If you are not entirely disgusted by the conduct of foreclosure proceedings, you are just not informed enough. The very worst part of the entire system is that the entire system is a series of lies built up and fabricated upon one another. The worst part about all the pieces, as they are put together is that the entirety of our nation’s court system has abdicated their responsibility to enforce and uphold vast bodies of laws that existed to protect consumers from the kind of gross abuses that are systematically visited upon the whole of our populations even now.
This is manifest in so many ways, but at the apex is the fact that courts are entirely comfortable allowing shadow agents to come into court and sue….without regard to proving up the actual right to do so.
THE BANKS ARE MERELY AGENTS ACTING ON BEHALF OF THE OWNERS OF MORTGAGES
Whenever a borrower shows a disregard for the mortgage loan obligation
or is unable to make the mortgagepayments, the servicer of a whole
mortgage loan or a participation pool mortgage loan that Fannie Mae
holds in its portfolio, or of an MBS mortgage loan serviced under the
special servicing option, must protect Fannie Mae’s investment by taking
prudent action. The servicer must makeevery reasonable effort to contact
the borrower and to cure the delinquency through Fannie Mae’s special
relief provisions or foreclosure prevention alternatives before referring a
mortgage loan to the foreclosure attorney (or trustee). The servicer also
must have inspected the property and analyzed the individual
circumstances of the delinquency.
THE SERVICER MUST COMPLY WITH LAWS (But only if a judge will actually enforce laws)
A servicer must process foreclos
ures, conveyances, and claims in
accordance with the provisions of the mortgage loan; state law; the
requirements of FHA, HUD, VA, RD,
or the mortgage insurer; and any
special requirements that Fannie Mae may have. To ensure that this is
done, the servicer must have appropriat
e policies, procedures, and controls
to ensure compliance with Fannie
Mae’s requirements
A SERVICER MUST NOT GET FANNIE MAE INVOLVED IN LITIGATION THAT MIGHT REVEAL THE REAL NATURE OF OWNERSHIP AND REAL PARTY IN INTEREST
A servicer generally should not initia
te routine legal pr
oceedings in Fannie
Mae’s name, but in instances where it
is appropriate or necessary to do so,
Fannie Mae must be described in th
e legal proceedings as “Federal
National Mortgage Associ
ation (Fannie Mae), a co
rporation organized and
existing under the laws of the Unite
d States.” The servicer, its legal
counsel, and foreclosure attorneys (or
trustees) should not forward papers,
pleadings, and notices related to ro
utine uncontested legal actions to
Fannie Mae. If any routine legal pr
oceeding becomes contested (e.g., the
defendant in any proceeding files any appeal, motion for rehearing, or
similar procedure) or a servicer r
eceives notice of a nonroutine action that
involves a Fannie Mae–owned or Fanni
e Mae–securitized mortgage loan
or that will otherwise affect Fannie
Mae’s interests—regardless of whether
Fannie Mae is also named as a party to the action—the servicer must
immediately contact Fannie Mae’
s Regional Counsel via e-mail to
nonroutine_litigation@fanniemae.com
.
A servicer may not initiate or de
fend nonroutine litigation on Fannie
Mae’s behalf unless it obtains prior written consent from its Fannie Mae
Regional Counsel via email. This will
enable Fannie Mae to concur in the
necessity for the action, the selection
of legal counsel, development of
legal strategy, and approval of lega
l fees and costs. One example of a
nonroutine legal action is a case in wh
ich the servicer’s legal counsel
wants to pursue a judicial foreclosure
in order to clear technical defects
even though the security
property is located in a
state in which the usual
method of foreclosure is by non-judicial
foreclosure. In this situation, the
servicer should not commence a judicial foreclosure for a conventional
mortgage loan without first clea
ring the action with Fannie Mae.
Nonroutine litigation also
includes any claim, counterclaim, or procedure
that: challenges methods in which
Fannie Mae does business; involves
Fannie Mae’s status as a federal instru
mentality; requires
interpretation of
Fannie Mae’s Charter, such as rem
oval to federal court based on Fannie
Mae’s Charter; claims punitive damages from Fannie Mae; or asserts
liability against Fannie Mae based on
actions of its serv
icers. Additional
examples include “show cause orders” or proceedings and motions for
sanctions.
SERVICERS ARE NOT IN POSSESSION OF NOTES, THOSE NOTES ARE OWNED AND IN POSSESSION OF FANNIE (But it’s okay to lie about this as long as you don’t get caught)
Some jurisdictions require
that the servicer produce the original not
e before or shortly after initiating
foreclosure proceedings. If Fannie
Mae possesses th
e note through its
designated document custodian, to ob
tain the note and any other custody
documents that are needed, the servicer must submit a request to the
designated document custodian’s elec
tronic release system.
THE SERVICER DOES NOT OWN THE NOTE AT ISSUE IN FORECLOSURES AND IS NOT THE HOLDER OF THE NOTE!
At the conclusion of the se
rvicer’s representation
of Fannie Mae’s interests
in the foreclosure, bankruptcy, proba
te, or other legal proceeding, or upon
the servicer ceasing to service th
e loan for any reason, possession
automatically reverts to Fannie Mae,
and Fannie Mae resumes being the
holder for itself, just as it was befo
re the foreclosure, bankruptcy, probate,
or other legal proceeding. If the se
rvicer has obtained physical possession
of the original note, it must be re
turned to Fannie Mae or the document
custodian, as applicable.
As compensation for servicing mortgage loans for Fannie Mae, Fannie
Mae pays the servicer serv
icing fees and allows it to retain late charges,
fees charged for special services, yi
eld differential adjustments, and, in
some cases, either a share or all of
any applicable prepayment premiums
that Fannie Mae permits under the
terms of a negotiated contract.
ANYONE CAN FABRICATE OWNERSHIP OF MORTGAGE LOANS
The need to prepare new mortgage
assignments in connection with a
transfer of servicing will depend on wh
ether Fannie Mae is the owner of
record for the mortgage loan and,
if Fannie Mae is not, on whether the
mortgage loan is registered with MERS.
In those instances in which Fannie
Mae holds the custodial documents,
any required assignments that are submitted to Fannie Mae must be
identified by the applicable Fannie Mae loan number and submitted under
cover of a transmittal letter that includes the following information:
MERS must not be named as a plaintiff or foreclosing party in any
foreclosure action, whether judicial
or non-judicial, on a mortgage loan
owned or securitized by
Fannie Mae. When MERS is the mortgagee of
record, the servicer must prepare
an assignment from MERS to the
servicer and bring the foreclosure
in its own name unless Fannie Mae
specifically allows the foreclosure to
be brought in the name of Fannie Mae.
