California’s New Gieseke Decision-A New Playing Field Emerges Post-Yvanova

 

Charles Marshallby Charles Marshall, Esquire

Gieseke Remand Order 5 20 16 from 9th Circuit

THE FOLLOWING ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
On the heels of Sciarratta v. US Bank, in the wake of Keshtgar v. US Bank, under the umbrella of Yvanova v. New Century Mortgage, comes now a unifying decision which applies at a base level at least these California Supreme Court and appellate decisions to the non-judicial firmament throughout the Greater West, that of Gieseke v. Bank of America.

Gieseke is a 9th Circuit decision, thus making itself persuasive if not controlling law in California and 9th Circuit states outside California, including Oregon, Washington, Montana, Idaho, Nevada, Arizona, Alaska, and Hawaii. While it is not mandatory for 9th Circuit Fed Courts in these states to follow Gieseke, due to the causes of action at issue being primarily state-based property claims as opposed to Fed-based claims, the persuasive authority of Gieseke will doubtless be useful and may prove to be compelling in many a future non-judicial foreclosure case in which the ‘borrower’ (never concede even, nay especially, fundamental terms in case pleading) is the Plaintiff.

It is also important to keep in mind that Federal authority is not controlling in a state litigation matter. Nevertheless, the persuasiveness of Fed to State and State to Fed authority must be acknowledged and understood among foreclosure litigants.

One of the reasons Glaski v. Bank of America failed largely to get traction until revived by Yvanova, is that even though it was controlling authority in the 5th Appellate District of California, and very much persuasive authority elsewhere in California, California’s Fed Courts tamped this brave and groundbreaking decision down from an oak to a stump, in a matter of months, following its publication in August of 2013.

Now with Gieseke, the entire 9th Circuit has greatly amplified the already-dramatic impact of Yvanova and its progeny Keshtgar and Sciarratta. Indeed, the way the Gieseke decision came to be is an event of great moment for this long-time foreclosure warrior-attorney. The underlying Gieseke case, which I had filed in the Northern District of California Fed Court on behalf of my clients back in late 2013, and appealed many months ago, was set for oral argument on July 5, 2016 before the 9th Circuit.

The Clerk of the 9th Circuit Court issued an order-to-show-cause (OTS) on May 2, 2016 with the breathtaking directive to the institutional defendants in the case, including Bank of America, to wit: why shouldn’t we the 9th Circuit simply remand this case summarily, in light of the Yvanova decision.

The institutional defendants had their best appellate firm at the ready, Severson Werson, and put forward a shallow but superficially credible case. I ‘marshalled’ (you’ll forgive the pun) my extensive network of resources, putting forward my considerably more credible Neil Garfield-inspired and ready arguments, and awaited the decision which just came down May 20: Gieseke Appellants win summarily, without even having to go to oral argument, which hearing was vacated upon the remand of the case to District Court, where it is to be reconsidered in light of Yvanova and Keshtgar.

Keep in mind that while Yvanova and Sciarratta are both post-auction cases, Keshtgar, and now Gieseke, are pre-auction, post-NOD cases. Which means at this point in California, through the California Supreme Court and now the 9th Circuit, all post-NOD lawsuits will have at least persuasive authority battering the opposition from the moment of filing. Strategically for once, Californians litigating non-judicial foreclosure matters have real options in choosing venue.

Where the focus of a case is directed to wrongful foreclosure and quiet title, state courts may be the better venue, since Yvanova and Keshtgar are controlling authority in all State Courts at this point. On the other hand, where rescission is an important cause of action in a compliant, a Federal venue using Gieseke for non-rescission state-based claims litigated in the same Federal venue may be the best way to frame a case.

Remember, Federal authority is persuasive, not mandatory, when applied to state claims. On the other hand, the breakthrough case of Jesinoski v. Countrywide Home Loans is controlling authority throughout the US on the issue of rescission (always a Fed-based issue vis a vis the TILA Federal law), as the decision came out of the US Supreme Court.

One might reasonably anticipate at this juncture to wonder what might one expect in light of the above cases, in trying to move a given plaintiff’s foreclosure case forward. Here follows a primer: For starters, from case inception, when facing a sale date, TROs will be much more readily granted. Be mindful that the standard applied to granting a preliminary or permanent restraining order, and derivatively a TRO, is whether the movant for an injunction is likely to prevail on the merits in the litigation at issue.

Before Yvanova, getting TROs in foreclosure-related matters was fraught with difficulty, though still doable in a number of cases, depending upon the district, the court, etc, although winning the preliminary injunction hearing to follow was another matter typically. With Keshtgar and Gieseke (pre-auction holdings), a TRO and preliminary injunction movant is likely to find getting the relief requested is much more straightforward and readily available. Also take note that TROs and their kindred hearings are much more easily brought, procedurally, in state courts, as opposed to Federal courts, at least in California.

As a still-relatively new lawsuit moves forward in the new dispensation of our post-Yvanova foreclosure world, plaintiffs will likely face as before, a surfeit of demurrer filings from the usual-suspect institutional servicers and sales trustees, such as Chase and Quality Loan Service Corp. Do not be feint of heart. New playing field, to which our opposition will have trouble adjusting much more than our side will. The new field largely benefits us, and will doubtless delimit and one hopes eventually demoralize our opposition. Can’t wait for the role reversal.

If California courts, state or Federal, are working properly, demurrers in this new litigation climate should routinely be overruled where the proper causes of action are pled, such as wrongful foreclosure, various Homeowner Bill of Rights statutory sections such as California Civil Code 2924.17 and 2923.55, and quiet title—this latter cause of action I believe will see a great revival with our side finally getting standing to present our arguments.

Equally important in this new terrain, is of course to plead void not voidable, when it comes to addressing the broken chain of assignments, the front-dating, back-dating, and robo-signing associated with same assignments.

Expect to see many motions for summary judgment, and the occasional judgment on the pleadings, from our not-so-friendly and often ruthless defendants, who will resort to these at present little-used devices to try and get out of a case they are no longer able to exit via a demurrer.

So yes, be heartened as a plaintiff when you see the opposition file an Answer as opposed to a demurrer (State level) or motion to dismiss (Fed). Do be cautious though, as a motion for summary judgment may soon follow.

Which brings us to discovery: This aspect of our litigation will grow dramatically, as our cases move to trial, instead of being snuffed in a proverbial litigation crib. More about the useful tool of discovery in a future blog post. Also on deck for a future blog post: Trial practice in our foreclosure cases, and appellate practice.

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California-licensed attorney Charles T. Marshall (CA Bar # 176091) earned his Juris Doctorate in 1992 from the University of San Diego School of Law. His practice includes Foreclosure Relief, Civil Litigation, Bankruptcy, Immigration, Estate Planning and all facets of Personal Financial Management.

Charles Marshall can be contacted at:

415 Laurel Street, Suite 405 San Diego CA 92101 US
+1.530.888.9600
Charles@MarshallLawCa.com

Website:  http://www.marshalllawca.com/home.html

 

 

The Strategic Warfare of Mortgage “Servicing”

By William Hudson
You can choose your sexual orientation and even your ethnicity but you can’t change your loan servicer. Mortage “servicing” is the ultimate misnomer. Modern loan servicing has nothing to do with service but instead provides a “disservice” in order to boost profits or engineer a default if at all possible. Being forced to contract with a sketchy loan servicer is like being forced to stay married to a spouse who lies, cheats and steals all your money.

 
The servicer’s job is to collect payments and manage the day to day operations of the loan, but servicers have taken on the new role of “default engineer” and “disinformation agent”. The servicers have found a new way of increasing profits and it is at the expense of a customer who has no choice in regards to who services their mortgage.

 
It is likely that the servicing rights to your loan were sold to either  the lowest bidder, or Pirates-R-Us Loan Servicing who purchased the note at a fire sale for pennies on the dollar with the knowledge that your loan had some major defect. It is even possible that your loan servicer is not a servicer at all but is pretending that they are forwarding your payments to the true owner when instead they are keeping your monthly payments for their own enrichment (and there is no creditor).

 
The typical tools servicers use to create a deliberate default include:
• providing disinformation or conflicting information to the homeowner
• failing to follow through with agreements (modifications or repayment)
• misapplying funds/refusing to take payments
• weeks spent trying to correct an issue (phone transferitis followed by disconnect)
• failure to answer QWR or failure to provide requested answers
• failure to acknowledge rescission
• backdating denial letters so homeowners don’t have sufficient time to challenge the              modification  denial
• forced-place insurance
• assign servicing rights to new servicer
• dual-tracking while modification is under consideration or borrower is in compliance
• revoking modification when homeowner is compliant (no opportunity to appeal)
• bankruptcy payment issues (misapplication of payments pre and post-bankruptcy)
• fabricating document to create the appearance of holder status
• misrepresenting status of relationship to loan
• Fabrication, forgery and other tactics to “perfect” the appearance of holder status

 
All of these activities serve to confuse the homeowner and require significant amounts of time and frustration to resolve as days, weeks and sometimes months are spent on trying to correct the situation (during work hours).   On a regular basis Servicers now participate in calculated fraud in order to create a default. The unsuspecting homeowner can be lulled by their servicer into practices that will increase the chances of foreclosure.

 
Over the past several months, the Lending Lies team has seen a disturbing trend of servicers taking advantage of people who are elderly, obviously mentally incapacitated, and economically vulnerable. Servicers are now aware of who the best victims are and who to pursue with impunity. The elderly who are on fixed incomes are particularly vulnerable, single mothers who are burdened by work and raising children on their own appear to be targets, and we have seen more and more mature single women with few assets except for their homes being given incorrect information to deliberately force them into arrears (many of these women acquired real estate through divorce or a spouse’s death- and are told they have no survivor rights and the bank refuses to accept payment). These people lack the financial resources to obtain legal assistance, and often are so beaten-down emotionally they have no ability to fight back.

 
The servicer’s current weapon of choice continues to be the loan modification offer, when the bank has no intention of granting one. During the loan modification process, paper work will be destroyed, customer service reps will claim to not have received paperwork, and the homeowner will be caught in an endless phone transfer loop (followed by an abrupt disconnect of the call in which the homeowner will be forced to start all over). After months of this nearly futile run-around the bank will claim the homeowner doesn’t qualify for a modification- but will then fail to provide a reason for the modification denial or an opportunity to appeal the servicer’s decision (last week Ocwen was sanctioned by the National Mortgage Settlement for this metric violation). Another tactic is to dual-track the customer (proceed with foreclosure while homeowner is in negotiations for a modification).

 
Unfortunately almost all homeowners are at the mercy of the party who acquires the servicing rights to their Note- and if the homeowner has the misfortunate of their loan being acquired by Ocwen, Nationwide, Bank of America, JPMorgan-Chase, CitiMortgage or Bank of America- the homeowner is almost assured that if they miss one payment during the life of their loan or have some other issue- there will be hell to pay and the bank will make it as difficult as possible to correct the issue.

 

 

Without effective counsel, the homeowner is literally at the servicer’s mercy.
Part of the servicer’s modus operandi is emotional warfare. First of all, mortgage issues are complex and most homeowners have no comprehension of what is going on except for what they are told by low-level employees at the banks that are literally practicing law without a license when speaking to homeowners. By keeping the victim confused, on edge, unable to receive concise answers and other gaslighting techniques- they can exponentially increase default odds in their favor. Most homeowners will follow the directions of their loan servicers without question- and are taken advantage by their naiveté and willingness to comply with the servicer’s demands. It is unconscionable that a loan servicer with a conflict of interest is able to advise vulnerable homeowners about saving their home when the servicer has very clear goals of foreclosure.

 
Over the past nine years, servicers have learned how to “perfect” their default model to ensure foreclosures occur. Now that it is well known that the servicers forge signatures, falsify notarizations, and fabricate documents, the banks have now reverted to “Plan B”. If paperwork they forged and altered over the past six years is a known liability, lenders are now resorting to “lost note” strategies so they can try to start over with a “clean” slate. Once they have convinced the court the note was lost and claim plausible deniability they can use a lost note affidavit to try and correct any earlier issues or oversights that occurred when sloppy fabrication and forgeries were used. The banks can then recreate their foreclosure “storyline”  in order to “perfect” their standing. Don’t be fooled by this tactic.

 
The homeowner’s chance of saving their homes are compromised when their own servicer behaves in predatory ways. Servicers are well aware of how to create a default and who to best target for their crime. The National Mortgage Settlement has proven impotent to stop loan servicers from continuing with their deceptive tactics. Society’s most vulnerable are victimized and have no hope of fighting back against these abusive servicer crime-syndicates with deep pockets, political allies and the courts in their corner. Welcome to the new America.

Held Hostage by a Home: The Devastation of Foreclosure

held hostage2

Held Hostage by a Home

By Anonymous

Depending on reader response- this column may become an ongoing Sunday feature on LivingLies. Let us know what you think.
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Although Neil Garfield eloquently describes the legal dynamics of foreclosure, there is also a human battle waged in millions of homes nationwide that remains hidden behind walls of shame, fear and anger. Families are torn apart by the stress and uncertainty that financial burdens bring. A home, no matter how modest or grand, is a foundation of family life- and when it is torn away by companies without legal standing to do so- the pain is compounded because of the injustice.

 
Most families who fall behind on their debts, do not do so deliberately. Usually financial debt is caused by job loss, illness, divorce, or simply being induced into obtaining more credit than the family can service-by companies who carry no risk (due to securitization). Most families would embrace the opportunity to have one second chance to pay back any outstanding balance on their home and make good on their debts-but loan servicers have no incentive to work with the homeowner.

 
Unfortunately, the way the mortgage industry works, it is no longer beneficial for the servicer to service your loan- when they can foreclose instead. A huge financial windfall awaits a servicer that can engineer a default. Instead of receiving approximately .125% of the monthly payment, the servicer is entitled to keep all fees, late interest, and other default charges (and the entire proceeds if they are collecting on behalf of a trust that does not exist). Until loan servicing issues are addressed, servicers will continue their predatory tactics to push homeowners into foreclosure. I should know because I am the victim of a predatory servicer. This is my story.

 
I am being held hostage by my home. The red brick and mortar of the quintessential American home has become my prison. For the past seven years I have had the rope of the commercial code truss my freedom, happiness, career and dreams. The blindfold has been removed but I still can’t trust what I see- banks that operate like organized crime syndicates supported by courts that refuse to acknowledge the fraud. I have been gagged and silenced by a bank, as my story, like millions of others goes unheard. Hopefully, the ability to warn others what a bank is capable of- will be cathartic.

 
What most people don’t understand before taking on foreclosure is that unless you have unlimited wealth, you will be taken hostage during litigation. The Notices of Default filed against you will keep you from repurchasing a different house, will destroy your credit, may prevent you from obtaining employment, may cause creditors to rescind credit extended, and may exhaust all of your savings and retirement. Your neighbors will likely shun you and your “friends” may distance themselves from you. Your opportunities to rebuild and recover from a financial setback will be compromised. I won’t even get into the emotional costs (divorce, volatile home environment, stressed parenting). Rarely is a case settled at the trial level. Most cases that should be settled with two or three years may go on for a decade or so if you continue to battle on.

 
Eight years ago, If I had been told what my future would hold if I dared to challenge my loan servicer- I would have held a block party for the bank and handed them the keys to the house. My greatest regret in life is that I decided to hold the bank accountable for reneging on my loan modification. It has cost me my life savings, my health, my marriage, and worst of all- instead of enjoying the childhoods of my children- I have spent every day depressed and anxious while battling a soul-less banking cartel with unlimited financial resources and power. My children have no idea who I am, or who I was before my life became a war game and I took up the position of General. In fact, I have no idea who I am outside of being held hostage by my home.

 
Why don’t I walk away? Surely losing 13 years of my life would be better than another decade? Because I am a fool. Because I have sacrificed and lost almost everything- to quit would be even worse than to go down defeated. There becomes a point in time- when you can’t turn back. For 13 years I have spent over 200k in order to receive an answer to one very simple question: WHO OWNS MY NOTE???? My servicer and the courts believe I have no right to an answer.

 
There are thousands of unconscionable foreclosure stories in America- that are unfathomably egregious and completely unnecessary- mine included. I had the ability and desire to pay the bank any amount they requested. I only wanted to sell my home and move on with my life. However, the bank did not want payment- they wanted the house. Neil Garfield has stated that the reason the banks want the foreclosure more than they want payment is because not only does the bank profit handsomely from a foreclosure, but it allows them to neatly tie up the fraud and seal the deal. Once a home is foreclosed upon- rarely does the homeowner sue for wrongful foreclosure.

 
The ordeal of foreclosure is by design, created by banks to cause the maximum amount of damage- both financially and emotionally. There is absolutely no good faith that arises when the bank can profit from a foreclosure. I have often wondered how people who work in the foreclosure industry sleep at night. Ayn Rand thought about these people also and wrote in Atlas Shrugs, “The man who lies to the world, is the world’s slave from then on…There are no white lies, there is only the blackest of destruction, and a white lie is the blackest of all.” To live knowing you have destroyed the lives of families and committed moral crimes in order to receive a paltry paycheck, would be a worse hell than even I have faced.

 
Last week the Center of Disease Control and Prevention (CDC) reported that the suicide rates for middle-age whites jumped an alarming 40 percent from 1999 to 2010. The suicide rate for both younger and older Americans remained virtually unchanged, however, the rate spiked for those in middle age (35 to 64 years old) with a 28 percent increase from 1999 to 2010. According to the CDC, there were more than 38,000 suicides in 2010 making it the tenth leading cause of death in America overall. Among African Americans, Hispanics and even the oldest white Americans, death rates have continued to fall. What could be responsible for this drastic change in suicide demographics?

 
The middle-class suicide spike began with the onset of the tech bubble implosion where middle-class families saw their retirement funds evaporate. Locked into company 401ks where the funds are illiquid, many 401ks don’t allow the ability to place stop-losses. A stop-loss is an order that is placed, usually on a stock, to sell when the price declines to a certain level. So while the wealthy and knowledgeable were able to stop some of the bleed, mid-level employees in company-sponsored retirement programs were disproportionately impacted.

 
By 2008 the middle class found themselves mired in home loans that were unaffordable, in houses where they owed more than the home was worth, and subjected to a volatile job market and economy. In effect, the middle class died in 2008 and has not rebounded.  Consider the way life has changed since 2001. We are under surveillance all day, we pay a disproportionate amount of our income to taxes that go to support wars and programs most of us do not want, the economy is rigged in favor of the wealthy, and the cost of living has skyrocketed while wages remain flat. Most people in this demographic went to college, both partners work full-time jobs, and are responsible for raising their own children while caring for aging parents on limited incomes.

 

 

When you face foreclosure or bankruptcy this often pushes people over the tipping point. This was not the life that most middle-class people contemplated and are ill equipped to deal with. The middle class bought into the premise if you go to college and work hard you will gain financial security- not knowing the system was rigged. These individuals were also typically raised in middle class homes and were unprepared for the financial struggles not typically equated with the middle class.

 
“It’s a loss of hope, a loss of expectations of progress from one generation to the next,” said Angus Deaton, a Nobel Prize–winning economist who had studied the data. The middle class is not only being financially impacted by the economy but the strain on the middle class is psychological. The study noted that white women between 25 and 55 have been dying at accelerating rates over the past decade, a spike in mortality not seen since the AIDS epidemic in the early 1980s. According to recent studies of death certificates, the trend is worse for women in the middle of the United States, even worse in rural areas, and worst of all for those in the lower middle class. Drug and alcohol overdose rates for working-age white women have quadrupled. Suicides are up by as much as 50 percent.

 
According to the Federal Reserve, 47 percent of those who responded to a recent survey said they are living so close to financial ruin that they couldn’t come up with $400 to meet an emergency, not without first borrowing the money or selling something. Almost half of all Americans are fighting a losing battle to keep their heads above water.

 
This situation was the subject of a paradigm shifting article in the May issue of Atlantic magazine, “The Secret Shame of the Middle Class,” that was written by Neal Gabler, a well-known book author and film critic. Gabler reveals that despite his successful career, impressive resume and outward appearance of prosperity, he is financially insolvent and must often “juggle creditors to make it through the week.”
The writer attempts to provide reasons for the crisis. He lists predatory credit card companies, the ever-rising cost of living, wage stagnation, poor decision-making, bad luck and a national plague of financial illiteracy. But one cash depleting issue Gabler overlooks is taxation — and the fact that the middle class that pays almost 50% of their income to some type of tax- while the wealthy are able to exploit the system and pay very little if any tax.

 
Rising health-care costs, job insecurity, climbing foreclosures, and rising energy costs are decimating the middle class. The middle class American now “leases” their lives and most will have no assets to show upon their deaths. They are tenants in their own homes (read your Mortgage- you are a tenant), lease their cars, and are dependent on their employer who is likely facing financial troubles of their own. The housing markets are starting to look a lot like they did in 2007 (except there are more renters now). It is easy to see why the middle class that provides the support for both upper and lower classes is at its breaking point.

 
Signs of Big Trouble
Families with no savings, piles of credit card debt, and mortgages on homes they should not have been qualified for coupled with flat-lining incomes, low-paying jobs, skyrocketing health-care costs and exorbitant college costs are in dire straits. Wall Street banks with complicit buy-ins from the courts and law enforcement have created an untenable situation where the middle class has nowhere to turn. The banks prey on the vulnerability of people who suffered a temporary setback but are doing everything in their power to correct the situation in good faith. Homeowners are a small obstacle to big banks with unlimited financial resources who retain the best attorneys in the country to defend their predatory and illegal schemes.

 

 

It is evident that the government and courts are either unable or unwilling to rein in the powerful banks. Home ownership has dropped to its lowest rate since 1967, and one in every three American families is dealing with a debt collector. One more major recession and the suicide rates will further skyrocket. Without the middle class who is going to take care of the lower classes? The middle class is fighting for its life- and when all else fails apparently they take their own lives.

 
People are angry, people are desperate and people want solutions. If the middle class really wants to do something to stop this downward trajectory- the first thing to do would be to close your accounts with the major banks that service loans (Wells Fargo, CitiMortgage, Bank of America). If able, refinance your home with a credit union who holds your mortgage in-house and does not securitize loans. The middle class could effectively starve the beast that oppresses them if they would unite.

 
There are economic indicators that the housing market is reverting back to the 2007 lending policies that were the norm prior to the bubble that popped in 2008. Many banks are offering zero-down loans while Fannie Mae and Freddie Mac have lowered their loan qualifications in an attempt to spur on the lower and middle class housing market. The banks are resorting to desperate tactics as homebuyers have stopped purchasing. There can be no doubt that those who have lived through a foreclosure or the foreclosure of a family member will ever trust a big bank again. I know that personally, I will NEVER borrow from a big bank again.

 
The suicide report showed a marked increase in mortality of middle-aged white non-Hispanic men and women in the United States between 1999 and 2013 was unique to the United States; no other rich country saw a similar event. Self-reported declines in health, mental health, and ability to conduct activities of daily living, and increases in chronic pain and inability to work, as well as clinically measured deteriorations in liver function, all point to growing distress in this population. Research confirms that this situation is due to economic causes and life quality deterioration. All indications show that economic conditions are even worsening for the middle class.

 
It is noteworthy that other countries have had similar financial problems that mirror the United States, however, the suicide rates and middle-class morbidity have not increased in any other developed country but the United States. The American capitalist machine is feeding off the hopes and dreams of the middle class and yet the middle class is unable to obtain any relief through government agencies or access due process within the courts. This reality is impacting the lives of millions of Americans who deserve much better.

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The graph is shocking. And for obvious reasons I’m very interested in the mortality of white Americans in the 45-54 age range since I am in this class. If anyone knows about the costs of fighting an unlawful foreclosure it is me. I have filed three bankruptcies during 13 years of ongoing litigation to save my home (despite simply wanting to sell the home that I no longer resided in and cash out my equity). The bank has also filed at least 9 Notices of Default (destroying my ability to obtain credit for over a decade) and illegally foreclosed on me once (in violation of an automatic stay). I have spent every single discretionary dollar I have had believing that the courts would honor the rule of law. I was so confident when I set out to settle the illegal acts by my servicer that I naively believed the situation would be remedied within a year (when it could still take up to another decade to settle this issue).

 
I was raised in a white upper-middle class family. Your credit score was considered as important as your IQ and success was measured by your position and income. However, by 2001 I found out it doesn’t matter how successful you are- if you are dependent on an employer- it can all be snatched out of your hands (I was fired while on an approved medical leave from a large pharmaceutical company just to add irony). Unable to replace my high salary I fell into financial arrears. I lost my friends, my social standing, my ability to obtain credit, and my ability to rebuild. Even more tragically, the stress decimated my family and destroyed my marriage. I have never recovered. I hope that I don’t become one of these statistics but there are no guarantees I won’t.

 
Fighting a foreclosure is ugly, ugly business. Unfortunately, in our society, litigation is reserved for those well enough off to fight back. The majority of low-income households have literally no hope of fighting back without competent and aggressive legal counsel (and legal counsel is expensive). Both middle and lower classes are extremely vulnerable to any fluctuation of the economy. A job loss can result in losing everything and purchasing a house you can’t afford further exacerbates your financial stress.

 
It appears the banks deliberately started giving out loans like candy to anyone with a pulse, knowing they would securitize these debts, keep the investors’ money meant to fund the loan, collect the monthly payments and then foreclose- while knowing very few in the lower and middle classes would be able to fight back. The researchers state they can only hypothesize why records of white middle class Americans are committing suicide in increasing numbers? Although my statistical skills are sub-par I can tell you exactly what is behind the statistics- the illusion of the American dream has been exposed and not one elected official is willing to do what is necessary to correct the situation while the elite are still able to milk the market while it climbs and crashes. This is a tragedy not seen since people jumped off of skyscrapers with the stock market crash in 1929- it is just more subtle and stealth.

 
One theory about what is causing rising mortality among whites is the “dashed expectations” hypothesis. According to Johns Hopkins University sociologist Andrew Cherlin, whites today are more pessimistic than their forebears about their opportunities to advance in life. They are also more pessimistic than their black and Hispanic contemporaries.

 
“The idea that today’s generations will do better than their parents’ generation is part of the American Dream. It has always been true until now,” Cherlin said. “It may still be true for college-educated Americans, but not for the high-school-educated people we used to call the working class.”  The demise of the middle class is broad in its effects, but it appears to be culminating in places that are particularly vulnerable — such as cities where the drinking water is polluted with lead for years, or a small city that saw its biggest manufacturer move overseas, or in a household destroyed by job loss and foreclosure. It’s no big mystery why the wounded middle class is turning to Trump and his anti-establishment rhetoric and hitting a nerve.

 
Things aren’t going to get better for sometime due to the apathy and disconnect of Washington and your elected officials. Before you pursue litigation please consider if you possess the endurance needed to fight a bank with unlimited sources. In almost every successful case- an Appeal will be necessary. Consider the evidence you possess- is it enough to defeat the servicer’s claims? Do you have the financial means to finish the fight? Can you detach enough from the outcome that when your due process rights are trampled and the banks resort to forgery to defeat you- you won’t fall apart?

 
As much as I hate to say this- most people who have viable cases end up in some type of modification or agreement. The costs become too high for most homeowners to endure. Sadly the judges are now unfazed by forgeries, falsified documents, and fraud on the court- and there is nothing unusual about dummied up documents (although the banks are committing felonies with impunity). It is up to the people who have the means and temperament to fight foreclosure to do so on behalf of those whose voices have been silenced. Going the distance also requires that you don’t give in and sign a confidentiality agreement. Precedents in favor of the homeowner are desperately needed.

 
Every case you have read on Living Lies was because an attorney and the client refused to give in and both incurred serious losses in order to prevail. In cases like these, both attorney and client looked under every rock and crevice for evidence, they studied every law, act and statute. There are few attorneys who are willing to stand up for the homeowner and take the case all the way to trial. These world-class attorneys have sometimes faced ridicule by their peers but can’t be deterred. South Florida has some of the best foreclosure attorneys in the country including Neil Garfield, Tom Ice, Patrick Giunta, James “Randy” Ackley, Matthew Weidner, Mark Stopa, Bruce Jacobs and others (please read the blogs of these attorneys). Through the professionalism, proficiency and passion of these attorneys- the judges are now becoming wise to court manipulation and the fraudulent deeds of the banks.

 
With the knowledge Neil Garfield has shared with his readers on Living Lies- YOU have a better chance of prevailing than most Americans do who rely solely on their attorneys to take care of every aspect of their case (attorneys simply do not have the time). Eric Mains wrote a blog for Living Lies entitled “Why your Foreclosure Attorney Just became Your Business Partner”. The post provides excellent information for people who are willing and able to take on their loan servicers.

 
There is no doubt that the banks must receive much harsher monetary penalties to dissuade them from engaging in criminal conduct. It is also time that the representatives of the banks and foreclosure mills they employ be criminally prosecuted for the destruction they have caused to millions of families by fabricating documents, deliberately deceiving homeowners (through disinformation, false modifications, refusal to accept payments) and intentionally setting homeowners up to fail.

 
My advice to anyone contemplating foreclosure would be to NEVER allow a bank to steal your happiness or harm your family- walk away.  If you decide to pursue litigation your eyes will be opened that the attorneys for the banks are no different than college-educated thugs and that the courts are owned and paid for by the big banks. This lesson in itself will completely shake your belief system to the core. I would recommend in most cases that you save your family, your sanity and your money and go fight a war you can win.

 
Not to discourage you- but I have now been held hostage for 13 years. I have no home (except the house that has sat empty during 6 years of litigation now), no retirement, no marriage and my physical health is now starting to suffer (my mental suffering endures). I have wasted the best years of my life fighting a heartless bank with unlimited power and unlimited resources- because I actually believed our judicial system guaranteed my due process rights (wrong).  My ONLY hope is that the judge overhearing my case can put his own biases aside, apply the rule of law- and allow a jury of my peers to hear what a bank hell-bent on orchestrating the theft of my home is capable of.

 
They haven’t stolen my home-yet, but they may have stolen my life.

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Florida Foreclosure: Where No Case is Over-Ever

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I have not commented on the arguments regarding the statute of limitations here in Florida. It is time I did. The article here points out that the 3rd DCA has bent over backward and essentially broken its own backbone by creating legal fictions to save the banks. What they continue to ignore is that saving the banks means screwing the consumer, the citizen and the taxpayer. They also have essentially ruled that the banks can keep coming into court, filing the same lawsuit over and over again, until they win by attrition — few homeowners can afford to contest foreclosures repeatedly. The 3rd DCA decision essentially says that it isn’t over until the bank wins.

 
The obvious premise behind this flawed decision is that somehow this will make everything turn out “right.” It doesn’t. The court completely ignores the huge body of law and information in the public domain that reveals the banks as the perpetrators of epic fraud. Either the court doesn’t know about the fraud or it doesn’t care.

 
And what the court does not address is the nature of the fraud by assuming facts that don’t exist. These banks don’t have a penny invested in any of the loans that they are using for foreclosure and even modification where ownership of the debt gets transferred from the investors who advanced the money to the banks who sold them the bad deals. The investor is left with nothing in most cases while the borrower cleans out his savings account trying to save his/her home only to lose it to a party who is stealing the home from the borrower and the loan from the investor.

 
The court is creating multiple legal fictions. In so doing the court has destroyed the value of stare decisis — legal precedent. Or, if you look from another point of view creating a destructive legal precedent. Instead of taking each legal effective act as something that matters, they have bent and broken the language of the note and mortgage — essentially converting the act of acceleration to an option that means nothing unless foreclosure is successful.

 
If this decision is left standing then no case is over, ever. And lawyers will start arguing that even though their client committed themselves to an act with legal significance, they now choose to disavow that act and proceed on an alternative theory — after they have already lost the case in prior proceedings. This creates an endless chain of alleging “new facts” or “alternative facts” on every case where a party previously lost the legal contest, or where their case was dismissed.

 
The inherent presumption is that borrowers have no voice in this process because they received the benefit of fraudulent schemes. But in the courts where I grew up as a lawyer, no party was allowed presumptions if they had unclean hands seeking the equitable remedy of foreclosure.

 

Nor would a fraudster be allowed to benefit from his schemes once the scheme was revealed. The courts are turning this on its head. As stated in the Yvanova decision in California, it DOES matter if the wrong party is bringing the foreclosure action. It is not enough that the homeowner may owe someone money based upon some equitable theory of law; the homeowner must respond only to a claim from the actual party to whom the debt is owed, i.e., the creditor.

 
That California decision said it well — we don’t enter judgments against people simply because they must owe somebody (or anybody) money. The legal system is only available to those with legal standing — a party to whom the debt is actually owed because they paid for it.
This rush to “convict” the homeowner of bad behavior (breach of an unconscionable arrangement where there is no actual enforceable loan contract) is the insidious basis of most of the court decisions where the courts have “read in” fictions that never existed by contract, statute or legal precedent.

 

They did it with due process by putting the burden on homeowners to prove facts that were solely within the care, custody and control of third parties.

 

They rubbed it in when they blocked discovery to get to those facts.

 

They did it again by reading into TILA rescission that the homeowner must file a legal action to make rescission effective (despite the express wording of the statute to the contrary).

 

They did it again by reading into TILA rescission that the homeowner had to offer some tender to the “lender” in order to make rescission effective.

 

And they are doing it again, even after the Supreme Court of the United States told them they were wrong by reading into TILA rescission that the conditions precedent to a valid rescission mean that the rescission is not legally effective until a judge decides the issues raised by the pretender lenders. THAT theory brings us full circle around to the erroneous theory that TILA rescission is not effective upon mailing and that it is not effective until someone files a lawsuit. But they do it again when they say that the Court can decide the outcome of a nonexistent lawsuit filed by a nonexistent party.

 
This won’t end until the Courts return to basic contract law. The courts must abandon their intrusion into the legislative agendas where public policy is declared. They must especially back off when the court doctrines on public policy conflict with the legislators who are the ONLY people constitutionally permitted to make policy. Those legislators have spoken on Federal and State levels. But the courts are unconstitutionally refusing to abide by laws passed by the legislative branch. The statute of limitations is just another example.

 

The way it destroys legal precedent is that it directly conflicts with the doctrine of finality. For example if a person is in an auto accident and chooses to make the claim before they reach maximum medical improvement, the measure of damages is diminished because once they sue the damages are based upon the proven injury. They might even lose because the proven damages are inconsequential. When they later discover they have more injuries and more damages they cannot come back into court and say that their last claim was an option — and more importantly that the fact that their claim was dismissed should be ignored.   And even more to the point, if their last claim was within the statute of limitations and their present claim is outside of the statute of limitations the plaintiff’s claim is dismissed on the basis of res judicata — the matter has already been litigated AND the statute of limitations.

 

If the judiciary is able to rewrite laws of the legislature from the bench in regards to Mortgages, then why shouldn’t the court do the same for ALL legal issues?  It is only a matter of time until these cases are used to circumvent the statute of limitations in other cases- opening up an onslaught of new cases that have already been tried.  Finality will be a thing of the past.

 

There can be little doubt that the banks control the judiciary. The Third District Court of Appeal ruled that the statute of limitations in mortgage foreclosure actions are not applicable. The court had earlier determined in the 2014 Deutsche Bank v. Beauvais opinion that the statute barred Deutsche Bank from filing a foreclosure action five years after the borrower’s default and the lender’s acceleration demanding full payment of the loan.

 
The Third District Court reversed this decision in a 6-4 ruling on April 12 and held that the statute of limitations can NEVER bar a bank’s efforts to foreclose on a Florida homeowner! What does this mean? It means that the banks will have until 5 years after the maturity of the loan to foreclose, and the ability to repeatedly file foreclosure actions until they have outspent and exhausted the homeowner.

 
This decision is a travesty. This decision ensures the foreclosure crisis will continue for decades, and allows the banks unlimited court actions until they can successfully foreclose on the homeowner. Very few homeowners have the financial means to endure decades of litigation, and very few homeowner’s attorneys will have the endurance or desire to defend cases for long durations of time. This ruling allows the banks to regroup, correct the issue, and re-litigate (or fabricate documents to “cure” the error).

 
The Third District’s en banc decision was based on the 2004 Florida Supreme Court opinion in Singleton v. Greymar. In Singleton, the trial court dismissed the lender’s foreclosure action on an accelerated debt with prejudice after the bank failed to appear at a hearing. What is unclear from the Singleton record is why the lender failed to appear. The court should have recognized that there was an agreement to reinstate under which the borrower made payments prior to the dismissal.
The lender filed a second foreclosure action after the borrower defaulted on a new, subsequent workout plan. The borrower sought to avoid the second action claiming res judicata. It is noteworthy that the lender’s Supreme Court brief in Singleton was only four pages long, with only one paragraph of actual argument stating that to deny the foreclosure would create “uncertainty” for banks and a “windfall” for homeowners, offering no analysis of res judicata, collateral estoppel or the consideration of the statute of limitations.

 
Even the attorney who represented the lender in Singleton, Mark Evans Kass, said that Singleton has been misinterpreted and misapplied by many courts across Florida, including the Third District in Deutsche Bank v. Beauvais. The Florida Supreme Court found the two actions were different events and the second action involved a new and distinct default by the borrowers.

 
“There really is no mystery as to why the Florida Supreme Court ruled that my client was not barred by res judicata in bringing the second foreclosure action,” Kass stated. “It’s simple. The debtors, Gwendolyn and William Singleton, made payments and reinstated the loan after we accelerated the debt. A few months after reinstating and dismissing the first lawsuit, they defaulted again, which is why we filed a second lawsuit and alleged a subsequent and separate default date — because there actually was a subsequent and separate default.”

 

Kass commented on the Third District’s recent en banc opinion and said, “I would agree with the dissent that Deutsche Bank v. Beauvais has created a new legal fiction. In Singleton, we had a reinstatement and then a new and separate default. For that reason, our second foreclosure was a different cause of action. I understand that the borrower in Beauvais never reinstated the accelerated loan, never made additional payments, and there was never a new or subsequent default.”

 
The four dissenting judges in Beauvais agreed and stated that Beauvais: 1) creates a “legal fiction” that acceleration does not affect the installment nature of the loan; 2) rewrites the contract provisions between the parties; and 3) rewrites the statute of limitations to favor banks. Thus, the only exceptions to the statute of limitations in Florida are capital crimes like murder and now-mortgage foreclosures. However, ONLY murder is an exception actually carved out by a statute enacted by the Florida Legislature.

 

The Florida Supreme Court failed to address is how there can legally be a new default after a debt has already been accelerated. Over the years the banks have worked to convince the courts that Singleton supports the proposition that if a foreclosure is dismissed “for any reason,” there is an automatic reinstatement of the installment nature of the loan, thereby resetting the statute of limitations period for foreclosures.

 
In an unprecedented move, the Third District took Beauvais to an entirely new level claiming that the installment nature of the loan was never affected by the lender’s acceleration of the debt. Thus, even if a bank demands full repayment, the borrower is still obligated to make monthly payments as if there were no acceleration. The courts have opportunistically misinterpreted Singleton and the Florida Supreme Court will need to clarify whether Singleton changes the meaning and effect of “acceleration” and therefore nullified the statute of limitations for mortgages.

 

 

With so many courts misinterpreting the Florida Supreme Court’s Singleton opinion, the Florida Supreme Court must clarify whether Singleton changed the meaning and effect of “acceleration” and nullified the statute of limitations for mortgages. New exceptions to the statute of limitations is a Legislature issue, not for the judiciary to decide.

Rescission Procedure Explained — Tonight on the Neil Garfield Show

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THE FOLLOWING ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.

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The following is lifted from the content of a report you can get by clicking on https://www.vcita.com/v/lendinglies. The review, report and analysis includes a 30 minute consult. Legal opinions are rendered to attorneys in all 50 states and to clients in the State of Florida.

  1. TILA Rescission is an event. It is not a theory, claim or defense. It is a nonjudicial procedural remedy. It is accomplished by mailing a letter. In most cases it is an event that has indisputably occurred. The effect of TILA Rescission is, as a matter of law and by operation of law, to cancel the loan contract, and to render the note and mortgage void. In its Motion to Dismiss, the pretender lenders seek to have courts assume that the rescission exists but is not effective, despite all law to the contrary. The matter is well settled, to wit: if the rescission exists, it is effective as a matter of law.
  2. The effectiveness of a TILA Rescission is not predicated upon any judicial analysis of the likelihood of the borrower’s success if a lawsuit to vacate the rescission is filed by a party with legal standing. Any such interpretation would be opposite to the holding in Jesinoski that the rescission is effective upon mailing, whether disputed or not.
  3. The pretender lenders do not dispute that rescission has occurred but seek to invoke issues in a case that is not and cannot be before any Court, to wit: whether the rescission is effective. And they seek to do so through motions in which they deftly avoid the requirement of pleading and proving facts in a proper lawsuit to vacate the rescission, thus depriving the homeowners of their right to raise appropriate defenses to the non-existent lawsuit seeking to vacate the rescission.
  4. Pretender lenders want the courts to enter an order that would impliedly vacate the rescission.

The pretender lenders seek to have the court assume facts about the consummation of the alleged loan including the date or dates when consummation occurred and the source of funding for the alleged loan. They even want the court to assume that disclosures were adequate. These are questions of fact requiring a lawsuit, discovery and trial. They seek to have courts adopt the premise that the rescission is not effective upon mailing if there are potentially defects in the reasoning or actions of the borrower. SCOTUS has expressly rejected that argument. (Jesinoski v Countrywide). SCOTUS clearly stated that the rescission is complete upon mailing, regardless of whether it is disputed or not.

This does not remove the ability of the creditor to vacate the rescission but it does eliminate the right of any creditor to raise a challenge based upon the theory that the rescission was not effective when mailed. That issue is completely settled by SCOTUS.

All three branches of government are in unanimous agreement: TILA Rescission is effective upon mailing by operation of law. Nothing further is required from the borrower.

California Supreme Court Rules in Yvanova, “The borrower owes money NOT TO THE WORLD at large but to a particular person or institution.”

Yvanova v New Century Mortgage 02182016 Supreme Court of California opinion

By William Hudson

Last week the California Supreme Court ruled in Yvanova v. New Century Mortgage Corporation (Case No. S218973, Cal. Sup. Ct. February 18, 2016) that homeowners have standing to challenge a note assignment in an action for wrongful foreclosure on the grounds that the assignment is void. Obviously if the court had ruled differently, the banks would have had absolute carte blanche to forge mortgage assignments with wild abandon. In fact, without a system of endorsements and assignments it would be almost impossible to determine what party has a legitimate interest in a property and chaos would have ensued (sound familiar?).

 
The Yvanova ruling puts to rest the prior assumption by most California courts that a homeowner lacks standing to challenge a void assignment. This decision has the potential to open the litigation floodgates by borrowers who were improperly foreclosed on due to fraudulent or improper assignments. In fact, you can bet that homeowners who lost their homes due to the court’s resistance to follow established law will be filing suit.

 
In Yvanova, she complained that the bank had resorted to the use of fraudulent documents in order to foreclose. First she identified that a bankrupt entity called New Century assigned a deed of trust years after the company ceased to exist. The mortgage assignments demonstrated that even though New Century was dissolved in 2008, New Century allegedly assigned Yvanova’s deed of trust to Deutsche bank in 2011. It was also discovered that Yvanova’s note could not have been delivered to the Morgan Stanley trust pool because the trust had a cutoff date of January 2007. Deutsche Bank, the servicer, claims to have transferred the deed of trust to that pool in December 2011. Thus, 3 years and 11 months after the trust had closed.

 
By law, and to ensure tax-free pass-through status by the REMIC (Real Estate Mortgage Investment Conduit) notes placed in trusts must be placed into the pool by a certain date. The Morgan Stanley trust had a cutoff date of January 2007 but Deutsche Bank claims the note they received by a zombie assignment was placed in the pool in 2011. Thus, a nonexistent company called New Century transferred a note to a closed trust.

 
Up until Yvanova was settled, the California courts rejected hundreds of similar claims over the years stating that borrowers were not a party to or holder of the debt (see Jenkins f. JP Morgan Chase). The California courts essentially ruled that homeowners may now challenge wrongful foreclosures on the grounds that the assignment of the note was invalid or the chain of assignment was faulty. In securitized trusts, it is fairly common for the endorsements and assignments to be either inaccurate or downright fraudulent (photoshopped, robosigned, etc.). The big securitizing banks like Ocwen, Deutsche, Morgan Stanley and Wells Fargo better prepare for a tsunami of wrongful foreclosure suits in California.

 
The California Supreme Court, by ruling in favor of Yvanova, effectively confirmed the 2013 California Appellate ruling Glaski v. Bank of America, which held that a homeowner facing a non-judicial foreclosure has standing to challenge violations of the pooling and servicing agreement. One of the most insightful quotes in Yvanova states, “The borrower owes money not to the world at large but to a particular person or institution, and only the person or institution entitled to payment may enforce the debt by foreclosing on the security.”

 

The California Supreme Court got it right when they elaborated that, “A homeowner who has been foreclosed on by one with no right to do so has suffered an injurious invasion of his or her legal rights at the foreclosing entity’s hands. No more is required for standing to sue.” Could it be that the California courts are tired of the 9 years of fraudulent banking games that have clogged the court system with no end in sight?

 
It wasn’t the homeowner who got sloppy, greedy and decided to start forging and photoshopping legal documents. It was the banks that engineered this complete fiasco from the top to bottom. Maybe now the banks will clean up their act, or they will be forced to find a more efficient and convincing way to forge and falsify endorsements and assignments. To date, the left hand doesn’t know what the right hand is doing- and the banks only hope that the homeowner doesn’t discover their deception.

 
I will reiterate again, if a bank claims to own a debt then why not simply show the documentation and prove it? This entire mess could be cleaned up very quickly if the banks would simply show the court evidence of ownership- but the courts know the banks don’t have it. By now we know that this entire debacle was engineered under the premise of plausible deniability and the screws are coming loose.
It is evident that the courts have had enough. The Supreme Court in Yvanova stated that:

 

“… California borrowers whose loans are secured by a deed of trust with a power of sale may suffer foreclosure without judicial process and thus ―would be deprived of a means to assert [their] legal protections if not permitted to challenge the foreclosing entity‘s authority through an action for wrongful foreclosure. (Culhane, supra, 708 F.3d at p. 290.)

A borrower therefore ―has standing to challenge the assignment of a mortgage on her home to the extent that such a challenge is necessary to contest a foreclosing entity‘s status qua mortgagee‖ (id. at p. 291)— that is, as the current holder of the beneficial interest under the deed of trust.”
The decision goes on to state that:

 

“In seeking a finding that an assignment agreement was void, therefore, a plaintiff in Yvanova‘s position is not asserting the interests of parties to the assignment; she is asserting her own interest in limiting foreclosure on her property to those with legal authority to order a foreclosure sale. This, then, is not a situation in which standing to sue is lacking because its ―sole object . . . is to settle rights of third persons who are not parties. (Golden Gate Bridge etc. Dist. v. Felt (1931) 214 Cal. 308, 316.)”

Apparently the California Supreme Court just grew a pair and the remaining 49 states might want to listen up. With all of the fraud settlements that have occurred over the past seven years, it is evident that what is occurring isn’t simply sloppy paperwork or unintentional oversight but blatant fraud, theft and criminal conspiracy if you want to be honest. It is a sad day in America when a homeowner must go all the way to the Supreme Court in order to obtain a fair and just ruling. If the courts had ruled in favor of the banks (and I am sure the judges in Yvanova knew what was on the line), there is no doubt in my mind that banks would have had a foreclosure feeding frenzy.

The court states the obvious, that there is an investor or entity who may suffer an unauthorized loss of its interest in the note if the foreclosure proceeds, “when an invalid transfer of a note and deed of trust leads to foreclosure by an unauthorized party, the ―victim‖ is not the borrower, whose obligations under the note are unaffected by the transfer, but ―an individual or entity that believes it has a present beneficial interest in the promissory note and may suffer the unauthorized loss of its interest in the note.”

And finally, the court gets to the meat of the matter- the issue of standing. “As it relates to standing, we disagree with defendants’ analysis of prejudice from an illegal foreclosure. A foreclosed-upon borrower clearly meets the general standard for standing to sue by showing an invasion of his or her legally protected interests (Angelucci v. Century Supper Club (2007) 41 Cal.4th 160, 175)—the borrower has lost ownership to the home in an allegedly illegal trustee‘s sale. (See Culhane, supra, 708 F.3d at p. 289 [foreclosed-upon borrower has sufficient personal stake in action against foreclosing entity to meet federal standing requirement].)  Moreover, the bank or other entity that ordered the foreclosure would not have done so absent the allegedly void assignment. Thus- [t]he identified harm—the foreclosure—can be traced directly to [the foreclosing entity‘s] exercise of the authority purportedly delegated by the assignment.”

In conclusion, the court clarifies who is allowed to enforce the note without showing overt favoritism to the bank. Please note the eloquence of the last line in this paragraph in the Yvanova decision:

“Nor is it correct that the borrower has no cognizable interest in the identity of the party enforcing his or her debt. Though the borrower is not entitled to object to an assignment of the promissory note, he or she is obligated to pay the debt, or suffer loss of the security, only to a person or entity that has actually been assigned the debt. (See Cockerell v. Title Ins. & Trust Co., supra, 42 Cal.2d at p. 292 [party claiming under an assignment must prove fact of assignment].) The borrower owes money not to the world at large but to a particular person or institution, and only the person or institution entitled to payment may enforce the debt by foreclosing on the security.

Again, “The borrower owes money NOT TO THE WORLD at large but to a particular person or institution, and ONLY the person or institution entitled to payment may enforce the debt by foreclosing on the security.” The court isn’t magically creating case law- this is exactly what the promissory note entitles the bearer to do- collect on a debt. The note does not say, “If you have a forged document you randomly printed a copy off the internet or photoshopped- you have standing.”

Only the individual or entity with actual STANDING can foreclose on a home. The fact that the homeowner defaulted on an alleged contract (that probably didn’t happen the way the contract reflects the transaction) doesn’t mean any party claiming to be a note holder can foreclose on the home. Like Jerry McGuire said, “SHOW ME THE MONEY.” Until the mortgagee shows up with actual evidence of ownership- no servicer, “lender” or unknown party should be able to randomly foreclose on a home simply by saying they own the note.

Again, this is the beauty of rescission. By precluding the servicer from walking into court with a forged note, mortgage and alleged contract- and forcing this party to demonstrate contractual standing- many fraudulent foreclosures would be prevented. It is tragic that so many people have lost their homes because the courts permitted a pretend lender with no standing to waltz in and take a home simply by showing fraudulent documents and making false claims.

Finally, the Yvanova ruling leaves us with the crowning glory of this decision, “A homeowner who has been foreclosed on by one with no right to do so has suffered an injurious invasion of his or her legal rights at the foreclosing entity‘s hands. No more is required for standing to sue.” Thank you California Supreme Court justices for ruling according to law instead of the banking lobby.

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