due.

90. [Improper data in bankruptcy actions]

  • “There is no connection between the proof of claim as determined in Equator/REALResolution [the system Ocwen uses to process bankruptcy] and the pre-petition arrearage balances in REALServicing.

97. …even though the borrower had sent Ocwen funds in advance to prepay her mortgage, the consumer reports that Ocwen changed her status to delinquent in May 2016, charged her late fees, and made disruptive and embarrassing collection calls to her at her home and work.

B. Ocwen has botched borrowers’ escrow accounts.

100. Ocwen has also failed to perform basic tasks associated with managing borrowers’ escrow accounts. Specifically, due to systems failures, control lapses, and excessive reliance on manual processes, Ocwen has failed to conduct escrow analyses or accurate escrow analyses; failed to timely send borrowers accurate escrow statements; and failed to properly account for and apply borrower escrow shortage payments.

134. Ocwen’s failures have resulted in the lapse of hazard insurance coverage for more than 10,000 borrowers. As of March 2015, more than:

  • 1,500 of these borrowers were able to reinstate their insurance policy, but had to pay a higher premium;
  • 3,000 of these borrowers received letters from Ocwen indicating that it was going to impose force-placed insurance on their loans because they lacked hazard insurance;
  • 500 of these borrowers had force-placed insurance imposed on their loans by Ocwen; and
  • 100 of these borrowers were foreclosed upon by Ocwen.

Ocwen failed to properly recognize individuals as successors, denied loss mitigation assistance to, and, in some instances, ultimately conducted foreclosure sales upon the loans of successors who may have been eligible for a loan modification or other loss mitigation options.

see http://therealfact24.com/ocwen-caught-difficult-situation-misconduct-foreclosure-misrepresentation/

see http://www.courthousenews.com/ocwen-financial-faces-boatloads-complaints/

Quotes from Articles:

Ocwen Financial Corporation is one of the major players in the mortgage world providing commercial and residential mortgage to the people of the US. It also provides Asset Management services to the clients. The U.S. Consumer Financial Protection Bureau had filed a lawsuit against Ocwen Financial Services for misconduct against the borrower’s loan amounts, providing false and inaccurate monthly statements and much more.  Nearly 20 states have filed this lawsuit against Ocwen due to which their share prices fell drastically by 60 percent within an hour of this news. This is not the first time Ocwen has been caught in such situation. They have faced a similar lawsuit in 2013.

At that time Ocwen Mortgage services were fined for $2 billion in compensation to the affected borrowers. Ocwen didn’t pay any attention to the continuous orders from CFPB to rectify their errors and continues with their own practices. Ocwen is accused by all the 20 states including Florida and North Carolina of violating the state as well as federal laws related to the consumer’s protection against loan and mortgages. Ocwen has a different story to tell against the allegation laid by CFPB.

Ocwen … mentioned that the allegations imposed currently are completely different from the 2013 case which would make up to only 1.3 million customers. Ocwen’s … share price declined with a record-breaking downfall to 53.9 percent after the news spread.

CFPB claims that Ocwen is involved in many unethical activities of forcibly foreclosing the homeowners, overcharging the customer for the services not utilized by them, failing to provide payment to the credit borrowers to mention a few. An REALServicing platform system is provided by Altisource to Ocwen from the time when they had a share in it. But later in 2009, it parted their ways but still provide the REALServicing. There has been a case filed against miscalculation of the mortgage amount by the customer even after making payment against the mortgage using the REALServicing system by the company. Since then Altisource is under the supervision and can be held responsible by the CFPB.

Ocwen has been in controversy due to many reasons and the allegations mentioned above are just few of them. William Erbey, an Ocwen founder, who managed Ocwen and Altisource was forced to leave his positions due to fine imposed by the New York’s financial regulator for $150 million.

GSE Bill would allow Homeowners to submit FOIAs to Fannie and Freddie while under Federal Conservatorship

By K.K. MacKinstry/LendingLies

Anyone who is trying to find out information about the trust ownership of their loan, knows that if Fannie Mae or Freddie Mac are involved- your research hits a stone wall.  Homeowners who have a mortgage not secured by the GSEs are better able to determine what trust their loan was allegedly assigned to.  The GSEs who operate as quasi-governmental agencies are still private companies but have been able to evade public disclosures by claiming to not be federal entities.

Under current law, the Freedom of Information Act does not apply to Fannie Mae and Freddie Mac because, while they are under federal conservatorship, they are not federal agencies.

The days of the GSEs hiding behind an ambiguous status may come to an end.   H.R. 1694 was introduced by Rep. Jason Chaffetz R-UT last week.     Under the proposed  bill, the GSEs would be required to accept and process FOIA requests from the public and release information to satisfy those request for as long as they remain under federal conservatorship.  This would allow homeowners in litigation and foreclosure to have access to trust information and other loan information.  You can be assured that the GSEs and private investors will fight all attempts to bring transparency to these opaque entities.

On March 28, 2017, the House Committee on Oversight and Government Reform requested a cost estimate from the Congressional Budget Office. The CBO estimated the bill would increase spending for Fannie, Freddie and the Federal Housing Finance Agency by $10 million over the 2018 to 2027 period. Revenues, however, would not be affected.

All the net costs would be covered by Fannie and Freddie because FHFA would assess the fees on the two entities to cover its costs.  Both Fannie and Freddie are profitable operations and the government has fought to relinquish federal conservatorship.  However, it can be predicted that Fannie and Freddie will attempt to revert back to publicly held companies rather than hide the fact that a majority of the loans it guarantees were never properly delivered to the trusts.

The increase in administrative costs wasn’t the only increase the Congressional Budget Office discovered. The office estimates that administrative costs would increase by $40 million in 2018 in order to research and administer FOIA requests.

This bill would only apply to the GSEs while they are under federal conservatorship, and the administration could have solidified plans for GSE reform. The Mortgage Bankers Association recently released its GSE reform suggestions that analyze suggestions for the best option for reform.  Therefore, if this legislation is passed we highly suggest that readers immediately send FOIA requests immediately by certified mail to obtain the name of the trust that allegedly holds your mortgage.

Steve Mnuchin, has already stated that GSE reform is a priority of this administration.  The MBA’s “Task Force for a Future Secondary Mortgage Market,” was created by big lenders and insurers in the industry, to offer a specific vision of the end-state of the GSEs, as well as transition steps to a post-GSE system.  Predictably,  the White Paper benefits the banks at the expense of the homeowner.

The paper breaks down specific areas for reform. It includes:

  • Maintain the liquidity and stability of the primary and secondary mortgage markets through the establishment of a resilient and robust housing finance system, throughout the transition process to the end state.
  • Replace the implied government guarantee of Fannie Mae and Freddie Mac with an explicit guarantee at the mortgage-backed security (MBS) level only, supported by a federal insurance fund with “appropriately” priced premiums (whatever that means).
  • “Protect” taxpayers by putting more private capital at risk through expanded front- and back-end “credit enhancements” (requiring that the government and tax payer pay for the guarantee).

The chart below is a snapshot from the white paper and gives a quick view of keys factors in the MBA’s GSE reform plans, comparing how the GSEs operated before and after conservatorship.

The paper emphasizes the need for affordable-housing as a political requirement for bipartisan GSE reform.  But in reality, the paper emphasizes the ability of the big lenders to step in for the GSEs and monopolize the profits, while having the federal government act as a guarantor only.

History demonstrates that big banks don’t do anything altruistic for homeowners and the plan would require a mandatory housing fee charged against the guarantors.  Therefore, the banks would receive all of the financial benefits while saddling the government and homeowner with the risk and expense.  It sounds like the type of plan the big banks would attempt to push on to an unsuspecting public.

It is likely that e-lending and e-documents would become the new standard so that the big banks can attempt to electronically manipulate a decade of defective loan documents through this system.  This is disguised under the “preserve infrastructure” clause.  The government and big banks have proven they are unable to administer responsible housing policies without resorting to fraud or protecting homeowners.

Homeowners and borrowers should vehemently oppose using big lenders that securitize loans or use e-signature loan products that can easily be manipulated and fabricated.  Do yourself a favor and bypass the big banks.  Credit unions, local banks and lenders that offer portfolio loans are an excellent alternative to having your loan backed by Fannie Mae or Freddie Mac.

 

 

Deed Theft Scams: Why Not Prosecute the Banks Too?

It is supreme irony that individual scam artists are being prosecuted for false representations and deed theft — while the the institutional scam artists on Wall Street did the same thing raking in trillions of dollars, without a whiff of criminal prosecution.

Get a consult! 202-838-6345
https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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see http://www.foxnews.com/us/2017/04/22/scams-push-foreclosure-fraud-to-limit-taking-victims-homes.html

What the fraudster did in this case was reprehensible and criminal. Any person who does this deserves jail. So beware of anyone who suggests that they have some nifty way to save you from foreclosure if you just deed the property to them. It’s an industry. And it is based on your payment of rent while they zig and zag with the banks.

Beware of any who promises you guaranteed results. The only thing that will stop a foreclosure judgment or sale is a court order from a court of competent jurisdiction. In the real world of the justice system there is no such thing as guaranteed results.

But when you look at the details, it is impossible to distinguish between the fraud visited upon the victim in the article linked above and the fraud visited upon the same victim that put him in the position of losing his home to another complete stranger.

Consider this:

  • The “loan” you received was merely one part of a fraudulent scheme in which the money of third parties was swindled from them and then applied to create the illusion of your loan.
  • The note you signed was to the sales agent for the fraudulent scheme and not to the party whose money was used to make the “loan.”
  • By receiving the money you are obligated to pay it back. That’s called the debt.
  • By signing the note you are obligated to make payments to the payee on the note. That’s your second liability and it WILL be enforced if someone pays real money for your signed note, at least before it goes into default. That person would be a holder in due course.
  • By signing the mortgage deed or deed of trust, you have put your home up as collateral to guarantee payments on the fraudulent note, not to guarantee payment of the debt.
  • The mortgage deed or deed of trust are deeds. How is the above transaction different from conventional deed theft?
Quote from article:
“The scammers are no longer content with stealing $5,000. Now they want the whole house,” said Dina Levy, who heads the Homeowner Protection Program in the New York attorney general’s office, which has spread word about deed theft and prosecuted culprits.
Isn’t that what happened on Wall Street? No longer content to overcharge you for unaffordable loans the banks want your whole house. And no longer satisfied to take your house they want ten times the value of your house by “trading” in securities that everyone treats as non-securities under the 1999 law. But they are securities and they are in violation of SEC regulations and laws defining theft as a crime on the grandest scale ever seen in human history.
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