Posts Tagged ‘hamp’
MIAMI HERALD HAMMERS THE FORECLOSURE PROCESS IN FLORIDA
Author: Matthew D. Weidner, Esq.
Hat tip to 4ClosureFraud for picking up on the media catching the chaos that permeates the entire state… In the years since South Florida’s housing market began its historic crash, a debilitating ripple effect has spread to many of the region’s institutions, sparking a number of satellite problems, ranging from fabricated foreclosure documents to faulty mortgage note transfers. Major lenders, local governments and county courts have spent the last three years trying to deal with the fallout from the housing crisis. Each institution quickly found out it was unprepared and undermanned to handle the crisis, and most have been trying to play catchup ever since. Bank of America’s success rate in the federal government’s Home Affordable Modification Program, or HAMP, is 28 percent, third worst among HAMP participants. Read the full report 4ClosureFraud
September’s Horrendous HAMP Numbers
Author: Matthew D. Weidner, Esq.
The figures published by our friends within the federal government confirm what we all know already…the government’s primary effort to resolve the mortgage crisis is an abysmal failure.
$50 billion dollars and less than 500,000 modifications resulting in average payment declines of less than $500
That’s government work for you. Keep in mind that the beneficiaries of all this government money are raking in massive profits….at the expense of borrowers, defendants in foreclosure and the American people in general.
THIS IS WAR! AND HERE IS HOW TO DISMISS THOUSANDS OF FORECLOSURE CASES!
Author: MattWeidner
The Florida Supreme Court mandated that all residential foreclosure cases filed after February 11, 2010 be verified.
The Florida Supreme Court mandated that all residential foreclosure cases filed after February 11, 2010 be verified.
The Florida Supreme Court mandated that all residential foreclosure cases filed after February 11, 2010 be verified.
The Florida Supreme Court mandated that all residential foreclosure cases filed after February 11, 2010 be verified.
I wanted to write that several times just to drive the point home. I put it in bold just to try and emphasize the point. Despite the fact that this is absolutely clear and that there is no question about this rule, across the state there are thousands of foreclosure cases that have been filed which completely ignore this rule.
It makes me furious and I cannot understand why our chief judges, why our elected judges, why senior judges continue to grant summary judgment for these cases when the court has the inherent authority to DISMISS THESE CASES FOR FAILURE TO COMPLY WITH THE RULES OF THE COURT.
I understand why the foreclosure mills continue to file complaints that are in direct and flagrant violation of the rules of the Florida Supreme Court, but I cannot understand why our courts and our press are not all over this issue.
I have petitioned for a hearing to be held here in Pinellas County to ask why this affront to our courts is allowed to continue, but I want to share the motions with everyone once again in the hopes that you will all print them out, tailor them to your cases and share them with your chief judge.
CHARNESKI-MTD-for-Unverified-Supplement1
I am issuing a challenge to any foreclosure mill attorney, any attorney, any judge. Explain why the reasoning in the memos attached above is incorrect. And if the memos are not wrong, then why are our judges allowing thousands of these foreclosure cases to continue on the dockets every single day?
THIS IS ARROGANCE AND TYRRANY. THE FORECLOSURE MILLS AND BANKS ARE TRAMPLING ON BASIC RIGHTS AND LIBERTIES AND IGNORING THE RULE OF LAW.
THEY’RE IGNORING THE SUPREME COURT OF FLORIDA!
THEY’RE IGNORING THE SUPREME COURT OF FLORIDA!
If we are allowing them to get away with this in this forum, what’s next? Shall we allow them to just kick down the doors of anyone’s home? (They’re already doing that.) Shall we just toss out the window due process and basic, Constitutional rights? (We’re already doing that.)
I will pay for the transcripts of any hearing where a foreclosure mill defends the fact that they are not verifying complaints. I am dying to hear the argument against complying with the lawful authority of the Florida Supreme Court….but then who really cares anyway? What does it matter, it’s only foreclosure?
WHY IS THERE NOT AN UPROAR AMONG THE PRESS, THE GENERAL PUBLIC, ATTORNEYS? WHERE IS THE SUPREME COURT ON THIS? I mean after all, they passed a rule that is just being ignored….why are they allowing this chaos to occur?
Lenders Working Hard to Avoid Mortgage Modifications.
Author: Matthew D. Weidner, Esq.
The reports from the federal government regarding the number of homeowners that have obtained permanent mortgage modifications under the HAMP program show once again how hopeless it is to rely upon government programs to resolve the mortgage crisis. Clients and advocates continue to ask me, “Why won’t the lender work with me on a modification?” I believe the answer is both simple and complex.
The simple answer is money….I believe the lenders have been incentivized not to approve modifications from their own financial perspective because they are getting both tax and subsidy benefits from their non-performing portfolio. The complex answer is I believe the program requirements are so complex and difficult to comply with that in order for the lender to obtain the subsidy benefits described above, they must obtain so many records and comply with strict documentary requirements.
The result is a maddening clash between servicers and homeowners who are working hard to obtain mortgage modifications. I attach below a recent exchange between a homeowner who is working hard to resolve an outstanding mortgage claim….reading this will make you want to pull your hair out….
This letter is a demand for additional review of Bank of America’s recent denial of my home loan modification. I have sent copies of this to various officials, agencies, and others via email or first class mail, which you can find listed below.
After careful review of your denial letter, I find your denial to contain fallacious reasoning—one which is nothing but a red herring,
Further, I have reviewed the PSA of CWALT 2005- 66 (which includes my loan) and the Guide referenced within this PSA, also known as Freddie Mac’s Single Family Seller / Servicer Guide, which will be referred herein as the Guide.
Your letter states:
“The investor has declined request for modification. Since the loan is not delinquent, for both a traditional modification and to qualify for HAMP, you needed to demonstrate imminent default hardship. One of the imminent default is defined as a long term disability status after the origination of the subject loan. Based on the documentation provided by you, including your statement regarding receipt of Medicare since 2001, you were receiving assistance prior to the origination date of (2005). As such, you are not a borrower and further the loan is not in imminent default as the assistance you received existed prior to the subject loan origination.”
There are serious and potentially litigious issues brought up in the above statements:
1. You state: The investor has declined request for modification.
My response: Why is this up to the investor? The PSA clearly states “…the Master Servicer may waive, modify or vary any term of any Mortgage Loan ….”. See Section 3.11 (b) pp.49-50 (CWALT 2005-66)
2. You state: Since the loan is not delinquent, for both a traditional modification and to qualify for HAMP….
My response: One does NOT need to be late for HAMP; one needs to show a hardship where imminent default is likely. You (the servicer) are supposed to abide by the PSA.
Section 3.01 (b) of the PSA states that you SHALL follow certain rules/regulation such as Freddie Mac’s Single Family Seller / Servicer Guide which, states in part that:
“In pursuing loss mitigation, Servicers must first consider Borrowers in accordance with the requirements of Chapter C65, Home Affordable Modification Program.”
So, we turn to Chapter C65, which states in part:
Borrowers who are current ,…….. but who, due to hardship, may be in imminent default, are also eligible for modification under HAMP. See: C65. 4
See also: http://www.makinghomeaffordable.gov/borrower-faqs.html
See question #22 from the above link. Do I need to be behind on my mortgage payments to be eligible for a modification under HAMP?
No. Responsible homeowners who are struggling to remain current on their mortgage payments are eligible if they reasonably believe they are very likely to default on their mortgage soon (often referred to by loan servicers as “imminent default”). This might be because a homeowner has had (or will have) a significant increase in the mortgage payment (due to a payment adjustment or rate adjustment upwards); …. or some other significant reduction in income; or some other financial hardship that will make the mortgage unaffordable.
3. You state: ….you needed to demonstrate imminent default hardship.
My Response; I did demonstrate imminent default— Loss of household income, change in household circumstances, significant increase in the mortgage payment if the Truth in Lending statement is correct. This was all documented at length in my hardship letter.
4. You state: One of the imminent default is defined as a long term disability status after the origination of the subject loan.
My response. I understand that, but it doesn’t pertain to my case. This is the red herring.
Disability is NOT the main issue. The main issues for imminent default as detailed in my hardship are 1) Upcoming increase in the monthly mortgage payment in 2010, 2) Loss of household income & 3) change in household financial circumstances, 4) Rising costs of living expenses, and 5) I briefly mentioned disability. I only mentioned disability in the hardship letter to let you know that my chances of returning to work do not look good and because I receive disability payments.
5. You state: Based on the documentation provided by you,
My response: Did you read my hardship letter?
6. You state: ….including your statement regarding receipt of Medicare since 2001, you were receiving assistance prior to the origination date of (2005).
My response: You asked me for this information and I provided it to you. I wasn’t sure why you wanted this information, but it now appears you are trying to divert the main issues and doing everything you can to block my attempts for an affordable loan mod.
Let me ask you—do you routinely ask others how long they have worked at a job and get such proof from the employer? If not, this act certainly appears to be discriminatory.
7. You state: As such, you are not a borrower
My response: This is a legal issue and you know that, especially due to the conflicting documents you sent to me. But if you insist that I am not a borrower– please file for a Satisfaction of the Mortgage since I signed the Adjustable Rate Rider promising to pay you every single month, among other things. Please review the Adjustable Rate Rider and the Rider to the Note for this predatory Pay Option Arm loan.
8. You state: …….and further the loan is not in imminent default
My response: You appear to be ignoring the facts that there will be a “significant increase” in the mortgage payments later this year, which is one of several reasons for my request for a loan modification now. Also, what about Loss of Household Income? What about the Change in Household Financial Circumstances and Rising Costs of Living Expenses?
9. You state: …as the assistance you received existed prior to the subject loan origination.
Like I said, this is a red herring. Please read my hardship letter.
I request an immediate review of my file and an immediate re-evaluation of my request for a modification. Your reasoning is faulty, and may be discriminatory. Please be assured I will do all I can to save my home, and I hope to be able to come to an agreement about an affordable loan modification in the very near future.
Thank you for your time into these serious matters.
More Details on The Corruption of the American Housing Market
Author: Matthew D. Weidner, Esq.
From a report emailed to me over the weekend:
At the core of the foreclosure-prevention strategy is ignoring delinquencies. The percentage of older delinquent loans not yet in foreclosure is startling: 60% have at least 12 missed payments, and 35% have at least 18 missed payments. Add to this that three-fourths of delinquent loans are not in foreclosure, and we see that hidden losses well exceed those in the open.
Uh, they’re not being “ignored” – this is systemic and intentional fraud.
Remember, these loans are either being held by someone or securitized into some sort of package. When you have a loan that has no chance of “curing” (to cure a loan with 12 missed payments the borrower would have to come up with the 12 payments to bring it current!) that loan should be carried at its recovery value – that is, the value of the collateral that can be seized and sold, LESS the cost of eviction, remediation and resale.
Does anyone recall all the entries I’ve written about getting competent legal and accounting (tax) advice before proceeding with any sort of action regarding walking away, short sales or foreclosure? This same report says:
Many homeowners would be better off going into foreclosure, than doing a short sale. Short sales are fraught with potential legal, credit, and complicated tax issues. For example, someone who refinanced could owe capital gains taxes, which are not forgiven under federal and California temporary debt relief acts. In the foreclosure route, borrowers can live in their house mortgage-free for at least one year, maybe two years. Both short sales and foreclosures are reported as “account not paid in full”, and are equally damaging to a credit score. An exception exists if short sellers can negotiate better terms with their lender on recourse liens. The other possible advantage to a short sale is the ability to get a mortgage again in 2 years (Fannie, Freddie), rather than having to wait 3-5 years after a foreclosure.
Homeowners pursue short sales, unaware of the problems they are creating for themselves. Their agents never warned them of deficiencies, ruined credit, taxes due on forgiven debt, or legal consequences. Agents made flowery promises to get listings, and now the lawsuits are starting.
No, really? You mean that people in the real estate business are less than truthful with their clients? That would never, ever happen with licensed professionals, right?
Then there’s this, which I also have written about:
Another gray area is junior lien holders asking buyers for additional payments. As the market improved, juniors were no longer content with $3k thrown to them from the senior. They now want 10% of the junior note. They argue the additional payment is legal practice because the payment is made to escrow and appears on the HUD-1. However, they are actually hoping the senior lien holder does not read the HUD-1. The California Association of REALTORS® position is that all payments made by the buyer or agent in the purchase of a short sale must be part of the written short sale agreement signed by the senior lien holder. Concealing payments from seniors is loan fraud, and omitting these payments from the HUD-1 closing statement may violate RESPA. Some seniors reinstate their security interests because of the fraud. It’s surprising that the biggest banks are responding, when pressed on the fraud of their request, “just do it if you want the deal done”.
Right. Big banks saying “just do it”? Why would they do that? Is it so they can re-instate their security interests? No, nobody would ever do anything that hoses the consumer, would they? Naw…..
Few people understand that the bank that gave them their mortgage turned around and sold it into a mortgage bond, and the “bank” on their mortgage statement is actually a servicer.
Actually, it’s a bit more complicated than that.
As I’ve been working on (and writing on) for a long time, and as a few attorneys are now starting to understand, the entirety of this process was corrupted and is rife with outright fraud from top to bottom.
Let’s go through a (partial) list of the problems:
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The originator of the loan (which often was some chop-shop mortgage boutique) was the place that got funding via a warehouse line of credit with a major bank. They paid the seller of the house. The seller thus is “whole” and has no further interest.
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The originator was shortly paid in full when the loan was sold to a major bank that was intending to (or did) securitize the paper. They were also paid in full and thus have no further legal interest in the property or the paper.
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The banks, in turn, set up “bankruptcy remote” trusts to hold all this paper. This is (of course) done so that whatever happens to the paper doesn’t impact the bank’s earnings itself. Or does it…. we will get to that later.
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Many of the assignments from this point onward in the loan are legally defective. In particular, many of the assignments of the loans were made in blank, that is, in bearer form. But in most states trusts cannot hold bearer paper of any sort – period. In addition, in many states you cannot record a bearer instrument. To get around recording fees the industry has even created its own “clearing house” called MERS, which alternately claims to be an agent or the actual holder in due course, whichever suits the position of the trust (or itself) any given time. Whether this is legal under state law varies from jurisdiction to jurisdiction – what is known is that only one state has actually made the “reach around” games MERS plays explicitly legal.
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The trusts that are the “vessel” in which the securitized instruments are formed and then sold to investors thus hold paper they can’t legally hold. This may in fact be sufficient to void the trust. Worse, they issued prospectuses and offering circulars to investors claiming that they had good recordable title to each and every loan in the trust. In many cases they never did and can’t cure this retroactively. That is, there is at least the appearance of fraud in the sale of these securities, in that the buyers were led to believe they were buying a note backed by a security interest in an asset, when in fact there is no such backing at all – the note is a “bare” promissory note!
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Cities, counties and states were ripped off to the tune of hundreds of billions of dollars over the previous ten years as a consequence of these intentional failures to properly record. Specifically, the states, counties and localities have laws governing the requirement to record and pay doc stamps – that is, taxes – on transactions of this sort. The necessity of recording these transactions varies from jurisdiction to jurisdiction, and thus the economic damage done by this avoidance varies, but the banksters and their cronies simply kept this money instead of filing and remitting it to the taxing authorities as required by law.
The mess doesn’t end here. If you buy a house where the original note was not satisfied in full and a full chain of assignments cannot verify that all security interests are released the title chain is severely clouded, perhaps to a degree that is almost impossible to unravel. Wise title insurance companies are beginning to recognize this problem and refuse to issue owners policies against properties where a broken chain of assignment exists, especially where a foreclosure or short sale took place, as those properties may still have an enforceable lien against them!
I recently spoke with an attorney who is aggressively pursing these issues when his clients are faced with foreclosure, with some (and likely growing) success. He related to me that he spoke with the FCIC and was asked “Well, what is your solution? Are you asking that we nationalize all the (large) banks?”
If that’s not an admission that FCIC knows the large banks were and are complicit in this and if forced to admit the truth in their financial statements would be rendered insolvent I don’t know what is.
We have fixed nothing, but the can-kicking has also not pushed the bar very far down the road. The gambit was that the economy would return to a “boom” in the two years that have passed, and that the problems would be “absorbed” in that time.
It hasn’t happened.
Now we’re faced with having structuralized a $1.5 trillion annual budget deficit into the indefinite future while those who were “helped” by HAMP and similar programs are facing re-default a few months to a couple of years down the road. DTIs over 60% virtually guarantee that outcome. At the same time the holders of these notes were sold a bill of goods and eventually some of them will wise up to the fact that the so-called “bankruptcy remote trusts” that allegedly hold the paper (and thus immunize the banks that created them) are legally defective. Those holders, when (not if) they suffer actual principal and coupon loss, can be reasonably expected to pursue their remedies at law with the aim of voiding the trust and opening the assets of the creating financial institution to attack.
If this line of inquiry is pursued it is entirely possible that these trusts would in fact be voided, and the resulting exposure landing on the major financial institution balance sheets would render them insolvent.
Again, we had the choice in 2007 and 2008 to force the institutions that did these things to “eat their own cooking”, which would have likely bankrupted many or even most of them. But while we need a banking system, we do not need any particular set of individual banks. Instead of “bailing people out” and playing “extend and pretend” we could (and should) have taken the $700 billion in TARP funds and used it to charter 10 new banks with strictly-limited 10:1 leverage and reserve ratios, which would have provided the ability to take up $7 trillion in new and rollover lending – and let the overlevered behemoths fail.
Yes, the FDIC would have had to step in, and it might have cost us a trillion or more in FDIC insurance payouts. But even that would have been cheaper than what we have done, and in addition, we would have a safe, sound and stable financial system today.
Instead we have allowed the banksters to rob us once again, fixing nothing. As this mess continues to unravel – and it will – we will find that in fact we have simply blown more than $4 trillion in borrowed funds and in fact gotten nothing in return for it.
We’re Paying WHOM to Fix Subprime Mortgages?-Why, subprime lenders, of course.
Author: Matthew D. Weidner, Esq.
Taxpayers….(that means my money and your money) are shoveling bajillions of dollars at the lenders that caused the foreclosure crisis and precious little is being done to help the homeowners….the following shows where all our money is going….I can tell you that homeowners are not benefitting from these programs and all this federal money….
The following article was first published in Mother Jones Journal….read on…..
— By Andy Kroll
The Treasury Department has allocated $75 billion to entice lenders to let beleaguered borrowers stay in their homes. And the companies getting most of that money—well, they’re the same companies that got the borrowers into this mess. At least 21 of the top 25 recipients in the Home Affordable Modification Program were major subprime lenders, according to the Center for Public Integrity. Meanwhile, not even 1 in 5 homeowners eligible for the program has gotten help.
| LENDER (PARENT COMPANY) | SUBPRIME LOANS (MINIMUM, 2005-2007) |
HAMP FUNDS AVAILABLE |
| Countrywide Financial (Bank of America) |
$97.2 billion | $4.5 billion |
| National City (PNC) | $68 billion | $610 million |
| Option One Mortgage (formerly H&R Block, now American Home Mortgage Servicing) |
$64.7 billion | $1.2 billion* |
| Wells Fargo | $51.8 billion | $2.5 billion |
| BNC Mortgage/Aurora Loan Services (Lehman Brothers) |
$47.6 billion | $448 million |
| Chase Home Finance/EMC Mortgage (JPMorgan Chase) |
$30 billion | $3.4 billion |
| IndyMac (OneWest) | $26.4 billion | $814 million* |
| Citigroup | $26.3 billion | $2.1 billion |
| EquiFirst/HomeEq (Barclays) | $24.4 billion | $553 million |
| Wachovia (Wells Fargo) | $17.6 billion | $1.4 billion |
| GMAC (Cerberus Capital) | $17.2 billion | $3.6 billion |
| * Funds available to parent companySources: Cent | ||
