We all need a real discussion here about whether loan audits have any value at all. Let me be clear, 100% clear again….
IF A LOAN AUDITOR OR REVIEWER CANNOT BE QUALIFIED AS AN “EXPERT” BY A JUDGE AN AUDIT HAS ZERO VALUE
Too many clients have blow thousands of dollars on something that is totally worthless…if the person who prepared the report cannot be qualified as an expert over the strenuous objection of counsel, it just does not get in. And getting an “expert” qualified is next to impossible in this area.
Read what Mark Stopa had to say recently…Mark Stopa
Thank you for having a discussion on this very imortant matter. I am submitting our in-house counsel’s input to assit attorneys and homeowners in deciding this matter.
Thanks, Rob Harrington – VP/BPIA
…………….
Securitization Audits are the Key to Stopping Foreclosure
(written by Richard F. Kessler, Esq.)
A securitization audit, properly performed, can discover the ” smoking gun” that can save a home from foreclosure. Very few people have the training and expertise to identify and document the legal defects and deficiencies which serve to bar foreclosure. The widespread misuse of a securitization audit by homeowners has led to a misconception of what a security audit is and what it does. That is why BPIA urges every homeowner to only obtain the audit for the use of counsel who either has been retained or will be retained.
What is a securitization audit? A securitization audit inspects the organization and operation of a mortgage backed securities trust (” MBST”) to obtain evidence for mortgage foreclosure defense. The investigation report which results is a tool for an attorney. It will not replace an expert witness and will not, by itself, stop a foreclosure.
Why perform a securitization audit?
More than 80% of mortgages were securitized. A mortgage is securitized when it has been sold to a mortgage backed securities trust (” MBST”). MBSTs became so popular that the volume and velocity of mortgage transfers led to errors and omissions evidence of which can be productively used by attorneys engaged in foreclosure defense. The securitization produces an investigation report intended to include information and evidence to be used by an attorney to defend against foreclosure.
What does a securitization audit provide?
A securitization audit uses the best efforts of a trained and qualified auditor to find evidence and documentation to support the legal arguments of counsel that:
The mortgage is unenforceable;
The party attempting to foreclose does not have the right to foreclose; and
Undisclosed mortgage payments, wrongfully alleged to have been unpaid to trigger foreclosure, were paid by a third party to the mortgage creditor fully satisfying the installment payment obligation of the mortgage debtor to the mortgage creditor.
What does a securitization audit not address?
The securitization audit does not perform:
A forensic audit for consumer defenses such as TILA, RESPA and FDCPA.
A document authentication audit usually used to detect robosigning.
An audit to ascertain compliance with local rules of civil procedure.
An audit to obtain evidence of lender misconduct with respect to loan modifications.
Each of these audits may also be productive of useful legal defenses to foreclosure. Nevertheless, what BPIA is selling and the client is buying is a securitization audit-nothing more.
How has the securitization audit been misused?
A securitization audit produces a report intended for the use of an attorney to defend against mortgage foreclosure. It is part of an attorney’s work product. It provides evidence and information. By itself, it is neither admissible into evidence at trial nor discoverable by the other side. Unfortunately, securitization audits have been sold to unwary homeowners in foreclosure to serve as expert testimony without the expert. BPIA condemns such misrepresentation. Put plainly, a homeowner may not hand the audit report to the judge at a hearing and expect the judge to stop the foreclosure.
Can a securitization audit be used by an expert witness?
A securitization audit can be recast to serve as the report of an expert witness but only if the expert witness has been retained and is available for discovery and will appear at trial. By itself, the audit report cannot be introduced into court as evidence or testimony but is excludable as hearsay. When a securitization report is used as a pre-trial investigative instrument, great care must be taken not to enable the opponent to characterize the report as an expert report because that would open the doors to discovery. An attorney knows how to use the information contained in the securitization audit report and the different techniques for introducing damaging information into evidence ( such as through an expert witness, direct testimony of a witness, cross examination of an opponent’s witness and discovery, etc.).
To repeat what was said above: BPIA urges every homeowner to only obtain a securitization audit for the use of counsel who either has been retained or will be retained.
this response is riddled with so many mis-staments, that I cannot even respond, only to say that I disagree with your approach and nearly everything you have written. Most problematic is if consumers relied upon your statements and were damaged as a result.
Matt and Mark, not all ” securitization audit” firms are the same in lack of disclosure, faulty work product/design, expense, etc”¦ This is a work in progress ““ just like foreclosure defense attorneys doing foreclosure defense law. We at BPIA highly support qualified attorneys because we have seen devasation to our legal system by horrible attorneys on both sides of the case. Matt has written about this before. You are right.
You statements above have some merit, and I respect those with merit. Your are 1000% correct about the need for admissible evidence and unimpeachable expert witness testimony. Read our in-house counsel Richard Kessler’s statement above for more on this crucial subject. But saying that a securitization audit has ” zero value, zero value, zero value,” as Matt stated yesterday, is like saying ALL attorneys are lazy, too expensive, arrogant, and incompetant? We know this to be an over-generalized and false statement. There are some really excellent attorneys out there”¦
All of our auditors have passed a criminal back-ground check and undergo training. We have have lots of disclosure, verbally, and in writing. We are very affordable at the detriment of our incomes. We are clean. Others may not be. We are also a licensed private investigative agency and our license is readily available on our website. We are not in this to get rich. We are in this to provide a tool the qualified attorneys can use to prove STANDING and CAPACITY. I learned that from both of you.
I still believe, and will always believe, that competant, affordable attorneys who ” walk the walk and talk the talk” are a homeowners best defense. Pro Se is NOT the way. I fully support Matt, Mark, Chip, etc”¦ Even Max G. has an expert securitization guy working with him at some level, doesn’t he? Correct me if I am wrong.
You guys KNOW who I am. My ethics are beyond reproach.
We are also going to be offering Legal Aid with some pro-bono work to assist those attorneys. Glenn Augenstein is offering to pay for these at cost, out of his own pocket. WE will be happy to demonstrate our work product to you at anytime you wish. We will be providing testimonials and references from qualified attorneys at anyone’s request.
Again, sorry for the typo’s, as always. (Really busy…)
Still your biggest fan,
Rob Harrington
VP/BPIA
I stand by and will amplify the comments, reports that cannot be admitted are of little or no value.
For the most part you and Stopa are right but the fact remains that you nor any foreclosure attorney that I have ever heard about are Bloomberg certified or have access to a Bloomberg terminal. By researching the data, closing dates of trusts, FWP, PSA’s, etc., you can present the evidence that is on SEC and kill the case.
You can make the argument on whether someone expert or not but you cannot argue with facts that are public record and are undeniable proof of a scam.
Again, I agree with Stopa but a good audit can kill and has killed many of cases across this country. Keeping in mind that Garfield has forgotten more about securitization than most attorneys even know, he has killed many of cases with a good audit.
email me, off list, show me a sample….show me what I’m missing…convince me…..
$2000 per month X 24 month contract = $48,000 committment. We are committed.
🙂
Rob
I’m coming into this convo late but its worth noting – first bloomberg “certification” and a token will get you on the bus. These fly by night California companies and others offering bloomberg training to people who in turn go out and start offering audit reports are as qualified as my 14 year old in Gears of War on X-Box – and for the record he’s one of the best players in the game! But that won’t get him qualified as an expert in the courtroom with a jusge that’s already prejudiced against the homeowner and counsel. And let me be clear since I too pay $6,000 every three months for each of our terminals. You better be ready to jusitfy how a $250,000 loan was agregated into 1.2 billion for ABC Trust 2007-AE1, show how the agregated amount was converted into a security bond/certificate and distributed over 35 classes (fractionalized). Then you better be prepared to show how of the 35 classes, YOUR subject loan was found in 18 of the classes (fractionalized) and of the 35 classes 28 have been paid off in full leaving 7 with an agregated value of 1.7 million. You then need to explain how of the 18 YOUR loan was found in, 15 of those classes are part of the 28 paid in full and of the 3 classes where YOUR loan is still fractionalized, the agregated amount is $275,000.
You see, the value to that for Matt and Mark is several fold. First, the break down I just gave, gives good cause for an accounting, something attorneys have difficulty obtaining through a normal discovery request so there’s a great value in a report that can prvide a litigation analysis attorneys can relate to. Second, if this information I just broke down is clear and understood it raises the question – if the court agrees the loan amount (debt) was agregated (pooled) and a security bond was issued and then fractionalized AND the subject loan is shown to have also been fractionalized in X amount of classes, how can the lien (DOT or Mortgage) still secure the Note? Secondly, how can the loan amount (debt) be fractionalized and distrubuted amongst several classes for profit and then have the Note be enforced in foreclosure proceedings as a separate instrument evidencing the same debt the security bond evidences that’s been fractionalized? That’s called double dipping and is securities fraud. I’m not even scrapping the surface of what Matt and Mark really need to be effective in these arguments.
Sorry people, a bloomberg certification and your 2k a month payment for the terminal won’t get you there as an admissible expert. And let me play a greater devil’s advocate – do any of you people have a clue of what to do when bloomberg information doesn’t match the current state of the loan? i.e. what happens when the loan is repurchased by the servicer and that info does not show up on bloomberg but the old trust information is still showing up? This is real life situations I’m talking about – Servicers walking into to court saying yes your honor however the loan was repurchased and is no longer a part of the trust. YOu know why? Because provisions in the PSA allow/require the servicer to repurchase the loans and guess what people – they’re buying the loans for pennies just to foreclose and make a few hundred grand. You all keep thinking the trillion dollar machine doesn’t have the fix to the arguments being raised. That’s what makes a GREAT portion of the reports out there USELESS!
So unless your CV shows qualification besides your so-called bloomberg teminal training, I’m here to tell every consumer out there who doesn’t know – DON’T ORDER A BLOOMBERG REPORT OR ABSNET REPORT UNTIL YOU HAVE AN ATTORNEY AND HE SIGNS OFF ON ORDERING ONE!!!!
Sorry to have to put it out like this Matt! 🙂
Anthony:
You gave a great example for not using a Bloomberg Securitization Report. I am in trouble at the moment with a foreclosure law suit against me. There are two concerns that I have:
1.)I found this on a website ” Do not be fooled by claims of Bloomberg Reports that do not have this Bloomberg data. The courts need the actual data: dates, amounts, names, etc”¦ thru legal documentation, a legal affidavit and an expert witness if necessary, to prove that your note or debt has already been paid by an insurance company, so there is no debt to the bank or lender, and they have no standing with the courts. That is what you want to show the courts. That is what the Bloomberg Reports reveal.”
The problem is that you don’t know if all the tranches have been paid off until you order the report.
2.)If the servicer came into court and argued that they bought the loan and plaintiff on foreclosure documents is still the trustee and trust should the foreclosure lawsuit be dismissed?
3.)What happens for example if the SEC reports shows that form 15-D was filed and C-Bass 2007″“CB7 was transferred to US Bank as custodian, trustee, servicer, seller etc. but the plaintiffs names are still in C-Bass and Bank of America by Ocwen Loan Servicing and GladStone Law Group?
Hello Anthony,
I read your thread and you have made some great points. Who are you? Do you have a website?
First, in a non judicial state like California, the opportunity to introduce any report before a forecosure sale is limited. A comprehensive plan to utilize reports can only be implemented as a part of an overall litigation strategy formulated by a licensed attorney. The reports should be ordered by and review by the attorney handling the case, and should not be sold to homeowners directly. I have had many many clients who have ordered reports, “forensic audits” or “securitization audits” on their own from a variety of report peddlers around the country. The truth is, all of these reports were of useless and inadmissible, including the Bloomberg reports. I have seen clients who spent their last $3500 on “audit” reports, and improperly drafted complaints hoping to save their home from foreclosure. In California, our attorney general has gone on the record and said that forensic audits are scams here– https://oag.ca.gov/news/press_release?id=1862. Additionally, the FTC has stated that these reports are scams here-https://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt177.shtm.
Essentially, the report sellers are the new breed of predators seeking to make money off the backs of distressed homeowners, and as the CA attorney general said, they “provide no foreclosure relief”. Those who claim to have “killed” it with reports have yet to disclose any such victories publicly that can be verified. My hope for 2012 is that we see more guns and taser raids on these companies who are violating California law by targeting vulnerable homeowners. No one should be selling anything directly to homeowners. Period.
Matt, I would like to drive down to St Pete from Niceville and show you first hand. Could you ask a half a dozen of our best attorneys in Florida to also be there? It is a 7 hour drive, but I feel its worth it. Tell me what day and time for our appointment.
Respectfully,
Your friend,
Rob
I worked for a company called American Hardship Group based in Fort Lauderdale FL. We pushed in our script, the 6 audits that some supposed lawers in new jersey used these audits, especialy the securitization audits. I quit because I felt that this company was a scam. Was I correct. Please let me know if ther is any thing I can do to stop this company from scamming these people any longer.
I’m still to get a lawyer to help me on my foreclosure thing. If the securitization audit and bloomberg financial report cannot help a home owner fight foreclosure then what can? Who can scrutinize my mortgage papers and find the dirty diapers that I need to fight the servicer who is trying a steal my house which may well have been paid of already?
I’m just a regular guy, who has held off the mortgage company from taking my live in friends home since 2007, I Had a ten year pre-paid lease with my friend, never recorded the lease, US BANK FORECLOSED Their attorneys laughed at my lease and said their client US BANK WOULD NEVER AGREE, i presented the evidance, argued the case, And won, And the judge ruled no rent paid for the remander of the lease left 2005 TO 2015, They also wrongfully foreclosed on my friend HOME , Prersented evidance for my friend to show break in chain of assingment, ROBO SIGNING, JUDGE AGREED TO APEAL OF FORECLOSURE DESSISION IN FAVOR OF MORTGAGE CO, SAME JUDGE IN BOTH DESISIONS [COMMON SENCE] IF YOU NEED GET THE REPORT, DON’T BE AFRAID TO TRY TO UNDERSTAND, PREPARE YOUR INFO FOR YOUR ATTY IN ADVANCE, KEEPS ATTY COSTS DOWN, I BET THERE IS A WAY TO FIND THAT REPORT FOR FREE, OR AT A LOW COST, I MEAN IF YOUR SELLING MBS, YOU I WOULD THINK HAVE TO FILE A DISCLOSURE REPORT, SHOWING PRINCIPLES, DID YOUR MORTGAGE CO FILE BANKRUPTCY, LIKE GMAC, DID GMAC ASSING YOUR MORTGAGE AND NOTE TO A BANK WHO THEN FORECLOSED ??? CHECK GMAC’S BANKRUPTCY STATEMENT DISCLOSING OWNED ASSESTS VS INCOME GENERATED THROUGH SERVICING, THAT’S HOW I’M SHOWING THAT THE ASSINGMENT OF MY FRIENDS MORTGAGE FROM GMAC TO US BANK IS A FRAUD, BECAUSE US BANK FORECLOSED, AND NOW OWNS HER HOME, BASED ON THE ASSINGMENT FROM GMAC, I USED COMMON SENCE,I BET THAT REPORT IS AVAILABLE AT THE FRACTION OF THE COST THAT ALL THESE CO ARE CHARGING.