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Foreclosure Defense FloridaGeneral Information

BOMBSHELL!~ BEWARE OF SERVICER RELEASE OF DEFICIENCY….."Fannie Mae Owns the Notes And May Still Pursue A Deficiency"

So, gullible American.   You struggled and worked hard with “The Bank”.   You filled out all their paperwork. (Over and over and over again)   You cooperated with all of “The Bank’s” onerous demands and conditions.   And at the very end, you get a written, “Release of Deficiency”.   Right there in black and white, “The Bank” makes it very clear that they are not going to pursue any deficiency against the homeowner, in exchange for all their cooperation in resolving the short sale and litigation.   The case is over, the homeowner has no more liability…..right?
Well, hold on there people…..


Remember how long I’ve been arguing about how important it is to rip the Wizard Out From Behind the Curtain?   Remember how I got my rear end handed to me by Florida’s 2nd District Court of Appeals when I argued that Plaintiffs must not be allowed to prosecute cases and throw Americans into the street unless they prove up that they have consent of the principal they are working on behalf of….and prove up the limits of their agency relationship?

Why is this an absolutely clear legal necessity?


And in the attached transcript, read how the brilliant foreclosure defense attorney extracts out the stunning admissions from the Plaintiff’s Corporate Representative:

Q And you’re in possession of the note?
5 A The original, if it’s been returned from the
6 Court, there was a request to have the originals
7 returned from the Court.
8 Q Why would you not return that document?
9 A That’s not customary practice to — to show
10 that mortgage was done; there’s also an outstanding
11 balance that was waived on behalf of the borrower; and
12 Fannie Mae has not waived their rights to seek a
13 deficiency.
14 Q But what does Everhome Mortgage, in that
15 letter, state?
16 A Everhome Mortgage states that it will not seek
17 a deficiency.
18 Q So Fannie Mae is going to hold onto the note.
19 A Fannie Mae is the owner of the note.
20 Q So there has been no waiver of deficiency.
21 A On behalf of Everhome, there was a waiver of
22 deficiency as part of the short sale agreement.
23 Q So the true owner of the note, the holder of
24 the note, may come back against Ms. Gordon.
25 A I have no idea what their intentions are.

They take possession of the note once the approval has
2 been completed. Whether or not they seek a deficiency
3 or not is up to Fannie Mae as the owner and holder of
4 note at that point.

THE COURT: Mr. Mogg, here’s what’s extremely
15 troubling to the Court. I think you probably
16 already know where I’m going. Every one of these
17 cases, almost every one of them, a good portion of
18 them, all come in here; somebody’s the servicer for
19 maybe the owner. And that is one of the major
20 issues in almost every one of these cases on these
21 motions to dismiss.
22 And the testimony I just heard, that the true
23 owner now won’t release, even though the case has
24 released the note, even though the case is
25 dismissed and the original borrower may still seek

deficiency issues, is — that’s probably the most
2 troubling aspect of this particular case.

And I’m
3 sure it has repre — repercussions as to all the
4 other litigation.
5 If the servicers won’t come in here and say
6 that they are the ones that are — have the legal
7 authority to resolve issues in this — these cases,
8 then the defendants hom — the borrowers should be
9 able to negotiate in good faith with whoever is the
10 plaintiff in this case.
11 Otherwise, it totally brings a total fallacy
12 on this whole — all this litigation, all my
13 twenty-five hundred cases, basically.
14 It’s really, really troubling.

THE COURT: Well, how sad is it, though?
12 It’s — it’s just disgusting, actually, that
13 Ms. Gordon, the defendant in this case, can’t rely
14 on this — this case to have that issue resolved.

23 When the whole issue — when the note gets
24 totally re — resolved, the note gets returned to
25 Ms. Gordon and marked “paid in full,” or satisfied,
1 resolved, then, at that point in time, the Court
2 will hear the motion again
Everbank is Everhome Mortgage. We previously
3 were known as Everhome Mortgage Company. On July 1st of
4 2011 we merged, and Everhome Mortgage Company is no
5 more, leaving Everbank Federal Savings Association.
6 Everbank currently does — is — does business
7 as Everhome Mortgage as it relates to servicing.
8 Everbank is the servicer for Fannie Mae. We are the
9 holder of the note and proceed with foreclosure actions
10 in our name. Fannie Mae is the actual owner of the loan
11 and owner of the note.
12 Q Okay. So in order to approve a short sale,
13 would you need to submit this to — you would need to
14 submit this to Fannie Mae to get approval for the short
15 sale, correct?
16 A Yes. In some cases we do need to send —
17 submit it to Fannie Mae. There is what — Fannie Mae
18 allows us a certain amount of authority to act without
19 their approval. It’s what they call “delegated.”
20 And then there’s non-delegated, where it’s
21 outside of a certain figure or amounts that they don’t
22 allow us to approve, where we have to, actually, have
23 them submit an approval.
24 All of them officially do go through Fannie
25 Mae; it’s whether or not we have to — we need a final approval before we can finalize it.
2 Q So in this particular case with the
3 negotiations that went as far as the short sale, the
4 amount of the purchase price, and the amount of
5 contribution by the borrower, were these all submitted
6 to Fannie Mae to see whether or not approval be had for
7 the short sale?
8 A Yes, it was.
9 Q Okay. Was it submitted? Was it actually
10 submitted to Fannie Mae?
11 A It was submitted. All of the numbers were
12 submitted to Fannie Mae; the amounts that were currently
13 due under the terms of the note and mortgage that were
14 outstanding in the borrower’s loan were provided to
15 Fannie Mae; and then the terms of the short sale
16 contract agreement and the net proceeds were all
17 submitted to Fannie Mae; and Fannie Mae came back and
18 approved it.
19 Q When you said they approved it, they allowed
20 for the short sale to take place?
21 A That’s correct.
Q Do you have confirmation of whether or not the
9 sale actually went through in this case or not?
10 A Yes, I do.
11 Q Did it actually go through?
12 A It did.
13 Q And were amounts disbursed backed to Fannie
14 Mae?
15 A Yes, they were.
16 Q How was that done?
17 A The final proceeds were tendered to Everbank,
18 and then the sale completed by the settlement agent upon
19 Everbank receiving the wire or the funds, the net
20 proceeds of the sale. We then transferred or wired the
21 funds to Fannie Mae.

HEARING 10-02-2012.miniprint



  • Laura says:

    And how does this affect the tax situation? The borrower is forgiven debt per current IRS rules…………..but if they are not really forgiven debt, then there is fraud on the IRS someplace right? I mean hasn’t FANNIE Mae or Everhome received some kind of tax incentive to do this?
    At what point does the IRS wake up to all this?

  • triumphant says:

    The Gordon’s related “Release of Mortgage” (by MERS, recorded in Pinellas County O.R. on 11/02/2012 – the same day as the hearing on the Gordon’s motion for costs – states: “KNOW ALL MEN BY THESE PRESENTS that MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. holder of a certain Mortgage, whose parties, dates and recording information are listed below, does hereby acknowledge that it has received full payment and satisfaction of the same, and in consideration thereof, does hereby cancel and discharge said Mortgage.”
    Given Everbank’s attorneys statement that the “owner” of the Gordon’s loan (Fannie Mae?) has NOT waived a deficiency, how are the short-sale-related “release” (above) and the “settlement” that the Gordon’s were induced to enter not outright frauds?

  • triumphant says:

    Oh, I was wrong – the “release” was recorded one month to the day AFTER the hearing, transcript which you reference.

  • Elise says:

    I just found this which may be of interest to you and your readers…
    Ruling May Lead Borrowers To Challenge Validity of Previously Entered Forclosures
    Posted on 11/16/2012 by Administrator Account in industry news
    Federal Home Loan Mortgage Corporation vs. Schwartzwald, Slip Opinion No. 2012-Ohio-5017
    The recent decision by the Supreme Court of Ohio in Fed. Home Loan Mtge. Corp. v. Schwartzwald held that standing is required to invoke the Common Pleas Court’s jurisdiction, and that an Assignment of Note and Mortgage to the foreclosing entity obtained after a foreclosure Complaint has been filed (but before Judgment has been entered) does not confer the necessary standing. The ruling will likely lead to an increase in attempts by borrowers to challenge the validity of previously entered foreclosure Judgments and previously held foreclosure sales.
    Full text of the decision is available at:
    { ¶ 33} As the Supreme Court explained in Lincoln Property Co. v. Roche, 546 U.S. 81, 90, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005), the real-party-in-interest rule concerns only proper party joinder. Civ.R. 17(A) does not address standing; rather, the point of the rule is that [I especially liked this part]
    ” suits by representative plaintiffs on behalf of the real parties in interest are the exception rather than the rule and should only be allowed when the real parties in interest are identifiable and the res judicata scope of the judgment can be effectively determined.”
    Consumer Fedn. of Am. v. Upjohn Co., 346 A.2d 725, 729 (D.C.1975) (construing analogous District of Columbia rule).

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