War on the Home Front | Mortgage Loan Investigations | Securitization Audits

Oct

“Oh what a tangled web we weave, When first we practice to deceive”

The memo below is a basic and frankly poorly written motion that I first filed many years ago that challenged the most basic element of foreclosure litigation….the fact that we have no idea who is collecting bajillions of dollars in mortgage payments, foreclosure judgments and title to properties all across this country. The memo is admittedly not well-researched and not well written…it was based more on a hunch and just a nagging sense of trouble in my gut. But that nagging sense in my gut is coming full circle now as we all realize just what a mess the United States mortgage system is in.

Forget about Robo Signers, we’re all going to learn about phantom mortgages, zombie trusts and an old Italian guy….his name starts with “P”.

memofiled

And just to drive the point home and make the issues real crystal clear, have a look at the sampling of assignments of mortgage below. Mind you these are only samples, the troubling component is that they are representative of the much larger problems we face in trying to unravel this mess. Look carefully at the dates on the assignments. Compare the names on the assignments, the dates on the assignments, the dates on the notary stamps. Ask your own questions and draw your own conclusions.

NotaryExamples

Assignments

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Oct

The Fallout From Allegations of Improper Foreclosures By David J. Stern

By MattWeidner | Weidner

14680Leave a Comment2010-10-20+10%3A30%3A18MattWeidner

The allegations contained within the depositions from former employees of David J. Stern are earth shattering. I was quoted as saying that I was speechless and that if the allegations are true, we are going to have a real crisis on our hands. The thing that absolutely boggles my mind and keeps me up at night is my inability to understand why foreclosure cases are being permitted to continue proceeding when there are substantiated allegations of gross abuses of the court process.

The most significant allegations involve improper or no service of process on the defendants. The typical rationale for continuing to grant summary judgments in foreclosure cases is that no defendant is present to contest the case. I believe the facts will show in the months and years going forward that Defendants were not properly served with some of these foreclosure cases. When there is fraud or flawed Service of Process at the outset, the entire judgment is Void thereafter.

And if they are willing to engage in fraudulent or flawed Service of Process, why in the world would the ensure that defendants receive notices of hearing…especially notices of Summary Judgment hearings? The number of clients that report not receiving any notices at all of hearings–who report that the first notice they get of a foreclosure sale is…the Final Judgment of Foreclosure mailed out by the Clerk of Court cannot be ignored.

Consumers who have been the victims of this improper practice are going to quite justifiably be wild with anger. The pending federal investigations are going to show what those of us in the fight have been saying all along….there are many consumers who have tried to make mortgage payments, who have mailed in paperwork and spent hours on the phone and have done their part to try and fulfill their mortgage obligations, only to have the lenders and servicers waste their time, destroy their paperwork and prevent them from fulfilling their obligations. All of that is bad enough, but what do you say to that homeowner when at the same time they are doing all of this, a court process is going forward that results in the sale of their home out from underneath them….and they had no notice of that hearing….or no service at all?

As an attorney, I am compelled by the quaint notion that we all have a responsibility to protect those around us from the abuses of the bigger and more powerful. I want everyone reading this to think about that immigrant family that has been tossed out of their home by a Plaintiff that had no right to do so. I want you to think about the broken, elderly man on Social Security who was the victim of a fast talking mortgage broker who pocketed tens of thousands in fees on a bad loan…a loan that’s now being foreclosed on by a Plaintiff based solely on a flawed assignment of mortgage.

Recent national polls show a dramatic shift in public opinion on the foreclosure crisis:

Fifty-two percent of likely voters said Wall Street investors and mortgage companies are to blame for most of the problems in the lending industry, while 35 percent faulted individuals who borrowed more than they could afford, the survey indicated. Those percentages changed from July 2008, when slightly more voters blamed borrowers than Wall Street investors and mortgage companies.

UPI Poll

Keep in mind that polls like this lag several months behind actual public opinion, which is changing daily. When the general press continues to hear the stories of abuse that is being visited upon Americans at the hands of the banks and institutions and their law firms, the general public is going to be seething with anger. And if you think we’ve got a mess on our hands now trying to sort out who owns and holds mortgages, just wait until we have to try and sort out competing title claims on homes that were sold or seized through improper foreclosures. There is no avoiding this. The claims are out there and they are real. When the general public learns of their right to personal service and of real notice of hearings and proceedings…and when we show that they did not receive notice….wow. As an example, have a read here at what is perhaps the first lawsuit that details the kind of facts I mentioned above. If there are only a thousand such cases in each county, we’ve got real problems and given the numbers reported on….that’s just going to be the beginning…

sternmotionforprotectiveorder

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Jul

CLASS ACTION SUIT INVOLVING MORTGAGE BACKED SECURITIES OF WELLS FARGO & JP MORGAN ACCEPTANCE CORPORATION

By LH | Foreclosure Blog News, Homeowner Resources

10536Leave a Comment2010-07-19+10%3A04%3A32LH

SOMEBODY SEND ME THE COMPLAINT PLEASE —> NGARFIELD@MSN.COM

Registration Statements omitted and/or misrepresented the fact that the sellers of the underlying mortgages to JP Morgan Acceptance were issuing many of the mortgage loans to borrowers who: (i) did not meet the prudent or maximum debt-to-income ratio purportedly required by the lender; (ii) did not provide adequate documentation to support the income and assets required for the lenders to approve and fund the mortgage loans pursuant to the lenders’ own guidelines; (iii) were steered to stated income/asset and low documentation mortgage loans by lenders, lenders’ correspondents or lenders’ agents, such as mortgage brokers, because the borrowers could not qualify for mortgage loans that required full documentation; and (iv) did not have the income required by the lenders’ own guidelines to afford the required mortgage payments which resulted in a mismatch between the amount loaned to the borrower and the capacity of the borrower.

2010/07/16 at 5:17 pm

Wells Fargo more than likely caloborated with J.P. Morgan . Look and see if your Trust is located below.

COUGHLIN STOIA GELLER RUDMAN & ROBBINS LLP FILES CLASS ACTION SUIT INVOLVING MORTGAGE BACKED SECURITIES OF JP MORGAN ACCEPTANCE CORPORATION
January 21, 2009 – Coughlin Stoia Geller Rudman & Robbins LLP (“Coughlin Stoia”) (http://www.csgrr.com/cases/jpmorgan/) today announced that a class action lawsuit is pending in the United States District Court for the Eastern District of New York on behalf of purchasers of Mortgage Pass-Through Certificates and Asset-Backed Pass-Through Certificates (“Certificates”) of J.P. Morgan Acceptance Corporation I (“JP Morgan Acceptance” or the “Depositor”) pursuant and/or traceable to false and misleading Registration Statements and Prospectus Supplements issued between January 2006 and March 2007 by JP Morgan Acceptance (collectively, the “Registration Statements”). The class includes purchasers of Certificates in the following trusts:

J.P. Morgan Alternative Loan Trust 2006-A1
J.P. Morgan Alternative Loan Trust 2006-A7

J.P. Morgan Alternative Loan Trust 2006-A2
J.P. Morgan Alternative Loan Trust 2006-S1

J.P. Morgan Alternative Loan Trust 2006-A3
J.P. Morgan Alternative Loan Trust 2006-S2

J.P. Morgan Alternative Loan Trust 2006-A4
J.P. Morgan Alternative Loan Trust 2006-S3

J.P. Morgan Alternative Loan Trust 2006-A5
J.P. Morgan Alternative Loan Trust 2006-S4

J.P. Morgan Alternative Loan Trust 2006-A6
J.P. Morgan Mortgage Acquisition Trust 2006-A3

J.P. Morgan Mortgage Acquisition Trust 2006-A4
J.P. Morgan Mortgage Acquisition Trust 2006-A5

J.P. Morgan Mortgage Acquisition Trust 2006-A6
J.P. Morgan Mortgage Acquisition Trust 2006-A7

J.P. Morgan Mortgage Acquisition Trust 2006-ACC1
J.P. Morgan Mortgage Acquisition Trust 2006-CH2

J.P. Morgan Mortgage Acquisition Trust 2006-HE2
J.P. Morgan Mortgage Acquisition Trust 2006-HE3

J.P. Morgan Mortgage Acquisition Trust 2006-NC1
J.P. Morgan Mortgage Acquisition Trust 2006-RM1

J.P. Morgan Mortgage Acquisition Trust 2006-S2
J.P. Morgan Mortgage Acquisition Trust 2006-WF1

J.P. Morgan Mortgage Acquisition Trust 2006-WMC2
J.P. Morgan Mortgage Acquisition Trust 2006-WMC3

J.P. Morgan Mortgage Acquisition Trust 2006-WMC4
J.P. Morgan Mortgage Acquisition Trust 2007-A1

J.P. Morgan Mortgage Acquisition Trust 2007-A2
J.P. Morgan Mortgage Acquisition Trust 2007-CH1

J.P. Morgan Mortgage Acquisition Trust 2007-CH2
J.P. Morgan Mortgage Acquisition Trust 2007-S1

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Samuel H. Rudman or David A. Rosenfeld of Coughlin Stoia at 800/449-4900 or 619/231-1058, or via e-mail at djr@csgrr.com. If you are a member of this class, you can view a copy of the complaint or join this class action online at http://www.csgrr.com/cases/jpmorgan/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

The complaint charges JP Morgan Acceptance, certain of its officers and directors and the issuers and underwriters of the Certificates with violations of the Securities Act of 1933. JP Morgan Acceptance was formed in 1988 for the purpose of acquiring, owning and selling interests in those assets. JP Morgan Acceptance is a subsidiary of J.P. Morgan Securities Inc. (“JP Morgan”) and is engaged in mortgage lending and other real estate finance-related businesses, including mortgage banking, mortgage warehouse lending, and insurance underwriting.

The complaint alleges that on July 29, 2005 and February 8, 2006, JP Morgan Acceptance and the Defendant Issuers caused Registration Statements to be filed with the Securities and Exchange Commission (“SEC”) in connection with the issuance of billions of dollars of Certificates. The Certificates were issued pursuant to Prospectus Supplements, each of which was incorporated into the Registration Statements. The Certificates included several classes or tranches, which had various priorities of payment, exposure to default, interest payment provisions and/or levels of seniority. The Certificates were supported by large pools of mortgage loans. The Registration Statements represented that the mortgage pools would primarily consist of loan groups generally secured by first liens on residential properties, including conventional, adjustable rate and negative amortization mortgage loans.

The complaint alleges that the Registration Statements omitted and/or misrepresented the fact that the sellers of the underlying mortgages to JP Morgan Acceptance were issuing many of the mortgage loans to borrowers who: (i) did not meet the prudent or maximum debt-to-income ratio purportedly required by the lender; (ii) did not provide adequate documentation to support the income and assets required for the lenders to approve and fund the mortgage loans pursuant to the lenders’ own guidelines; (iii) were steered to stated income/asset and low documentation mortgage loans by lenders, lenders’ correspondents or lenders’ agents, such as mortgage brokers, because the borrowers could not qualify for mortgage loans that required full documentation; and (iv) did not have the income required by the lenders’ own guidelines to afford the required mortgage payments which resulted in a mismatch between the amount loaned to the borrower and the capacity of the borrower.

According to the complaint, by the summer of 2007, the amount of uncollectible mortgage loans securing the Certificates began to be revealed to the public. To avoid scrutiny for their own involvement in the sale of the Certificates, the Rating Agencies began to put negative watch labels on many Certificate classes, ultimately downgrading many. The delinquency and foreclosure rates of the mortgage loans securing the Certificates has grown both faster and in greater quantity than what would be expected for mortgage loans of the types described in the Prospectus Supplements. As an additional result, the Certificates are no longer marketable at prices anywhere near the price paid by plaintiffs and the Class and the holders of the Certificates are exposed to much more risk with respect to both the timing and absolute cash flow to be received than the Registration Statements/Prospectus Supplements represented.

Plaintiff seeks to recover damages on behalf of all purchasers of Certificates pursuant and/or traceable to the Registration Statements (the “Class”). The plaintiff is represented by Coughlin Stoia, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Coughlin Stoia, a 190-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Coughlin Stoia Web site (http://www.csgrr.com) has more information about the firm.

Filed under: bubble, CASES, CDO, CORRUPTION, expert witness, foreclosure, GTC | Honor, HERS, interest rates, investment banking, Investor, Mortgage, Pleading Tagged: Coughlin Stoia, HERS, JP MORGAN ACCEPTANCE CORPORATION

Jul

A Conversation Between MANDELMAN and a Reader About New $1 Billion Fund For Unemployed Homeowners

By Mandelman | HAMP, Housing & Economic Research

9793Leave a Comment2010-07-02+01%3A14%3A47Mandelman

The other day, I posted an article about how a deal had been negotiated in Congress that would make available $1 billion in federal bridge loans for homeowners who, due to unemployment or illness, are unable to make their mortgage payments. You can find it here: New Legislation to Offer $1 Billion Fund for Unemployed

I came out saying I support the idea, basically because my expectations of what my government is capable of have been reduced to essentially nothing. Everyone knows how much I love sarcasm… or at least have come to love sarcasm writing about the foreclosure crisis… and on this article I think I might have taken my sarcasm to such a level that readers, especially those that read quickly, may have missed it.

Anyway, I say this because I received an email last night from a reader and our conversation back and forth follows. I thought it would be worth reading it for numerous reasons… but, it’s of course up to you… Mandelman

THE MANDELMAN MATTERS READER WRITES:

How can an unemployed person taking on even more loans, for what is most likely a well-underwater home mortgage situation, be a good thing? I still believe the only thing that will work to help resolve this gigantic mess is principal forgiveness, not more loans. Use a tax on banks, hedge funds, Wall Street firms of all types, to help reduce principal. Start with those of us who had fully documented income when we got our loans, have lost income due to the negligent (and intentional egregious behavior of various banking types), and help us out with reductions. I’m surprised that you would think this new program is a good idea (unless I’m reading it wrong).

MANDELMAN RESPONDS:

Well, when you look at it from the perspective of coming from a federal government that has not even come close to doing anything that even gets down the runway, let alone launches…

Bush’s Hope-4-Homeowners plan, which had a $320 billion authorized by American Jobs Creation Act of 2008, ended up modifying one loan and spending essentially nothing.

Obama’s HAMP was authorized at $380 billion and more than a year into it, has spent essentially nothing… $200 million.

Obama’s 2MP program, which was launched 14 months ago, has NOT modified one single solitary second mortgage.

Um, what else… I’m sure there’s more, but I’m tired. When you consider that kind of track record, and the fact that federal employees from two administrations, the entire congress and God knows how many others have been working on this for 3 years… Well, it would seem to me that you either leave the country, eat a gun, or start having some pretty diminished expectations as to the potential for competency that exists.

I mean, it’s like if you were listening to a game of one-on-one being broadcast on the radio, and you were rooting for your player, but he never seemed to be able to hold onto the ball, let alone shoot or score, and then you found out that the guy you were rooting for was playing against Kobe, but was actually a 7 year-old autistic dwarf with Down Syndrome… Well then you clap when he manages to bounce the ball and it doesn’t hit his own foot and rolls out of bounds… Right?

So, with that in mind… A billion in loans for people without jobs, while you allow the market to remain in a freefall with millions of foreclosures ongoing, and at this point nothing even on the drawing board that could potentially stop them… After three years and that many working on the problem…

So… YAY! loans for the unemployed!! YAY! Look, honey, he almost bounced the ball that time. Almost! I know, he hit his toe again, and Kobe got the ball, but the last time he just threw it directly out of bounds, while he shit his pants, slipped on the excrement and fractured his femur… So look how much better this time was!!!

So, YAY!!!’ Loans without jobs!!! That’s the way guys!!! GOOD JOB!!! Assuming they actually do end up making any of the loans that is. If I find out that there’s a requirement attached to the program that says that it only applies to unemployed homeowners with 700 FICO scores and above, and that the bill forgot to consider who the loan originator might be and then they forget to either print or distribute the applications… Well, then that will just be more of the status quo and I’ll have to stop cheering.

AND THE READER REPLIES:

No, it’s another useless program. You’re not applauding a handicapped kid; it’s applause for the Emperor-with-No-Clothes. Its not a kid that can’t do any better; it’s another administration who cant push through a difficult but necessary program. More loans to underwater homes is simply pushing back the day of reckoning by a few months to a couple years. Another misguided program is worse than doing nothing.

AND MANDELMAN RESPONDS:

Well, of course it’s a useless program, in the sense that it is entirely devoid of thought or potential. As in, more loans targeted for people without the ability to repay them? That’s the answer? Well, if they weren’t going to lose their homes, they certainly will now. But then, maybe that’s the goal right? (My sarcasm on this point may have gone too far. Hey, is it okay if I print our interchange if I leave your comments anonymous? MA

ONE MORE THING FROM MANDELMAN TO THE READER…

Oh, one more thought… I should add that in some ways, I am quite seriously in favor of the program. Because our government has proven itself so entirely incompetent, people have taken their own lives and perhaps this program will delay even one person from committing suicide. It probably won’t stop them from doing it, but maybe because of this program, they’ll do it a year later, and at this point… since this is the best case type of accomplishment I’ve come to expect from the government in this country… then good.

It’s the absolute pinnacle of incompetence… something I’d expect in a novel by George Orwell, or Ray Bradbury… a people conditioned to be happy because at least their government managed to delay one suicide by spending a billion dollars… because the other untold billions they’ve spent or tried to spend, accomplished even less.

And there you have it… ain’t life grand?

Jun

New Legislation to Offer $1 Billion in Federal Loans to Help Unemployed Homeowners Pay Mortgages

By Mandelman | HAMP, Housing & Economic Research

9725Leave a Comment2010-06-30+12%3A58%3A47Mandelman

Okay, so if your response to reading this is to say: “file under Giant Federal Band-Aid,” then fair enough. I understand how you feel and you’re certainly right. But, in terms of federal responses to the foreclosure crisis, and considering the rich tradition of meaningless blathering and epic failure that has come before, I’d have to call this one a winner, even though admittedly it’s potential to create anything even remotely sustainable is essentially nil.

Apparently, unemployed homeowners struggling to make their mortgage payments may very soon be able to access $1 billion in federal bridge loans, accordording to a deal negotiated in congress and included in the financial-overhaul legislation. In simple terms, if you’re unable to make your mortgage payment because of being out of work or illness, you may soon be able to get a stopgap loan from Uncle Sam.

Some in the House wanted a $3 billion fund for such loans, but in the end settled for $1 billion as negotiations between the two sides ground to a halt in what I imagine was the typical flurry of partisan immaturity over a subject not well understood by either side. Both chambers of Congress now have to approve the deal that was worked out by negotiators, but it appears that it’s really going to happen at this point, so I figured I’d go ahead and cover it.

The House and Senate negotiators also agreed to a $1 billion fund that’ll be available to cities and towns so they can buy and rehabilitate foreclosed properties that are litering some areas and making the communitie’s pillars uncomfortable.

Personally, I think they should have given this $1 billion to the unemployed, making their fund $2 billion. I mean, for one thing, what’s the point in giving a billion dollars to cities to buy up dilapidated foreclosures, while leaving plenty of other in the unemployed class to lose another billion dollars in soon to be dilapated foreclosures. It’s like cutting off the end of a blanket and then sewing it onto the other end in order to make it longer.

For another, this is like spending a billion dollars to sweep up the homeless people, moving them a few blocks away so they won’t be “in the shot” during some foreign dignatory’s arrival. As far as I’m concerned, if we’re going to turn America’s economy into a third world mess, then let’s open up the curtains and let the blight shine in.

Now, I’m all done being even the least bit mature about this subject, I’m not interested in running for office, and I’d rather live under a bridge or more likely a palm tree that rejoin politically correct, ladder climbing corporate America, so let me address those of you tempted to say something predictable about how this doesn’t solve anything, won’t stabilize the housing market, and is just wasted spending.

My response to this group? Hmmm… what would be the right words? Damn. I hate it when I can’t think of the right way to say what I want to say. Oh wait, I think I’ve got it! Here goes: Shut up, shut up, good Lord would you please shut up.

First of all, I don’t give a rat’s petute what isn’t sustainable about this program, and secondly, it’s not “spending dumbass,” it’s a loan.

You remember loans, right? I realize we haven’t any in some time, but if it will cheer you up, maybe you can find someone to securitize these, package them up, get them some triple A ratings, and sell them as bonds to some foreign country that doesn’t know that you’re the credit default swap counter party who’ll be cashing in at 50:1 when the bonds you just sold them default, which should be by next spring. Aren’t you glad we didn’t bother making any of that stuff illegal when we put together the financial reform legislation? See, I knew that would make you feel better.

Now why don’t you go back to ruining someone’s life for fun and profit and let those that can’t find work have a few months peace at least as far as their mortgage payments are concerned, would you please?

If you’re part of our federal government, and through two administrations you haven’t come close to getting anything having to do with the foreclosure crisis even remotely right, so much so that there are now millions of people who consider you so unfailingly incompetent that they wouldn’t be surprised to learn that you need help crossing streets and ordering grilled cheese from the kid’s menu, well… now you’ve at least created something that will do something to help someone struggling in the morass you’ve created.

Will it fix the problem? Of course not, but you guys in government even talking about fixing the foreclosure crisis is about as productive as my wife and I discussing how NASA should go about building the next space shuttle. We don’t have a clue, and neither do you.

It’s simple really, my expectations for government have been so diminished that I can become happy when I turn on C-SPAN and don’t find one or more of my elected representatives drooling on themselves.

So, good… out of work or knocked down by illness and can’t swing the mortgage payments, take the loan from Uncle Sam… why the hell not. It’s only a billion dollars, so it’s not even one percent of last year’s bonuses at Goldman Sachs. And at least you won’t have to think about pouring cement down all the drains and removing all of the copper wiring in the house before giving it back when the bank finally forecloses, assuming you can’t get back to work on time for insolvent asshats at Fannie Mae or Bank of America, or wherever.

Don’t agree with me? That’s okay. I think of you as pretty much a worthless moron anyway, and I don’t need nearly as many friends as I’ve got now, so… SCAT! Before I take after you with a broom. I’m tired of having to spend time making my metaphors monosyllabic for your ilk anyway.

Plus, if I was at all unsure of my position on this program, the clincher was finding out that the cost of both programs is being covered by a tax on large banks and hedge funds contained in the bill. Oh come on… I don’t know about you, but I think I might even vote to fund Al Queda if I knew that’s how it was going to be funded. Well, maybe not… unless of course they’d promise to blow up IndyMac/One West, or something similar. It wouldn’t have to be Goldman… I’d be flexible.

There were a couple of additional unbelievably stupid statements made in the press about this program. A couple of reporters repeated the ignorant drivel about how unemployment is now the primary driver of foreclosures. Saying stuff like that a year ago might have merely shown one’s ignorance, but today it’s just sad.

Then there was the newspaper, covering this new funding, that wrote this little gem:

“The rules of the Obama administration’s foreclosure-prevention effort make it difficult for the unemployed to get loan modifications under the program.”

Actually, I don’t think you can be mad at whoever wrote that sentence. Down syndrome is a serious disease and it certainly doesn’t help to be unkind to those afflicted by it. My mother had a way of talking about people who would say something that out-of-touch with reality. She’d just nod her head and say: “Why, bless his heart.” And we all knew to be nice to that person, you know… give them a nice slow pitch up the middle, ‘cause they had been touched, and all the help they could get in this world would never be enough.

Oh, and by the way… Republicans, the “other white meat,” during the two-week-long debates over the bill, reportedly tried to kill the program in its entirety, saying that the country couldn’t afford to spend more money on homeowner help.

Ladies and gentlemen, and there you have it… a message that should have been paid for by the Obama in 2012 campaign. I swear… I don’t know what it is that makes today’s Republicans so stupid, but it really works.

BTW: A READER WROTE IN REGARDING THIS ARTICLE AND OUR CONVERSATION, WHICH IS WORTH READING, CAN BE FOUND HERE.

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Jun

At the Bank of America Signpost Up Ahead, Your Next Stop – The Loan Modification Zone

By Mandelman | Bankruptcy, HAMP, Housing & Economic Research

8698Leave a Comment2010-06-09+15%3A10%3A07Mandelman

A homeowner wrote to me the other day, and I could tell from her emails that she had been through the ringer trying to get a loan modification. I’ve heard from so many thousands of homeowners over the last year that I could probably guess the lender or servicer just from the tone of the email.

This particular homeowner, however, kept notes of her journey with Bank of America into The Loan Modification Zone, and I couldn’t help but share them… you’ll see why. Usually I’d comment more, but this one speaks for itself, over and over and over again.

Oh, and one more thing… Yoohoo! Bank of America people! Are you listening? Well, that’s a silly question, I know you’re not. Here’s a better one:

ARE YOU ASHAMED?

Because you damn well should be.

Nice slogan, by the way. What does it refer to?

My Journey to Get a Bank of America Loan Modification

1/14/09 - Hired a lawyer to help with the loan modification. He made me do all the work on home values in my area. Submitted my income and expenses and wrote a hardship letter. My mortgage was not behind at this time.

2/23/09 – @5pm – My lawyer said he had been calling Bank of America but was not getting anywhere, so I decided to make a call to Bank of America. I spoke with Crystal and she said the only thing she could offer was for me to request forbearance, but not a modification because I wasn’t behind on mortgage payments.

3/10/09 - My lawyer still could not provide me any answers and said I should keep trying to call as well. So I did.

4/10/09 - My lawyer told me he can’t get anywhere with B of A and said since I was getting more information than he was from B of A, then I should keep trying on my own. I asked if I could get a refund since nothing was done, but the answer was No.

6/1/09 – Missed my first mortgage payment

6/8/09 - Received a letter from B of A stating “there are no options available” for me to modify.

7/9/09 – Bank of America told me to resend income and hardship letter asking for a modification so I faxed it in again.

9/20/09 - Called B of A about status since now injured at work and was taken off work. No update at this time.

11/17/09 - 11am- Spoke with Crystal. She requested I resent my income and hardship letter again. SO I DID.

12/1/09 - Via automated phone line. Collection activity suspended until 12/22/09. Work out info still in review.

12/21/09 - Called B of A. Modification still in review. Told B of A I was going to have to file for BK and was instructed to get a letter from my lawyer so the modification process can continue.

1/22/10 - Filed for BK

2/23/10 - Called and spoke with Crissy. They received letter from the lawyer, but no update at this time

2/24/10 - Called again. Spoke to Paris (BK dept). Need to resend all the documents again.

3/1/10 - Called to verify B of A received the documents. They did “again”.

4/2/10 -Received a letter from B of A stating “no options available” for modification.

4/5/10 - Called B of A. Spoke with Justin. Resend updated income and expense information. Also told to contact HUD for counseling.

4/8/10 - Called and spoke to Bill for status update. Was told there were “no options available”. Asked to speak to a supervisor. Spoke with Iris to find out why I didn’t qualify. She couldn’t give me an answer, but said “you probably don’t make enough”, and said I should refax my income and expenses again. Then call in 3 days to see if they received it.

4/14/10 - Received a letter from B of A stating “no options available.

4/19/10 – Call HUD. Spoke to Delores. Told about denial letter from B of A. He went over my numbers with me and said I SHOULD of qualified for HAMP. She conferenced in B of A to ask why I was denied. They couldn’t tell her, but they said I did not qualify BECAUSE I WAS BEHIND ON MY MORTGAGE. HUD was very firm with B of A and quoted the preliminary qualifications to her. B of A placed us on hold and then we got cut off. Deloris tried to call back, but was only able to leave a message this time.

4/20/10 - Call and left a message for Delores at HUD.

4/22/10 – Call HUD and spoke to Cecilia. She conferenceD in with B of A and we spoke with Desiree Delgado in the BK dept to get the reason for the denial. No answer was given by B of A, but was told to refax all the income and expenses, hardship letter, etc. to the same number that I’d been faxing things all along.

4/27/10 - Called B of A to verify that they received the whole package. Spoke with John. Packet was received. I was transferred to the Bankruptcy Dept. and spoke with Rashida. She said its “In review”, and to call back in 2 weeks.

4/30/10 - Call HUD, spoke with Ann. Will call me back. She said the “Escalation” dept of HUD is handling this with the B of A management.

5/10/10 - Called HUD Escalation team. Spoke with Nancy. She is going to review all the notes and call me back.

5/10/10 - HUD, Michelle called back and conferenced in B of A. Spoke with Julie. Said the file was still in review and then the call was dropped… or she hung up. Couldn’t tell which.

5/11/10 - Call B of A Rania. Was transferred to the BK Dept. I sent in 2 mortgage payments and was making sure they were credited. Also inquired about status of modification. Transferred to Brianna- no update available on modification.

5/11/10 - HUD told me to call HOPE and do the counseling so it could be documented. Did that with Money Management International. Notes were sent to B of A.

5/17/10 - Call B of A. No update. No notes about notice of intent to accelerate or foreclosure notices at this time.

5/19/10 – Call HUD. Spoke with Steve. Conferenced with B of A and spoke with David. Verified that workout file is “in review”. Also B of A verified some of the information I sent in and then said he was referring my file to the HAMP program for the next review. Stated I should receive a packet in the mail within 30 days to discuss the trial payments.

5/25/10 – Call B of A on status. Spoke with Jason. Still under review.

6/3/10 – Called B of A. Spoke with Stella. File still under review.

6/4/10 - Wrote to Mandelman Matters about “who can I trust” to help me in my plight to get a loan mod. We wrote back and forth a few times and he was prompt answering my questions. Martin even told me to call if I wanted to talk about the situation. I almost fell out of my chair when I read that because I didn’t know if I was in for a “sales” pitch.

6/6/10- 9pm - Decided to call Martin Aandelman with additional questions. I couldn’t believe he said it was ok to call him so late on a Sunday night. We spoke for about an hour and then Martin thought I could get some solid help and advice from Julie Greenfield (a lawyer that deals with loan mods). He texted her around 10pm to see if she could talk, especially being so late. Martin conferenced her in with me and explained my whole dilemma. She immediately had thought B of A had sent my file to the “transfer around the building party”. I don’t know how the over 400 pages I had sent them, and resent them a dozen times could actually have ended into the wrong department. Julie offered to make an inquiry call for me to check on the status. Julie would send me an authorization the next day to give her legal permission to speak with B of A. I actually could not BELIEVE there were actual good people that would help me in my time of chaos with B of A, and not get paid for it. THERE IS A GOD!

6/7/10 - Made my usual call to B of A, which seems to almost be daily now, about my loan mod status. Spoke with David. I was placed on hold for a while so he could “review” the notes. He stated a negotiator was assigned (Oscar Nunez) to negotiate with the investor and then I should be receiving a packet by next Wednesday (6/16/10) or the following Wednesday. He explicitly told me to call back if I don’t receive it.

6/7/10 – Received the authorization from Julie Greenfield (the lawyer). Faxed it back to her and she said she would call someone at B of A the next day.

6/8/10 – Julie wrote me after she called B of A. It seems now that my case had been assigned to a different negotiator from the one they told me about the day before. So now Valarie Kemp is reviewing the file for HAMP and Non-HAMP programs. However, now it could take another 30 days for review, which is A LOT different than “I’m supposed to get my documents by next Wednesday”. At this point I don’t believe anything B of A tells me because if they think they can tell me one thing to get me off their back, and then tell an attorney another thing, which was probably the truth. So, I’m still frustrated, but I finally feel I have someone to trust with my case. THANK YOU MARTIN AND JULIE.

You are quite welcome, and it was no problem… happy to help… and Julie’s not only one of my favorite people on the planet but she’s super smart about all things mortgage banking.

~~~~~~~~~

Here’s a good one…

Q. What do you get when you mix Bank of America with Countrywide and Merrill Lynch?

A. TARP Funds.

Or how about this one…

Q. What do you get when you mix Bank of America with Countrywide and Merrill Lynch?

A. A little over twenty million bucks, $20,404,009 to be precise.

~~~~~~~~~~

Read it and weep, people, read it and weep. Torch or Pitchfork?

While CEO of Bank of America in 2007, Kenneth D. Lewis earned a total compensation of $20,404,009, which included an annual base salary of $1,500,000, a cash bonus of $4,250,000, stocks granted of $11,065,798, and options granted of $3,376,000.

But wait… there’s more!

He is also leaving with more than $135 million in retirement benefits, including the pension and $10 million in life insurance benefits, according to an analysis of corporate filings by James F. Reda & Associates, an independent consulting firm.

Lewis is a graduate of Georgia State University, where he earned a bachelor of arts degree in finance from J. Mack Robinson College of Business. He is also a graduate of the executive program at Stanford University.

Wow… now that’s truly impressive. Not only did Kenny earn his bachelors in finance from Georgia State, but he hungered for knowledge, so he also took a couple of weeks off one summer to attend an executive program at Stanford? Now you see, that I did not know. Makes me feel kind of bad for calling him a spineless, yet dangerous moron for the last couple of years.

Actually, Kenny’s educational background has motivated me to sign up for one of those “executive programs,” but I’ve decided to attend the HARVARD EXECUTIVE PROGRAM. (Now that’s what I call “HIGHER LEARNING!”)

Ergo Bibamus!

May

New MERS Case: Bellistri v Ocwen Loan Servicing, Mo App.20100309

By LH | Foreclosure Blog News, Homeowner Resources

8195Leave a Comment2010-05-25+22%3A50%3A54LH

SUBMITTED BY MAX GARDNER. HIS NEXT BOOT CAMP IS MAY 20, 2010

SEE Bellistri v Ocwen Loan Servicing, Mo App.20100309

Bellistri paid the taxes for three years, then sent notice to Crouther and BNC that he was applying for a collector’s deed. After BNC failed to redeem (which means “pay the taxes with interest and penalties,” so that Bellistri could be reimbursed), the county collector issued a collector’s deed to Bellistri, in 2006.

Meanwhile, MERS assigned the promissory note and deed of trust to Ocwen Servicing, probably because nobody was making mortgage payments, so that Ocwen would be in a position to attempt to (a) get Crouther to bring the loan payments up to date or (b) to foreclose, if necessary. But this assignment, as explained below, eliminated Ocwen’s right to foreclose and any right to the property.

Bellistri filed a suit for quiet title and to terminate any right of Crouther to possess the property. After discovering the assignment of the deed of trust to Ocwen, Bellistri added Ocwen as a party to the quiet title suit, so that Ocwen could have an opportunity to prove that it had an interest in the property, or be forever silenced.

Bellistri’s attorney Phillip Gebhardt argued that Ocwen had no interest in the property, because the deed of trust that it got from MERS could not be foreclosed. As a matter of law, the right to foreclose goes away when the promissory note is “split” from the deed of trust that it is supposed to secure. The note that Crouther signed and gave to BNC didn’t mention MERS, so MERS had no right to assign the note to Ocwen. The assignment that MERS made to Ocwen conveyed only the deed of trust, splitting it from the note.

When MERS assigned the note to Ocwen, the note became unsecured and the deed of trust became worthless. Ironically, the use of MERS to make ownership of the note and mortgage easier to trace also made the deed of trust unenforceable. Who knows how many promissory notes are out there that don’t mention MERS, even though MERS is the beneficiary of the deed of trust securing such notes?

O. Max Gardner III

Gardner & Gardner PLLC

PO Box 1000

Shelby NC 28151-1000

704.418.2628 (C)

704.487.0616 (O)

888.870.1647 (F)

704.475.0407 (S)

maxgardner@maxgardner.com

max@maxinars.com

www.maxgardnerlaw.com

www.maxbankruptcybootcamp.com

www.maxinars.com

www.governoromaxgardner.com

Next Boot Camp: May 20 to May 24, 2010

Filed under: foreclosure

May

Florida AG investigating ‘bogus’ foreclosure records

By LH | Foreclosure Blog News, Homeowner Resources

7566Leave a Comment2010-05-16+19%3A56%3A11LH

Submitted by O. Max Gardner

O. Max Gardner III

Gardner & Gardner PLLC

PO Box 1000

Shelby NC 28151-1000

704.418.2628 (C)

704.487.0616 (O)

888.870.1647 (F)

704.475.0407 (S)

maxgardner@maxgardner.com

www.maxgardnerlaw.com

www.maxbankruptcybootcamp.com

Next Boot Camp: May 20 to May 24, 2010

The Florida Times-Union

May 14, 2010

Florida AG investigating ‘bogus’ foreclosure records

Source URL: http://jacksonville.com/news/florida/2010-05-14/story/state-investigating-bogus%E2%80%99-foreclosure-records

By Steve Patterson

Florida’s attorney general is investigating whether Jacksonville-based Lender Processing Services and Fidelity National Financial were involved with forging real estate documents for foreclosure lawsuits.
The probe deals with a Lender Processing subsidiary that “seems to be creating and manufacturing ‘bogus assignments’ of mortgage,” according to a synopsis the Attorney General’s Office posted on its website.
Assignments are notices that a mortgage has been sold or transferred from a lender to someone else. Many lenders routinely sell or assign their mortgages to investors, who could be businesses, pension funds or individuals.
If a homeowner stops making mortgage payments, the investor can sue to take the home — a foreclosure.
But the investor has to have paperwork proving the original lender sold the mortgage. And many don’t.
Investigators suspect workers at a Lender Processing company called Docx LLC could have created paperwork that was “illegally executed, false and misleading,” said a statement posted on the Attorney General’s Office site.
“These documents are used in court cases as ‘real’ documents of assignment and presented to the court as so, when it actually appears that they are fabricated,” the statement said.
The state investigation is looking for civil infractions, not crimes.
Lawyers fighting foreclosures have questioned the authenticity of some assignment paperwork prepared by Docx.
Court files have given them some extra ammunition.
At least 10 times since 2008, Docx assignments have been filed in Florida courthouses naming the new owner of the mortgage only as “BOGUS ASSIGNEE FOR INTERVENING ASMTS [assignments],” court records show.

On at least three assignments, the initial owner of the mortgage is listed as “A BAD BENE” — seemingly, for a false beneficiary.
Those forms were filed in Duval, Nassau, Volusia, Lee, Orange, Pasco and St. Lucie counties.
It’s not clear how Fidelity National Financial, a Fortune 500 title insurance company, might fit into the state review.
Fidelity National Financial bought Alpharetta, Ga.-based Docx in 2005. But the next year, the company spun off many of its holdings into an independent company, Fidelity National Information Services, and no longer owns Docx. Fidelity National Information Services spun off Lender Processing as a separate company in 2008.
Fidelity National Financial Chief Compliance Officer Paul Perez declined to comment publicly.
Lender Processing Services spokeswoman Michelle Kersch was out of town Friday and didn’t respond to messages sent by e-mail and routed through an assistant. Company CEO Jeff Carbiener didn’t reply to an e-mailed message.
Like a deed, assignment forms carry notarized signatures of people listed as officers of the company transferring the mortgage to the new owner.
But a number of forms prepared through Docx carry signatures of the same people listed as officers of different companies. One signer was listed as a vice president at three different mortgage companies, based in different parts of the country, over a six-month period.
The attorney general’s investigation started in early April, shortly after news reports announced said federal prosecutors were reviewing records from an LPS subsidiary. LPS had reported that to shareholders in its annual report in February.
At the time, the company said it had “identified a business process that caused an error in the notarization of certain documents” used in foreclosures.
Jacksonville Area Legal Aid attorney April Charney said she began reporting cconcerns about Docx documents to the Attorney General’s Office in 2006 or 2007.
“I know they have been playing around with this for years,” she said.

steve.patterson@jacksonville.com,
(904) 359-4263 begin_of_the_skype_highlighting (904) 359-4263 end_of_the_skype_highlighting

Filed under: foreclosure

Apr

Gap between cost of renting, buying narrows

By LH | Housing & Economic Research

6589Leave a Comment2010-04-19+20%3A51%3A14LH

Thinking of buying a home? Consider this: The gap between monthly rents and mortgage payments is at its lowest level in almost 20 years.

Mortgage – Renting – Business – Home – Loan

Mar

800-Numbers Lead to Runaround as Banks Refuse to Modify Mortgages

By LH | Foreclosure Blog News, Homeowner Resources

6007Leave a Comment2010-03-31+14%3A48%3A11LH

Rule of Thumb: If they can’t execute a release or satisfaction of the mortgage, then they can’t foreclose. And if they did, it is reversible.

Whistle-Blower: Banks Give Homeowners the Runaround

“In our managers meeting, which can last eight or nine hours, we probably addressed mortgage modifications five minutes or less,” the banker said.

Editor’s Note: The reason is simple. They want the property. They can get the property because of pandemic confusion over securitization. They can’t modify mortgages as easy as they can foreclose. They don’t have the right, title, interest or authorization to modify mortgages because they never advanced a dime for the funding of those mortgages. But because non-judicial states make it real easy for anyone with a bogus piece of paper to foreclose and get title to the property, and because investors who are the real creditors are not asserting their right, title and interest, it’s easy for a pretender lender to pick up a free house.

And due to heavy caseloads and poor understanding of securitized mortgages in judicial states, the same rules seem to apply as non-judicial states — homeowners are generally not heard on the merits of their defenses and claims. The foreclosure proceeds, automatic stays are lifted in bankruptcy court, all because the Judge is not directed to look at the paperwork.

By DAVID MUIR

March 23, 2010

// A vice president for one of the nation’s biggest banks claims customers looking for help in lowering their mortgage payments are often told to call an 800 number — where he says representatives then give homeowners the runaround.

David Muir gets answers from a vice president of one of the biggest banks.

The bank executive spoke to ABC News on the condition that ABC News not show his face or name him, because he feared coming forward would cost him his job.

Of the 1.1 million homeowners who’ve signed up for the federal program aimed at avoiding foreclosures, only 168,000, or 15 percent, of homeowners have had their mortgages permanently modified.

“In our managers meeting, which can last eight or nine hours, we probably addressed mortgage modifications five minutes or less,” the banker said.

WATCH: Blowing the Whistle on Banks

WATCH: Barry Scott Shares His Story

WATCH: The Fight for the Middle Class: Viewer Speaks Out

Americans Frustrated by Banks

Jay and LeeAnn Givan are two of those frustrated Americans who reached out to ABC News about their banks. They say they’ve run out of time and money. Both lost their jobs in the recession, and they have been begging their bank since last September to modify or refinance their mortgage. Six months later, all the paperwork and phone calls have amounted to nothing.

“The bank’s not interested in helping us,” LeAnn said. “Just a couple of weeks ago, Jay was on the phone for two hours being transferred from department to another department until finally somebody told him, ‘Look, we can’t help you until you stop paying on your house.’”

The couple made its last mortgage payment last week.

“I have heard that,” the banker said. “That will affect their credit card, their insurance, [have] a big effect on their credit history.”

The banker described homeowners pleading to him for help, but he said his bank is not interested in modifying mortgages, even after taxpayers helped bail out the nation’s biggest banks.

“It’s just not happening,” said the banker.

The banker said there is significant pressure on bank employees to get customers to take on more accounts than they need because of the late fees and penalty fees that will then co

I have watched the news story about Banks helping with Foreclosure etc…..THEY WILL NOT HELP if they are WELLS FARGO…..They were terrible with my 82 year old mothers mortgage.After being a loyal customer for years shw was not able to get help from me with her mortgae because I was laid off and at that time for a year already….They ASSURED us that a modification was to be done and to NOT PAY anything until it was completed because those payments would be included in new mortgage….we called for months and tried to make some payments only to have house start into foreclosure with their lawyers, be served embarassing papers and be put into undue stress. Went thru Wells President John Stump and 4 other Board members to only be told BANK OWNING YOUR MORTGAGE WILL NEVER AND WOULD NEVER HAVE DONE A MODIFICATION. Why were we told it was being worked on for over 6 months…why a run around like that to a senior citizen who has worked her whole life. End result was COME UP WITH $4500 IN 2 WEEKS or bye bye home your out of there. Terrible to do to anyone. I had found out we were one of 10’s of thousand that Wells did exactly this to also. Just google that problem and you will see. SHAME ON WELLS FARGO and all these banks taking money from us and the government and putting people in worse trouble.
barkleyandme1 11:16 AM

Americans like to sue over everything. Seems like there is grounds for a class action suit against the banks. They used my money for what seems to be strictly their benefit and bonuses. Where are all the lawyers now. Let’s bring suit against the banks for not fulfiling their obligation to the publc. We bailed them out in good faith and they turned around and screwed us.
tjbmeb 9:33 AM

S.W.Florida..I have applied for a modification with Select Portofolio Service, as of this date I have NOT received any information other that it is under review. After reading all the horror stories on this site. I have deceiced that if the modification doesn’t go thru I will foreclose. I will walk away with no hesitation. Why should I pay good money for a bad investment. My money was solid when I purchased the home. However with all the greed from lenders over inflating homes I have no pity. I worked too hard for the American Dream only to be disappointed by Wall Street greed. Come on Obama put your money where your mouth is!

Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: ABC World News, creditors, DAVID MUIR, Diane Sawyer, foreclose, foreclosure defense, heavy caseloads, homeowners, judicial states, Mortgage, mortgage modification, non-judicial, release, satisfaction, securitization, securitized mortgages, Wells Fargo, Whistle-Blower

Mar

CLASS ACTION LAWSUIT AGAINST BANK OF AMERICA – BAC VICTIMS CAN JOIN THE LAWSUIT

By LH | Foreclosure Blog News, Homeowner Resources

5769Leave a Comment2010-03-24+16%3A12%3A32LH

CLASS ACTION LAWSUIT AGAINST BANK OF AMERICA – BAC VICTIMS CAN JOIN THE LAWSUIT
———————————————————————
Bank of America Home Loans
Date Filed: March 22, 2010
Court: U.S. District Court
Location: Seattle
Ticker Symbol: BAC
Washington homeowners sued Bank of America claiming the lending giant is intentionally withholding government funds intended to save homeowners from foreclosure. Hagens Berman represents plaintiffs in the class-action lawsuit. Attorneys are interested to speak with other eligible home owners who were intentionally deferred or wrongfully declined a permanent mortgage adjustment per the Home Assistance Modification Program (HAMP).

The case, filed in U.S. District Court, claims that Bank of America systematically slows or thwarts Washington homeowners’ access to Troubled Asset Relief Program (TARP) funds by ignoring homeowners’ requests to make reasonable mortgage adjustments or other alternative solutions that would prevent homes from being foreclosed.

Bank of America accepted more than $25 billion in government bailout money financed by taxpayer dollars earmarked to help struggling homeowners avoid foreclosure. One in eight mortgages in the United State is currently in foreclosure or default.

Bank of America, like other TARP-funded financial institutions, is obligated to offer alternatives to foreclosure and permanently reduce mortgage payments for eligible borrowers struck by financial hardship but, according to the lawsuit, hasn’t lived up to its obligation.

Bank of America services more than 1 million mortgages that qualify for financial relief, but have granted only 12,761 of them permanent modification, reported the U.S. Treasury Department.

According to the TARP regulations, banks must gather information from the homeowner, and offer a revised three-month payment plan for the borrower. If the homeowner makes all three payments under the trial plan, and provides the necessary documentation, the lender must offer a permanent modification.

Bank of America continues to ignore TARP regulations and instead creates more financial pressure on homeowners, the court filing states.

The lawsuit charges that Bank of America intentionally postpones homeowners’ requests to modify mortgages, depriving borrowers of federal bailout funds that could save them from foreclosure. The bank ends up reaping the financial benefits provided by taxpayer dollars financing TARP-funds and also collects higher fees and interest rates associated with stressed home loans.

If you received an inadequate response from Bank of America for a home loan modification request after April 13, 2009, you are encouraged to join the suit.

Please visit: http://www.hbsslaw.com for more info.

About Hagens Berman

Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with offices in San Francisco, Seattle, Chicago, Boston, Los Angeles, and Phoenix. Since 1993, HBSS continues to successfully fight for consumer rights in large, complex litigation. More about the law firm and its successes can be found at http://www.hbsslaw.com.

4closureFraud

Filed under: foreclosure

Mar

Do NOT Prepay Your Mortgage

By LH | Foreclosure Blog News, Homeowner Resources

5770Leave a CommentDo+NOT+Prepay+Your+Mortgage2010-03-24+15%3A43%3A04LH

As pointed out in the article below there are many good reasons for prepaying your mortgage on a monthly basis. But if you are in a securitized mortgage and you are either underwater or facing payments that are resetting, be aware that any prepayments will take you far out of the running for any modification. Yours will be a super-performing mortgage that doesn’t “qualify” for even a first look at modification. In addition, if there is a new mortgage, or elimination of the mortgage, note or obligation in store for you, you will have sent the money down a rabbit hole.

March 19, 2010

When Not to Pay Down a Mortgage

By RON LIEBER

New York Times

This week, the Federal Reserve reaffirmed its intention to stop buying mortgage-backed securities, signaling the likelihood that the mortgage rates you can get today are as good as they’re going to be for a long while. Once the Fed stops buying, after all, rates are likely to go up.

And current rates are quite good. At about 5 percent, in fact, they’re so good that they’ve helped change the age-old debate over whether homeowners should make extra mortgage payments to pay off their debt well before their loan periods are up.

Back when rates ran at 7 or 8 percent, making extra payments offered what amounted to a guaranteed return on your money. When you’re ridding yourself of debt that costs you much less, however, it’s easier to imagine a future when you could more easily earn a higher return by investing those potential extra mortgage payments someplace else.

Meanwhile, at a time when just about everyone knows someone who is unemployed or who owes more on a home loan than the house is worth, keeping extra cash someplace more liquid than a mortgage seems like a safer approach.

So is the case against extra payments closed for good, given that so many people have locked in rock-bottom mortgage rates for the long haul?

The answer depends on two things: how likely you are to leave the extra money in savings and how good it would feel to wipe your debt out years earlier than your mortgage requires.

THE BASICS First, let’s dispense with the standard boilerplate. Don’t even think about making extra mortgage payments unless you’ve paid off higher-interest debt. Credit card debt is the easiest win here.

Also, if you’re not saving enough to get the full match from your employer in a 401(k) or similar account, increase your savings there first. And don’t make extra mortgage payments if you don’t already have a decent emergency fund set aside.

YOUR REAL INTEREST RATE Now, take a look at the interest rate on your mortgage. That 5 percent? It’s not your real rate if you get some of the interest back each year in the form of a tax deduction.

Let’s say you have a household income of $175,000 and are paying 35 percent of that in total to the state and federal tax collectors. If you pay $20,000 in mortgage interest each year on a loan that charges 5 percent, the deduction effectively brings your taxable income down to $155,000.

As a result, you’re paying $7,500 (35 percent of $20,000) less in taxes than you would have without the deduction. So ultimately, you’re not really paying $20,000 in interest at all; your net cost is $12,500 after you subtract the $7,500 tax savings.

And that makes your effective, after-tax interest rate on your loan just 3.25 percent, which is simply 35 percent (your tax rate) less than the original 5 percent.

BETTER RETURNS? So any money you set aside in lieu of making extra mortgage payments would need to earn more than 3.25 percent annually. That seems like a reasonable possibility in the future.

In fact, you could have done that well during the supposedly lost decade we just finished. Vanguard Wellington, for instance, a popular low-cost mutual fund that holds about 65 percent stocks and 35 percent bonds and other short-term securities, earned an average annual return of 6.15 percent in the 10 years ended Dec. 31, 2009.

The Vanguard Balanced Index Fund would not have outperformed our 3.25 percent benchmark, however, as it only returned 2.64 percent over the same 10-year period.

STORING THE SAVINGS Wouldn’t taxes eat into the returns from the money you’d save instead of making extra mortgage payments? Not if you place it into an account shielded from taxes. A Roth individual retirement account would fit the bill here, as would a 529 college savings account or health savings account.

Bruce Primeau, whose note to his financial planning clients at Wide Financial Group in Minneapolis on this topic inspired me to re-examine it, adds that this isn’t simply about keeping more assets under his watch so he can earn a better living. “I’m not telling them that the money has to come to me,” he said. “A 401(k) match beats the return on paying a mortgage off automatically. There’s real estate and buying employer stock through a purchase plan at a 15 percent discount and all kinds of things.”

Then you need to preserve those savings. When extra money goes toward a mortgage, it’s hard to get at it when the urge strikes to flee to an Asian beach for a few weeks of playtime. If the money is not locked up in retirement or college savings, however, you may be tempted to spend it.

THE LIQUIDITY PROBLEM Capital-gains taxes might eventually come due with some of these investments, and the rate could well rise above the current 15 percent long-term rate before too long. Still, having some of your savings in a taxable account makes sense for several reasons.

If you hit a stretch of long-term unemployment after having plowed most of your extra cash into paying down your mortgage, your bank probably won’t pat you on the back for being a good saver and give the money back to you. Nor is it likely to let you borrow it through a home equity loan if you have no income with which to repay it.

Elaine Scoggins, who had the mortgage department chief reporting to her at a bank before she became a financial planner, suggests imagining a situation where you need to move quickly but can’t sell your home or extract equity to use as a down payment in your new town. Given that possibility, why create more home equity through extra mortgage payments than you have to?

“The whole housing debacle has reminded us all, including me, that real estate is not liquid,” said Ms. Scoggins, who is the client experience director for Merriman, a planning firm in Seattle. “And it takes cash to support it.”

Those who have used their cash in an attempt to be conscientious have learned some tough lessons, meanwhile. Imagine people who scraped together a 5 percent down payment and bought a home in Florida or Arizona in 2005 and then made extra mortgage payments the first two years to try to increase their equity. Now, post-collapse, they owe, say, 30 percent more than their homes are worth and need to seriously consider walking away from the loan — and all of those extra payments.

REASON AND EMOTION So the reasoned case for making no extra payments is very strong. But there’s one counterpoint that almost always carries the day, even when there’s only a mild risk with the financial strategy of putting extra money elsewhere.

And it’s this: I need to be able to sleep at night.

Even Mr. Primeau concedes here. “Emotionally, you’re right, and financially I’m right, and emotionally, you win,” he said. “If emotionally, people want to pay down their debt, than that’s what I help them to do.”

If you’ve just started paying down your mortgage, any extra payments should go toward principal (make sure your mortgage company is applying it properly). That will have the effect of shortening the term of your loan from, say, 30 to 25 years, depending on how many extra payments you make. The extra payments won’t lower your monthly payment, but they will reduce your balance.

Many people who are years into their mortgages — and perhaps paying less in interest and getting less of a tax break as a result — tend to develop stronger feelings about making extra payments. Those feelings are often even more acute as retirement approaches and homeowners become determined to quit work with no debt to their names.

Those who do retire their debt rarely regret it or wring their hands over the big gains they might have scored by investing the money elsewhere. Tim Maurer, a financial planner and co-author of “The Financial Crossroads,” describes the feeling that washes over people who have paid their last mortgage bill as “beholden to no one.”

So he doesn’t feel as if it’s his business to separate people from their emotions if they feel strongly about working toward a debt-free existence. “The whole point of planning is to make life better,” he said. “It’s not to have more dollars at the end of the day.”

Filed under: bubble, CDO, CORRUPTION, currency, GTC | Honor, Investor, Mortgage, securities fraud Tagged: modification, Mortgage, New York Times, note, Obligation, prepayment, reset, Ron Lieber, securitized mortgage

Mar

Local News Stories Provide Real Data on Increasing Foreclosures

By LH | Foreclosure Blog News, Homeowner Resources

5134Leave a Comment2010-03-07+15%3A57%3A13LH

You Just Can’t Hide It: Until the market and the judiciary gets real about these mortgages, foreclosures will continue to skyrocket, people will walk away from their homes, and the demand for alternative housing needs will skyrocket as well — which might be the underlying reason why nobody wants to do principal reduction and solve the problem.

Throwing millions of people out of their homes creates a false “demand” for lower income housing. The supply of such housing is currently drying up. So the excuse for building newer and cheaper housing and renting them at a profit or selling them at higher and higher interest rates results in an incentive to maintain the status quo. The status quo in this case is a movement to throw as many people out on the street as possible.

Foreclosures keep climbing in Wisconsin

BY JOHN KREROWICZjkrerowicz@kenoshanews.comThe number of property owners landing in court because they’re behind on mortgage payments has jumped for the fourth year in a row in Kenosha County.

Foreclosure lawsuits filed in Circuit Court in 2009 reached 1,352, up 29 percent from the year before. The figure is almost triple the number from 2005, when it was 505.

High foreclosures rates often have detrimental effects on communities, according to various studies. Neighborhoods with an excessive list of foreclosed properties often have more crime; credit scores for borrowers in foreclosure often drop; homelessness might increase, and property tax income for municipalities can fall.

Kenosha County’s jump in foreclosures last year has created a greater workload for the Sheriff’s Department, which handles posting of properties to be sold at auction, oversees the auction and helps keep the peace at sites where owners are being evicted, officials said. Deputies conduct a sheriff’s auction of the properties every Wednesday at the county courthouse.

Experts have said the growing roster of those defaulting on loan repayments is tied to more people being unemployed, drained savings and subprime loan failures.

Foreclosures here grew to 605 in 2006, a 20 percent hike; to 821 in 2007, a 36 percent jump, and to 1,050 in 2008, a 28 percent increase.

Foreclosures usually start with lenders sending a notice that the borrower defaulted on the loan. If payments aren’t arranged, the lender could file a lawsuit to foreclose on the mortgage. When a judge grants foreclosure, the property is sold by auction and proceeds are used to pay off the loan.

When no one buys the property, the lender owns it.

Kenosha Sheriff Sgt. Gil Benn said foreclosure postings — properties being auctioned — skyrocketed from 493 in 2007 to 772 in 2008 and to 1,266 in 2009. That’s a 157 percent jump in two years.

“We’ve already gotten significant entries for 2010, and I see us maintaining the numbers we’ve done,” he said.

Benn said the type of evictions also has changed. He said they used to involve apartment dwellers and a few furnishings but now are more likely to be houses and all their contents.

Benn said foreclosure-related work is being spread among Sheriff’s Department personnel. A home’s new owner pays for a deputy to oversee the move and for the movers. There also are fees for a deputy to deliver legal papers involved.

Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: John Krerowicz, Kenosha News, Kensoha County, principal reduction, Wisconsin

Feb

Fewer people falling behind on home loans

By LH | Housing & Economic Research

4828Leave a Comment2010-02-19+21%3A17%3A49LH

The number of borrowers falling behind on their mortgage payments dropped sharply at the end of last year, a sign the foreclosure crisis is beginning to ebb.

Mortgage – Foreclosure – Loan – Business – Financial Services

Jan

Mortgage ‘relief’ leads to foreclosure notice

By LH | Housing & Economic Research

4369Leave a Comment2010-01-26+12%3A44%3A57LH

Red Tape: For nine months, Deb Franklin said, she did exactly what JP Morgan Chase and President Barack Obama told her to do. She made her mortgage payments on time. Then, on the day after Christmas, a “bomb dropped” on her life.

Barack Obama – JPMorgan Chase – President of the United States – United States – Foreclosure

Sep

Tips on getting feds to cut your house payment

By LH | Housing & Economic Research

2252Leave a Comment2009-09-30+11%3A27%3A56LH

Here are some pointers for navigating the terrain of a federal government’s program meant to help you cut your mortgage payments. That is, if you qualify.

Aug

Mortgage Delinquencies Still Rising says MBA – More Americans Underwater

By LH | Featured, Foreclosure Defense Research, Homeowner Resources, Housing & Economic Research

1653Leave a Comment2009-08-20+23%3A00%3A42LH

I have a lot of conversations with people about our economy, foreclosures and such… from clients to friends in business to attorneys. Everyone who’s asked me what I foresee coming I’ve told them that 2010 will be a very tough year and they better prepare now. We aren’t done yet folks… and the policies of the Obama Administration and our collective disaster we call Congress, are going to make things even worse – and very well will extend the recession quite painfully. I have told people to expect another wave of foreclosures. As long as you have no job creation and more job loss happening every day, this cycle won’t stop. It’s as simple as that.

And with that, I bring you fresh news…

Delinquencies Are Still Climbing and Threatening More Foreclosures on the Horizon, MBA Says

08/20/2009 By: Carrie Bay

More than nine percent of all mortgages in the United States are now delinquent, according to figures released Thursday by the Mortgage Bankers Association (MBA).

The delinquency rate for mortgage loans on one-to-four-unit residential properties rose to 9.24 percent of all loans outstanding at the end of the second quarter, MBA reported. The new number breaks the record set in the first quarter of this year, when 9.12 percent of the nation’s homeowners were behind on their mortgage payments.

Important to note is that the biggest jump in delinquencies last quarter came from prime fixed-rate mortgages. These seemingly low-risk loans also accounted for one in three of the nation’s foreclosure starts in Q2. A year ago they were only one in five.

Like prime, Federal Housing Administration loans are generally thought to be “safe,” but foreclosure starts among government-insured mortgages jumped to 9.1 percent last quarter – a record-high for the agency.

The states of California, Florida, Arizona, and Nevada continue to drag down the national numbers. These four had 44 percent of all the nation’s new foreclosures in Q2. Rhode Island, Georgia, and Michigan also posted foreclosure start rates above the national average. All

other states in the country fell below the national benchmark, and roughly half even saw their new foreclosure numbers decline.

But then, there’s the not-so-sunny Sunshine State. Florida has cemented itself as the worst state in the union for mortgage performance. Twelve percent of all mortgages there were somewhere in the process of foreclosure at the end of June, and another 5 percent were more than 90 days past due and about to cross that threshold. Based on MBA’s numbers, Florida has the highest foreclosure and delinquency rates in the country, and MBA’s chief economist, Jay Brinkmann, says he doesn’t expect to see a turnaround in Florida’s housing market for a long, long time.

Some fortunate regional markets are faring better and offsetting Florida’s bad numbers because the nation’s total foreclosure starts during the second quarter actually dropped slightly. Foreclosure actions were initiated on 1.36 percent of the nation’s outstanding mortgages, compared to 1.35 percent during the first three months of the year, MBA reported.

Despite the leveling off of foreclosure starts, the fact that loans 90 or more days past due continues to climb in all categories suggests an overhang of foreclosure activity and engorged inventories of repossessed homes may be looming in the coming months.

So, when is the foreclosure problem going to crest? Brinkmann, points out that unemployment is currently the primary driver behind missed mortgage payments.

The number of jobless Americans is forecast to peak in mid-2010, and Brinkmann says he expects delinquencies to top out at about the same time. But because of the lag time associated with foreclosure proceedings, he doesn’t see a break in the upward trend of foreclosures until six months later, at the close of next year.

Aug

How To Avoid Foreclosure By Declaring Bankruptcty

By LH | Housing & Economic Research

1455Leave a Comment2009-08-10+17%3A10%3A53LHiehi-feed-20157

” Over 3 million people are 60 days behind in their mortgage payments with little hope of finding a quick solution. This has caused many borrowers look for somewhat imaginative measures to save their home, one of these has been declaring bankruptcy to avoid a mortgage foreclosure. Does this work? Is it legal?”

Aug

Mortgage Hardship: Solutions to Avoid Foreclosure

By LH | Foreclosure Rights, Forensic Loan Audits, Homeowner Resources

1110Leave a Comment2009-08-05+01%3A35%3A09LH

Here’s a link to my similar article at EZinesArticles.com: http://ezinearticles.com/?Mortgage-Hardship—Solutions-to-Avoid-Foreclosure&id=2710389

If you are facing a hardship with making your mortgage payments, you’re not alone. The national foreclosure rate is now at one in every 555 households. If you live in the Ft. Myers/Cape Coral area, that statistic jumps to 1 in every 18 households now in foreclosure.

A mortgage hardship is very common with unemployment numbers rising daily and US homeowners losing the values in their homes on a monthly basis as well

When someone loses their income they go through all sorts of emotions when they cease to have the ability to pay their bills. Fear can easily be all-consuming when facing a mortgage hardship and foreclosure.

The first thing I tell my clients is to not be afraid. Fear can take a root in our lives and cripple us from taking action and acting wisely.

Don’t cave in to the fear tactics of your mortgage servicer or lender – or any other creditor for that matter. You’re still in control even though you may not feel like it.

There are precise steps you can take to protect yourself and your interests. There are legal rights that you possess and can use to help yourself in difficult times. The biggest challenge is that most American consumers and homeowners don’t know they have legal rights. You have foreclosure rights…when you’re facing a mortgage hardship, all hope is not lost.

We have helped families stay in their home for an extra 6 months, 8 months and over a year. We never provide a precise time frame or outcome. There are so many variables… if you have a company giving you a bunch of promises and charging a lot of money upfront for now finite service, be extremely wary and cautious.

Another very likely issue is that the financial institution attempting to collect and/or foreclose doesn’t even own your loan or have the legal right to collect. Over 80% of all foreclosures filed in Florida right now contain a “Lost Note” count alleging that they (the plaintiff) have lost the most important document as evidence of the debt they claim you owe – the Note

There are several affirmative defenses that a qualified and competent foreclosure attorney will know how to bring in your case.

A TILA mortgage rescission may be something that you can assert if there are material disclosure violations found in a forensic loan audit of your loan documents. Obtaining a true forensic loan audit is probably the best first step you as a homeowner in mortgage hardship can take.

A forensic loan auditor will truly break down the entire package of loan documents and examine them for state and federal loan violations along with a forensic examination for fraud and failure to disclose, appraisal fraud and loan application and underwriting fraud.

Be certain that you are truly dealing with a reputable and knowledgeable auditor. I find that a very select few of us really know what to look for and truly know the laws. So many people will tell you what you want to hear without preserving integrity and honesty.

There is a litany of scams out there so be careful. Take your time, ask questions, find a professional who will help and educate you. Knowledge is truly power. The more you know and understand your foreclosure rights, the better off you’ll be.

Quantified violations of the Truth in Lending Act (TILA) and other federal violations can be used a Claims in Defense by Recoupment in any foreclosure action brought against you. A forensic loan audit (done right) is highly valuable for you.

You’ll land on your feet. You’ll make it through this tough time. Be a sponge for information, read it with common sense in mind and find a person or two who can be your mentor or advisor through this time. You’ll make it… I promise.

Aug

chase offering 1% mortgage cash back

By LH | Housing & Economic Research, News for the Patriot

1078Leave a Commentchase+offering+1%25+mortgage+cash+back+2009-08-04+14%3A28%3A42LHiehi-feed-20010

“Chase is offering to give customers 1% of their scheduled monthly principal and interest mortgage payments back if they meet certain requirements via its new “1% Mortgage Cash Back” program.”

America- Just Who Is Getting Bajillions of Dollars in Mortgage Money

“Oh what a tangled web we weave, When first we practice to deceive”

The Fallout From Allegations of Improper Foreclosures By David J. Stern

CLASS ACTION SUIT INVOLVING MORTGAGE BACKED SECURITIES OF WELLS FARGO & JP MORGAN ACCEPTANCE CORPORATION

A Conversation Between MANDELMAN and a Reader About New $1 Billion Fund For Unemployed Homeowners

New Legislation to Offer $1 Billion in Federal Loans to Help Unemployed Homeowners Pay Mortgages

At the Bank of America Signpost Up Ahead, Your Next Stop – The Loan Modification Zone

ARE YOU ASHAMED?

New MERS Case: Bellistri v Ocwen Loan Servicing, Mo App.20100309

SUBMITTED BY MAX GARDNER. HIS NEXT BOOT CAMP IS MAY 20, 2010

SEE Bellistri v Ocwen Loan Servicing, Mo App.20100309

Florida AG investigating ‘bogus’ foreclosure records

Gap between cost of renting, buying narrows

800-Numbers Lead to Runaround as Banks Refuse to Modify Mortgages

Rule of Thumb: If they can’t execute a release or satisfaction of the mortgage, then they can’t foreclose. And if they did, it is reversible.

Whistle-Blower: Banks Give Homeowners the Runaround

Americans Frustrated by Banks

CLASS ACTION LAWSUIT AGAINST BANK OF AMERICA – BAC VICTIMS CAN JOIN THE LAWSUIT

Do NOT Prepay Your Mortgage

When Not to Pay Down a Mortgage

By RON LIEBER

Local News Stories Provide Real Data on Increasing Foreclosures

Foreclosures keep climbing in Wisconsin

Fewer people falling behind on home loans

Mortgage ‘relief’ leads to foreclosure notice

Tips on getting feds to cut your house payment

Mortgage Delinquencies Still Rising says MBA – More Americans Underwater

Delinquencies Are Still Climbing and Threatening More Foreclosures on the Horizon, MBA Says

How To Avoid Foreclosure By Declaring Bankruptcty

Mortgage Hardship: Solutions to Avoid Foreclosure

chase offering 1% mortgage cash back

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