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Foreclosure Case Law Update

March 10th, 2010 · Foreclosure

For a short period of time in Florida, pretender lenders and their attorneys had a field day in Florida courts, obtaining foreclosure judgments and title to property based on the flimsiest of evidence.  Now courts are aware of many of the problems with these files and lenders can no longer count on a free ride to the foreclosure auction.  Below is a sampling of case headnotes from recent circuit court opinions that denied foreclosure.  Judges in circuits across the state are now standing up for consumers (or at least for the rule of law) and requiring lenders to prove their right to claim the relief they seek.  A sampling of the headnotes follows:

Mortgages — Foreclosure — Stay — Foreclosure action is stayed until mortgagor has been afforded mitigation and modification opportunities of home affordable modification program

Mortgages — Foreclosure — Standing — Motion for final judgment of foreclosure denied — Plaintiff that did not become holder of note until after suit was filed did not have standing to bring action — Even if assignment could confer standing retroactively, assignment is deficient where jurat does not indicate that it was signed in presence of notary, and assignor does not have documented authority to assign mortgage — Further, motion for summary judgment is deficient where supporting affidavit was signed by person whose only demonstrated authority is to assign and release liens, not by individual with corporate authority and demonstrated knowledge.

Mortgages — Foreclosure — Complaint — Plaintiff has failed to state cause of action where partial terms sheet attached to foreclosure complaint omits details as to who gets paid, when and where payment is due, and amount of payment — Further, assignment that is dated after filing of suit is at variance with complaint — Complaint dismissed with leave to amend.

Mortgages — Foreclosure — Standing — Motion to dismiss is granted with leave to file new or amended complaint to allege that plaintiff is owner and holder of note and mortgage and to allege additional facts that support that allegation.

Mortgages — Foreclosure — Where note filed by plaintiff is endorsed but does not name entity to which it is made payable, plaintiff failed to plead in complaint that it is owner of note or mortgage, mortgage names entity other than plaintiff as mortgagee, plaintiff has filed assignment of mortgage executed and recorded after complaint was filed, and complaint does not demonstrate equitable assignment of mortgage to plaintiff before complaint was filed, plaintiff must amend complaint to allege that it is owner and holder of note and mortgage and identify documents upon which it relies to establish that it holds and owns note and mortgage

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Obama’s Foreclosure/Modification “Help”- A Waste of Time and Money

March 10th, 2010 · Foreclosure

A story in the Huffington Post, and available here reports that the federal government’s response to the foreclosure crisis is a dismal failure with a mere 33% of those who were in a trial modification converting to a permanent one.  Of the millions of Americans that are struggling, all the might and power of the federal government (and $75 billion of our taxpayer dollars) has only provided any assistance to less than 180,000 people.

  • Rep. Jim Jordan, an Ohio Republican on the House Oversight Committee was more blunt: “It’s not surprising these numbers are lower than expected,” he said in an email. “This program has been a waste of taxpayer dollars and harmful to the very families it was supposed to help.”
  • “I’ve come to the reluctant conclusion that the only way to accelerate the program and also provide adequate incentives for homeowners who sacrifice to stay in their own homes is through permanent, locally-tailored, unconditional reductions in mortgage principal,” he said. (Dennis Kucinich)
  • A senior Treasury official told HuffPost on Monday that the department was heading towards more writing down of principal as part of its mortgage modification efforts, and that an announcement was to be expected in the next few weeks.
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Judges To Attorneys From Foreclosure Mills: Your License is on the Line!

March 8th, 2010 · Foreclosure

For a brief period of time in the history of courts in Florida, lawyers engaged in a widespread and pervasive practice of submitting blatantly false evidence in courts.  This period of time began roughly when the foreclosure crisis moved from the mortgage and lending industries and into Florida courts.

Now that judges and courts have become aware of just how pervasive this practice was, individual efforts on the part of judges and systemic rule changes implemented by the Florida Supreme Court should signal the end of this era.  An article that appeared in the Sarasota Tribune and can be viewed here quotes a local judge, Robert Bennett from Sarasota who recently had one of his opinions reversed by the Second District Court of Appeals.  (Verizzo v. Bank of New York) Found here

In the article, the good judge admits that his initial ruling…in favor of the bank was incorrect.  The decision was a reflection of a judicial system that was totally overwhelmed by problems caused by the mortgage and lending institutions….they caused the problems then dumped their problems in the laps of absurdly understaffed courts and judges then said, “Here, you fix the mess we’ve created!”

It’s taken a while to identify the issues and to grasp the scope of the problem, but now that judges and court systems are aware that they were taken advantage of, the tide has shifted.  New rules and new cases, both from appellate courts and from sister courts, have made judges all over aware of the issues such that they are no longer willing to look the other way and sign off granting sale….when asked how he thinks Plaintiff’s attorneys will comply, Chief Judge Lee Hayworth (long a critic of sloppy Plaintiff practice) had this to say:

“I’m looking forward to see how they do comply,” Haworth said. “Their license could be on the line.”

Liberty and Justice Prevail When Good Judges Sit Firmly on The Bench!

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Congress Urges More Mortgage Help- Today’s Wall Street Journal

March 8th, 2010 · Foreclosure

An article in today’s Wall Street Journal, found here reports that Congress is getting real serious about forcing banks to work with homeowners (taxpayers) in foreclosure.  They are so serious, that Rep. Barney Frank wrote a letter!  He wrote a letter.  See apparently, banks aren’t working with homeowners and the foreclosure problem continues to slog on.  Not to worry though, once the lenders get THE LETTER things are bound to get better.

  • Many second liens have little value because of the plunge in home prices, Rep. Frank wrote, adding: “Yet because accounting rules allow holders of these seconds to carry the loans at artificially high values, many refuse to acknowledge the losses and write down the loans.”
  • Most first-lien home loans are held by the government-controlled mortgage companies Fannie Mae and Freddie Mac or by other investors in mortgage securities. By contrast, banks hold most of the seconds and other junior-lien mortgages.
  • About $1.05 trillion of junior-lien home mortgages were outstanding as of Sept. 30, according to the Federal Reserve. Of those, $766.7 billion were held by commercial banks; most of the rest were owned by savings banks and credit unions.
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Assignment/Foreclosure Fraud Explained- Attorney Lynn Szymoniak

March 7th, 2010 · Foreclosure

Vague allegations of assignment fraud and other systemic fraud within the foreclosure and court systems can be a bit hard to get one`s hands around.  So attached here is an article by noted foreclosure defense attorney Lynn Szymoniak that explains in plain English the reasons for the pervasive fraud.  Bottom line is the legal system of mortgage recording and ownership didn’t change to keep up with the orgy of securitization and trading that developed in the secondary mortgage market.  MERS and the other servicers either didn’t get that at the time or they did, but just decided to keep charging ahead with a failed business model.  Now they need the legal system to ignore the laws in order to compensate for their failed business model. Some questions provoked by the article….

What`s all this screaming about “assignment fraud”, and “foreclosure fraud” anyway and how does it affect me?

Is the fraud as pervasive as Weidner and other attorneys say it is?

How can such systemic fraud be perpetrated on the courts across the country?

Can it be fairly argued that judges across the country are complicit in the fraud if they are knowingly signing judgments that grant foreclosure in the face of growing awareness of such pervasive fraud?

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Deposition of a Robo Signer at Chase Home Finance- Foreclosure Fraud on Record

March 7th, 2010 · Foreclosure

When speaking in generalities, it’s difficult for folks to understand what lawyer, judges and informed consumers are ranting about when we scream, “THE BANKS, LENDERS AND FORECLOSURE MILLS ARE COMMITTING FRAUD!”

I attach here a deposition transcript of Angela Melissa Nolan, a robo signer at Chase Home Finance.  In the deposition, she describes in detail some of the corporate processes in place that purport to give pretender lenders the evidentiary basis to pursue foreclosure cases….I’ve called these people “Robo Signers” because prior depositions indicated they don’t read anything…they just sign.  This deposition reveals another form of “Robo Signer”, a computer generated document, complete with a “real” signature scanned in…..and the rabbit hole just gets deeper and deeper

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The Foreclosure Appeals Process- Great Work From Pro-Se Litigants

March 7th, 2010 · Foreclosure

This foreclosure crisis is inspiring for many reasons, but one of the most inspiring things I see are non-lawyers standing up to fight the fraud and injustices of the banks and their lawyers.  I’ve started posting appeals and transcripts so people get a sense of the process….I can tell you that at least in the case of David Verizzo in Sarasota, Florida, this guy is going to inspire a whole lot of people….including experienced foreclosure/real estate attorneys.

Posted here is an example of an excellent, detailed appeal out of the Fifth District and here is one out of the Fourth District.  Both present excellent treatment of complex issues faced in foreclosure and will be of big help to pro se or attorneys fighting both at the trial and appellate level.  This stuff is spreading…with fantastic effect!

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The MERS Splitting Argument- By a Pro Se Litigant De La Salle

March 7th, 2010 · Foreclosure

The “MERS Splitting” argument is a complex and sophisticated argument, which is presented most powerfully by Pinellas County lawyer, Greg Clark.  Attached here however is the transcript of a Motion to Dismiss hearing where the MERS argument is made quite convincingly by a pro se litigant, Bernice Thoreau De La Salle.

There is something very, very wrong in the MERS mortgage soup.

What is most fascinating about this transcript is how powerfully this plain clothes advocate makes her argument….it’s just plain brilliant and she stands up tough against the bank and a skeptical court…read through the transcript and you will find the court coming back around….she’s does a brilliant job of pushing hard and sticking up….this is a case study in advocacy that practicing attorneys should read.

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Article in Today’s St. Petersburg Times- How Long Can A Foreclosure Be Defended?

March 6th, 2010 · Foreclosure

“On a societal basis, it’s better to have your neighbor still there and the neighborhood still stable instead of a vacant house trashed and vandalized,” says Matthew Weidner, a St. Petersburg lawyer active in the booming field of foreclosure defense.

Click here for an excellent article out of today’s edition of the St. Petersburg Times.

The St. Petersburg Times is often on the cutting edge and does an exceptional job of presenting balanced reporting. This article does pick up the exceptional case of a homeowner who delays foreclosure through multiple bankruptcies–a fairly controversial practice, but the more important theme of the article is making sure people understand the larger societal impact of foreclosure and helping them to grasp the facts that the lenders who caused these problems–with grossly fraudulent and improper behavior– bear the responsibility for where we are now.

A few questions we must ask before every foreclosure is granted:

1) Are we sure this Plaintiff is the owner of this debt?

(Probably not, too much evidence of widespread fabrication.)

2) Should this Plaintiff be rewarded with foreclosure if they have not worked with the homeowner?

(The homeowner has paid for federal modification assistance, but lenders are not effectively using this money.)3

) Will the marketplace be improved with a foreclosed home on the market?

(No new homes on the market are good.)


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Warrant Issued For Arrest of Matthew Weidner In a Foreclosure Case

March 5th, 2010 · Foreclosure

On March 1, 2010 a warrant for my arrest was signed by a Pinellas County Judge.  The warrant was signed based on an affidavit of probable cause that was signed by an officer of the private company that the Pinellas County Sheriff’s office has contracted to process all their probable cause affidavits and arrest warrants.  For hundreds of years, only actual deputized officers of the Sheriff’s office signed these affidavits and they were kept within the Pinellas County courts, but that process was recently contracted out to a private company.

When I appeared before the judge, I reviewed the affidavit and it was clear that whomever signed the affidavit got the facts all wrong.  I’m 175 pounds, not 204.  I’ve got brown hair, not white hair.  I’ve got blue eyes, not brown eyes. And most importantly, I couldn’t have committed the serious felony crime the affidavit accused me of because I wasn’t even born yet on the date the affidavit said I committed the crime.  When I appeared before the judge and pointed all this out her response was astonishing…while she admitted that the affidavit was totally wrong and that it was clear from its face that I could not have committed the crime, she told me, “The prosecutor admits that the affidavit is wrong and while you may not have committed this specific crime, the affidavit says you committed a crime.  The prosecutor assures me that they believe you’ve committed a crime even if it’s not the crime that I’m going to sign this arrest warrant for and that’s enough information for me.”

The judge signed the arrest warrant even though she knew and the prosecutors admitted that the facts in the affidavit did not support my arrest.

There were hundreds of attorneys in the courtroom who had clients that were being arrested on precisely the same obviously wrong set of facts, but they could do nothing.  The facts were all wrong, the files were all wrong, but the warrants were signed.  If this weren’t bad enough, I thought about the thousands of files on the judge’s bench where no attorney were present.  She was so busy and those accused had no attorney to challenge the facts in the affidavit, so the judge just signed thousands of those cases every single day.

Sorry lenders, sorry plaintiff’s attorneys, I was not arrested.  The story above did not happen.  Not exactly that way anyway.  But every single day in courtrooms all across this country, acts no less severe than the ones I described above are happening.  While an arrest is the most serious exercise of judicial power, close behind it is the judicial act of throwing a person or family out of their home.  Unfortunately, this dire judicial act is being done hundreds of thousands of times across the country every day based on fraudulent information and based on facts that are in direct contradiction to taking that most severe judicial act–throwing a person out of their home.

We truly are living in a Kafaka-esque world where this scenario above plays out in courtrooms across the country every day.  Lenders and their attorneys are committing gross fraud on the courts.  The practice is shockingly widespread and pervasive.  The lies and tactics employed by the banks and officers of the court to fulfill their ultimate goals of taking back property (to what end?  who will buy them?  how will the banks recover $$ even after they have taken the property back?) are becoming very well documented in depositions, SEC filings, class action lawsuits and other definitive places.

There are bright spots though….the Sixth Circuit of Pinellas County, Florida and the Second District Court of Appeals in Florida is one such place.  The recent opinions released by judges from these two courts make it clear that the judges take their jobs and their solemn responsibility to their citizens seriously.  The opinions that force lenders to prove their right to foreclose and challenge the improper tactics of the banks and lenders, make it clear that in their courtrooms and neighborhoods at least, the law and the rights of consumers and citizens are more important than the arrogance, bullying and abuses of nameless, faceless, shifting entities that are attempting to steal our country!

We can only hope that courts in the rest of the country will turn their gaze to Pinellas County, Florida….

The Flames of Justice Are Burning Bright!

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