Notes From Foreclosure Trials
All across this nation, “The Banks” and “The Servicers” are filing millions of foreclosure cases, pursuing loan modifications or concluding Short Sales. But the reality that we all must start to understand is “The Banks” and “The Servicers” are not the real parties in interest in the vast majority of cases….they are merely straw parties, debt collectors, front organizations who are manipulating our nation’s legal system and hijacking the economy in the largest financial conspiracy that’s ever been exacted upon the citizens of this country.
Here’s what’s undisputed. “The Banks” have no real interest in the mortgages of most Americans. “The Banks” used federal dollars to write those loans and were paid quite handsomely to blast billions of dollars in federal dollars (in the form of originated mortgages) in communities from one side of this country clear across to the other side of the country. And what we know from the OIG Office of Inspector General Reports and the National Mortgage Settlement was “The Banks” were far more interested in stealing billions of dollars in taxpayer funds than they ever were with fulfilling their contractual and legal obligations…but that’s an entirely different story.
The point of this post is to understand that when “The Bank” pursues a foreclosure and when “The Bank” sells the home of a citizen in foreclosure, they are merely a front for the real party that is directing the legal action in something like 70% of the cases, and that is Fannie Mae and Freddie Mac. Now the rabbit hole has gotten even deeper now that “The Banks” have sold of their portfolios of servicing obligations to “The Servicers”, third party debt collectors that are even farther removed from the crime scenes. The courtrooms of this nation and the foreclosure files that are flushed out in these courtrooms are crime scenes. The crimes being the financial fraud that lies at the heart of the entire mortgage financing sector of the nearly entirely fradulent American economy. What’s the fraud you ask? Well, how many more banking and trading and Wall Street crime schemes do we need to have reported before we all acknowledge that the entire financial system is rigged? LIBOR, London Whale, HSBC drug cartel money laundering, black pool trading, high frequency trading, 401ks, retirement accounts, the whole of Wall Street, BNP Parabas, Goldman Sachs, Jamie Dimon. For those that pay even just a little bit of attention and who have just one or two firing neurons, you have to recognize that the entire financial system is nothing but a Ponzi scheme of nearly unimaginable magnitude. Shall we even consider trillions of dollars in student loan debt…compounding daily? But (once again) I digress.
Let’s get back to the fraud in foreclosure…those two terms so synonymous that “foreclosure” should never be spoken without its partner, “fraud” and hence from now until forever we should always call it like it is, “Fraudclosure”.
Fannie and Freddie own the loans and rely on The Banks to be the bad guys in collecting their debts. Nominally at least The Bad Guys have certain rules they should follow in collecting debts, otherwise know as the Fannie Mae and Freddie Mac Servicing Guidelines. But The Banks are experts at ignoring all rules and laws and the contacts they signed so why should the follow them in the context of foreclosure or bankruptcy proceedings? Why should The Banks be truthful in piddly state court and bankruptcy proceedings when they have clearance from the highest levels to continue their massive financial fraud. (Jamie Dimon cufflinks anyone?)
The powerpoint is a real AHA! Kind of presentation….but (again) I’ve gone way off the farm. Let’s get down to application of all this to the typical foreclosure. Here’s the legal analysis:
- In this claim for mortgage foreclosure, the entirety of Plaintiff’s allegations are contained within the Complaint filed on 12/04. The Complaint was never amended and the key assertion Defendant asserts is fatal to Plaintiff’s claim in their one-count prayer for relief is the statement that (Plaintiff)
“is now the holder of the Mortgage Note and Mortgage and/or is entitled to enforce the Mortgage Note and Mortgage.” Plaintiff’s Complaint, ¶4.
2.Initially, and as will be supported by case law which is directly on point, Plaintiff’s use of the conjunctive and disjunctive “and/or” renders Plaintiff’s pleading a legal nullity and therefore the complaint should be dismissed for failure to state a cause of action. This paragraph is the very foundation upon which the entirety of Plaintiff’s cause of action is based and, as is detailed in case law which is directly on point, this allegation is fatal because it contains mutually exclusive allegations within the same statement. Put plainly, which allegation is Plaintiff traveling under?
Is The Bank the holder of the Mortgage Note and Mortgage and entitled to enforce the Mortgage Note and Mortgage
Is The Bank entitled to enforce the Mortgage Note and Mortgage?
(but not the “holder” of the note)
Critical to this argument is the undisputed fact that The Bank did not institute this lawsuit on its own accord or for its own benefit. The Bank is pursuing this lawsuit and Wells Fargo is suing this Defendant on behalf of, and at the express direction of another party, Freddie Mac. The Bank is merely Freddie Mac’s agent and Freddie Mac is the Principal who is directing this action.
- The key failure for Plaintiff case is The Bank’s failure to present even a scintilla of admissible evidence that they have any authority to act on Freddie Mac’s behalf. And there is one key element of Defendant’s case which must be recognized by this court relating to this point:
Defendant has sought, through motion practice and extensive discovery, any proof that the agent, The Bank has any authority to act on behalf of its principal, Freddie Mac. Plaintiff’s attempts to provide any such proof are entirely lacking.
4.The failure of The Bank to produce proof of a proper agency relationship leads to one indisputable conclusion:
That The Bank has failed to establish the necessary factual predicate for the Court to determine that an agency relationship exists between Plaintiff and Freddie, and therefore has failed to establish its standing to sue.
And this from a deposition:
9 Q Okay. Does that statement there reflect a fact
10 that the owner of the loan is Freddie Mac?
12 Q And just so the record’s clear, Freddie Mac is
13 Federal Home Loan Mortgage Corporation?
14 A Yes.
15 Q And Freddie Mac owns this; and for purposes of
16 the deposition, will we agree that if we say “Freddie,”
17 we are all understanding and referring to Federal Home
18 Loan Mortgage Corporation?
19 A Yes.
20 Q Okay. So does that statement reflect that, in
21 fact, Freddie owns the note and mortgage?
22 A They are the investor and own this loan, yes.
23 Q And does that statement also reflect that The Bank
24 services the loan, or acts on behalf of Freddie,
25 with respect to this loan?
1 A Yes.
The fact that Freddie and Fannie direct and control all is contained clearly within their requirements:
- In fact, Freddie Mac has instituted highly detailed procedures for “servicers” instituting foreclosure actions on its behalf in the State of Florida:
A66.7: Expedited foreclosures – Florida (08/15/13)
(a)Determining the judgment method In the State of Florida, Servicers may obtain judgment in connection with a foreclosure in several ways, including the following:
- Motion for summary judgment
- Bulk trial foreclosures
- Order to show cause
53.11: Servicer authorized to service (02/07/02)
The Servicer must be eligible to service Mortgages for Freddie Mac under the requirements of the Purchase Documents. The Servicer warrants that it has complied with all applicable laws related to licensing, qualification to do business or approval to service Mortgages. The Servicer also warrants that the Purchase Documents have been duly authorized, executed and delivered and are valid and enforceable according to their terms. The Servicer further warrants that compliance with the terms and conditions thereof will not conflict with, result in a breach of or default under, or be adversely affected by the following:
- Any terms and conditions of the Servicer’s charter, or
- Any agreement or instrument to which the Servicer is a party, or
- Any judgment, order or regulation to which the Servicer is subject