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Internal Doc Reveals GMAC Filed False Document in Bid to Foreclose

An internal document obtained by ProPublica shows that when one of the nation’s largest mortgage servicers sought to foreclose on a homeowner last year and lacked a crucial document, they just made one up. The case appears to be part of a larger pattern of deceptive filings to foreclose on homeowners.

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GMAC Mortgage Corporate Headquarters in Horsham, Pa. (Rusty Kennedy/AP Photo)

GMAC, one of the nation's largest mortgage servicers, faced a quandary last summer. It wanted to foreclose on a New York City homeowner but lacked the crucial paperwork needed to seize the property.

GMAC has a standard solution to such problems, which arise frequently in the post-bubble economy. Its employees secure permission to create and sign documents in the name of companies that made the original loans. But this case was trickier because the lender, a notorious subprime company named Ameriquest, had gone out of business in 2007.

And so GMAC, which was bailed out by taxpayers in 2008, began looking for a way to craft a document that would pass legal muster, internal records obtained by ProPublica show.

"The problem is we do not have signing authority—are there any other options?" Jeffrey Stephan, the head of GMAC's "Document Execution" team, wrote to another employee and the law firm pursuing the foreclosure action. No solutions were offered.

Three months later, GMAC had an answer. It filed a document with New York City authorities that said the delinquent Ameriquest loan had been assigned to it "effective of" August 2005. The document was dated July 7, 2010, three years after Ameriquest had ceased to exist and was signed by Stephan, who was identified as a "Limited Signing Officer" for Ameriquest Mortgage Company. Soon after, GMAC filed for foreclosure.

An examination by ProPublica suggests this transaction was not unique. A review of court records in New York identified hundreds of similar assignment documents filed in the name of Ameriquest after 2008 by GMAC and other mortgage servicers.

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The issue has attracted growing scrutiny in recent months as bloggers, consumer attorneys and media outlets have identified what appears to be part of a pattern of questionable assignments filed across the country.

GMAC, whose parent company renamed itself last year as Ally Financial, was at the center of what became known as the robo-signing scandal. The uproar began last fall after revelations that mortgage servicing employees had produced flawed documents to speed foreclosures. GMAC and other banks have acknowledged filing false affidavits in which bank officials claimed "personal knowledge" of the facts underlying thousands of mortgages. But GMAC and other servicers say they've since tightened their procedures. They insist that their records were largely accurate and the affidavits amounted to errors of form, not substance.

The issues surrounding the Ameriquest loan and others like it appear to be more serious.

"This assignment of mortgage has all of the markings of GMAC finding that it lacked a needed mortgage assignment in order to foreclose and just making it up," said Thomas Cox, a Maine foreclosure defense attorney.

In New York, it's a felony to file a public record with "intent to deceive."

"It's fraud," said Linda Tirelli, a consumer bankruptcy attorney. "I want to know who's going to do a perp walk for recording this."

No criminal charges have been filed in the robo-signing cases.

Asked by ProPublica about the document, GMAC acknowledged Stephan did not have authority to sign on behalf of Ameriquest. The bank said it is still planning to push ahead with foreclosure on the homeowner, who remains in the property.

Company spokeswoman Gina Proia said an internal review last fall into "suspected documentation execution issues" had flagged the loan as problematic and that GMAC is "determining what needs to be done in order to receive the necessary authorization." 

"We will determine and complete the necessary steps to remediate and proceed with foreclosure," Proia said. 

GMAC also declined a request from ProPublica to interview Stephan.

Another GMAC document obtained by ProPublica shows that in at least one recent incident, GMAC employees were still discussing the possibility of fabricating evidence needed to facilitate a foreclosure.

The company once again lacked a document that would show it had been assigned the mortgage. Since the lender was defunct and no assignment had ever been made, GMAC again seemed to be stuck. But the employee proposed in June of this year that GMAC file a sworn statement that the assignment had once existed but had been lost. It's unclear if such an affidavit was ultimately provided to a court.

Records also show that GMAC has continued to rely on documents signed by the very employee at the center of the robo-signing scandal—Jeffrey Stephan, the same employee who also signed the Ameriquest document in 2010. Stephan acknowledged in sworn testimony last year that he had been signing 400 documents each day, a revelation that helped kick off the scandal. According to a former employee and a consumer attorney, Stephan still works at GMAC, though he has been transferred to a different unit.

GMAC, which is still majority owned by the government, said it is still pursuing foreclosures based on assignments signed by Stephan.  

"There is no reason or requirement to 'withdraw' valid assignments of mortgage that happened to have been signed by Mr. Stephan," said GMAC spokeswoman Proia, because there's "no requirement that [the assignment] be signed by a person with knowledge of any particular facts." All that mattered, she said, was that the signer had received the proper authority.

Banks have little reason to worry about their documents being challenged, since homeowners rarely contest foreclosure actions. In a filing with the New Jersey Supreme Court, GMAC said that of the more than 4,000 foreclosures it has handled in the state only about 4 percent of homeowners had contested the action.

When homeowners do challenge banks' documentation for foreclosures, they can have success. Late last week, the Vermont Supreme Court threw out a foreclosure case handled by GMAC due, in part, to a flawed assignment document signed by Stephan.

"It is neither irrational nor wasteful to expect the foreclosing party be actually in possession of its claimed interest," the court said, "and have the proper supporting documentation in hand when filing suit."

Since last fall, GMAC has added staff, increased training and added new procedures, said Proia. But some of those new hires have come from firms themselves accused of filing false foreclosure documents.

One manager at GMAC, Kevin Crecco, moved there from a position at the Law Offices of David Stern in Florida after the firm drew scrutiny from the state's attorney general for allegedly filing forged documents. Stern's office, once among Florida's biggest foreclosure law firms and labeled a "foreclosure mill" by critics, ceased operations earlier this year.

An internal organization chart from this spring for GMAC's foreclosure department lists Crecco as a manager overseeing roughly two dozen employees. GMAC declined to make Crecco available for an interview. He hasn't been accused of any wrongdoing.

Mortgage servicers like GMAC continue to be set up like assembly lines, with members of its "Document Execution" team responsible for signing documents. The organizational chart shows two "Document Execution" teams of 13 employees each.

The employees are tasked with, among other things, signing affidavits attesting to the accuracy of the basic facts of the loan, such as the mortgage amount, outstanding fees, etc. Affidavits are a necessary step to foreclosure in many states where banks have to go to court to seize a home.

During the robo-signing scandal, GMAC admitted that employees signing affidavits didn't verify the underlying facts. The bank says it has fixed the problems.

But consumer attorneys said that while GMAC's processes have improved, they haven't corrected basic flaws with their process.

Cox, the attorney who questioned Stephan last year as part of a foreclosure case, said employees on the "Document Execution" team still aren't truly checking the accuracy of the underlying information. Rather than digging for the original documents, employees on the team look at the numbers given by a GMAC database and double-check the math.

If the employee "just looks at a computer screen, that's not sufficient in my view," said Cox. He said he would soon be challenging affidavits GMAC recently filed in court.

Consumer attorneys also said the systems that servicers rely on are consistently plagued with inaccuracies, making a more thorough verification of the information necessary. "These days, homeowners are being forced to save every receipt, every letter, every statement, so that one day they can prove that their payment history is accurate and the bank is wrong," said Jim Kowalski, a consumer attorney in Florida.

GMAC's Proia said the company's procedures—which amount to a review of information in the company's computerized databases—were sufficient to file affidavits.

Why no mention of Ally Financial? Didn’t GMAC just rebrand itself to avoid this kind of negative publicity?

Hi Greg, Good point. We’ve added that to the piece.

We always knew that GMAC was not honest with our case.
They [GMAC ] WASTED TIME ON OUR LOAN MODIFICATION PAPERS AND HAD SERVED NOTICE TO US FOR FORECLOSE.

WE HAD TO RUSH TO PAY ATTORNEY TO STOP THE FORECLOSE
FOR CHAPTER 13.
NOW WE ARE IN CHAPTER 13 ,WITH CREDIT RUINED AND WE ,NOW WE DON’T KNOW HOW TO REFINANCE OR GO FOR MODIFICATION.
GMAC IS NOT INTERESTED IN OUR CASE ANYMORE.
IS THERE ANY ONE OUT THERE WHO CAN PERSUE GMAC TO DO MODIFICATION TOUR LOAN.

THEY GMAC IS VERY HARD TO FIND REPS WHO WILL EVEN TALK TO YOU.

GMAC SHOULD BE PENALIZED FOR ALL THEIR WRONG DOING.

nathaniel bostwick

July 27, 2011, 2:19 p.m.

No mention of Chase?
Paul Kiel is still doing a damn good job calling out these fraudsters!
Keep up the good work!

Nick Thompson

July 27, 2011, 2:20 p.m.

No question a spotlight should be applied to any false document signing taking place, but aren’t we forgetting something really vital with all this media salivating over alleged wrongdoing?  What about the tens of thousands of people who lied about income and their ability to pay and are now being forclosed upon? Don’t they bear some semblence of responsibility? What should the companies do? Just forgive al the debts and give away houses?  This isn’t the lottery. What about the 90% of the population that has continued to do the right thing - despite the economy—and paid their mortgages on time every month? At the end of the day, due to whatever legitimate and illigitimate hardships, people have an obligation to pay their debts. If they don’t, they should suffer the consquences.

@KAY AND EVERYBODY—-

IT’S ALL UNSECURED DEBT—-THEY HAVE NO PROOF OF ACTUAL CREDITOR—-WHO CARES ABOUT CREDIT REPORT—-IT’S JUST AN “I LOVE DEBT” SCORE—-DON’T LET THE BANKS WIN—-THE BANKS ARE FAILING BECAUSE THERE ARE NO ACTUAL MORTGAGES—-SEND A QWR—-QUALIFIED WRITTEN REQUEST ASKING FOR PROOF OF ACTUAL CREDITOR AND ALL ACCOUNTING FROM BEGINNING OF “LOAN”—-FORGET “LOAN MODIFICATION”—-IT’S A SCAM—-DON’T GIVE THEM ANY MONEY—-SEND CEASE AND DESIST LETTERS AND DISPUTE OF DEBT—-DON’T TRUST THE BANKS OR THE SERVICERS—-I HAVEN’T PAID ANYTHING TO THEM IN MONTHS BECAUSE THEY CAN’T PROVE ORIGINAL CREDITOR IS GETTING THE MONEY—-DEBT IS UNSECURED—-THE GOVERNMENT IS HIDING THE TRUTH—-THEY CANNOT LEGALLY TAKE YOUR HOUSE—-FIGHT FIGHT FIGHT AND DON’T BACK DOWN!!!!!!!

Whats the big deal? If the money was borrowed, the borrower intended to put up their house as collateral, and they didn’t pay their mortgage as agreed, why should’nt they lose the house? - that was the deal. Securitization enabled many to get money that otherwise would have received none. The fact that paperwork gets messy when companies go out of business shouldn’t be that big of a factor. Why should it matter if a robo signature or something else is used by an owner of the note to facilitate obtaining the collateral? So many scammers.

Stephanie Palmer

July 27, 2011, 2:35 p.m.

Not only did GMAC take the taxpayer’s money, but they then turned around with fraudulent papers and tried to foreclose on the very taxpayers who provided them with the original bailout money. There is no end to the hypocrisy evidenced by them and all of the others who took advantage of the bailout. In the future, let us let them hang themselves. Their greed is outrageous and totally unacceptable in this country. If they want to operate like that, let them go elsewhere. They don’t deserve to be in the USA.

Actually Nick, when the foreclosing party is playing fast and loose with the law, and committing both fraud and potentially criminal acts in their filings in court, it does essentially become a lottery. Regardless of how the home purchaser became subject to foreclosure, should they successfully fight the foreclosure due to the loan servicer’s illegal actions, that’s completely the servicer’s fault.

Dale, you must work for the banks…wake up—-there was no actual securitization of mortgages—-all a big LIE…the real truth is coming out…wait and see…

(from huffungton post):

“If mortgages were not properly transferred in the securitization process, then mortgage-backed securities would in fact not be backed by any mortgages whatsoever,” Adam J. Levitin, a bankruptcy expert and professor at Georgetown University Law Center, said at a House panel last November. Levitin said the problem could “cloud title to nearly every property in the United States” and could lead to trillions of dollars in losses…
“While several investigations remain ongoing at the state and federal level, no agency has systematically examined loan-level documents to ensure the creation of mortgage securities complied with state laws or to examine the scope of sloppy paperwork in foreclosure proceedings, like the so-called “robo-signing” fiasco…”

“In essence, banks may be unable to prove that they own the mortgage loans they claim to own,” the panel said.

“The review “calls into question the securitization of these loans,” Field wrote. She added that the findings also raise questions over the right of investors to foreclose on the borrowers who defaulted on their loans since the mortgage securities may be invalid.”

“At the end of the day, due to whatever legitimate and illigitimate hardships, people have an obligation to pay their debts. If they don’t, they should suffer the consquences.”
____________________________

Nick that is entirely too simplistic in this case.  Remember getting “cold-called” around dinner from a mortgage company offering amazing rates and easy qualifying?  Just a few years ago?  Remember pols including Bush speaking on national TV that home ownership was a step forward in the American dream?  Americans were sold, mesmerized, brainwashed and outright lied to regarding home ownership, its risks and liabilities.  Who invented the “Liar” loan?  Consumers?  Who came up with the Adjustable Rate Mortgage?  Consumers?

Carola Von H.

July 27, 2011, 3:32 p.m.

As you say, the original lender, Ameriquest, was notorious. Their fraudulent methods included encouraging borrowers to lie on loan applications, adding unwarranted fees, etc. Ameriquest was also huge (at one point the largest subprime player in the game) and highly politically connected—to both the Bush (first) and Clinton administrations. They were sued in a group effort by dozens of state attorney generals, but beat the rap with a settlement. No admission of wrong-doing required. When Ameriquest eventually sank beneath subprime excess, such luminaries as Robert Rubin and Governor Deval Patrick tried to throw them a rope. Interesting that the mortgage at the heart of this particular case was Ameriquest generated. Guess you could call them the gift that keeps on giving…

Carola Von H.

July 27, 2011, 3:55 p.m.

Correction to my earlier comment re the bi-partisan political connections of Ameriquest. On the Republican side, twas Bush the Second not the First. How I hate these political dynasties—they’re so darn confusing.

“What about the tens of thousands of people who lied about income and their ability to pay and are now being forclosed upon? Don’t they bear some semblence of responsibility? What should the companies do? Just forgive al the debts and give away houses? “

You seem to know nothing at all about the mortgage lending business, so let me enlighten you. Lenders are supposed to verify any financial information a potential borrower provides. However, in the rush to expand their portfolios and in pursuit of larger profits, they almost totally abdicated that responsibility. There are ample avenues to verify someone’s income, and if a lender is unable to do so, he/she should not make the loan. Full stop. What you fail to understand is that lenders din not want to know if they were being lied to, because if they actually verified that potential borrowers were lying about their income, they’d be forced to reject the application. They didn’t want to do that - they wanted to close as many mortgages as quickly as possible, and allowing people to tell them fairy tales about their income was the quickest and easiest way to do so. Besides, those Alt-A and “liar loans” carried much higher interest rates and servicing fees, which made them potentially much more lucrative than properly underwritten loans that were secure but less profitable. As a former mortgage banker, I have zero sympathy for the banks that made these loans. They made their beds and now they don’t want to lie in them. Too damned bad. When you run a scam, don’t bitch when your mark scams you back.

Betsy Jacobson

July 27, 2011, 4:07 p.m.

Our mortgage banker wanted so badly to foreclose on us that they perjured themselves in court, and when that lie was so easily provable, they had to pull their necks in.  I don’t know why something as little as perjury should have bothered those stinkers, do you?

our courts system and judges wake up dont rubber stamp
the bank fraud demand to see evidence of ownership do your jobs
please

So, reading this article reminds me that I’ve been asking for copies of original loan documents from both my 1st (Wells Fargo) and my HELOC (ETRADE) and both, separately, sent me some copies of documents fully executed but both, separately, also sent me a copy of my DEED (different ones respectively) but in both cases the copy of the DEED is not signed by me or anyone else and instead only has a pre-typed-out fields filled in - but no signatures. Is that common/acceptable? I live in a non-judicial foreclosure state and so have no real opportunity to contest even if it is negligence on both their parts.

karen, a friend of mine requested note from bofa.they sent her 11 pages.including title insurance docs.ofa doesn’t appear anywhere.i can not make heads or tails of it. may i fax it to you for your advice and council?

OK… the world now knows all about the robo Signing scandals… the Assignment of mortgages suddenly appearing purporting to transfer the mortgages into the Trusts YEARS after the Trusts are closed to deposits, the forged Applications, the forged Notes and mortgages, false testimony in the Courts and so much fraud on the part of the Lenders that if any one of us lowly peons ever committed even 1/1 millionth as many torts we would be seen Globally on the News as financial terrorists and our execution (after waterboading) would be at least a national event… so I gotta ask…  when the Hell are our Courts gonna anti up, admit their mistakes and go back through their records and start sua sponte throwing out not only these present fraudclosures, but the millions and millions that have already happened? It is, after all, the right thing to do! And if they don’t, it’s an automatic and very public admission of Collusion. For which we the people have a duty to prosecute.  They have a job to do, they screwed up, it’s time for them ALL to step forward… or let’s start putting them, each & every one, under the eye of the Law.

My FHA/HUD loan was bought from Wells Fargo in August 2007 before the ink dried on the closing documents.And beleive me there was so much fraudulent activity that went through with it that no one wants to investigate in to cause there was so much cover up paper work,like the Appraisel never being finished,and the year of the home was actually older then what was written in by seller. on documents.But they got away with it cause they have Political Ties within the County.Housing Market is one BIG Fraudulent act !!!!

Margret Brady

July 27, 2011, 7:07 p.m.

Our Ditech/gmac/ally mortgage application was honest(at least on our part), and we refused to take as much money as they offered and are not underwater but we were got sucked in by promises to reduce our interest rate and then bogus charges were added and the whole litany of errors and mistakes that were part of their pattern of fraud occurred, as we tried to straightened things out. We just want to sell our very large historic home and move to something easier to manage in our old age. 3 years later, we are still here, they still won’t accept our mortgage payments and another bank claiming to be a trustee for a trust attemptd to foreclose. We hired an attorney to ask the court, just who are lender was. Foreclosure was withdrawn and now they all refuse to negotiate or even discuss anything.  Our morgae and or note could be owned by any or all of 7 entities and all a tiltle search revealed was that robo signer Jeffrey Stephen, assigned our mortgage to another bank 3 years after the fact. He signed as an officer of the computer company MERS who was the only owner of record prior to the transfer to the foreclosing bank 4 years later.

Nick, you don’t have it quite right.  John, you are correct.

Let it be understood that if the banks had underwritten the loans properly and not sold the dangerous loan programs which they did, these loans would never have been originated, funded and sold off as securities:  Thus, the meltdown.

I do not believe I have ever met a purchaser of a home that demanded that his loan be approved by a lender.  Certainly, purchasers should be held responsible to some degree, but even if wrong doing was performed, this does not give the bankster the right to falsify documents to foreclose.  Nick, you are giving up your protection by giving a stamp of approval to banksters to do whatever they want when they want.

Now, second to that is if you had audited all of the files that I have audited, it would be clear to you that at least 75% of the people had a legitimate reason, a hardship or whatever, and this does not mean that the bankster should be able to foreclose illegally.

48 years in the business and virtually have worked with every mortgage related issue imaginable.  Let’s get back to the rule of law and then foreclose the home if it is found 1)  that the lender has the right 2) that the lender has not tried to foreclose through illegal practices and that the 3) that the borrower has no valid reason for staying the foreclosure, such as bk, and is indeed in default.

Micheal—-I’m not a lawyer—-but I have received advice and knowledge on livinglies.wordpress.com .  Just send a QWR…asking for proof of EVERYTHING.  Don’t trust whatever they say…they are STILL lying about the extent of the “fake mortgages” fraud.

This is very serious problem more so than Mr. Keil has gone into.

We in the USA have 3 branches of Government. The Legislative and the Exeuctive set the rules and write the laws. The Judicial is expected to see that the laws are obeyed.

As we have found out the Legislative and Executive branches are for sale and have been purchased. What the morthashe scandal has shown us is that the Judicial branch of goverment has also been purched either with direct bribes or with quid pro quo’s of some type.

The crooked Banksters would have never dreamed up or executed this scam that has brought this country to its knees unless they were spot on certain that they owned the Judicial branch.

The USA is in its last throws. The US Supreme Court’s “Citizens United” decision that allows anyone, any corporation, any foreign country to purchase an election, sealed it with a kiss.

GMAC foreclosed on our home after more than 2 years of back & forth to get a modification we never wanted, but could not get anyone to refinance our loan because of credit freeze. Our mortgage payment was all over the place as we were placed in one mod after another, going from $2,299 a month to $3,420—even when we used HAMP certified advisors—with thousands of dollars added to our premium.
Finally, before our last loan mod pack was rejected, (it happened ever few month) but before they notified us of the rejection, they foreclosed on our house and put it up for auction without us knowing. We ran to an attorney everyone said was great, only to find out that GMAC had moved us out of HAMP & into their own mod program that afforded us no protection, without our permission or knowledge. The only difference between the packets was the GMAC packet did not have the HAMP stamp on the front, otherwise everything was the same.

Seems to me that the simplest thing (albeit expensive) would be to have a law firm or the ACLU to challenge a huge number of foreclosures from someone like GMAC. 

The company knows that their systems/authority won’t stand up in court but if only 4% challenge and 50% win, they only lose on 2% of their portfolio. If a substantial portion challenged, GMAC and others would be forced to adjust their position and process.

LizinSarasota

July 28, 2011, 7:23 a.m.

For those of you who say that an affidavit is a mere “detail” in the foreclosure process, just a “technicality,” let me quote from the US Bankruptcy Court of the Eastern District of Louisiana, in a case involving Lender Processing Services, the notorious affidavit mill out of Mendota Heights, MN and Jacksonville, FL:
Default affidavits are a lender’s representation as to the status of a loan. They are routinely accepted in both state and federal courts in lieu of live testimony. They are an accommodation to the lending community based on a belief by the courts that the facts they present are virtually unassailable. The submission of evidence by affidavit allows lenders to save countless hours and expense establishing a borrower’s default without the need for testimony from a lending representative. While they can be refuted by a borrower, too often, a debtor’s offer of alternative and conflicting facts is dismissed by those who believe that a lender’s word is more credible than that of a debtor. The deference afforded the lending community has resulted in an abuse of trust.
The court goes on to call an LPS affidavit - all of them, based on testimony about their practices and procedures - a “sham” and a “farce” and the court states the documents do not meet the requirements for filing.
http://www.scribd.com/doc/52867919/In-Re-Wilson-Memorandum-Opinion-07-Apr-2011 page 21
The banks have nearly bankrupted our court system.  LPS was flooding our courts with fraudulent documents to the tune of 200,000/year as early as 2006.  http://www.scribd.com/doc/58804906/Lender-Processing-Services-formerly-FIS-newsletter-The-Summit-September-2006 page 16
Our libraries are closing.  Our services are being sliced.  The courts are clogged with fraud and nearly bankrupt (financially and ethically).
The situation we find ourselves in can be laid directly at the feet of the banks (and several wars halfway around the world).  This mortgage/foreclosure fraud debacle is the direct responsibility of the banks.
I personally think the banks need to be busted up.  They are no friend to the American consumer.

It’s not the only bank doing this amongst other wrongful things. For example I now have a pending criminal housing court case on a property that Deutsche Bank can’t prove it owns but pad locked and lock boxed the property. There is no judgement against me. When the property was illegally locked boxed it caused thousands of dollars of damages, it invited vandals to strip the unit completly.  I oost a $20,000 reapir grant, materials stolen out of my home, and tenants equlaing loss of income from me.There is also a court hearing in federal court involving my case.

It simply comes down to this. In 2006 I recieved a written modification from Indy mac freezing my motnhly mortgage to $896.00 per month until the year 2034, inlcuding taxes and insurance. The bank accepted the payments for years. Then When the housing market collapsed & afterwards Indy mac was seized by the Feds another monster emerged.
Indy mac became part of One West and in 2009 a new statement arrived rasing the mortgage to $1,750.00 despite the written agremeent.
In 2009 One West sent foreclosure papers suing not only me but others it has no business doing. Such as the prior family who sold my family the home 15 years earlier. Another individual who never signed off his release so teh refinance should have never taken place.

In 2009 discovered neither One West nor Indy mac owned the loan.
2010 the illegal lock box was placed on the home.
2011 pending court cases in federal and city court.

My shocking story and video footage of the property is on Youtube.com Channel: Baron 2888 Titled: Guilty until proven Innocent. I wish for no one else to go through this hell I have had to go thorugh
when I did nothing wrong. I am no where in the video on purpose because it’s about my topic. I hope by me coming out others gain courge to speak out and tell.

So, legally, if I borrow money from company A and the A goes out of business, do I still owe the money?

If A sells the loan to B, but B fails to obtain any document that says that it owns the loan, and A goes out of business, do I owe B the money? How can B prove that it owns the loan? Why should I pay B anything unless they can prove they own it? What gives them the right to foreclose?

What if C claims that it owns the loan and files for foreclosure on me. How can C do that if it really has no claim whatsoever on the loan? How can we tell the difference between B that MIGHT have a claim and C that has no claim?

John Anderson

July 28, 2011, 9:23 a.m.

A point that is not covered is the fact that these signers are not vested nor employed, nor paid by the Banks that they claim to represent. That is a direct violation of banking regulations. These people are not under the control or direction of the banks.
Why are the banks outsourcing the signing of assignments of mortgage and other documents for the banks?
To limit the liability to the banks, in this Wall Street fraud!

Since my first post yesterday, several have followed but no one yet sees the problem. Its not the criminals attempting to get away with something, its the judicial system failing to stop it.

You have to ask why?

The laws are on the books for 200 years (Uniform Commercial Code)

Where are the courts?

Are they just sleeping or bought off?

Mortgage-Mod-Monster.com

July 28, 2011, 9:38 a.m.

This is more of the Foreclosuregate scandal from last November. Remember Linda Green?

The solution is to get the REST Property Solutions Report. I sell it. It is a prerequisite to an attorney consultation. As near as I can tell, discussions about this scandal seem to be collecting under a “Corrupt Title” keyword or tag.

Unfortunately it’s a rich man’s game. You need an attorney to prosecute a Sue your Lender for Broken Chain of Title case. Trained attorneys are few and far between.

Common wisdom seems to indicate that if a groundswell of these cases are filed, slowly, the mortgage investors are going to prosecute the miscreant mortgage servicers. If and when that happens, Katy bar the door.

Every person who signed one of these—OFF TO PRISON!

James B Storer

July 28, 2011, 10:48 a.m.

Trubee:  Your overview is exactly right on exactly.  Corporate money owns the three branches of govenmemt.
LizinSarasota, your learned comment and conclusions are great, and I wish to quote from it one sentence which is a universal truth and is the cause of much injustice, even in situations not riddled by corruption:  “…too often, a debtor’s offer of alternative and conflicting facts is dismissed by those who believe that a lender’s word is more credible than that of a debtor.”
I did not intend to comment on this report, as the basics are covered in numerous other reports.  Upon reading the ‘comments’ I felt obliged to voice my disagreement with Nick’s comment:  This is not about ‘the tens of thousands who lied about their income and are being foreclosed upon.’  It is not about ‘should the companies Just forgive all the debts and give away houses’?  It is not about ‘the 90% of the population that has continued to do the right thing.’  It is not about ‘due to whatever legitimate and illegitimate hardships, people have an obligation to pay their debts.  If they don’t, they should suffer the consequences.’
What this is fine Kiel report is about is a giant household name corporation forging documents to use against a buyer.  Buying a house is the most expensive financial transaction by far for most households.  The paper work involved is monstrous in quantity, much of it in perplexing legal lingo.  For a mortgage company to resort to falsified documents is absolutely and totally unethical and immoral in any stage of the matter, regardless of supposed responsibilities of the borrower.  The mortgage company is responsible to check the buyer’s financial condition and determine if approving the loan is good business practice.  There is always the possibility of nonpayment, but the company (the “expert”) shall not resort to illegal practice in pursuing the situation.
  Skartishu, Granby MO

GMAC has been the easiest lender to work with with both loan modifications and short pays.  Don’t get me wrong, this article is informative that it sheds light on something which is common in this industry but for the most part GMAC has been the #1 lender in approving mods and short pays.  We just did 10 short sales for one client with them in 60 days.  We dream of a GMAC loan coming our way.

We do not condone prosecutors fabricating and planting evidence against a defendant simply because they think the defendant is probably guilty.

It is just as antithetical to our legal system to allow banks and their lawyers to invent evidence and submit it pursuant to a judicial proceeding.

Plain and simple, the document uncovered by Mr. Kiel shows that GMAC and its attorneys recognized that they lacked key evidence to win their case.  Their solution was simply to fabricate the evidence they desired and submit it as part of a judicial proceeding.  By all indications, this behavior is systematic and routine.

If this material has not been forwarded to the New York State Attorney General, it should be immediately brought to his office’s attention.

Well I know what gives them signing authority a damn patent that what I found patent for a invention for the law firm of barrett,Daffin,Frappier Turner & Engel LLP filed in 2008 for the creation of mortgage foreclosure documents prior too he tesified at a Task Force Meeting that that “no such document exist thats going to state I am the holder and owner and hereby give to the servicer the right to foreclose” so if there is a lawyer on this blog can you please tell me how the hell they going to foreclose on property based on someone patent idea? Please

ALL THE BANKS ARE CRIMINALS—-INCLUDING GMAC—-WAKE UP PEOPLE—-YOU ARE BEING PLAYED LIKE A VIOLIN—-STOP GIVING THEM MONEY—-MAKE THEM SHOW YOU ALL ACCOUNTING—-ALL PAPERWORK—-PROOF OF CONVEYANCE—-PROOF OF ORIGINAL CREDITOR GETTING YOUR MONEY—-THE TRUTH IS IN THE ACCOUNTING—-MASSIVE FRAUD HERE—-FINALLY STARTING TO BE UNCOVERED—-THEY CANNOT LEGALLY TAKE YOUR HOME—-STRAW MEN ARE STEALING THE HOMES—-THE SCAMS AND FRAUD CONTINUE—-FIGHT FIGHT FIGHT—-DON’T GIVE UP—-DON’T LET THEM WIN—-

Abigail Field

July 28, 2011, 7:18 p.m.

Thanks the story, Paul, and the link to my VT case post.

Here’s my blog post riffing off your story and the piece about the suit against Blackwell: http://abigailcfield.com/?p=202

@Dale: I don’t want to beat up on you because your question is typical of people who refuse to take the time to learn the truth before they offer a worthless opinion & muddy the water. In 95% of cases homeowners received legitimate loans because they had sufficient credit and down payments to be approved. People have been paying their mortgages faithfully just as you’ve probably paid your own. But . . then banks committed the biggest ponzi fraud this country has ever seen by creating literally ghost money machines, & stolen hundreds of billions, and should’ve been declared illegal but wasn’t because legislation is for sale to the highest bidder. The mortgage-backed securities paid over and over the financed cost of the home’s original debt, and banks were also bailed out to the tune of hundreds of billions of taxpayer $$, then they also cashed in on insurance policies that paid out when they purposely sunk the economy (resulted in job losses & financial disaster for homeowners), all after having sold the bundled mortgages to investors for more billions. Now they want the notes paid again for a 4th or 5th time by foreclosing & pocketing the sale price plus collecting from Treasury.. We say - hell no!!! How stupid does one need to be to understand what’s wrong with this equation? How many times exactly do you get to cash YOUR paycheck - 3 or 4 times depending on how much $$ you want that week? You and others need to stop looking at these banks and servicers as innocent and homeowners as taking something undeserved. The people scourged by the collapse of the economy at the very least deserve their loans modified - not foreclosed.  Also, the truth and people responsible for theft & fraud held accountable would be appropriate as well.

Can’t write any longer, because Microsoft Corp. or some face less profiteering party by repeatedly disabling my new Laptop has made it difficult for me to continue on my old PC.

Tutt: No one could have explained it better. The problem we have is that most Americans are stupid or at best, uneducated and don’t want to hear the truth. Instead they would rather listen to FOX news and Tea Party candidtates and believe this is 1955,  and God is good.

Criminals love this mentality and look for another small hole in the system to open so they can keep stealing.

What is truly amazing is that it took so long for Wall Street to figure this out. The county clerk’s offices in this country were run by slow minded people who thought anyone who walked through their doors was honest, in fact that is still the case today in most counties.

What these Wall Streeter’s did was take a 200 year old system (UCC) and turn it into their check book.

What has gone on over the past 10-12 years cannot be fixed for a generation or maybe more.

My question is, what’s the next scam?

This last one was the biggest anyone could possibly dream up but you can bet these same people or their successors are in a war room somewhere thinking hard on how to separate common people from their hard earned money.

The basic fundamental thing the want to do is convince people to trade their hard earned money for worthless paper.

View the video and let the video on Youtube.com Channel: Baron 2888 title: “Guilty Until Proven Innocent” I hope the video give others the encouragement to speak out about the wrong doing banks are doing to home owners who have done everything right, still to be violated by the banks. Put away your shame as lenders want people to feel. Perhaps Social Media can be used for a good thing, pass the video on.

There are two upcoming court hearings in my situation. Criminal in and Federal.

Tutt—-one problem with your post—-you say:

“The mortgage-backed securities paid over and over the financed cost of the home’s original debt,”

Well, guess what—-THE MORTGAGE-BACKED SECURITIES WERE NEVER MORTGAGE-BACKED.  Never “transferred” to the “trust”. Only collection rights transferred at closing. No REAL mortgages in sub-prime.  Loan level files are completely invalid. HUGE COVER-UP for years…  Securities investors are winning in court because of this fraud—-why aren’t the homeowners???  Fraudulent “straw men” stealing houses…no proof of original creditor.

MUST PROVE STANDING TO FORECLOSE…don’t let them steal your house!!!

Mortgage-Mod-Monster.com

July 29, 2011, 1:24 p.m.

The huge problem w/ all this is that suing for corrupt title; or suing for broken chain of title is a rich man’s game. You don’t dare do it yourself.
And the word is that expert attorneys are few and far between.

This is a potentially burgeoning industry, but you’d better have a few thousand in your pocket.

On the other hand, the reduction in principal rewards would be phenomenal.

Joyce Cauthen

July 29, 2011, 2:32 p.m.

Alright - enough is enough -  What is the matter with the judicial system.  Where are the district attorneys - the AG’s - all are absent what is going on here.  The banks are counting on the people not being able to pay for their defense and the feds, the AG’s and the Politicians are letting it happen.  Why do the people continue to be led around by the nose.

No settlement should be accepted unless they are fair to the people and those that corrupted the judicial system, including the judges along with the pathetic attorneys, should go to jail. 

No one is in the corner of the people -  hopefully the AG’s will be voted out of office not to mention theier plans for becoming Governor or a future senator.

Get the town hall meetings ready.  And do not do business withe banking industry.  Find out what is needed to protect your interest and then just simply move the account.

They are now planting the seed to say the banks are weak and may now need to be divided up.  That is the most recent ploy set to buy more time while the feds, the courts, the AG’s buy more time to figure out which settlement best serves the needs of the banks.

This is a devastating turn of events and we should have recovneized it early on back in 2009 and most certainly before, when AG’s refused to address (along with Senators) and the regulatory, that they were not going to reign in the fraud and corruption.  Title companies included kept doing what they were doing to work in tandem with the banks.  What a mess and as for the people -  you guess it, the banks are going to clean house while they taker away what few assets you have as an American citizen. and do it while the banks provide a pittance of restitution and absolutely destroy the rule of law.

48 years in the business and look what our decision makers have allowed to happen to us.

Wow, Tutt, share the bong! What planet are you from or on? I know you don’t want to “beat up on me” for my opinion, but when you take someones money, agree to make payments according to a schedule to pay it back, and put up your house as collateral if you don’t keep your commitment - well, you may very well get what you bargained for - bye bye rooftop!!!  Doesn’t really matter what happened to the paperwork after, if it was securitized, whether a computer signature was used, or whatever came later - so what. Most of the people whining now are members of the “gimmie something for nothing” crowd. I say - get used to renting, buddy! See how long you get to freeload when you don’t pay your rent to the man :)

The bailout each bank received of our tax dollars (which never should have been) technically represents the defaulted principle AND interest on the mortgages they approved. So, if they got payed for the lent money, WHY are they foreclosing on the collaterized properties of the same loans they jus got bailed out of???

Hm? Why is someone out there NOT bringing this up? The banks got bailed out. They can’t collect double!!!

to realitycheck… oh… it’s much worse than that. 1st., they didn’t loan any of their own money.. they created a “Trust” with the promise of filling it with bundled mortgages (called mortgage backed Securities). Then they sold shares of the Trust to investors and took that money to loan to homeowners.. then, they made the loans and charged commissions and fee’s… then, before they could make the deposits into the Trusts legally (IRS & Trust Law), they had to “bundle those loans” using another legal “entity”. So they transferred the mortgages to a securitizing “Agent” (again charging fee’s) who bundled up about 5000 mortgages into the above mentioned “Mortgage backed Security” and then transferred the bundle (again charging another fee) to another “entity” called the “Depositor” who (for a fee of course) Deposited the MBS’s into the Trust (sometimes!) and all the while, generally, retaining the rights to act as the Trustee for the Trusts (for which they charged a fee!)

Knowing that the loans were less than good…. they then bet against the Trusts!

When it all went down, the collected from the bets (Credit Default Swaps) and us taxpayers too! 

So whereas the banks got the bailout money… they didn’t own the bad mortgages! That way, they weren’t being “paid off”... we were all just getting screwed!

This article is part of an ongoing investigation:
Foreclosure Crisis

Foreclosure Crisis: Banks and Government Fail Homeowners

Banks and the government have fallen short in helping homeowners in danger of foreclosure.

The Story So Far

Systemic failures at the country’s banks and mortgage servicers have exacerbated the most severe foreclosure crisis since the Great Depression, and government efforts to limit the damage have fallen short. ProPublica created an unrivaled database of homeowners who have faced foreclosure, opened a Facebook page to encourage homeowners to share their stories, wrote profiles of some of them, and incorporated their experiences into our reporting. We also provided a comprehensive rundown of the numbers behind the crisis.

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