Guidance for Judges When Considering Admissibility of Hearsay Business Records

We have all seen it. Practically every foreclosure trial is the same. The lawyers claim they represent the servicer but do not claim to be representing the Plaintiff “Trust.” Their sole witness is a robo-witness whose sole job is to testify in court and who in most cases never had any other relationship with the servicer or any bank or trust involved in the subject foreclosure.

The lawyer seeks to get into evidence the “business records” of the “servicer.” In most cases the “servicer” is not the servicer. It has processed no payments and has done none of the duties of a servicer as it is understood in the industry and as specified in the Pooling and Servicing Agreement. That servicer is in actuality an enforcer masquerading as a servicer.

So the lawyer shows the witness the “business record” and asks him what it is and the witness replies that it is the business records of his employer, the alleged servicer who is not a servicer. And then come the rehearsed questions about whether the witness is “familiar” with the record keeping procedures of his employer but is never asked about the record-keeping procedures of the the predecessors who actually collected money from the borrowers and who did and in most cases still are making payments to the investors who are the real “creditors.”

The witness usually knows nothing about who, what, when , where and why any records were kept, why they reflect certain changes in posting or anything else because his employer entered the picture AFTER the borrower stopped paying but during the time that the previous “servicer” was making payments tot he investors. In most cases the investors are getting paid currently through servicer advances. That in truth is what the real case is about — getting to a foreclosure judgment and sale so the previous servicer can collect back the volunteer payments made to investors.

My tirades about hearsay and exceptions to hearsay to allow certain documents can be summed up thusly: By definition any document purporting to have relevant information or data on it is hearsay simply because a document cannot be cross examined nor can it attest to its own authenticity, accuracy, reliability and truthfulness. On that everyone agrees. So a witness is necessary to provide a foundation for one of the exceptions to the hearsay rule which simply says that a hearsay statement may not be admitted in evidence. The witness can’t say that he heard from someone not in the courtroom that the light was red. If the lawyer wants to get the red light into evidence he needs the person who said it, not the person who heard it.

But more than that is the credibility of a witness, and the company he or she represents, in connection with current foreclosures. They are retained as a stand-in for their predecessors so they don’t have to answer questions about how and why certain records were kept and how and why the court and the borrower is not entitled to the rest of the records which would show payments to the real creditors. They are there at the behest of the former servicer for the sole purpose of getting a foreclosure judgment and sale not for the protection of the creditor, who has been paid, but for the advantage of the predecessor who wants to collect the volunteer advance payments made to the investors. That predecessor has no direct claim against the borrower. So they are disguising their claim as a foreclosure leaning on the fact that the borrower stopped paying. But if the creditors are receiving payment anyway there is no default.

Since it is the servicer that has an interest, the credibility of the witness or “records.” is at least in some doubt. My feeling is that the credibility of the witness is more than a little in doubt. Both the witness and the company for whom he or she is the corporate representative have no interest in serving the “lender” or “creditors” and have only the interest of themselves and their predecessor “servicers” to protect or advance. So by my reckoning lawyers should argue more forcefully (notwithstanding some appellate decisions to the contrary) to bar such evidence in court. They could, if they really wanted to be open about it, bring in a witness who was involved in the creation of the records that were “boarded.”

I came across a recently decided case and I liked their description of what constitutes trustworthiness and credibility. I offer it below:

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In Kagen aka Gaurino v Kagen,Unpub Per Curiam Opinion, (#318459, 7/14/2015) the Court of Appeals reversed a trial court order denying the father’s motion to update the children’s vaccinations; and ordered that the children be vaccinated, but in strict compliance with the recommendations of the children’s pediatrician.

<>

A critical issue before the court was the admissibility of hearsay evidence under the catch-all exception of MRE 803(24). <>

Hearsay evidence may be admissible under the catch-all exception of MRE 803(24). “To be admissible under MRE 803(24), a hearsay statement must: (1) demonstrate circumstantial guarantees of trustworthiness equivalent to the categorical exceptions, (2) be relevant to a material fact, (3) be the most probative evidence of that fact reasonably available, and (4) serve the interests of justice by its admission.” People v Katt, 468 Mich 272, 290 (2003).  In Katt, 468 Mich at 291 n 11, the Michigan Supreme Court quoted with approval various factors that federal courts have adopted in analyzing a statement’s trustworthiness. Of particular relevance are the following factors: (3) The personal truthfulness of the declarant. If the declarant is an untruthful person, this cuts against admissibility, while an unimpeachable character for veracity cuts in favor of admitting the statement. The government cannot seriously argue that the trust due an isolated statement should not be colored by compelling evidence of the lack of credibility of its source: although a checkout aisle tabloid might contain unvarnished truth, even a devotee would do well to view its claims with a measure of skepticism. (4) Whether the declarant appeared to carefully consider his statement. * * * (8) Whether the declarant had personal knowledge of the event or condition described. * * * (11) Whether the statement was made under formal circumstances or pursuant to formal duties, such that the declarant would have been likely to consider the accuracy of the statement when making it.<>

In Kagen, proffered reports from the Center for Disease Control (CDC), National Institute of Health (NIH), Food and Drug Administration (FDA), and Michigan Department of Community Health (MDCH) were admissible. Although hearsay, “[a]ll four reports are official (formal) statements by government agencies.” Kagen I, unpub op at 5. That the reports were prepared in the declarants’ official capacities and were presented in a public forum assured that the declarants had verified the accuracy of the information before its dissemination.  Such reports “were prepared by experts in the field of child immunizations and were based on scientific study,” we reasoned, and “it would impose an unreasonable burden to expect [the party] to present the testimony of the government agents who compiled or prepared the reports.” Kagen I, unpub op at 5. Accordingly, such reports produced by government agents are “the most probative evidence of [a material] fact [that is] reasonably available.” See Katt, 468 Mich at 290. As noted, such formal reports are also reliable as required under the first Katt factor as they are created by individuals in their official capacities and for public dissemination, invoking a special duty to ensure accuracy. Kagen I, unpub op at 5-6.<>

However, documents from Wikipedia are not inherently trustworthy.  See, e.g., Badasa v Mukasey, 540 F3d 909, 910 (CA 8, 2008); Bing Shun Li v Holder, 400 Fed Appx 854, 857 (CA 5, 2010) (“We agree with those courts that have found Wikipedia to be an unreliable source of information.”); United States v Lawson, 677 F3d 629, 650 (CA 4, 2012) (“Given the open-access nature of Wikipedia, the danger in relying on a Wikipedia entry is obvious and real. As the “About Wikipedia” material aptly observes, “[a]llowing any-one to edit Wikipedia means that it is more easily vandalized or susceptible to unchecked information.” Further, Wikipedia aptly recognizes that it “is written largely by amateurs.”); Johnson v Colvin, unpublished opinion of the United States District Court for District of Maine, decided September 25, 2014 (Docket No. 1:13-cv-406-DBH) (“Counsel are reminded that this court has not accepted Wikipedia as a reliable medical reference.”); Smartphone Techs LLC v Research in Motion Corp, unpublished opinion of the United States District Court for the Eastern District of Texas, filed February 13, 2012 (Docket No. 6:10-CV-74-LED-JDL) (citations omitted)<>

A blog by its very nature is not akin to a formal and official statement presented by a government agency. A blog is a “[w]eb site that contains online personal reflections, comments, and often hyperlinks provided by the writer.” Merriam-Webster’s Collegiate Dictionary (11th ed), p 133. As described by this Court in Ghanam v Does, 303 Mich App 522, 547; 845 NW2d 128 (2014) (quotation marks and citation omitted): Ranked in terms of reliability, there is a spectrum of sources on the internet. For example, chat rooms and blogs are generally not as reliable as the Wall Street Journal Online. Blogs and chat rooms tend to be vehicles for the expression of opinions; by their very nature, they are not a source of facts or data upon which a reasonable person would rely.<>

Snopes.com as a website that “has come to be regarded as an online touchstone of rumor research” also lacks the characteristics of trustworthiness.  See (accessed July 1, 2015). The site touts: “Welcome to snopes.com, the definitive Internet reference source for urban legends, folklore, myths, rumors, and misinformation.” (accessed July 1, 2015).<>

Finally, the catch-all exception to the hearsay rule does not open the door to the introduction of anything a physician or ‘purported’ expert has to say. The other evidentiary rules governing the introduction of expert testimony (MRE 702, MRE 703 and MRE 707) make it plain that in the absence of an adequate foundation, an expert opinion lacks reliability.<>

40 Responses

  1. The Deed of Trust Act, enacted at the lobbying efforts of lenders seeking to avoid the time and expense of judicial foreclosure, introduced and provided for non-judicial foreclosure by the introduction of a third party, the trustee, into the collateral instruments for mortgage loans. (this is an old act; I wonder now if homeowners were given an opp to weigh in on the proposed legislation. We all know what we’d have said had we know of its future abuses, just like with a “mers” beneficiary or a “mers” mortgage”.) That party, the dot trustee, was vested with the powers to do certain things and those rights are triggered by the default in payment on the note the dot secures. Trustees were generally title companies. Title companies, btw, retain copies of the documents used when loans are closed. I think they must keep them for a prescribed amt of years. This includes copies of the notes and dots (which imo has been a source of many copies of alleged orig notes introduced in litigation, that and a copy of the copy sent with the loan file to the loan servicer, pawned off as copies of an original, wet ink document). By and large, the law holds that a title company is not the agent of the lender (nor of the borrower). I don’t know, unfortunately, how the original act described the party who could be the dot trustee. I, as the rest of us, only know they are initially the title company closing the loan. All title companies, to my knowledge, have attorneys on staff well-versed in the laws relevant to these loans and the transfers of these loans from a seller to a buyer.
    As non-agents for either party to the agreement, the trustee is to serve as a non-judicial (no black robe), impartial third party in determining if non-judicial foreclosure may be instituted. The attorneys on staff (distinction re: other attorneys) should be, and likely were, people qualified to make such a determination.
    Today, some states mandate that these dot trustees be licensed as debt collectors. I’ve never thought such a requirement for licensing as a debt collector was appropriate, but, big but, that was based on the former qualification of parties serving in that capacity (with well-versed staff attorneys). Now it’s just about anyone and some of those just about anyone’s call themselves escrow companies to avoid the licensing requirements prescribed by some states, here noteworthy, Nevada. Further, the “escrow company” and also companies acting as dot trustees are affiliated with the party claiming to be the successors in interest to the loans. Actually, they often if not mostly didn’t even claim to be the successors in interest to the loans, just that they’re in poss of a note* (and then, of course, they can execute their own assgts in mers’ name). They are often owned by law firms representing the alleged lender or by the alleged lender itself. This is hardly consistant with the objectivity and neutrality contemplated by the Act in allowing non-judicial foreclosure.

    Some states, like Nevada, have massacred the Act by changes to state law, in particular in allowing agents of the lender to perform duties related to non-judicial foreclose. Any originally legislated neutrality and objectivity is a thing of the past, wrongfully so in my opinion.
    Be that as it may, Nevada requires those acting as deed of trust trustees to be licensed as debt collectors, something I, again, eschew because a deed of trustee should not be acting as anyone’s debt collector, in fact, it’s an outrage. Debt collectors work exclusively for the party paying them, which is hardly consistant with neutrality.
    So it’s with that background, including “they wanted it, they got it”, that I was pretty much thrilled by a recent decision in the 9th, reversing and allowing (after a 4 year battle) a suit to go forward regarding the non-licensed status of five companies who were acting as these debt collectors for any number of entities (often, imo merely the loan servicer and not even the successor in interest to the loan). It’s a class-action case.

    BENKO , 1315185 (9th Cir. June 18 2015)

    v

    1) QUALITY LOAN SERVICE(s) CORPORATION, a California corporation ( majority owned on info and belief by principals of law firm McCarthy & Holthus *- AZ, NV, CA, don’t know where all else) and who represented Aurora Loan Services, LLC and prob many others banksters.
    *McCarthy & Holthus is representing Quality Loan Services

    2) MTC FINANCIAL,INC., DBA Trustee Corps.

    3) MERIDIAN FORECLOSURE SERVICE, DBA Meridian Trust
    Deed Service, DBA MTDS, Inc.

    4) NATIONAL DEFAULT SERVICING CORPORATION;
    CALIFORNIA RECONVEYANCE COMPANY, Defendants Appellees

    5) CALIFORNIA RECONVEYANCE COMPANY, DefendantsAppellees

    (my nos. above)

    Nicholas A. Boylan (argued), Law Office of Nicholas A. Boylan, San Diego, California, for Plaintiffs-Appellants

    Las Vegas attorney Shawn Christopher was or is also involved for
    the plaintiff-homeowners.

    I do so hope they all get their lunch.

    *I think that’s the distinction being made in the note itself: one must be a successor in interest, not merely be in poss of the note.

  2. SECTION 4. Record Title and Possession of Mortgage Files. The Seller hereby sells, transfers, assigns, sets over and conveys to the Purchaser, without recourse, but subject to the terms of this Agreement and the Seller hereby acknowledges that the Purchaser, subject to the terms of this Agreement, shall have all the right, title and interest of the Seller in and to the Mortgage Loans. From the Closing Date, but as of the Cut-off Date, the ownership of each Mortgage Loan, including the Mortgage Note, the Mortgage, the contents of the related Mortgage File and all rights, benefits, proceeds and obligations arising therefrom or in connection therewith, has been vested in the Purchaser

    . All rights arising out of the Mortgage Loans including, but not limited to, all funds received on or in connection with the Mortgage Loans and all records or documents with respect to the Mortgage Loans prepared by or which come into the possession of the Seller shall be received and held by the Seller in trust for the exclusive benefit of the Purchaser as the owner of the Mortgage Loans. On and after the Closing Date, any portion of the related Mortgage Files or servicing files related to the Mortgage Loans (the “Servicing Files”) in Seller’s possession shall be held by Seller in a custodial capacity only for the benefit of the Purchaser. The Seller shall release its custody of any contents of the related Mortgage Files or Servicing Files only in accordance with written instructions of the Purchaser or the Purchaser’s designee.

    SECTION 5. Books and Records. The sale of each Mortgage Loan has been reflected on the Seller’s balance sheet and other financial statements as a sale of assets by the Seller. The Seller shall be responsible for maintaining, and shall maintain, a complete set of books and records for the Mortgage Loans which shall be appropriately identified in the Seller’s computer system to clearly reflect the ownership of the Mortgage Loans by the Purchaser

    .

    SECTION 6. Delivery of Mortgage Notes.
    ————————–

    (a) On or prior to the Closing Date, the Seller shall deliver to the Purchaser or the Custodian, as directed by the Purchaser, the original Mortgage Note, with respect to each Mortgage Loan so assigned, endorsed without recourse in blank, or in the name of the Trustee as trustee, and signed by an authorized officer (which endorsement shall contain either an original signature or a facsimile signature of an authorized officer of the Seller, and if in the form of an allonge, the allonge shall be stapled to the Mortgage Note), with all intervening endorsements showing a complete chain of title from the originator to the Seller. If the Mortgage Loan was acquired by the endorser in a merger, the endorsement must be by “____________, successor by merger to [name of predecessor]”. If the Mortgage Loan was acquired or originated by the endorser while doing business under another name, the endorsement must be by “____________ formerly known as [previous name].” The delivery of each Mortgage Note to the Purchaser or the Custodian is at the expense of the Seller.

    In lieu of delivering the Mortgage Note relating to any Mortgage Loan, the Seller may deliver or cause to be delivered a lost note affidavit from the Seller stating that the original Mortgage Note was lost, misplaced or destroyed, and, if available, a copy of each original Mortgage Note; provided, however, that in the case of Mortgage Loans which have been prepaid in full after the Cut-off Date and prior to the Closing Date, the Seller, in lieu of delivering the above documents, may deliver to the Purchaser a certification to such effect and shall deposit all amounts paid in respect of such Mortgage Loan in the Payment Account on the Closing Date.

    (b) If any Mortgage Note is not delivered to the Purchaser (or the Custodian as directed by the Purchaser) or the Purchaser discovers any defect with respect to a Mortgage Note which materially and adversely affects the interests of the Certificateholders in the related Mortgage Loan, the Purchaser shall give prompt written specification of such defect or omission to the Seller, and the Seller shall cure such defect or omission in all material respects or repurchase such Mortgage Loan or substitute a Qualified Substitute Mortgage Loan in the manner set forth in Section 7.03. It is understood and agreed that the obligation of the Seller to cure a material defect in, or substitute for, or purchase any Mortgage Loan as to which a material defect in, or omission of, a Mortgage Note exists, shall constitute the sole remedy respecting such material defect or omission available to the Purchaser, Certificateholders or the Trustee on behalf of Certificateholders.

    (c) All other documents contained in the Mortgage File and any original documents relating to the Mortgage Loans not contained in the Mortgage File or delivered to the Purchaser, are and shall be retained by the Servicer in trust as agent for the Purchaser.

    In the event that in connection with any Mortgage Loan: (a) the original recorded Mortgage (or evidence of submission to the recording office), (b) all interim recorded assignments, (c) the original recorded modification agreement, if required, or (d) evidence of title insurance (together with all riders thereto, if any) satisfying the requirements of clause (I)(ii), (iv), (vi) or (vii) of the definition of Mortgage File, respectively, is not in the possession of the Servicer concurrently with the execution and delivery hereof because such document or documents have not been returned from the applicable public recording office, or, in the case of each such interim assignment or modification agreement, because the related Mortgage has not been returned by the appropriate recording office, in the case of clause (I)(ii), (iv) or (vi) of the definition of Mortgage File, or because the evidence of title insurance has not been delivered to the Seller by the title insurer in the case of clause (I)(vii) of the definition of Mortgage File, the Servicer shall use its best efforts to obtain, (A) in the case of clause (I)(ii), (iv) or (vi) of the definition of Mortgage File, such original Mortgage,

  3. “February 15, 2013
    Robo-Signing Fraud Case Is Settled

    The mortgage servicing company Lender Processing Services agreed to pay $35 million to resolve a federal criminal investigation into foreclosure fraud, the Justice Department said on Friday…..

    Prior to DocX’s closure in 2010, Lender Processing Services had handled more than half of the nation’s foreclosures.”

    Seeing as how I believe these guys operated using MERS-officer designations courtsey of Hultman resolutions (pursant to merscorp’ member requests), how did MERSCORP and MERS skate? Anyone hear anything?

    Any lawyers ready to file that antitrust case against these guys yet?

  4. Elex
    I needed that today, thanks for posting the case, made my day.

  5. Time for some real law. In this case, a reply to the several amicus curiae briefs in Yvanova on the Glaski issue in CA. I thought it might be pretty much settled with the recent Slorp decision from the feds, but then again, the Ca judiciary is corrupt up through the state supreme court.
    https://mariokenny.files.wordpress.com/2015/07/yvanova-v-new-century-mortgage-corporation-7-appellant_s-answer-to-amicus-curiae-briefs.pdf

  6. re: the language in the notes (transfer and right to payment):

    “Under Nebraska law, which governs the ……Agreement,
    if the terms of a contract are not ambiguous, “the intent of the parties
    must be determined from the contents of the contract, and the
    contract must be enforced according to its terms.” New Light Co.
    v. Wells Fargo Alarm Servs., 525 N.W.2d 25, 31 (Neb. 1994).
    Construing an unambiguous contract is a question of law for the
    court, and “[t]here is a strong presumption that a written
    instrument correctly expresses the intention of the parties to
    it.” Artex, Inc. v. Omaha Edible Oils, Inc., 436 N.W.2d 146,
    150 (Neb. 1989). However, if the contract is ambiguous — that is,
    if it may objectively be understood in more than one sense — then
    extrinsic evidence is admissible, and the parties’ intent is a
    question of fact for the jury. See Luschen Bldg. Ass’n v. Fleming
    Cos., 415 N.W.2d 453, 458-59 (Neb. 1987); Lauritzen v. Davis,
    335 N.W.2d 520, 527 (Neb. 1983).”

    Imo it was the clear intent of the crafters / lenders that the notes not be negotiable, not be enforceable by anyone in mere possession (even of a note endorsed in blank), and in fact this provision might just be construed to actually prohibit blank endorsements because a blank endorsement could throw into question whether or not the note were freely negotiable by poss and further, that this – only a transferee-with-a-right-to-payment guy could go after the borrower – was mol a warranty made to the borrower. I could be way over there in left field, ought of the park even, but until someone let’s me in on how that is, I’m reading the words to mean what they say: transfer and right to payment. Btw, contracts are generally construed against the party who wrote them, certainly imo as to contracts of adhesion.

  7. 4 recent articles linked at
    stopforeclosurefraud

    Trespass Unwanted, Creator, Corporeal, Life

  8. If a business made a loan to a master servicer for the MS’s servicing advances, that would be a risky deal, seems, and would prob involve trust law and maybe even the default law UCC. That business itself could demand subrogation of the MS’s right to be reimbursed in the agreement between them. So if MS doesn’t pay its (call it) line of credit, the business stands in the shoes of the MS. Holy cow. But personally I think such a possiblity would be nixed because servicers to my knowledge have no right to do something which could make those advances accrue to yet someone else’s interest. If it weren’t for trust law and the agreements between MS and trusts, maybe. I’m just spinning a MS’s “advances line of credit” out here to look at, but it IS entirely possible. Can’t know if it crosses into probable territory.
    So the business wants its funds back and has been subrogated to the rights of the MS, at least in their contract, for reimbursement of advances. Say you’re Aurora and in deep, dam’s bursting all over the heck, tapped out. You borrowed your advances, clock’s ticking, and now the govt is hollering about HAMP etc (and you took the funds) (did the govt know you borrowed your advances or that you had made them or were even compelled to and how you got reimbursed?)
    I could be wrong, since I don’t know, but it sounds like NS got Aurora’s advance-receivables at 100% (a billion!). I can’t find Aurora’s alleged bk anywhere, but at any rate, what made NS a better candidate for servicing these loans than Aurora? Was NS a start up such that it had no other financial train, obligations, it was dragging? Had a better financial statement? Or does the 100% it appears NS paid* tell us that servicer advances are a really good deal for servicers – as long as one has the wherewithall to keep making them (like in my theory – only – of playing the spread)?

    *actually, we don’t know what NS paid for the advance reimbursement rights – just that Aurora was said to have racked up 1 billion. Did Aurora in fact morph into NS, a diff business entity, and somehow benefit from selling the advances that way? (I’m fairly certain Nationstar is Aurora LLC with another name, essentially.)

    Maybe part of the reason Lehman went under, besides not being bailed like apparently more-Washington-kindreds-spirits is on account of advances (and default swaps, whatever those actually are – the possibly insurable obligation to make someone else’s advances? Wouldn’t wanna leave out our buddies at AIG, which as a reminder is said to have waived subrogation). 1 billion is a hard number for us mere mortals to fathom, but for all we know, it was (is?) more the norm than not.

    I guess really why we care is because we care about 3rd parties’ interests in foreclosing on our homes, and getting back servicing advances is a heck of a motivation to foreclose (unless they are benefitting by a spread and haven’t sent the money off to the cayman’s and or benefitting from those possibly insurable obligations to make someone else’s advances. We also care about whether or not these advances are collectible UNDER the notes. Or if they are separate and distinct. If they’re separate and distinct, the advances must be credited to the loan balance or at least the advances should be shown on the ledger for our loans. I don’t think any accounting should ignore payments made by anyone, even if that party has a right to one thing or another about those payments.

    Could they insure their own obligation to make advances?(Got me; actually seems like they could.) I’m just trying to get a grip on what a default – swap is. Probably, which might at least explain the write-your-own-AIG terminals in their offices). And I still have the same questions: Why did fnma guarantee anything? Why did master servicers agree to make advances? Was it just a sale’s tool? Did the Master Servicer’s have what at least we here, those very impacted by these deals, would consider more sinister motivations in their own interests and no one else’s such that there is contractual interference?

  9. Actually, maybe we haven’t been relieved of the claim of failure to mitigate so much as we’d have a hell of a time proving it when a third party can just say what he wants and have it pass for fact (or maybe that’s the same thing?) If they don’t get these lousy advances back which they apparently volunteered to make until foreclosure, they certainly aren’t motivated to do a thing even if they could do that thing.

  10. “Private mtg insurance companies opened shop, getting their piece of the pie, and allowing lenders to make conventional loans (not FHA or VA) over 80% ltv.”
    By the 90’s I’d say, some lenders discovered they could “self-insure” the loans by adding the fee to the rate charged the borrower. Kinda, but not quite, like is done with fnma loans by the “g-fee” – that fee is to cover fnma’s guarantee to YET another party.

  11. A “float” generally means the diff between what one pays for money and what one charges for that money. It’s basically one big way lenders made money before all this bs started. They’d borrow money at 3% and sell it at 5% (to the borrower). The diff is the “float” and it was rightfully theirs. They had to pay servicing costs and so on (incl losses) out of that spread. Many here are too young to know this, but there was a time when S & L’s, say, retained their own servicing. Loans weren’t always sold and neither was the servicing. As will happen with free enterprise, others figured out how to create what was sold as a valuable service – servicing someone else’s loan. Private mtg insurance companies opened shop, getting their piece fo the pie, and allowing lenders to make conventional loans (not FHA or VA) over 80% ltv.
    Servicing and pmi each became a big industry. F & F bought the loans originated by others, servicing released, meaning the big fish could keep the servicing and make lots of moloah servicing (and or sell it). F & F created a secondary market so that lenders could recapitalize and make more loans… Residential Funding Corp hit the market sometime in there with programs for ‘jumbo loans”, ones which exceeded F & F’s loan amt limits. They eventually began having diff qualifications for those loans, also – less stringent.
    Then the whole industry went nuts, finding more and more ways to get in the act, and get as big a piece of the pie as possible. Clearly free enterprise runs amok when untethered and not overseen. There’s so much blame to go around here, it’s not funny. But what’s really not funny is that the one with the least recourse is the one impacted the most by losing his home. We can’t stop lenders from selling our loans and with more ethical and regulatory oversight, we prob wouldn’t want to. But what we can do is demand our records be returned where they belong so that, if for no other reason, we can have a shot at meaningful mitigation should the need arise. Whether or not it’s intentional, the other guys supposedly on the other end of our home loans can hide behind the third party they either put in the act or allowed in the act. With the current situation, there is NO true shot at mitigation, and imo, we’ve been relieved of a proper affirmative defense by the presence and (conflicting) motivations of a third party. Each one of of us can prob come up with what we’d have been willing to concede had we been given a legit shot at it. Sec’n has to go.

    MERS HAS TO GO SAY NO TO A MERS ANYTHING

  12. What is the point of a bankster making servicer advances? Stop.

    Doesn’t it really just serve to keep the prices of the derivatives at artificial levels by showing a false return (and or keep a trust ‘alive’ if there’s a bar for its death?) Whether or not the servicer may claim under the note or not, the investor still has to repay the servicer for the advances and so the advances aren’t really a return on investment.
    I mean, what? The servicer is going to make advances until the market turns around? Ok, say let’s just say the investors didn’t know the appraisals were inflated majorly. But the lenders did. All of them imo. Even if an appraisal weren’t itself inflated per se, they created a false market (which sales supported comps for other homes) by making loan funds available to and promoting loans (many, many) to people who didn’t qualify. As lenders, B of A, WF, and other bigger fish KNOW real estate markets are cyclical and have burst cycles. Were they making so much dough on these deals, they thought they could afford to make advances? Well, now, the answer to that lays in whether or not their recovery is UNDER THE NOTE. *These teasor rate loans adjusted to ridiculous rates (partly but not at all entirely) due to the rigged index to which they were “tied” – libor.
    So one way or another, servicers would be getting a hell of a return on their advance monies because they get it back likely at the note rate.
    I can’t quite support this this minute, but they could be using funds gotten at X% and be paid back at Y%, the note rate, I think and a hell of a float if so. One more try. BAnksters borrows the advance funds at 2 – 3% for Loan X with a rate of 10%. Well, I can’t get there. I guess the question is DO banksters get interest on their advances?

    *They could hypothecate their right to reimbursement, that is, basically use it as collateral for loans to make the advances (if they found someone willing to make such a loan). Gee, maybe their advance-lender was Merscorp. Seems to me they’d have the dough since they’re the ones who get the money the recorders aren’t getting (for one, and mmsp fees, etc – a member is charged for doing ANYthing with the computer program and for using MERS’ name. Yes, the servicers, like ALS, WF, whomever pays MERSCorp for letting its employee execute docs in MERS’ name. LPS must have run up and paid quite a Bill). Now that’s a heck of a note, whether it were Merscorp or not (prob not – just something which struck me). But and also, generally, money borrowed short term (not 10, 15, 30 years, say) has a price for not paying it as scheduled. A lender will move out the due date FOR A FEE, often 1% of the outstanding balance. Could be more if they hadn’t agreed ahead of time of an amt to move out the due date.

  13. What is a default servicer? Well, I don’t know. But if ALS didn’t get one and forked out a billion dollars in advances, seems like that helped lead to its demise, meaning to me they got caught in their own bullshit (really, knee deep – picture it! – making and or buying junk loans) Default servicing must be an accounting issue and related to balance sheets. Seems to do one thing first and foremost: changes the company which is making servicer advances.
    Did servicers insure their obligation to advance somehow? But if that were true, and ALS took such insurance, they shouldn’t have been out (owed) 1 billion in advances, unless they blew the insurance dough out thru a subsidiary, to the Caymans, or ….bonuses!

    Back to default servicers: either that – 1st para – or not making advances because trust has been 86’d – pure speculation since I know nada of that, cept to spec if that happens, derivs become worthless) and the default servicer shares the booty with the former- trust servicer??? Nah, don’t think this one is the case. Hey, David, you like blood-hounding. Whatcha got about default servicers?

  14. NG, et al: We need to know, not speculate further, that these servicer advances are collectible UNDER THE NOTE, what are, as a matter of law, the determining factors. (I don’t think, but can’t swear, that fnma – so neither fhlmc – has rights of subrogation regarding its own voluntary guarantee made in the prospectus and or its supplement. Nor for that matter do we know WHY FNMA guaranteed anything. Was it a sales’ tool? Was it because FNMA was a quasi (is it?) agency of the government and that makes a difference?

    The banksters on non-conforming (here non-VA, FHA, F or F) loans
    far as I can tell didn’t guarantee anything per se. The master servicers just agreed to advance missing borrower payments until one of a few things happened, the most drastic foreclosure. And btw, does this mean if there’s a loan modifiction, the servicer must WAIT for its advances? One can see from the servicer advances Nationstar inherited from Aurora (One BILLION!!*) and Nationstar’s attempt to auction loans in default instead of servicing (KIRP – investors – lawsuit) that they don’t want to WAIT to be reimbursed for those advances.
    *running advances up to one billion bears scrutiny – stuck? betting on the come after racking up monster bs fees? What?

    The agreements say the bankster may recover its advances from sales proceeds. Okay. DOES that amt to subrogation as to those amounts, and if so, IS it a right which is properly indicated as due and owing ON AND UNDER THE NOTE? I don’t see it that way, not if the advances are due OUT OF SALES PROCEEDS. If you’re my granny and you give me a right to 10k of the proceeds from the sale of your house upon death, that doesn’t give me an interest in your house – only in the PROCEEDS. Not sure, but don’t think this example is apple and oranges.
    The banksters, way I get it, may NOT recover their advances until at least the dot is extinguished (as a matter of law as I recall) by way of a sale of the property. Don’t think this is material here, but throwing it in in case it is.
    Fnma, on the other hand sort of, has the right to make 4 payments and then repurchase the note or certs which it must do to end its vol payments, but I believe fnma must eat those four payments and is owed what is owed after those four payments (the balance of the note after application of its four (or how many) payments, never credited to the loan.

    If a servicer, say, had to sue a lender, for contractual advances after lender jerks the servicing from that servicer, the lender would likely be found liable to the servicer for the advances. But NOT under the notes….just liable for a breach of contract. The way these deals seem to be written, I don’t see a claim of subrogation (even if I admittedly can’t rattle off 1) the factors which make for such a claim of right and 2) what it – right of subrogation – means beyond that as to the balance of a note). IF it turned out the only assets the lender had were the loans, could the old servicer attach its judicial lien to them? Probably (now turn to UCC as applicable). But that still doesn’t create rights under the notes re: the note issuer (homeowner) or change the fact that the servicer advances must have been credited. imo.

  15. ARTICLE V. ALLOWANCE OF CLAIM.
    Section 5.01 The Allowed Claim. ResCap hereby makes an irrevocable offer to settle,
    expiring at 5:00 p.m. prevailing New York time on the date that is forty five (45) days after the
    Petition Date, with each of the Trusts that timely agrees to the terms of this Settlement
    Agreement (the “Accepting Trusts”). In consideration for such agreement, ResCap will provide a
    general unsecured claim of $8,700,000,000 (the “Total Allowed Claim”). For the avoidance of
    doubt, the Total Allowed Claim shall be shared among any Trusts accepting the offer contained
    12-12020-mg Doc 320-2 Filed 06/11/12 Entered 06/12/12 00:00:34 Exhibit 2
    Pg 6 of 39
    EXECUTION COPY
    -6-
    ny-1040888
    in this Section 5.01, subject to the provisions of this Settlement Agreement. Any Trusts
    accepting the offer contained in this Section 5.01, subject to the provisions of this Settlement
    Agreement shall be allowed claims in an amount calculated as set forth below (the “Allowed
    Claim”), but in no case shall the amount of the Allowed Claim exceed $8,700,000,000. The
    amount of the Allowed Claim shall equal (i) $8,700,000,000, less (ii) $8,700,000,000 multiplied
    by the percentage represented by (a) the total dollar amount of original principal balance for the
    Trusts not accepting the offer outlined above, divided by (b) the total dollar amount of original
    principal balance for all Trusts.
    Section 5.02 Waiver of Setoff and Recoupment. By accepting the offer to settle
    contained in Section 5.01, each accepting Trust irrevocably waives any right to setoff and/or
    recoupment such Trust may have against Ally and ResCap.

    ARTICLE VII. RELEASES.

    Section 7.01 Releases. Except as set forth in Article VIII, as of the Effective Date, with
    respect to each and every Trust for whom the Trustee accepts the compromise contemplated by
    this Settlement Agreement, the Investors, Trustee, Trust, and any Persons claiming by, through
    or on behalf of such Trustee (including Institutional Investors claiming derivatively) or such
    Trust (collectively, the “Releasors”), irrevocably and unconditionally grant a full, final, and
    complete release, waiver, and discharge of all alleged or actual claims, demands to repurchase,
    demands to cure, demands to substitute, counterclaims, defenses, rights of setoff, rights of
    rescission, liens, disputes, liabilities, losses, debts, costs, expenses, obligations, demands, claims
    for accountings or audits, alleged events of default, damages, rights, and causes of action of any
    kind or nature whatsoever, whether asserted or unasserted, known or unknown, suspected or
    unsuspected, fixed or contingent, in contract, tort, or otherwise, secured or unsecured, accrued or
    unaccrued, whether direct or derivative, arising under law or equity, against ResCap that arise
    under the Governing Agreements. Such released claims include, but are not limited to, claims
    arising out of and/or relating to (i) the origination, sale, or delivery of Mortgage Loans to the
    Trusts, including the representations and warranties made in connection with the origination,
    sale, or delivery of Mortgage Loans to the Trusts or any alleged obligation of ResCap to
    repurchase or otherwise compensate the Trusts for any Mortgage Loan on the basis of any
    representations or warranties or otherwise or failure to cure any alleged breaches of
    representations and warranties, (ii) the documentation of the Mortgage Loans held by the Trusts
    including with respect to allegedly defective, incomplete, or non-existent documentation, as well
    as issues arising out of or relating to recordation, title, assignment, or any other matter relating to
    legal enforceability of a Mortgage or Mortgage Note, or any alleged failure to provide notice of
    such defective, incomplete or non-existent documentation, (iii) the servicing of the Mortgage
    Loans held by the Trusts (including any claim relating to the timing of collection efforts or
    foreclosure efforts, loss mitigation, transfers to subservicers, advances, servicing advances, or
    claims that servicing includes an obligation to take any action or provide any notice towards, or
    with respect to, the possible repurchase of Mortgage Loans by the applicable Master Servicer,
    Seller, or any other Person), (iv) setoff or recoupment under the Governing Agreements against
    ResCap, and (v) any loan seller that either sold loans to ResCap or AFI that were sold and
    transferred to such Trust or sold loans directly to such Trust, in all cases prior to the Petition
    Date (collectively, all such claims being defined as the “Released Claims”). For the avoidance
    of doubt, this release does not include individual direct claims for securities fraud or other
    disclosure-related claims arising from the purchase or sale of Securities.

  16. Trust Assignment Fraud Letter to SEC
    Posted on July 14, 2010
    LYNN E. SZYMONIAK, ESQ.
    The Metropolitan, PH2-05
    403 South Sapodilla Avenue
    West Palm Beach, Florida 33401
    April 15, 2010
    Mary L. Schapiro, Chairman
    Robert S. Khuzami, Director, Division of Enforcement
    Securities & Exchange Commission
    100 F Street, NE
    Washington, D.C. 20549
    enforcement@sec.gov
    Re: Mortgage-Backed Trusts Missing Critical Documents
    Dear Chairman Schapiro and Director Khuzami::
    This is a report of suspected fraud involving mortgage-back securities. Certain mortgagebacked
    trusts have been using forged and fraudulent mortgage assignments in foreclosure
    actions in Florida, and throughout the United States.
    These assignments are most often produced by employees of Lender Processing Services, Inc.,
    (“LPS”), a mortgage default management company located in Jacksonville, FL. LPS produced
    several million Mortgage Assignments, using its own employees to sign as if they were officers
    of the original lenders The fraud includes:
    • Mortgage assignments with forged signatures of the individuals signing on behalf of the
    grantors, and forged signatures of the witnesses and the notaries;
    • Mortgage assignments with signatures of individuals signing as corporate officers for
    corporations that never employed them in any such capacity;
    • Mortgage assignments prepared and signed by individuals as corporate officers of mortgage
    companies that had been dissolved by bankruptcy years prior to the Assignment;
    • Mortgage assignments prepared with purported effective dates unrelated to the date of any
    actual or attempted transfer (and in the case of trusts, years after the closing date of the trusts);
    • Mortgage assignments prepared on behalf of grantors who had never themselves acquired
    ownership of the mortgages and notes by a valid transfer, including numerous such
    assignments where the grantor was identified as “Bogus Assignee for Intervening Assignments;”
    and
    • Mortgage assignments notarized by notaries who never witnessed the signatures that they
    notarized.
    Trust officers used these fraudulent mortgage assignments to conceal the fact that the trusts are
    missing critical documents, namely, the mortgage assignments that were supposed to have
    been delivered to the trusts at the inception of the trust.
    These trusts suffered the following economic harm:
    The Trusts paid substantial fees to the Trustees for Document Custodial Services including fees
    for obtaining and retaining a Mortgage Assignment for each of the properties in the trust. The
    2
    Assignment was supposed to have been “in recordable form” – that is, legally sufficient to allow
    the Trustee to foreclose in the event of default. These services were never provided. In each
    trust identified herein, many if not all of the Mortgage Assignments were never obtained, or were
    obtained and lost.
    Because the Assignments were not obtained and/or retained, the Trusts incurred significant
    additional expenses:
    i) each Trust paid, and will continue to pay, hundreds of thousands of dollars in fees to
    mortgage servicers, document preparation companies and law firms to prepare and record
    “Replacement Assignments” including Assignments that were prepared with false information
    regarding dates and signers;
    ii) each Trust paid, and will continue to pay, hundreds of thousands of dollars in fees to the
    default management company and to law firms retained by the mortgage servicing companies
    and/or default management company (usually, Lender Processing Services) to litigate the issue
    of the standing of the trust to file the foreclosure action because the Assignment to the Trust
    that established standing was missing or never obtained.
    In many cases, because the Assignments were not obtained and/or retained, the Trust could not
    successfully foreclose when loans in the Trust defaulted. In many cases, where the Trust has
    successfully foreclosed, it had no legal right to do so and the Trust has been or will be exposed
    to claims for wrongful foreclosure by former homeowners and claims of fraud by subsequent
    purchasers. In many cases, where mortgage servicing companies or law firms representing
    the Trust attempted to collect amounts due from defaulting homeowners of properties in the
    trust, the debt collection activities violated the Federal Fair Debt Collection Practices Act
    because the Trust had no right to pursue collection or foreclosure where it lacked a valid
    Assignment.
    In many cases, particularly where the loan originator is a mortgage company that is no longer in
    existence, it may not be possible to ever obtain a valid Assignment to the Trust. Long after the
    Trustees and Servicers became aware that critical documents, the Assignments, were missing,
    the Trustees and Servicers failed to disclose that information to the Certificate Holders and to
    the SEC.
    Attached hereto are examples of fraudulent Assignments. Many (over 100,000)
    of these are signed by Linda Green. From an examination of the signatures, it is
    apparent that many different employees signed the name Linda Green.
    Job Titles attributed to Green include the following:
    • Vice President, Loan Documentation, Wells Fargo Bank, N.A.,
    successor by merger to Wells Fargo Home Mortgage, Inc.;
    • Vice President, Mortgage Electronic Registration Systems, Inc., as
    nominee for American Home Mortgage Acceptance, Inc.;
    • Vice President, American Home Mortgage Servicing as successor-ininterest
    to Option One Mortgage Corporation;
    • Vice President, Mortgage Electronic Registration Systems, Inc., as
    nominee for American Brokers Conduit;
    • Vice President & Asst. Secretary, American Home Mortgage
    Servicing, Inc., as servicer for Ameriquest Mortgage Corporation;
    • Vice President, Option One Mortgage Corporation;
    • Vice President, Mortgage Electronic Registration Systems, Inc., as
    nominee for HLB Mortgage;
    • Vice President, American Home Mortgage Servicing, Inc.;
    3
    • Vice President, Mortgage Electronic Registration Systems, Inc., as
    nominee for Family Lending Services, Inc.;
    • Vice President, American Home Mortgage Servicing, Inc. as
    successor-in-interest to Option One Mortgage Corporation;
    • Vice President, Argent Mortgage Company, LLC by Citi Residential
    Lending Inc., attorney-in-fact;
    • Vice President, Sand Canyon Corporation f/k/a Option One
    Mortgage Corporation;
    • Vice President, Amtrust Funsing (sic) Services, Inc., by American
    Home Mortgage Servicing, Inc. as Attorney-in-fact; and
    • Vice President, Seattle Mortgage Company.
    Other LPS employees similarly used job many different job titles and claimed to be officers of
    many different mortgage companies on Mortgage Assignments.
    Korell Harp and Tywanna Thomas used a variety of conflicting job titles on Assignments of
    Mortgages in 2008 and 2009, holding themselves out to be officers of numerous different banks
    and mortgage-related entities, often using numerous conflicting titles in the same week.
    Titles attributed to Korell Harp include Vice President of American Home Mortgage Servicing,
    Inc. as successor-in-interest to Option One Mortgage Corporation; Vice President of American
    Brokers Conduit; Vice President of Argent Mortgage Company, LLC; and Vice President of
    Mortgage Electronic Registration Systems, Inc.
    Titles attributed to Tywanna Thomas include Assistant Vice President of Option
    One Mortgage Corporation, Assistant Vice President of American Home Mortgage
    Servicing, Assistant Vice President of Mortgage Electronic Registration Systems,
    Assistant vice President of Argent Mortgage Company, LLC, Assistant Vice
    President of Deutsche Bank National Trust Company, Assistant Vice President of
    Sand Canyon Corporation and Assistant Vice President of American Home Mortgage
    Acceptance.
    Regarding the Attachments,
    SECTION ONE – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE
    AMERICAN HOME MORTGAGE ASSETS TRUSTS
    Section One includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    showing mortgages transferred to American Home Mortgage Assets Trusts
    SECTION TWO – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE
    AMERICAN HOME MORTGAGE INVESTMENT TRUSTS
    Section Two includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    showing mortgages transferred to American Home Mortgage Investment Trusts
    SECTION THREE – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE
    HARBORVIEW MORTGAGE LOAN TRUSTS
    Section Three includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to HarborView Mortgage Loan Trusts
    SECTION FOUR – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE
    SOUNDVIEW HOME LOAN TRUSTS
    Section Four includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Soundview Home Loan Trusts
    SECTION FIVE – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE
    AMERIQUEST MORTGAGE SECURITIES TRUSTS
    4
    Section Five includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Ameriquest Mortgage Securities Trusts
    SECTION SIX – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE ARGENT
    SECURITIES TRUSTS
    Section Six includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to show
    mortgages transferred to Argent Securities Trusts
    SECTION SEVEN – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE GSAA
    HOME EQUITY TRUSTS
    Section Seven includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to GSAA Home Equity Loan Trusts
    SECTION EIGHT – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE HS1
    ASSET SECURITIZATION TRUSTS
    Section Eight includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to HS1 Asset Securitization Trusts
    SECTION NINE – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE
    IXIS REAL ESTATE TRUSTS
    Section Nine includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Ixis Real Estate Trusts
    SECTION 10 – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE LONG
    BEACH MORTGAGE TRUSTS
    Section Ten includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to show
    mortgages transferred to Ameriquest Long Beach Mortgage Trusts
    SECTION 11 – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE MORGAN
    STANLEY ABS CAPITAL 1 TRUSTS
    Section Eleven includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Morgan Stanley ABS Capital 1 Trusts
    SECTION 12 – DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE NOVASTAR
    MORTGAGE FUNDING TRUSTS
    Section Twelve includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Novastar Mortgage Funding Trusts
    SECTION 13 – DEUTSCHE BANK NATIONAL TRUST CO. AS TRUSTEE SAXON ASSETS
    SECURITIES TRUSTS
    Section Thirteen includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Saxon Assets Securities Trusts
    SECTION 14 – DEUTSCHE BANK NATIONAL TRUST CO. AS TRUSTEE OTHER TRUSTS
    WITH MISSING ASSIGNMENTS
    Section Fourteen includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to WAMU 2005-AR2, QUEST 2005-X1
    SECTION 15 – DEUTSCHE BANK TRUST CO. AMERICAS AS TRUSTEE
    MISCELLANEOUS TRUSTS
    Section Fifteen includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to: MSIX 2006-1, MORGAN STANLEY, MSAC, 2007-NC3, MSHEL
    2007-1, MSHEL 2007-2, 2007-3, MERITAGE 2005-2, JP MORGAN ACQUISITION TRUST,
    IMAC SECURED ASSETS CORP, GSR MORT. LOAN TRUST, BCAP LLC TRUST,
    CARRINGTON, SERIES 2005 OPT2
    SECTION 16 – BANK OF NEW YORK AS TRUSTEE AMERICAN HOME MORTGAGE
    INVESTMENT TRUST 2004-4
    Section Sixteen includes Mortgage Assignments prepared by LPS EMPLOYEES
    purporting to show mortgages transferred to American Home Mortgage
    Investment Trust 2004-4.
    5
    SECTION 17 – CITIBANK, N.A. AS TRUSTEE AMERICAN HOME MORTGAGE ASSETS
    TRUSTS & INVESTMENT TRUSTS
    Section Seventeen includes Mortgage Assignments prepared by LPS EMPLOYEES purporting
    to show mortgages transferred to American Home Mortgage Assets Trusts.
    SECTION 18 – CITIBANK, N.A. AS TRUSTEE BEAR STEARNS ALT-A TRUSTS
    Section Eighteen includes Mortgage Assignments prepared by LPS EMPLOYEES purporting to
    show mortgages transferred to Bear Stearns ALT-A Trusts SECTION 19 – CITIBANK, N.A. AS
    TRUSTEE STRUCTURED ASSET MORTGAGE INVESTMENT TRUSTS
    Section Nineteen includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to Structured Asset Mortgage Investment Trusts
    SECTION 20 – CITIBANK, N.A. AS TRUSTEE WAMU TRUSTS & BNC MORTGAGE LOAN
    TRUST
    Section Twenty includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to WAMU Trusts and BNC Mortgage Loan Trusts
    SECTION 21 – HSBC BANK, N.A. AS TRUSTEE DEUTSCHE ALT-A & ALT-B SECURITIES
    TRUSTS
    Section Twenty-One includes Mortgage Assignments prepared by LPS EMPLOYEES purporting
    to show mortgages transferred to Deutsche Alt-B Securities Mortgage Loan Trust, Series 2006-
    AB3; Deutsche Alt-A Securities Mortgage Loan Trust, Series 2006-AR5
    SECTION 22 – HSBC BANK, N.A. AS TRUSTEE ACE SECURITIES CORP. HOME EQUITY
    LOAN TRUST; SG MORTGAGE SECURITIES TRUST, OPTION ONE MORTGAGE LOAN
    TRUST
    Section Twenty-Two includes Mortgage Assignments prepared by LPS EMPLOYEES purporting
    to show mortgages transferred to ACE Securities Corp. Home Equity Loan Trust, Series 2006-
    OP1; and SG Mortgage Securities Trust Series 2006 OPT2; and Option One Mortgage Loan
    Trust Series 2007-HL1
    SECTION 23 – JPMORGAN CHASE BANK, N.A. AS TRUSTEE STRUCTURED ASSET
    MORTGAGE INVESTMENTS TRUST
    Section Twenty-Three includes Mortgage Assignments prepared by LPS EMPLOYEES
    purporting to show mortgages transferred to Structured Asset Mortgage Investments II, Inc.,
    Series 2006-AR5.
    SECTION 24 – LASALLE BANK, N.A. AS TRUSTEE MORGAN STANLEY & BEAR STEARNS
    MORTGAGE LOAN TRUSTS & OTHERS
    Section Twenty-Four includes Mortgage Assignments prepared by LPS Employees purporting
    to show mortgages transferred to Morgan Stanley Mortgage Loan Trust 2006-6AR; Morgan
    Stanley ABS Capital MSAC 2007-HE6; Bear Stearns Asset-Backed Securities 1, LLC, Series
    2004-FR3; Series 2004-HE; 2005-HE9; 2006-HE2; 2006-HE7; 2007-HE1; Series 2007-HE5;
    Bear Stearns Asset-Backed Securities Trust 2005-4; Securitized Asset Investment Loan Trust,
    Series 2004-7.
    SECTION 25 – U.S. BANK, N.A. AS TRUSTEE MASTR TRUSTS
    Section Twenty-Five includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to MASTR Adjustable Rate Mortgages Trust 2006-OA1; MASTR
    Adjustable Rate Mortgages Trust 2007-1; MASTR Asset-Backed Securities Trust 2007-HE2
    SECTION 26 – U.S. BANK, N.A. AS TRUSTEE STRUCTURED ASSET INVESTMENT &
    STRUCTURED ASSET SECURITIES TRUSTS
    Section Twenty-Six includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to Structured Asset Investment & Structured Asset Securities
    Trusts, including Series 2005-3, 2005-10, 2006 BNC2, 2006 BNC3 and 2006 BNC6
    SECTION 27 – U.S. BANK, N.A. AS TRUSTEE MISC. OTHER TRUSTS
    Section Twenty-Seven includes Mortgage Assignments prepared by LPS Employees purporting
    to show mortgages transferred to American Home Mortgage Investment Trust 2005-4; and
    6
    GSAA Home Equity Trust 2006-9.
    SECTION 28 – WELLS FARGO BANK AS TRUSTEE ABFC TRUSTS
    Section Twenty-Eight includes Mortgage Assignments prepared by LPS Employees purporting
    to show mortgages transferred to several ABFC Trusts
    SECTION 29 – WELLS FARGO BANK AS TRUSTEE MASTR ASSET-BACKED SECURITIES
    TRUSTS
    Section Twenty-Nine includes Mortgage Assignments prepared by LPS Employees purporting
    to show mortgages transferred to MASTR Asset-Backed Securities Trust 2003-OPT2 and 2005-
    OPT1
    SECTION 30 – WELLS FARGO BANK AS TRUSTEE OPTION ONE MORTGAGE LOAN
    TRUSTS
    Section Thirty includes Mortgage Assignments prepared by LPS Employees purporting to show
    mortgages transferred to over 25 Option One Mortgage Loan Trusts
    SECTION 31 – WELLS FARGO BANK AS TRUSTEE SECURITIZED ASSET-BACK
    SECURITIES and/or RECEIVABLES TRUSTS
    Section Thirty-One includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to six Securitized Asset-Backed Receivables Trusts
    SECTION 32 – WELLS FARGO BANK AS TRUSTEE SOUNDVIEW HOME LOAN TRUSTS
    Section Thirty-Two includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to four SoundView Home Loan Trusts
    SECTION 33 – WELLS FARGO BANK AS TRUSTEE MISC. OTHER TRUSTS
    Section Thirty-Three includes Mortgage Assignments prepared by LPS Employees purporting to
    show mortgages transferred to other trusts that use U.S. Bank at Trustee.
    Thank you for your attention to this matter. While I am concerned about the defrauded investors,
    particularly the pension funds that have invested in these trusts, I am also concerned about the
    homeowners who are losing their homes to bank/trustees who use these Assignments without
    disclosing the issue of the missing Trust documents.
    Yours truly,
    Lynn E. Szymoniak, Esq.

  17. I think we all know the answer to that

  18. Servicer is the debt collector
    But for who

  19. Heres an interesting thing about assigning from MERS
    Its the only way they can make that 1099a appear almost legit
    But they admit they are servicer NOT LenDER. Its all on record, they hang themselves with their own rope eventually.

  20. usedkarguy: “7 YEARS, ACTUALLY. It’s all obfuscation, folks.”

    You’re too kind. When you use your employee to assign to yourself though you’re not the lender and then pose as the lender, I have another word for it.

    MERS HAS TO GO

    Here is a guy at Linked who has signed assignments for “mers” to his EMPLOYER, Aurora (Aurora Loan Services, LLC). See ANY mention of HIS alleged OFFICERSHIP with MERS???? Grab your own “mers officer” while you can. (I don’t think this is consistant with another version of him at linked I have elsewhere, also not mentioning any affiliation with “MERS”).

    Theodore Schultz
    Senior Financial Analyst
    Nationstar Mortgage
    April 2013 – Present (2 years 4 months) Scottsbluff, NE

    I’m pleased to presently support Nationstar Mortgage, the fifth largest Residential Mortgage Servicer in the country. Responsibilities include management of Rating Agency relationships, maintenance and update of the Company Servicing presentation, and support of other significant, external Client and Nationstar Finance team objectives. Mortgage Servicing Professionals: If considering a career move, check out Nationstar, as you will be impressed by Nationstar’s products, people, and performance

    AURORA BANK FSB
    Account Manager October 2010 – July 2012 (1 year 10 months)Scottsbluff, Nebraska

    Received promotion to role of AVP, Records Manager, with responsibility over four key Records departments, including: Assignments, Document Control, Final Documents, and Releases. Responsibility included oversight over department time-sensitive Compliance (delivery timing) requirements, plus four Supervisors and approximately 30 employees. During Records Management tenure, oversaw consistently-improved productivity with exceptionally-low Associate turnover.

    AURORA BANK FSB
    Records Managment
    October 2010 – July 2012 (1 year 10 months)Scottsbluff, Nebraska

    Supported Company and managed external Clients within Client Services department as primary business liaison. Worked directly with multiple Investors in support of externally-owned Loan Portfolios, as Account Manager, via direct contact. Communicated daily statistics and addressed performance achievements and concerns with prompt focus and attention to detail. Developed and provided customized Portfolio Performance Reports for each supported Client, with periodic deliverables (including recurring meetings) managed on schedule.

    AURORA BANK FSB
    Master Servicing LIason, Project Manager
    September 2002 – February 2009 (6 years 6 months)Scottsbluff, Nebraska
    Worked with Aurora Loan Services (later titled Aurora Bank FSB) from 2002-2012, with first 6+ years spent in the Master Servicing Liaison/Project Manager role. Responsibilities included management of Rating Agency relationships and reporting for Aurora’s Denver-based Master Servicing division. Most time devoted to coordination and support of external audits, including management of external due diligence audits pertaining to loan sales, plus data collection and presentation coordination for Investor, Rating Agency, and regulatory audits.

  21. Reblogged this on California Freelance Paralegal and commented:
    Another great blog post by Neil Garfield on the admissibility of hearsay business records.

  22. On my husbands note the lender named was 1st (Take) Advantage Mortgage

    The unfilled deed says…1st (Take)Advantage Capital Funding.

    Scratches
    The warehouse lender …….

  23. Take the warehouse lender out of the scenerio and what do you see?

  24. In PPMs. There are 2 trusts. As JG says…one trust is not allowed to hold land. This is where the bifurcations occur.
    The indentured party…aha…

    If the trust is created in the instrument that creates the estate……

    I know nothing…yet know things I don’t know because once you know..you can never not know.

  25. “27. At the RALI Trusts’ inception, the Master Servicer was Residential Funding Corporation.
    In 2008, Aurora Loan Services LLC (“Aurora”) assumed the servicing responsibilities. Over the next several years, many of the loans in the Trusts and affiliated RALI trusts became non-performing. Their non-performance caused Aurora to advance very substantial sums in its duties as Master Servicer,

    reaching well north of $1 billion over all trusts serviced by Aurora.

    28. Last year, Aurora sold all of its servicing rights to Defendant Nationstar. Specifically, on March 6, 2012, Aurora and Nationstar entered into an asset purchase agreement (“Asset Purchase Agreement”), in which Aurora agreed to sell its servicing assets in the Plaintiff Trusts. The purchase closed on June 28, 2012.”

    jg: And altho only servicing rights were sold by ALS to NS, they used their employee mers’ “officers” to purport sales of the loans themselves. If the ability to do that isn’t a racket, I don’t know what one is.
    I think most of the folks from Aurora will now be found at NS. I heard a few years ago that Aurora filed bk, but I haven’t been able to find it.

  26. usedkarguy – I don’t know what has happened to make them think they may now just purport to assign to trusts. First we had mers, then we had servicers incognito as the rpii’s, now it’s allegedly assgts right to the trusts. Prob some White Paper they circulated said the coast is clear (but still, why now: Just keep the game changing?)

  27. “22. Furthermore, to avoid unnecessary foreclosures when borrowers fall behind on their payments, the Servicing Agreements authorize the Master Servicer to engage in efforts commonly referred to as “loss mitigation.” Subject to specific limitations in the Servicing
    Agreements, the Master Servicer is authorized, under certain conditions, to waive certain late payments and prepayment charges; extend due dates for payment on a mortgage loan, waive,
    modify or vary any term of any mortgage loans; and/or consent to the
    postponement of strict compliance with any such term or in any manner grant indulgence to any Mortgagor if in the
    Master Servicer’s determination such waiver, modification, postponement or indulgence is not materially adverse to the interests of the Certificateholders.
    See Section 3.07 of the Servicing Agreement”

    When a third party is allowed to make decisions impacting the two real parties to an agreement and when that third party may, not does, but just may, make decisions based on its own interest and not that of the two real parties, something’s wrong. Leaving the decision of whether or not something is adverse to the lender to a party with its own motivation for making that decision this way or that way is bs. Failure to mitigate is an aff defense, but for the presence of that third party, I doubt we have a way to prove it’s happened: the self-motivated servicer can just say whatever they want, long and short. Or sign something as the such and such of just about anyone. Well, I wouldn’t know how to properly argue it’s bs, but someone(s) with more business law savvy could or should. imo. (can there be any doubt the servicers’ motivations have been in play here for years? When homeowners, if given half a chance would pay 300k, but homes were sold for 200k or short sales were denied?)

  28. from our response to a MTD…
    For the first time since the commencement of a foreclosure action in Kenosha County Circuit Court on February 3, 2009, an entity has appeared in this action, by Attorney Stephanie Dykeman of LITCHFIELD CAVO, LLP, identifying itself as the Wells Fargo Home Equity Asset-Backed Securities 2005-2 Trust (WFHET 2005-2), which has never previously appeared in any action involving the Note and Mortgage which have been the subject of years of litigation.

    7 YEARS, ACTUALLY. It’s all obfuscation, folks.

  29. Nationstar got busted for “selling loans at (online I think) auction in bulk instead of servicing them” (app, loans in default). KIRP, LLC sued them ref: 6 trusts. Looks like they settled. Then, I read that the guys who bought the loans at fire-sale prices, Truman Capital Advisors, also sued NS for not forking over the loans (as a result of the KIRP suit).
    From KIRP’s suit (NG says the banksters want their advances back and this supports that assertion. I’m guessing the loans at issue are non-conforming and went thru no agencies):

    As the Master Servicer, the RALI Trusts pay Nationstar to “service” the mortgage loans owned by the trusts in the best interests of the trusts and their certificateholders. This includes working to maximize the recoveries on each of the mortgage loans through enumerated
    actions detailed in Pooling and Servicing Agreements (the “Servicing Agreements”) (including loan modifications -sic) , which set forth the Master Servicer’s duties. However, rather than fulfilling its responsibilities to maximize recoveries, Nationstar has recently embarked on a campaign to benefit its own interests at the expense of the RALI Trusts and their certificateholders, through auctioning off
    the trusts’ mortgage loans in bulk (“Bulk Note Sales”) for amounts that are a fraction of the loans’ unpaid balances or the value of the properties securing the loans. While these Bulk Note
    Sales injure KIRP and the RALI Trusts’ other certificate holders by dissipating the assets of the RALI Trusts, they provide multiple benefits to Nationstar, including through allowing them to
    more quickly recoup certain advances they made on the mortgage loans as part of their servicing duties. KIRP seeks to enjoin Nationstar from engaging in any further Bulk Note Sales in breach
    of its duties and to recover damages for the Bulk Note Sales that have already occurred…..*
    The six RALI Trusts at issue in this case were formed in 2005 and 2006. Pursuant to the Servicing Agreements for each of the RALI Trusts, a Master Servicer is responsible for servicing the mortgage loans included in trust portfolios for the benefit of certificate holders.

    As part of its duties, the Master Servicer is required to advance certain costs related to defaulted or delinquent loans, such as
    costs for maintaining or protecting the property securing the loans as well as certain principal and interest payments from non-paying borrowers. The Master Servicer is allowed to recoup these costs at later times.”

    Apparently NStar didn’t want to 1) make the advances or 2) “recoup these costs at a LATER time”.

    * I wonder to whom NS made bulk note sales already and what yeahoo is coming after or has gone after the homeowners. NS, I believe, retained the servicing on these already-made bulk sales OUT of the trusts. Gosh. I hope for their sake they were IN the trust to sell. Maybe at pennies on the dollar the buyer wasn’t too worried about it. Wonder who signed the bulk sale agreement since the trusts would be the alleged sellers? Le’s guess….”NS as such and such for RALI Trust”, which would take a poa, right? And yet, by this suit and its settlement, I’d say NS exceed its authority. Wonder if they yet tried to or did foreclose in the trusts’ names using “mers” assgts?
    These investors clearly wanted the max return on these loans, including by way of loan mods. But borrowers get shut down trying to assert they want them because they have nothing to say about nothing. Isn’t it clear this is detrimental to the investors and this detriment is caused by the patent conflict of interest demonstrated here by the presence of these particular (servicers) third parties? Does the end of the story really have to legally be “tough luck”?

    RALI = “Residential Accredit Loans, Inc.”

    I’ve heard that lenders are offering pre-sale online auctions. Anyone know if this is true?

  30. PENNSYLVANIA HOUSING FINANCE AGENCY
    BAILEE AGREEMENT
    THIS BAILEE AGREEMENT by and among (“Warehouse Lender”), , (“Seller”), and PENNSYLVANIA HOUSING FINANCE AGENCY (“Buyer”) is dated as of _______________.
    WHEREAS, Seller may, from time to time, originate and close residential mortgage loans (each, a “Mortgage Loan”); and
    WHEREAS, each Mortgage Loan will be evidenced by a promissory note (a “Note”) and secured by a mortgage, and certain other documents (collectively, together with each Note, the “Collateral”); and
    WHEREAS, Seller may obtain monies from Warehouse Lender to temporarily fund such Mortgage Loans (the “Warehouse Line”), and will grant Warehouse Lender a security interest in the Collateral in order to secure such Warehouse Line; and
    WHEREAS, Seller intends to sell closed Mortgage Loans to Buyer pursuant to a Master Origination and Sale Agreement, Buy/Sell Agreement or similar previously entered into agreement between Seller and Buyer (the “Agreement”), and one or more commitment letters between Seller and Buyer (a “Commitment Letter”) entered in pursuant thereto (the Agreement and any and all Commitment Letters are hereafter collectively referred to as the “Instruments”); and
    WHEREAS, Warehouse Lender has requested that Buyer act as Warehouse Lender’s Bailee with respect to such Collateral until the related Mortgage Loan is purchased by Buyer.
    NOW, THEREFORE, in consideration of the agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Warehouse Lender, Seller and Buyer agree as follows:
    Section 1. Notification and Acknowledgment of Security Interest. Warehouse Lender shall attach to each shipment of one or more Notes a cover letter, substantially in the form of Exhibit A. Warehouse Lender, upon instruction from Seller, shall promptly forward such cover letter and Note(s) to Buyer at the following address (or such other address as may be sent in writing by Buyer to Seller and Warehouse Lender):
    PENNSYLVANIA HOUSING FINANCE AGENCY

  31. If the funding is “dry,” If the funding is “dry,” the original
    promissory note and mortgage assignment
    documents are signed and transferred to a
    warehouse lender prior to the closing on
    the home buyer’s purchase transaction, and
    therefore, a warehouse lender’s possession
    of the original promissory note becomes a
    factor in the warehouse lender’s agreement
    to release funds to the mortgage lender so
    that it can fund the home buyer’s loan. Typically,
    warehouse lenders prefer “dry” closings
    because they are most protected when
    they have actual possession of the promissory
    note prior to releasing funds. As noted
    below, dry funding may also be critical to
    coverage under the Financial Institution
    Bond, Standard Form No. 24.on
    the home buyer’s purchase transaction, and
    therefore, a warehouse lender’s possession
    of the original promissory note becomes a
    factor in the warehouse lender’s agreement
    to release funds to the mortgage lender so
    that it can fund the home buyer’s loan. Typically,
    warehouse lenders prefer “dry” closings
    because they are most protected when
    they have actual possession of the promissory
    note prior to releasing funds. As noted
    below, dry funding may also be critical to
    coverage under the Financial Institution
    Bond, Standard Form No. 24.

  32. SFR INVESTMENTS POOL 1, LLC v. U.S. BANK, N.A., 63078 (Nev. 9-18-2014)
    130 Nev. Adv. Op. No. 75, 334 P.3d 408

    SFR INVESTMENTS POOL 1, LLC, A NEVADA LIMITED LIABILITY COMPANY, Appellant,

    v. U.S. BANK, N.A., A NATIONAL BANKING ASSOCIATION AS TRUSTEE FOR THE CERTIFICATE HOLDERS OF THE BANC OF AMERICA MORTGAGE PASS-THROUGH
    CERTIFICATES, SERIES 2008-A, Respondent.

    No. 63078. Supreme Court of Nevada. September 18, 2014.

    Re: the word “action” and modifiers / adjectives:

    “…..as considered and rejected in Nationstar Mortgage, LLC v. Rob and Robbie,LLC, No. 2:13-cv-01241-RCJ-PAL, 2014 WL 3661398, at *4 (D. Nev. July 23, 2014). The court gave “two independent reasons” for its holding. “First, ‘action’ does not include only civil actions. The Legislature could easily have said ‘civil action’ or ‘judicial action,’ but it used the broader term ‘action.'” Id. In the lien foreclosure context, “where the statutes …provide for either judicial or non judicial foreclosure, ‘action’ is most reasonably read to include either.”

    (I’m keen on this because banksters claim non-j is not an “action’. It matters that it is in prob lots of ways, but in particular to recoupment cunter-claims and defenses (where one may defeat the sol).

  33. Despite my numerous communications with Mrs. Brown…..
    I never had any use for her.
    She knew exactly what was being done…..
    She was paid very well to take the fall.

    Money can not Buy Happiness…..That comes within yourself.

  34. Before and After Fidelity spun off LPS to avoid liability.
    LPS had a subsidiary called DocX. ….

  35. And they used their access to copies of our Notorial Seals and did unspeakable things in our Notorial Capacity under Oath!

  36. Deadly Clear is Right!
    They alter the original documents…..

    I keep Good records….
    I Bite Hard! Piggies have thick skin.

  37. Reblogged this on Deadly Clear and commented:
    The quasi-servicer witnesses are merely computer jockeys. They look at screen shots of the computer software platform of data they did not enter and do not know who did… Nor did they watch any of the entries. The best question to ask is “what servicing software platform are you using?” It will open up a world of information.

    It’s not the computer jockeys you want to depose. It’s the IT guys. How the software operates, exactly what and how it is entered and stored, and how it is linked to the foreclosure attorney firms for their access (and encrypted messaging) will provide a myriad of crucial information.

    Judges think there a boxes of original files and documents being stored. What a hoot! All these “collateral” files contain are copies printed from the computer that are accessed by hundreds of people who also have the keys to make minimal to mega changes (alterations) to “original” scanned documents.

  38. Service advances. … I will bite…Oh wait I did bite aha.
    Double dipping…
    Little Pigggies they are…..
    Leave manure everywhere…. Time to get the Shovel out.

    Happy Gardening..
    Many Blessings to All.

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