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Wednesday, October 13, 2010

Legality of Foreclosers and Mortgage Titles in Question; Millions of Unemployment Job Seekers Possibly Impacted

LAS VEGAS - MARCH 21:  Prospective buyers look...Image by Getty Images via @daylife

Millions of unemployed job seekers across the nation have faced actions of mortgage lender callers threatening foreclosure proceedings, while dealing with other financial crises in their family. Some has been forced to move out of their former home, to live within their cars, with family or friends while wondering if they will ever have a place again, to peaceful rest their head.

Recent reports, by a growing number of internet and one mainstream media resource, have begun to expose, what could amount in the future, in the largest mortgage fraud case to face America in years. 

Large financial mortgage lending institutions of Bank of America, Chase-Manhattan, Goldman Sachs via Litton Loans and Ally (former GMAC) Monday, on October 11, announced that they would suspend foreclosure sales in a number of states.

Bank of America then announced on Tuesday, October 12, that the bank would suspend their foreclosures in all 50 states.

Investigation by a Florida Based Law Firm, cites that former Walmart and McDonald’s Employees approved legal mortgage related documentation

Within a tower of foreclosure depositions shown at the Ticktin Law Group’s Deerfield Beach office, senior legal counsel Peter Ticktin says the group has discovered the groundwork of an illegal home foreclosure system, South Florida based news resource WPTV Channel 5 reports.
"It's massive, it's criminal, it's wrong and it's proven with what lawyers call a mountain of evidence,” Ticktin cited. The evidence, according to Ticktin, includes incorrect foreclosure paperwork pushed through by all types of banks by so-called “Robo-Signers”. 

Ticktin stated within the article, that banks hired unqualified workers to complete crucial foreclosure affidavits, which are the official document used for a foreclosure hearing. In many cases, Ticktin cites that the banks purposely put wrong income information on those affidavits to rush foreclosures through. 

In addition, the law firmed reviled that by the time a homeowner got to the courtroom, they didn't have a chance, against the possible illegal actions performed by the large banks. 

Joshua Bleil, a foreclosure defense lawyer for Ticktin stated to News Channel 5, "The courts gave little credence to our position and we've made that repeated argument over and over again. Now the judges are starting to realize that it can be as big as this problem is." 
Ironically, a CNBC Reporter Describes the Real Issues and How the Actions by Bank Based “Robo-Signers” could affect the Entire U.S. Mortgage Based System

On Tuesday, October 14, a report by CNBC Real Estate Newscaster Diana Olick, states that not only could the issue with the legality of mortgage documentation raise questions on if the foreclosures are valid but, also if millions of mortgages that have been paid by Americans to date on time, have clear titles.

Adam Levitin, is a Georgetown University Law professor who specializes in, a host of financial regulatory issues and mortgage finance. During a recent conference call reported by Olick, Professor Levitin said the documentation problems involved in the mortgage mess have the potential to spread across to many homeowners, nationwide.
The problems with the paperwork threatens “…to cloud title on not just foreclosed mortgages but, on performing mortgages," Levitin mentioned.
To clearly understand the depths of the actions that major financial institutions have engaged within, Diana Olick explains within her article.
“The issues are securitization, modernization and a whole lot of cut corners. Real estate law requires real paper transfer of documents and titles, and a lot of the system went electronic without much regard to that persnickety rule,” Olick wrote.
“Mortgages and property titles are transferred several times in the process of a home purchase from originators to securitization sponsors to depositors to trusts. Trustees hold the note (which is the IOU on the mortgage), the mortgage (the security that says the house is collateral) and the assignment of the note and security instrument.”
In the normal legal process, the courts, Title Company require what is referred to as “Wet Ink”, the actual live documentation the borrowers signed to secure the mortgage.

Banks then place the mortgage amounted borrowed into a trust account, which are required to be dated to the original time, place and date, the mortgage closing occurred. Instead of these actions taking place as required by law, the banks are accused of backdating the documentation, thus illegally processing the paperwork involved.

The chain of documentation now in question, and trustee ownership in question, here is one legal scenario, according to Professor Levitin within the Diana Olick article.
“The mortgage is still owed, but there's going to be a problem figuring out who actually holds the mortgage, and they would be the ones bringing the foreclosure. You have a trust that has been getting payments from borrowers for years that it has no right to receive. So you might see borrowers suing the trusts saying give me my money back, you're stealing my money,” Levitin stated.
“You're going to then have trusts that don't have any assets that have been issuing securities that say they're backed by a whole bunch of assets, and you're going to have investors suing the trustees for failing to inspect the collateral files, which the trustees say they're going to do, and you're going to have trustees suing the securitization sponsors for violating their representations and warrantees about what they were transferring,” Levitin recited.
Diana Olick Video report on MSNBC on October 12

“Robo-Signers” on Foreclosure Documentation cites that they did Their Jobs, without Question.

Depositions released on October 12, by the Ticktin Law Firm, unveiled many of the “Robo-Signers” employees barely knew what a mortgage was. Shockingly, others did not have the knowledge required within the legal documentation to know what a complaint was, or even know the definition of was “personal property” meant.

Most troubling, several said they knew that they were lying when they signed the foreclosure affidavits and, agreed with defense lawyers' accusations, about document fraud.
"The mortgage servicers hired people who would never question authority," said Peter Ticktin, the attorney defending 3,000 homeowners in foreclosure cases. 

Ticktin represented during an press conference with the news resource Tampa; 150 depositions from bank employees who say they signed foreclosure affidavits without reviewing the documents or ever laying eyes on them.

In one of the deposition presented by Ticktin, a supervisor with Litton Loan, a mortgaging unit for Goldman Sachs, attested that not only could she not define the basic terms of real estate loan language but also, that she didn't know what the required conditions were for a bank to foreclose or who the holder of the mortgage note was.
"I don't know the ins and outs of the loan; I just sign documents," she said reported by
“Double-Funding” Processes by Financial Institutions, Could Have Caused Millions of Unemployed Job Seekers Mortgages, to be “Paid-in-Full” While Still Giving Money to the Banks on a Monthly Basis

An quote from the blogging website call MS, describes the possible “double-dealing” the banks were engaged within. At this point, it is possible that millions of unemployed job seekers mortgages are already “paid-in-full” by “double-dipping” process. Borrowers, who have trying to negotiate with lenders to little avail under “Making Homes Affordable” program, could have been attempting to gain relief under fraudulent circumstances.
“Double-Funding” involves a mortgage originator sending simultaneous funding requests for the same loan to two different warehouse lenders. Both warehouse lenders, unaware of each other, would send funding for the loan to the title companies specified by the mortgage originator,” states.
“The mortgage originator then disburses the money from one lender to the borrower, while directing the title company to wire the money received from the other lender to mortgage originator’s bank account. The mortgage originators then provide fabricated mortgage documents to the warehouse lenders that falsely represented that the lender’s funds had, in fact, been used to finance borrower loans,” the PDF documents cites.
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