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Monday, May 31, 2010

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non-judicial sale is NOT an available election for a securitized loan

Posted on May 28, 2010 by Neil Garfield

NON-JUDICIAL STATES: THE DIFFERENCE BETWEEN FORECLOSURE AND SALE:
FORECLOSURE is a judicial process herein the “lender” files a lawsuit seeking to (a) enforce the note and get a judgment in the amount owed to them (b) asking the court to order the sale of the property to satisfy the Judgment. If the sale price is lower than the Judgment, then they will ask for a deficiency Judgment and the Judge will enter that Judgment. If the proceeds of sale is over the amount of the judgment, the borrower is entitled to the overage. Of course they usually tack on a number of fees and costs that may or may not be allowable. It is very rare that there is an overage. THE POINT IS that when they sue to foreclose they must make allegations which state a cause of action for enforcement of the note and for an order setting a date for sale. Those allegations include a description of the transaction with copies attached, and a claim of non-payment, together with allegations that the payments are owed to the Plaintiff BECAUSE they would suffer financial damage as a result of the non-payment. IN THE PROOF of the case the Plaintiff would be required to prove each and EVERY element of their claim which means proof that each allegation they made and each exhibit they rely upon is proven with live witnesses who are competent — i.e., they take an oath, they have PERSONAL KNOWLEDGE (not what someone else told them),personal recall and the ability to communicate what they know. This applies to documents they wish to use as well. That is called authentication and foundation.

SALE: Means what it says. In non-judicial sale they just want to sell your property without showing any court that they can credibly make the necessary allegations for a judicial foreclosure and without showing the court proof of the allegations they would be required to make if they filed a judicial foreclosure. In a non-judicial state what they want is to SELL and what they don’t want is to foreclose. Keep in mind that every state that allows non-judicial sale treats the sale as private and NOT a judicial event by definition. In Arizona and many other states there is no election for non-judicial sale of commercial property because of the usual complexity of commercial transactions. THE POINT is that a securitized loan presents as much or more complexity than commercial real property loan transactions. Thus your argument might be that the non-judicial sale is NOT an available election for a securitized loan

Read more here > Neil Garfield

AN ASSIGNMENT OR A FORMALIZATION OR A MEMORIALIZATION? By LYNN E. SZYMONIAK, ESQ.

Posted on May 28, 2010 by dinsfla

AN ASSIGNMENT OR A FORMALIZATION OR A MEMORIALIZATION?
The standard language in most of the mortgage assignments being signed by employees of LENDER PROCESSING SERVICES (most recently, Kathy Smith, Joseph Kaminsky) has changed in one significant respect.

The effective date of the transfer from grantor to grantee is now not stated as a specific date. Instead, we have the following:

"This document has been executed and is being recorded in order to formalize and memorialize an assignment of the subject mortgage which took place prior to December 17, 2009."
A copy of this particular "assignment" is attached. It is signed by Kathy Smith "Assistant Secretary, MERS as nominee for American Home Mortgage."
This language is easy enough to locate on the document because a different type font is used.
How this prior assignment took place without a document is left unexplained.
IN THE PAST MONTHS, THIS CHANGE HAS BEEN MADE BY MANY OF THE FORECLOSURE MILL LAW FIRMS DIRECTED BY LENDER PROCESSING SERVICES, SO,
THERE MUST BE A MEMO DIRECTING THIS.
This is really an acknowledgment that the document is NOT the original assignment - but a replacement. Who will recognize this shoddy attempt to "create" standing to foreclose? No doubt, the state court judges in Brooklyn, the federal court judges in Ohio, a few bankruptcy judges, a few Massachusetts land court judges (Keith Long) and many bankruptcy trustees.
In Florida, the scheme will perhaps be first be exposed by state court judges Bailey, Traynor or Rondolino.

Read More here > Stopforeclosurefraud

Sunday, May 23, 2010

Sactions Motion filed Against LPS

BY
Lynn Szymoniak - Fraud Digest

Dear Editor:


Once again, a U.S. Trustee is leading the way in exposing fraud in foreclosures. On Friday, May 21, 2010, United States Trustee R. Michael Bolen, Region 5, Judicial Districts of Louisiana and Mississippi, by Mary Langston, Assistant U.S. Trustee, New Orleans, Louisiana, filed a Motion for Sanctions against Lender Processing Services, Inc. and The Boles Law Firm. The Motion was filed in a bankruptcy action, In re Ron Wilson, Case No. 07-11862, U.S. Bankruptcy Court, Eastern District of Louisiana.

The U.S. Trustee is seeking to sanction LPS and The Boles Law Firm for making misrepresentations in statements and/or in testimony in open court, during the course of Show Cause proceedings initiated by the Court. Show Cause Orders were entered on May 9, 2008, July 11, 2008 and July 18, 2008. The misrepresentations relate to a Motion to Lift Stay (“2d MFR”) filed on March 10, 2008 and execution of a false affidavit supporting the 2d MFR, filed on behalf of Option One Mortgage Corporation, n/k/a Sand Canyon Corporation.
The misrepresentations concern payments received but not posted by Option One, dated January 2, 2008; January 31, 2008; and March 3, 2008 (the “Unposted Payments”).

According to the Trustee, Fidelity National Information Services, Inc. (now, Lender Processing Services, Inc.) misrepresented to the Court its knowledge of, and whether it communicated with Boles about the Unposted Payments. Further, the Trustee alleges that
LPS/Fidelity misrepresented that it did not function as a “go between” in this case, between Boles and Option One, with respect to the Unposted Payments.

"Boles lacked candor before this Court, based on statements that one if its attorneys made to the Court on June 26, 2008 during the OSC [Order to Show Cause] proceeding. In that hearing, the Boles attorney indicated that, although Boles possessed one or more of the Unposted Payments, Boles did not know why it had received them. Upon information and belief, the proof will show that Boles received the Unposted Payments because Boles had issued instructions directing that each of the Unposted Payments be sent to it."

Again, according to the Trustee, "The respondents’ [LPS and Boles] representations were not well grounded in fact, were made in bad
faith to avoid potential liability, and have resulted in unnecessarily protracted discovery and litigation concerning their roles involved with the 2d MFR and false affidavit."

In a 19 page Memorandum of Law supporting the motion for sanctions, Trustee Mary Langston set forth that Dory Goebel, an officer and employee of Fidelity, was questioned regarding an Affidavit she had submitted regarding unposted mortgage payments. Goebel essentially denied communications between Fidelity and the Boles firm:

"Goebel testified that Fidelity would not have communicated with the Boles law firm regarding post-referral payments; rather, Option was responsible for notifying its counsel directly about such payments. Goebel further testified that she reviewed the Wilson file,
and that were no communications between Fidelity and Boles regarding the Unposted Payments because “[n]o, that is not the responsibility of Fidelity. We would not know of additional payments, Option One would.” August 21, 2008 Tr. 110:18 - 111:5. Goebel’s testimony thus portrayed that Fidelity would not even know that a borrower’s post-referral payment had been received unless Option posted the payment on Option’s accounting system; and that Fidelity would not communicate with Option’s counsel about payments received." (Memorandum, p.8)

According to Trustee Langston, "However, Goebel’s testimony simply does not comport with the evidence the United States Trustee has obtained from Option, Fidelity, and Boles through discovery." (Memorandum, p.8) The Trustee goes through the many communications that contradict Goebel's testimony. She concludes, "... the evidence establishes that both Boles and Fidelity had knowledge about the Unposted Payments which they misrepresented to the Court. Upon information and belief, Fidelity and Boles played an integral role in communicating about those very payments, participating in queries about how to handle the Unposted Payments." (Memorandum, p.9)

This is not the first time that a U.S. Bankruptcy Trustee has sought to impose sanctions against Fidelity and/or LPS. Most recently, the
in the case of Niles and Angela Taylor, 2009 WL 1885888 (Bankr. E.D. Pa. 2009), Judge Diane Weiss Sigmund also determined
that sanctions were warranted in a foreclosure case involving Lender Processing Services. Judge Sigmund described in great detail how the default mortgage servicing and foreclosure systems really work.

Lender Processing Services (“LPS”) was described as the largest out-source provider in the United States for mortgage default services. The LPS systems frequently resulted in incorrect information regarding mortgages reported to litigants and judges in foreclosure actions. The LPS network of national and local law firms were required to communicate directly with LPS, and not the mortgage servicers, about any issues that arose in any given case. Likewise, the servicers were required to execute a 51-page Default Service Agreement with LPS that
delegated to LPS all functions with respect to the default servicing work. LPS used a software communication system called “NewTrak” to deliver instructions and documents to the LPS network attorneys and to deliver any information to the servicers. LPS also had access to the servicers data-base platforms. The law firms were staffed primarily by paralegals with little supervision by attorneys. See
In re Taylor, supra, at 1885889 to 1885891.

Judge Sigmund found that he LPS system was designed to minimize human involvement. She concluded, “When an attorney appears in a matter, it is assumed he or she brings not only substantive knowledge of the law but judgment. The competition for business cannot be an impediment to the use of these capabilities. The attorney, as opposed to the processor, knows when a contest does not fit the cookie cutter forms employed by the paralegals. At that juncture, the use of technology and automated queries must yield to hand-
carried justice. The client must be advised, questioned and consulted. The thoughtless mechanical employment of computer-driven models and communications to inexpensively traverse the path to foreclosure offends the integrity of our American bankruptcy system. It is for those involved in the process to step back and assess how they can fulfill their professional obligations and responsibly reap the benefits of technology. Noting less should be tolerated.”

In a case pending in the United States Bankruptcy Court for the Southern District of New York, In re Silvia Nuer, Case No. 08-17106 (REG), in a Memorandum of Law of the United States Trustee in Support of Sanctions Against J.P.Morgan Chase Bank National Association, filed January 4, 2010, the Trustee reviewed the testimony of Mr. Herndon, a witness for Chase, who testified that the chain of title for the property in question passed through three entities. Previously, however, Chase had submitted contrary documents. In particular, Chase had
submitted an assignment “that appeared to show that Chase assigned its right as mortgagee to Deutsche, as trustee for Long Beach Mortgage Trust 2006-2. The Assignment was signed by Scott Walter as “Attorney in Fact for Chase (the “Walter November 1 Assignment”)…It was signed on November 1, 2008, after the Filing Date. This 2008 Assignment to a trust that closed in 2006 signed by an individual who did not in fact work for Chase has become the focus of the sanctions debate. Regarding the Walter Assignment, the Trustee states: “Here, the misconduct of Chase includes the attachment of the Walter November 1 Assignment…Chase’s own witness could not explain the Walter November 1 Assignment…”

Walter was actually an employee in the Minnesota office of Lender Processing Services.

What is an appropriate sanction for a company that repeatedly makes false statements in bankruptcy proceedings - and files false mortgage assignments and Affidavits - so that the bankruptcy judge will lift the stay and allow a foreclosure to proceed more quickly?

If the debtor engaged in these acts, the case would be referred to the U.S. Attorney so that criminal charges of bankruptcy fraud could be filed against the debtor. Why should a repeat offender deserve less?

Lynn E. Szymoniak, Ed., Fraud Digest

Friday, May 21, 2010

FORENSIC MORTGAGE AUDITS AS TOOLS TO SAVE FORECLOSURE HOMES


I wanted to post this great info that I have found from the truth in lending auditors, about forensic mortgage audits and if used properly how they can help you save your home and get a total new reset of your loan at the terms you ask instead of the terms the banks want to force down your throat.

FORENSIC LOAN AUDIT

Why do you need forensics?

You’ve been denied a loan mod. You short sale has been denied. You’ve been told you do not qualify. Your lender has a policy against modifying. You can’t prove a hardship. You make too much money. You can’t hold on any longer waiting on your lender. Your lender refuses to modify your investment properties. You are still current on your payments and can’t get help. Your lender has claimed he can make more money foreclosing on your home.


Why Won’t Your Lender Help?

Lenders are Bankers. They are about making money-they are not about “help.” They will modify your loan if it will make them money. They will choose some other way to get their money, if you are too great of a risk. Foreclosure is a great way to get money. Selling your loan to another lender is a great way to get money. An insurance policy that may pay out if you default on your loan is a great way to get money.

There are many federal laws that lenders must follow when they issue loans. Predatory loans do not follow those laws. It is the lender’s responsibility to handle and resolve any violations of TILA, RESPA, HOEPA, ECOA and to address and resolve FRAUD when they are found in loan documents. Their licenses are at risk if they don’t address the matter.

FRAUD AND FEDERAL VIOLATIONS:

Think about it: Would you buy a loan from a lender if it had a report on file of fraud and federal violations? Nope. You’d stay away from that because you don’t want to inherit another man’s mess. How about that insurance premium? Forget that-it’s more than likely null and void now that the loan is fraudulent or violation heavy.


THE LAWS ARE ON YOUR SIDE:

Unfortunately, your lender is not going to call or write letting you know that your loan has violations. “Hello Joe. Hey GREAT news, we just found out we broke several federal laws when we issued you that loan. So we are going to fix this whole mess for you. Hey, you know, one of the laws we broke, well it turns out, you get free title of the place. Is that just terrific or what? So we’ve got that title coming to you in the next couple of weeks.” Sadly, you are never going to get that call – where’s the money making – in that?

IF YOU USE THE LAWS:

“Hello can you put me through to Mr. Loan Shark?” “Hello Mr. Loan Shark, this is Joe and I got some GREAT news. We just found out you broke several federal laws when you issued us that loan. So we just need you to fix this whole mess. Hey, you know, we still want our house and let’s just negotiate some new terms. We’ve got a truth in lending auditor (TILA) representative on the job – they’ll talk the talk with you. Is that terrific or what? So we are really looking forward to your offer now that we can all honestly come to the negotiations table together.

We are not a loan modifications company. We are not on the lenders payroll. We are not on the government’s payroll. We are an audit company. We investigate your loan.

We then use these forensics to negotiate any one of the following for you absolutely free.

Loan Mod/Loan Restructuring, Short Sale or Short Refi, Short Payoff, Deed In Lieu.

TRUST… Who can you trust?

Your lender tells you that he wants to help you and then denies you and sends you foreclosure papers…(it seems you paid him to take your home.) Boston Globe reports that lenders don’t want to modify loans; they find no profit in helping the distressed. The president tells you that your tax dollars, if given to the lenders will help save your home – only it turns out that same lender just send you the foreclosure papers… And a little web search shows news articles revealing the facts: the bailout was about keeping the lenders in business, not helping the homeowners.

THE ONLY GUARANTEE:

The only thing your lender guarantees is FORECLOSURE. Temp mods – don’t always result in permanent mods. The lenders have canceled permanent mods. Many mods raise the payments to astronomical levels – home goes back to the bank AFTER they collect a few more payments. Short sales have been denied – often after they were approved. Month after month the foreclosures rise to record – high numbers in cities across the nation.

“Yah, but my lender says…”

I don’t need anybody to help me…they will help me modify my loan for free, they even send me a letter in the mail to warn me away from professionals who may try to help me. I shouldn’t trust any professional that wants to charge me money to modify my loan…you know, ‘cuz they’ll do it for free. I’m not sure, but I don’t think they want me to investigate them either…they wouldn’t actually come right out and say….

WHO ISSUED THAT LOAN?

Why on earth would you trust or listen to a company that issued you an illegal loan while telling you how good it was…you know, the loan that is wiping you out now? Why on earth would you think they, who initiated the first lies, are not lying to you now?

WHY DO YOU NEED AN EXPERT?

We are the expert at forensic loan review. We work as your hired gun to show the lender all the violations in “his” loan. If you had a cavity, would you drill the hole yourself, or go to the dentist? If the Judge told you that didn’t need a lawyer, he would listen to your case for free, would you do it? How could you conduct your own investigation and get the lender to accept it as a professional review? Even attorneys get lawyer to represent them in court.

If you don’t get help…

You may be ok. You may be one of the very few who actually get a modification. Or you may be one of the thousands who loses their home, or continues to give the bank far more in monthly payments than you can honestly afford until the bank finally gets your home.

To date every single loan the bankers have issued and we have investigated has been full of violations; you don’t have to believe us, you don’t have to trust us, you only need to get your loan investigated

Read more here > FMI

Wednesday, May 19, 2010

What is a Forensic Mortgage?

Forensic Mortgage Definition

Forensic Auditing involves the intensive investigations of cases that are suspected to involve fraud so as to "Validate, Verify, Prove, Authenticate, Substantiate, Confirm, Corroborate, Justify, or Disprove a claim" and to identify the persons involved, support the findings by collecting evidence and to present the evidence in an acceptable format for subsequent civil and legal penalties proceedings.

We will conduct auditing on your paperwork to find discrepancies, violations, unlawful/ illegal acts, misrepresentations of material facts as well as act as a third party witness to the validation, verification process you have a natural right to demand. The difference here is now you have a witness you can put on the stand and testify to what they found in the audit and the information provided by “Alleged Note Holder.”

How would you know if the most current mortgage company claiming to be "Holders in Due Course" has a "True and Accurate Debt Claim" to said property?

You wouldn't without a professional audit conducted by industry leaders working for you, the individual!

Our audits begin with day one - the day of closing

1. Did you receive the note, mortgage and terms you agreed to?

2. Did the Title Company properly prepare and close your loan?

3. Did your mortgage company execute the note and mortgage you were led to sign?

4. If you are in foreclosure has your mortgage company provided you all of your loan documents, followed State and Federal Rules and Regulations in your foreclosure proceedings and has a Proper Claim to the Property?

5. Were your payments accurately and properly applied to your mortgage loan?

6. And finally what about your escrow account, has that been properly managed, etc.?

Remember...it is essential that individual consumers have access to an Independent Third Party Auditing Company that truly investigates the facts!

More information about this topic ? > HERE http://www.fmi-audit.com

Signs of Predatory Lending

Signs of Predatory Lending

• Excessive fees
• Prepayment penalties
• Inflated interest rates from brokers (yield-spread premiums)
• Steering and targeting
• Adjustable interest rates that “explode”
• Promises to fix problems with future refinances
• Not counting taxes and insurance
• Repeated refinances that drain your resources

Contact us for more information > Here http://www.fmi-audit.com

Predatory Lending

How To Spot and Avoid Predatory Lending

Predatory lenders promise loans that are "too good to be true" and pressure borrowers to take them on the spot. Here's a few things you or your family and friends should know about spotting and avoid predatory loans:
How to Spot a Predatory Loan
Balloon payments.
High interest rates.
Monthly payments you can't afford.
Penalties for early pay-off of the loan.
Unauthorized refinancing of your loan
How to Avoid a Predatory Loan
Always shop around.
Ask questions.
If you don't understand the loan terms, talk to someone you trust to look at the documents for you.
Don't trust ads promising "No Credit? No Problem!"
Ignore high-pressure sales tactics.
Don't take the first loan you are offered.
Remember that a low monthly payment isn't always a 'deal.' Look at the TOTAL cost of the loan.
Be wary of promises to refinance the loan to a better rate in the future.
Never sign a blank document or anything the lender promised to fill in later.

Contact us here > http//www.fmi-audit.com
Securitization Chain Research

Securitization is a structured finance process that distributes risk by aggregating debt instruments in a pool, then issues new securities backed by the pool. The term "securitization" is derived from the fact that the form of financial instruments used to obtain funds from the investors are securities. As a portfolio risk backed by amortizing cash flows - and unlike general corporate debt - the credit quality of securitized debt is non-stationary due to changes in volatility that are time- and structure-dependent. If the transaction is properly structured and the pool performs as expected, the credit risk of all tranches of structured debt improves; if improperly structured, the affected tranches will experience dramatic credit deterioration and loss.

All assets can be securitized so long as they are associated with cash flow. Hence, the securities which are the outcome of securitization processes are termed asset-backed securities (ABS). From this perspective, securitization could also be defined as a financial process leading to an issue of an ABS.
Securitization often utilizes a special purpose vehicle (SPV), alternatively known as a special purpose entity (SPE) or special purpose company (SPC), reducing the risk of bankruptcy and thereby obtaining lower interest rates from potential lenders.

A credit derivative is also sometimes used to change the credit quality of the underlying portfolio so that it will be acceptable to the final investors. Securitization has evolved from its tentative beginnings in the late 1970s to a vital funding source with an estimated outstanding of $10.24 trillion in the United States and $2.25 trillion in Europe as of the 2nd quarter of 2008. In 2007, ABS issuance amounted to $3,455 billion in the US and $652 billion in Europe.

Securitization, in its most basic form, is a method of financing assets. Rather than selling those assets "whole," the assets are combined into a pool, and then that pool is split into shares. Those shares are sold to investors who share the risk and reward of the performance of those assets. It can be viewed as being similar to a corporation selling, or "spinning off," a profitable business unit into a separate entity. They trade their ownership of that unit, and all the profit and loss that might come in the future, for cash right now. A very basic example would be as follows:

(A) Bank loans 10 people $100,000 a piece, which they will use to buy homes. (A) has invested in the success and/or failure of those 10 home buyers- if the buyers make their payments and pay off the loans, (A) makes a profit. Looking at it another way, (A) has taken the risk that some borrowers won't repay the loan. In exchange for taking that risk, the borrowers pay (A) a premium in addition to the interest on the money they borrow.