On March 3rd, 2020 a jury found Anthony Williams GUILTY of all 32 counts in the Superseding Indictment in the case of United States v. Anthony Williams in Federal District Court in the District Of Hawaii, case number 2017-cr-00101.
As the above-linked complaint shows, the Consumer Financial Protection Bureau (CFPB) sued Certified Forensic Loan Auditors (CFLA) and its owner Andrew Lehman, and its so-called securitization auditor Michael Carrigan in federal court for violating the Consumer Financial Protection Act and its supporting regulation, Regulation O, by charging advance fees for foreclosure rescue services, and for selling worthless services like securitization audits.
It seems to the Maven of Mortgage Attack that the CFPB read the CFLA Scam Report of March 2019 and decided to act on it by trying to put CFLA out of the business of scamming troubled mortgagors. THANK YOU, CFPB!
Crooked attorney Neil Garfield, ever concerned about public exposure to crooked or incompetent attorneys, writes to readers of his Living Lies blog:
Warning: Conduct your Due Diligence on ANY Attorney you Hire
by Neil GarfieldBefore you hire ANY attorney for a phone consultation, to conduct an analysis of your case, or retain them to represent you, please conduct your due diligence first. A simple google search with their name will usually suffice.
In fact, before you hire Neil Garfield for a consultation, case analysis, or other legal matter I suggest you conduct your due-diligence like you would when hiring any professional.
Always use caution if the Bar has publicly reprimanded an attorney.
If you believe you have been a victim of an unethical Florida foreclosure attorney, please report your experience to the Florida Bar at: https://www.floridabar.org/public/acap/assistance/
Contact me at:
Neil Garfield | March 27, 2018 at 2:54 pm
JAX DAILY RECORD MONDAY, AUG. 1, 2016 12:00 PM EST
Supreme Court disciplines 32 attorneys
The Florida Supreme Court disciplined 32 attorneys — disbarring six, revoking the licenses of two, suspending 16 and publicly reprimanding eight.
Two attorneys were also placed on probation and another was ordered to pay restitution.
The attorneys are: […]
Neil Franklin Garfield, Parkland, to be publicly reprimanded. (Admitted to practice: 1977) In at least four instances, Garfield accepted money to represent clients and failed to follow through. In one case, Garfield did not perform the work and, when asked for a refund, denied knowing the client. In other cases, he failed to communicate, charged excessive fees, failed to return refunds upon request and failed to timely respond to Bar inquiries.
Neil Garfield’s frivolous filings and bogus legal theories cost at least one client, Zdislaw Maslanka, a wad of attorney fees in an utterly frivolous action to get his house free even though he remained current in his mortgage payments. As the docket entries below show, the Florida 4th District appellate panel affirmed the 17th Circuit’s dismissal of the case and ordered Maslanka to pay the attorney fees of the two mortgage creditors that he sued. If you read Garfield’s 5th amended complaint at the above link you will see a plethora of nonsensical, frivolous arguments that had not even a ghost of a chance of winning. Clearly, Garfield cheated Maslanka, and used his case to test absurd legal theories.
- 4D14-3015-Zdzislaw E. Maslanka v. Wells Fargo Home Mortgage and Embrace Home Loans
05/12/2016 Affirmed Per Curiam Affirmed 05/12/2016 Order Granting Attorney FeesUnconditionally ORDERED that the appellee Embrace Home Loans Inc.’s September 2, 2015 motion for attorney’s fees is granted. On remand, the trial court shall set the amount of the attorney’s fees to be awarded for this appellate case. If a motion for rehearing is filed in this court, then services rendered in connection with the filing of the motion, including, but not limited to, preparation of a responsive pleading, shall be taken into account in computing the amount of the fee 05/12/2016 Order Granting Attorney FeesUnconditionally ORDERED that the appellee Wells Fargo Home Mortgage’s September 3, 2015 motion for attorneys’ fees is granted. On remand, the trial court shall set the amount of the attorneys’ fees to be awarded for this appellate case. If a motion for rehearing is filed in this court, then services rendered in connection with the filing of the motion, including, but not limited to, preparation of a responsive pleading, shall be taken into account in computing the amount of the fee.
Last but not least, here is the text of an 8-page report that Neil Garfield charged Vincent Newman THOUSANDS of dollars for, advising a foreclosure defense and TILA rescission strategy. Newman obtained a pick-a-pay loan in 2010 to purchase a home, then defaulted.
Thus, Neil Garfield’s incompetent advice, had Newman heeded it, would have caused Newman expense and embarrassment through a frivolous, failing TILA rescission effort.
———– Garfield’s Expensive Report to Newman ————
This is a review and report and not a definitive statement of opinion on the entire case strategy.
Since the property is located in Florida and Mr. Garfield is licensed in Florida, he is qualified to
give both expert opinions and legal opinions.
DATE: February 8, 2016
RE: Vincent Newman and his Wife
Phone No.: 954-554-6487
Email Address: firstname.lastname@example.org
JUDGMENT ENTERED 2011,
SALE DATE CANCELED MULTIPLE TIMES
FEDERAL ACTION TO ENJOIN USE OF NOTE AND MORTGAGE SUGGESTED
1. The address of the property in question is 6401 Garfield Street, Hollywood, Florida, 33024 in Broward County.
2. The property is in foreclosure. As of December 29, 2015 Mr. Newman reports that he hired an attorney, started modification and is not current on payments.
3. He has requested a review and commentary in connection with his property and his loan.
4. He has already filed a petition for relief in bankruptcy court under Chapter 7 and apparently converted to Chapter 13. Motion to lift stay was filed and presumably granted. The name of his attorney in the State Court action, Case No. CACE10041220 is Evan Plotka, in the 17 th Judicial Circuit for Broward County [Florida].
5. Mr. Newman reports that in 2010 they were 3 months behind in their payments. Acting through a HUD counselor there was apparently an agreement that was reached in September 2010 where they would catch up on the three payments. According to Mr. Newman Wells Fargo broke the agreement, refused to discuss the matter any further and Mr. Newman and his wife apparently were served with a summons and compliant that October 2010. If they have correspondence proving the existence of the deal, then this would be a point to raise in defense as a possible violation of either estoppel 1 or dual tracking, which was not passed until after the agreement.
1 If the agreement can be proven (they will most likely deny it), then even without the Dodd-Frank prohibition against dual tracking, the homeowners reasonably relied upon the existence of the agreement and made payments that were accepted. Wells Fargo has a history of accepting payments under oral modifications and then abandoning the agreement without accounting for the payments — which often makes the default letter wrong as to the missing payments.
6. Disclosures as to the true funding of the origination of the loan, the acquisition of the debt (as opposed to the acquisition of the paper) and the true party in interest who could be plaintiff are all absent, which is the same thing that I have seen as an expert witness and as an attorney many times with Wells Fargo. Many entities, like World Savings and Wachovia boasted they were funding their own loans. This was nearly never true. The loan papers may have been originated back in 2010 but the disclosure of the money trail has never been made.
7. Mr. Newman answered the summons and complaint without the help of legal counsel and served interrogatories on the plaintiff that he says were never answered.
8. He has apparently been through several attorneys that were merely kicking the can down the road to buy more time without making mortgage payments but of course having Mr. Newman make monthly payments to the attorney.
9. According to the registration statement submitted by Mr. Newman the original loan was with World Savings Mortgage which merged into Wachovia and then Wells Fargo. I think what he meant was World Savings Bank which was acquired by Wachovia Bank which in turn was acquired by Wells Fargo Bank. The case was filed as Wells Fargo Bank as plaintiff. From prior experience we know that this is probably a ruse intended to cover up the fact that they don’t know who the creditor is and they are hoping that a judge will simply take their word for it.
10. Mr. Newman has provided a docket from the Clerk of the Circuit Court which indicates that the property has been set for sale several times. This would indicate in turn that a final judgment of foreclosure was entered. However I do not see on the docket the description of an order granting summary judgment or a final judgment of foreclosure entered in favor of Wells Fargo. I presume that such a judgment exists or the sale would never have been scheduled.
11. As of December 30, 2015 Wells Fargo is showing a balance due of $93,979.25, with an unpaid principle balance of $200,338.10, an escrow balance of $31,855.05, carrying an interest rate of 6.5 percent with a maturity date in July 2049.
12. Based upon my knowledge of the parties involved, and specifically in this case Loan No. 0483028569 2 , I believe that the loan is in fact claimed by a trust which in fact does not own it. The loan was in my opinion most likely never funded by World Savings Bank, Wachovia or Wells Fargo. It is my opinion that none of those entities paid for either the origination or the acquisition of the loan and that any documents to the contrary are fabricated and most likely forged. The system at Wells Fargo if this case actually goes to trial at some point will show that probably Fanny Mae or Freddie Mac was the “investor” from the start. However, since the government sponsored entities generally function in only two areas 3 , it seems unlikely, to say the least, that the investor would be correctly identified in the Wells Fargo system that they would use at trial unless they have changed their method of fabricating business records.
2 Client advises that the loan number changed recently. The reasons for this change should be investigated.
3 The statutory authority of the GSE’s (Fannie and Freddie) allow for them to operate as guarantors and/or Master Trustees of REMIC Trusts who were intended to own the debt, note and mortgage. The “hidden” REMIC Trusts operate the same as private label and publicly registered REMIC Trusts. And they suffer from the same defects — the money from investors never made it into any account owned by the Trust or the Trustee, which means that the Trust could not possibly have paid for loans. The Trust would be an inactive trust devoid of any business, operations, assets, liabilities, income or expenses.
13. For reasons that I will discuss below, it is my opinion that the homeowners in this case should send a notice of rescission and we will discuss whether that notice should be recorded. In addition there should be consideration of a federal lawsuit seeking to enforce the rescission and seeking an injunction to prevent Wells Fargo from using the note and mortgage against the Newmans. I would further add that in my opinion from my review of the documents that were provided by the client there is a strong likelihood of success using standard foreclosure defense strategies.
14. In the court file is a notice of action which states that Vincent Newman and Imelda Newman both stated as avoiding service at the address of 6401 Garfield Street, Hollywood, Florida, 33024. This indicates to me that the service in 2010 was a “drive by” service in which no real effort was made to find or serve Mr. or Mrs. Newman.
15. This in turn leads me to believe that this was typical foreclosure mill actions and that Wells Fargo still has not fulfilled its obligation to review the business records to determine the ownership or balance of the loan. Or to put it differently, they probably did know about the problems with ownership and balance of the loan and wanted the foreclosure sale anyway. Based upon my preliminary review it would appear that Wells Fargo Bank made payments to the certificate holders of a trust under a category known mainly in the industry as “servicer advances.”
16. Based upon their statement I would say that their servicer advances totaled more than $90,000.00. The longer the case goes the higher is the value of their claim to recover their “servicer advances.” However, those advances, while made, came from a comingled account consisting entirely of investor money. Therefore there is no actual action for recovery of the servicer advances.
17. The case was apparently filed in January 2011. Or if the case was not filed at that time then additional paperwork was added to the file at that point. Since the case number refers to the year 2010 I am presuming that they filed a skeleton case in order to have the case filed before the end of the year.
18. The complaint is interesting in that, as usual, Wells Fargo does not allege that it is the owner of the debt. It alleges that it is the owner and holder of the note and mortgage. And of course it alleges that a default exists but it does not state the party to whom the money is owed nor the statement of ultimate facts upon which the court could arrive at the conclusion that the actual creditor has suffered a default or loss as a result of the payments being stopped.
19. The alleged loan, which in my opinion was never funded by World Savings Bank, was a reverse amortization (pick a payment) loan. This loan was probably sold in one form or another 20 or 30 times. The capital from the sale of the loans probably funded many other loans.
20. There is a request filed in January 2011 for the original promissory note, and the contact information for the current holder of the note, which was never answered. This might have some relevancy to a claim contesting jurisdiction of the court.
21. While the docket that was sent to me by Mr. Newman did not appear to contain the final judgment for the plaintiff, the documents that he sent and which were uploaded contain a final judgment for plaintiff. The final judgment apparently was a summary judgment in favor of the plaintiff on November 17, 2011 at 1:30 p.m.
22. As expected, the documents in the possession of Mr. Newman contain a mortgage servicing transfer disclosure. Hence we have evidence of the transfer of servicing rights but not transfer of ownership of the debt. 4 In my opinion this corroborates my conclusion that the loan was subject to claims of securitization starting at a time before consummation could have ever occurred. In my opinion the loan was table funded, which means that the actual source of funds for the loan was another party to whom the documents would be “assigned” immediately after, or even before the apparent “closing.”
4 This is especially relevant to the issue of whether the alleged loan is subject to claims (probably false claims) of securitization. Each of the alleged entities in the “Chain” had robust servicing capacities. The transfers of servicing duties makes no sense and explains nothing except that the usual pattern of musical chairs was being employed to confuse the issues surrounding “holder” of the note etc. The presumptions that are ordinarily used for a holder of a note should not be allowed, in my opinion, because of the history of flagrant violations by Wells Fargo and its predecessors. Producing evidence of a pattern of conduct of fabrication, forgery, robo-signing etc should enable the attorney to argue that the presumptions should not apply, thus requiring Wells Fargo to prove the money trial and ownership of the debt, which they will never do.
23. In my opinion the mortgage document was improper in that it failed to disclose a hidden balloon payment. By having negative amortization or reverse amortization, the balance that is owed as principal continues to increase. Under the terms of the mortgage when it reaches 115 percent of the original loan principal, the loan automatically reverts to standard amortization which is what caused so many people, including the Newmans, to default. Borrowers were seduced into taking these highly complex loan products under the supposition that they would later be able to refinance again, taking “equity” out of the home and providing them with the resources to make the payments. The effect of these loans is to cause a balloon payment at the end of a short period of time. Thus the balloon was not disclosed and the term of the loan was not disclosed because the full amortization of the loan was beyond the financial capacity of the “borrower.”
24. In my opinion the assertion by Wells Fargo that it is the investor, the creditor, the lender, or the successor lender is and always has been false. It appears that no sale of the property has taken place and that none is scheduled based upon information I received from Mr. Newman on December 29, 2015 in a telephone consultation. Even though a judgment has been entered, it is my opinion that the rights and obligations of the parties are still defined by the alleged note and the alleged mortgage. Hence the sending of a notice of rescission and the recording of a notice of interest in real property under Florida Statute 712.05 would be appropriate as a strategy. I also think that an action filed in federal court to enjoin Wells Fargo from the use of the note and mortgage would be appropriate. The basis for the action would be, after notice of rescission had been sent, and presumably after the 20 days from receipt of the notice of rescission had expired, the loan contract was cancelled, the note and mortgage became void as of the date of mailing of the notice of rescission.
25. There is also another strategy of alleging a fraud upon the court, but I don’t think that would get much traction.
26. What I think can get some traction is a lawsuit against Wells Fargo for having presented the false evidence to the court. The difference is that you are not accusing the court of wrongdoing, you are accusing Wells Fargo of wrongdoing and taking advantages. I believe that considering the history that the Newmans report in their narrative that substantial compensatory damages might be awarded, but that punitive damages do not appear to be likely at this time. That is not to say that punitive damages will not be awarded. As time goes on, more and more courts are becoming aware of the fact that the type of foreclosure system has been a sham. Each time another judgment for settlement is reached it becomes apparent that the banks are continuing to engage in the same behavior and simply paying fines for it as a cost of doing business.
27. As Mr. Newman knows, I do not accept many engagements to directly represent homeowners in these actions. I think that in this case I would be willing to accept the engagement, along with co-counsel, Patrick Giunta. I would have to review this file with him to confirm, but the likelihood is that the initial retainer would be in excess of $5,000.00 and that the monthly payment of our fee would be at least $2,000.00. There would also be court costs and other expenses amounting to over $1,000.00.
28. Another option is to seek out another attorney who is willing to take on the case and use my services as litigation support. The hourly rate I charge for all matters, whether as attorney or expert witness is $650.00. The hourly rate of most other attorneys is significantly below that. The actual amount of work required from me if I am in the position of litigation support would be vastly reduced and thus the expense of having me work on the Newman file would be significantly reduced, enabling the Newmans to hire counsel who is receptive to me providing litigation support.
29. In all engagements, in which I am the attorney, or providing litigation support, there is also a contingency fee that varies from 20 percent to 35 percent of any amount paid in hand to the homeowner. Specifically this means that if the case is settled or resolved in a manner in which title to the property becomes unencumbered, the contingency fee would not apply to the house itself, but only to other damages that were paid in connection with the settlement or collection of a judgment.
Job Number: 16039-001
Custom Filename: Newman
Billed Words: 2069
Dear Neil Garfield:
You’ll find a serving serving of crow in the 8th Circuit’s post-Jesinoski Keiran v Home Capital, Inc., F. 3d 1127 opinion. After reading it, I imagine you will craft a huge apology to your LivingLies blog readers for misleading them for years about the proper understanding of TILA rescission AND of the Jesinoski v. Countrywide Home Loans, Inc., 135 S. Ct. 790 opinion.
Keirans propounded the same lame excuse as the Jesinoskis. They signed an acknowledgment of receipt of Right to Cancel disclosures, and later gave the court an affidavit claiming they only received one copy, instead of two, each. They appealed the judgment against them to the 8th circuit, then to SCOTUS which granted cert and remanded for consideration in light of Jesinoski. After trial and appeal, the 8th circuit affirmed the trial court’s denial of rescission and damages.
Keiran relied on the same false legal theory that you have espoused for years about TILA rescission, and yet, in the wake of Jesinoski, SCOTUS, the 8th Circuit, and USDC all agree that TILA rescission does NOT work the way you wish it did. The borrow gets NO 3-year right of rescission UNLESS a TILA violation occurred.
The SCOTUS instructs you from the Jesinoski opinion:
“The Truth in Lending Act gives borrowers the right to rescind certain loans for up to three years after the transaction is consummated. The question presented is whether a borrower exercises this right by providing written notice to his lender, or whether he must also file a lawsuit before the 3-year period elapses.”
There you have the question before the court: does conditional TILA rescission written notice or notice plus lawsuit within 3 years after consummation? Now the fun part, where SCOTUS explains TILA’s extended, conditional right to rescind requiring a TILA violation:
“Congress passed the Truth in Lending Act, 82 Stat. 146, as amended, to help consumers “avoid the uninformed use of 792*792 credit, and to protect the consumer against inaccurate and unfair credit billing.” 15 U.S.C. § 1601(a). To this end, the Act grants borrowers the right to rescind a loan “until midnight of the third business day following the consummation of the transaction or the delivery of the [disclosures required by the Act], whichever is later, by notifying the creditor, in accordance with regulations of the [Federal Reserve] Board, of his intention to do so.” § 1635(a) (2006 ed.).[*] This regime grants borrowers an unconditional right to rescind for three days, after which they may rescind only if the lender failed to satisfy the Act’s disclosure requirements. But this conditional right to rescind does not last forever. Even if a lender never makes the required disclosures, the “right of rescission shall expire three years after the date of consummation of the transaction or upon the sale of the property, whichever comes first.” § 1635(f).”
My point: you have bloviated that SCOTUS, when it gets a case like Jesinoski back, will agree with YOUR interpretation of TILA rescission law, that a TILA violation is not a condition of the extended right to rescind. Well, SCOTUS did get precisely such a case in 2015 (Keiran), and the justices and the 8th Circuit panel made it clear that NO 3- year right of rescission exists in the absence of a TILA violation.
But who needs the Keiran opinion when Justice Scalia explained conditional TILA rescission PERFECTLY in the Jesinoski opinion?
Eat some crow. I’ll do you good.
Dear Neil Garfield:
I write in answer to your Jesinoski Revisited article (see below). I’ll post my comment and yours in my Mortgage Attack and LivingLiesTheTruth blogs because I know you lack the courage to post them at LivingLies blog.
To refresh everyone’s memory, SCOTUS wrote this holding in the Jesinoski opinion:
“The Jesinoskis mailed respondents written notice of their intention to rescind within three years of their loan’s consummation. Because this is all that a borrower must do in order to exercise his right to rescind under the Act, the court below erred in dismissing the complaint.”
Jesinoski v. Countrywide Home Loans, Inc., 135 S. Ct. 790 – Supreme Court 2015
Remember the nature of the dispute. Jesinoskis had mailed his notice of rescission exactly 3 years after loan consummation, but the district and circuit denied the rescission because Jesinoskis sued AFTER mailing the notice. So the only issue before the SCOTUS was the question of whether Jesinoskis had to sue within the three year period of repose. SCOTUS said no because TILA does not require that.
The sole principle that Jesinoski clarified was that the three year limitation on notice did not extend to the filing of a lawsuit. 135 S.Ct. at 793
The SCOTUS opinion did not question whether a TILA violation had occurred. SCOTUS granted certiorari merely to quell differences of opinion between the circuits as to when a borrower may sue to enforce rescission. The trial judge explained it this way:
“In April 2012, the Court issued an order granting Defendants’ motion, finding that TILA required a plaintiff to file a lawsuit within the 3-year repose period, and that Plaintiffs had filed this lawsuit outside of that period. (Doc. No. 23 at 6.) The Eighth Circuit affirmed. Jesinoski v. Countrywide Home Loans, Inc., 729 F.3d 1092 (8th Cir.2013). The United States Supreme Court reversed, holding that a borrower exercising a right to TILA rescission need only provide his lender written notice, rather than file suit, within the 3-year period. Jesinoski v. Countrywide Home Loans, Inc., ___ U.S. ___, 135 S.Ct. 790, 792, 190 L.Ed.2d 650 (2015). The Eighth Circuit then reversed and remanded the case for further proceedings. (Doc. No. 38.) After engaging in discovery, Defendants 959*959 now move for summary judgment.”
Jesinoski v. Countrywide Home Loans, Inc., 196 F. Supp. 3d 956 – Dist. Court, Minnesota 2016
The Elephant in the Room – NO TILA VIOLATION OCCURRED.
You blindly fail to see this gargantuan elephant:
ONLY A TILA VIOLATION TRIGGERS THE RIGHT TO RESCIND… No violation, no rescission.
If no TILA violation occurred, then an effort to invoke TILA rescission should (and always does) fail. That explains why the trial court wholeheartedly ruled against Jesinoski.
Furthermore, if the borrower timely mails the notice of rescission and then waits till after the TILA statute of limitations has tolled (1 year and 20 days after mailing notice to rescind), the borrower’s lawsuit should and will fail. Then the borrower will have only a defensive remedy available, such as in foreclosure or bankruptcy.
In any case, the trial judge explained that Jesinoskis had signed an acknowledgement of receipt of the roper TILA notices of right to cancel. He believed that written acknowledgement rather than their contrary claim. Thus, the lack of a TILA violation made irrelevant their inability to tender.
A reading of the trial opinion makes it clear that the Jesinoskis were scammers trying to trick the system into giving them an undeserved windfall. They had used their house as an ATM, borrowing to pay other debts and live large. The trial court gave a well-deserved comeuppance to them and many others like them. The judge wrote:
“Here, it is undisputed that Plaintiffs left with copies of their closing documents. (L. Jesinoski Dep. at 94-95.) In addition, Plaintiffs did not testify unequivocally that they did not each receive two copies of the rescission notice. Instead, they have testified that they do not know what they received… Based on the evidence in the record, the Court determines that the facts of this case are more line with cases that have found that self-serving assertions of non-delivery do not defeat the presumption”
The Court rightly denied the Jesinoskis any and all damages:
“For the reasons discussed above, Plaintiffs’ TILA claim fails as a matter of law. Without a TILA violation, Plaintiffs cannot recover statutory damages based Defendants refusal to rescind the loan.”
Clearly Neil Garfield Does NOT Understand TILA Rescission
In spite of KNOWING how the courts have ruled in numerous post-Jesinoski cases, you keep insisting on a nonsensical interpretation of TILA rescission. You wrote the following in denial of reality:
“The ultimate decision in the Jesinoski case was against the rescission. This was wrong and in flagrant disregard of the Jesinoski decision rendered by the SCOTUS. The decision simply stated that the rescission WAS effective the moment it was dropped in the mail (or delivered.)”
Excuse me, Neil, but didn’t the Jesinoski trial court SHRED your legal theory? The judge and the creditor knew full well that Jesinoskis LIED about not receiving their TILA notices, and that no TILA violation occurred. What kind of bozo thinks a court should enforce a TILA rescission notice when no TILA violation occurred to justify it?
Recall again that the SCOTUS opinion presumed a VALID TILA rescission, one preceded by a TILA violation. It did not presume a rescission notice without a justifying TILA violation. The trial court made that crystal clear.
Now, Neil, you allege that ” It is uncontested that rescission caused the note and mortgage to immediately become void – not conditionally but actually.”
Well, that’s dead wrong too. Even a valid TILA rescission has certain procedural requirements. If the creditor does not sue to prevent rescission, and yet does not tender or release the lien, then the borrower must sue and ask the court to void the security instrument. And try not to forget that the creditor need not tender if he knows the borrower cannot or will not tender. Only a court can sort out those issues.
“The bankruptcy court did not err in finding that Brown never effectively rescinded the loan because she ignored her tender obligation to restore the lender to the same position it was in before the transaction. Brown, 538 B.R. at 720.”
“In the Fourth Circuit, “unilateral notification of cancellation does not automatically void the loan contract,” Am. Mortgage Network, Inc. v. Shelton, 486 F.3d 815, 821 (4th Cir. 2007), because courts “must not conflate the issue of whether a borrower has exercised her right to rescind with the issue of whether the rescission has, in fact, been completed and the contract voided.” Gilbert v. Residential Funding LLC, 678 F.3d 271, 277 (4th Cir. 2012).”
To accomplish rescission, rather than merely initiating the process, “[e]ither the creditor must acknowledge[ ] that the right of rescission is available and the parties must unwind the transaction amongst themselves, or the borrower must file a lawsuit so that the court may enforce the right to rescind.”
Neil, you seemed to allege that Countrywide, not Jesinoski, bore the onus to sue for relief in the rescission question. The above rulings should disabuse you of that fallacious thinking. But just in case they didn’t, I’ll explain it to you.
In the matter at hand, Jesinoskis sued Countrywide in 2011 for TILA rescission and related damages, and lost. JESINOSKI v. Countrywide Home Loans, Inc., Dist. Court, Minnesota 2012.
Somehow this matter wound its way up and back through the Minnesota District Court to the 8th Circuit and the US Supreme Court, and NOBODY (not even Jesinoskis) exhibited the stupidity of suggesting that Countrywide should have sue Jesinoski in order to buck against Jesinoskis’ specious claim for rescission.
You see, Jesinoskis DID sue to enforce the rescission, and Jesinoskis LOST because of their flimsy and transparently FALSE evidence: their word that they didn’t remember receiving TILA notices just could not stack up against proof, in the form of their own written acknowledgement, that they had received them.
You seem to think that Jesinoskis had some better evidence at hand. They didn’t. AND even if they had better evidence, they couldn’t tender. That made it THEIR obligation to sue in order to work out some means of tendering, as courts across the land have allowed.
Why Does Neil Garfield Insist on Being Wrong?
Look, Neil, I have proven you wrong repeatedly, and as you pointed out, I AM NOT EVEN A LAWYER.
You definitely have a way with words. I don’t know of any practicing attorney who whiles away more hours at the keyboard than you do. And sometimes, even I, in spite of my ignorance, will admit that you raise some thought-provoking, if not worthy, points.
But I see you as a Pied Piper leading hapless, feckless, desperate foreclosure victims with the music of your words that “THE COURTS ARE ALL WRONG” and “BOB HURT IS A SHILL FOR THE BANKS”… you lead them inexorably right into the jaws of foreclosure with irrational POPPYCOCK about the meaning of fairly simple laws like TILA.
I think I recall a time (correct me if I’m wrong) when you pronounced that everybody with a mortgage loan should file a notice of rescission (or something similarly nonsensical), even though every other attorney seemed to know the law makes TILA rescission available ONLY to those with refinance or HELOC loans.
Eventually I concluded that, even though I am not an attorney, I am a good enough student to read court opinions that say unequivocally and repeatedly that some of the legal theories you most vehemently espouse are nothing more than COW PLOP.
And I decided that I would try just a little to break the mesmerizing spell you cast on desperate foreclosure victims, by telling them the truth, such as about the really simple meaning of Jesinoski.
Now I see you intend to deliver this oratorial offal to people (victims) in a seminar:
“Countrywide was not a lender or even an aggregator. It was a conduit for an aggregator and far removed from the actual transfer of funds attendant to the apparent loan.”
I recall your claim that table funded loans aren’t really loans because the borrower doesn’t know the lender, or that the borrower should demand a TILA rescission because the loan was never consummated.
“The Fannons theory that the loan was not consummated has been overwhelmingly rejected by other courts. See, e.g., Schiano v. MBNA, 2016 WL 4257761, at *9-*10 (D.N.J. Aug. 10, 2016); Johnson v. Bank of N.Y. Mellon, 2016 WL 4211529, at *4 (W.D. Wash. Aug. 10, 2016); Wilder v. Ogden Ragland Mortg., 2016 WL 4440487, at *4-*5 (N.D. Tex. July 29, 2016)(“Plaintiff’s claim that the three years period to rescind the loan remains open, because Defendants failed to identify the true lender and the loan was never consummated, is nonsensical.”); Almutarreb v. Nationstar Mortg. Holdings, 2016 WL 3384067, at *5 (N.D. Cal. June 20, 2016); Tyshkevich v. Wells Fargo Bank, N.A., 2016 WL 3077580, at *4 (E.D. Cal. May 31, 2016); Smith v. Wells Fargo Bank, N.A., ___ F. Supp. 3d ___, 2016 WL 370697, at *4 (D. Conn. Jan. 29, 2016).”
Don’t you, a lawyer, know that rescission is a contract remedy, and so if the loan was not consummated, NO CONTRACT EXISTS, and so the purported borrower is not a borrower and therefore cannot rescind anything?
Further, if, as the Fannons assert, the loan had never been consummated, then TILA would not apply because there would be no loan to rescind. See, e.g., Wilder, 2016 WL 4440487, at *4-*5; Samuelson v. Wells Fargo Bank, N.A., 2016 WL 1222222, at *2 (N.D. Ind. Mar. 29, 2016).
Don’t you know that the borrower’s agreement with the terms, signature on the note and security instrument, along with delivery of the funds, constitute “consummation” of the loan?
” “A valid enforceable contract requires offer, acceptance, consideration, and a meeting of the minds.” Tessier v. Rockefeller, 162 N.H. 324, 339 (2011). A meeting of the minds occurs when there is agreement on all essential terms of the contract. Syncom Indus., Inc. v. Wood, 155 N.H. 73, 82 (2007).”
See more proof of the folly of your consummation theories, practiced by your followers, I presume:
Here’s my fundamental trouble with your writings, Neil. For years you have propounded legal theories that courts have disdained with adverse rulings. And then you have used the puffery of false erudition to trick unsuspecting innocents into believing your theories will allow them to prevail in court, if only they attend your seminar or buy your “TILA Rescission Package,” or hire you as a consultant.
Of course you cannot show them where your legal theories won in court because those theories always LOSE. Or you trick them into believing that a dismissal without prejudice is a win and not a dilatory tactic forbidden by the Bar’s Rules of Professional Conduct.
Neil Garfield’s Path to Righteousness
Neil I don’t like “crossing swords” with you because I’m no match for you. And I should go easy on you because statistically, a man who writes as much about the law and litigation as you do is BOUND to err from time to time.
And unfortunately, some of your errors, such as those in the Maslanka case, in which you tried to drown the court in balderdash, have become stuck in court archives, and you will never live them down, particularly if you never admit you were wrong. Let’s face it. You deserved the spanking the trial and appellate courts gave you in that case, and poor Maslanka had to pay his adversaries’ legal fees as well as yours.
And it’s hard to get over the spanking the Florida Supreme Court Justices gave you in its August 2016 public reprimand:
“Neil Franklin Garfield, Parkland, to be publicly reprimanded. (admitted to practice: 1977) In at least four instances, Garfield accepted money to represent clients and failed to follow through. In one case, Garfield did not perform the work and, when asked for a refund, denied knowing the client. in other cases, he failed to communicate, charged excessive fees, failed to return refunds upon request, and failed to timely respond to Bar inquiries.”
But if you put forth a wee bit of effort, you can stop propounding the dreck that courts have denounced repeatedly, and give your clients some honest service instead, such as by using some of your ridiculously high fees to purchase a comprehensive mortgage examination for them from Mortgage Fraud Examiners. You’ll actually have fun hammering the bank, broker, appraiser, and title company with cogent causes of action in which they really did injure the client. You’ll become a hero instead of a heel because you’ll actually start winning money and beneficial settlements for your clients instead of earning their scorn and bar complaints.
If you ever bothered to do your job right, Neil, you’d forsake the scams of the foreclosure defense business in favor of attacking the validity of the loan transaction. I quit the foreclosure defense racket in 2009. The time for you to make the switch to mortgage attack is long overdue.
*********** Neil Garfield’s Blog Article ************
On 2018-01-23 10:35, Livinglies’s Weblog wrote:
[Garfield’s service promo excised]
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
The ultimate decision in the Jesinoski case was against the rescission. This was wrong and in flagrant disregard of the Jesinoski decision rendered by the SCOTUS. The decision simply stated that the rescission WAS effective the moment it was dropped in the mail (or delivered.) You can read the attack on me in Bob Hurt’s blog in the above link.
Rescission was effective starting with the mailing and uncontested delivery of the notice of rescission, if someone wants to challenge it they must do so in a lawsuit to vacate the effective instrument. This is the most basic procedural law — you don’t get relief without asking for it and the way you ask for it is by filing an pleading in court and getting a decision vacating the rescission notice. This trial court never vacated the rescission probably because it knew it had no power to do so.
You can’t get relief unless you first establish legal standing. SCOTUS said that the rescission was effective in this case and all others like it. It is uncontested that rescission caused the note and mortgage to immediately become void – not conditionally but actually.
So in order to bring a claim you would need to file a claim stating that you are being injured by a wrongfully delivered notice of rescission. That is called standing. The only party who could do that is the owner of the debt, since the ownership of the note and mortgage (void instruments now) is irrelevant. And THAT is where the trial court got it wrong (again). In the absence of a pleading from the owner of the debt, the trial court was devoid of jurisdiction to render any decision in which there rescission was ignored.
Hurt, a non lawyer, is apparently attempting to discredit a Federal law. But he is voicing the party line of the banks. The trial court was twice in error when it entered judgment against Jesinoski and if Jesinoski had the resources to appeal again they MIGHT well have won. It does appear that the “issue” in the trial court was whether the rescission stands. Clearly the opposition did not follow the requirements of statute.
BUT it is possible for the appellate courts to see this as harmless error since the factual finding of the trial court was that proper disclosure was given to Jesinoski. While that finding is also appealable, appellate courts are not likely to intervene in a finding of fact unless there was absolutely nothing in the court record to justify that finding.
So in the end this is about evidence and the failure to present it.
Since rescission is all about proper disclosure and since Jesinoski failed to show that required disclosure was not given at the “closing” of the loan, it may be assumed that they would have lost in an action brought by Countrywide or its successor to vacate the rescission. But that is an advisory decision prohibited to any court.
The assumption is improper. That is why we have rules of procedure. If you want relief you must plead for it not simply argue about it. Countrywide never filed a pleading to vacate the rescission, as far as I know. And the rescission was never vacated even by this decision.
The trial court decided instead to accept the challenge from a party without standing (CW did not own the debt and their standing was entirely based upon the void note and mortgage). Inherent in the trial court’s erroneous decision was the presumption that was used to allow Countrywide to oppose the rescission — i.e., that because it supposedly had the original note and mortgage, it therefore owned the debt. The rest is history.
This decision assumes that Countrywide had standing apart from the note and mortgage, i.e., ownership of the debt. And it also assumes that there was an action filed by Countrywide to vacate the rescission. Neither of these was addressed, much less the 20 day requirement for filing such an action. Instead the trial court simply continued its error by ignoring the rescission because of its factual finding that disclosures had been properly given. But the disclosures were given by people who withheld basic information that is required under the statute, to wit: the identity the lender and the identity of the creditor (i..e., owner of the debt).
So this case went down because Jesinoski did not stick with the requirements of burden of proof, and the requirement that a party with standing make the challenge to the rescission within 20 days. Ignoring the 20 day limitation period results in placing a condition to the effectiveness of there rescission in contradiction to the express wording of Federal Statute and SCOTUS. There are no conditions. Jesinoski failed to press the rules of evidence, based upon the written opinion, which could have landed a victory.
Virtually everyone is ignoring the elephant in the living room, to wit: Countrywide was not a lender or even an aggregator. It was a conduit for an aggregator and far removed from the actual transfer of funds attendant to the apparent loan.
This is why I am offering a seminar on evidence [excised]. The devil is in the details. And too many foreclosure defense lawyers do not properly prepare to attack the details. The trial court decision is basically a political decision, not a legal one. So it continues to be true that the statute is clear, the rules of procedure are clear, and the rules of evidence are clear — yet trial courts are adamantly opposed to allowing homeowners to use the power granted to them by Congress.
[Garfield’s services promo excised]
Here's a twist on legal malpractice and foreclosure that NOBODY but I wants to report. The Malpractice Scheme: Hundreds if not THOUSANDS of attorneys around the USA, including prominent lawyers in YOUR CITY, vigorously promote their foreclosure defense services. They get foreclosure victim clients by promising to "keep you in the house as long as possible." They charge $1500 to $3000 retainer (a downpayment gift) and $500+ a month till the foreclosure becomes final. Meanwhile they file cookie-cutter pleadings they copied from other attorneys complaining about "show me the note," bifurcation of note from mortgage, securitization, wrong track of ownership of note, lack of standing (wrong plaintiff), vapor money (lender deposited borrower's note and used that to fund the loan), and other nonsense. This delays the foreclosure, but the foreclosure inevitably goes through anyway and the client loses the house. BUT, the lawyer seldom if ever bothers comprehensively examining the mortgage, note, and all related documents for evidence of torts, breaches, fraud, and legal errors. Some lawyers sell or promote useless services like securitization audits and loan audits. In the end, to avert the otherwise inevitable foreclosure, some lawyers con the client into a short sale, deed in lieu of foreclosure, keys for cash, or an onerous loan modification that leaves the client owing double to triple the value of the house, and facing a huge balloon the client cannot pay. How does this constitute LEGAL MALPRACTICE? Well, the bank accused the foreclosure victim of breach of contract. So, the attorney should take these steps: 1. Say "give me the contracts and all related documents, letters, lawsuits, etc.," then 2. Search for the causes of action in them against the lender or lender's agents, then 3. Attack the lender and agents through settlement negotiation or lawsuit, then 4. WIN compensation for the mortgage victim's injuries. You see, historically, lenders and their agents have cheated NINE OUT OF TEN mortgagors. Settling or suing on the basis of those causes of action can get financial compensation for the mortgagor. Thus, the mortgagor can fight one of two battles: 1. The foreclosure, which the borrower statistically always loses. 2. The mortgage, which the borrower statistically always wins. Which battle makes most sense to you? Our problem lies in the fact that no MORTGAGE ATTACK legal industry exists. Foreclosure Defense Lawyers focus on the easy money of defense for $300 to $500 a month and the mortgagor loses the house after paying the lawyer upwards of $10,000 to $30,000 for doing virtually no work on the case. They do this KNOWING the mortgagor will lose the house. Those lawyers have not learned how to examine mortgages for causes of action, and I believe most have become too lazy and incompetent to serve the real interests of the client. Many such lawyers ballyhoo claims of winning when the court temporarily dismisses the foreclosure complaint for lack of standing because the wrong plaintiff sued. The plaintiffs nearly always correct their paperwork, get standing, refile or appeal the case, and win. Then the court sells the property and orders the mortgagor out of the house. The net issues: mortgagors cannot find competent lawyers to examine their mortgages. And, the mortgagor with an examination report showing causes of action in hand cannot find a lawyer to attack the mortgagee over those causes of action. Herein lies a huge opportunity for lawyers and mortgagors. Mortgagors do have a mechanism available for negotiating with the lender to obtain a reduced loan balance and payments they can afford, or financial remuneration for their injuries. They can simply contact the lender and demand a solution. If the lender balks, the mortgagor can contact Government regulators and report the lender for violating regulations. That usually brings a quick remedy. Severely injured borrowers might even get the house free and clear WITHOUT NEEDING the services of a lawyer. The public needs to know about this technique and opportunity. I can connect people with a competent mortgage examiner, and I charge nothing for my service. You can read numerous articles I have written on related subjects at http://mortgageattack.com/articles. Many people come to me for help. Some go on to ignore my encouragements, and lose their home. Others get their mortgages examined, and I help them discover how to proceed from there to save the home or obtain financial compensation for their injuries.. If you want to learn more about this, and don't want to read my articles, contact me. I have retired from the computer industry and have the time to help people free as my way of giving back to the community. I have no business obligation to any company. Before deciding NOT to contact me, ask yourself what YOU would do with a mortgage exam report that showed causes of action against YOUR lender.
In his LivingLies Blog entry of 2016-04-27, Foreclosure Pretender Defender and Kool-Aid Drinker Neil Garfield wrote this, correct for a change:
“… you need a thorough analysis of everything that happened with your alleged loan and a careful examination of the pleadings if you are already in court. We readily understand the reluctance to spend more money on what has been a frustrating experience, but the ONLY way you can select a strategy that will or might get traction is by having an experienced eye do a thorough review and report.”
Garfield FAILS to tell his readers that he and his crew don’t have a clue about doing mortgage examinations. They only do securitization and forensic loan audits, not full-bore examinations. And because Garfield has spouted bogus legal theories for years, THOUSANDS of people have lost their homes to foreclosure by relying upon his advice. So DON’T rely upon it. Instead, rely upon the court opinions that I have cited in the Articles section of this site. They prove nearly everything Garfield promotes is a band-aid, at best.
The ONLY reliable place to get a comprehensive mortgage examination that finds all the ways a borrower got injured in the loan is RIGHT HERE at Mortgage Attack.
Go to the Contact page in the site menu and tell us your story. We’ll show you exactly how to get a comprehensive mortgage examination AND how to use it for best results.
|Moving: Such Fun!|
- Hired a foreclosure pretense defense lawer
- Bought a securitization audit
- Bought a chain of title audit
- Bought a loan audit
It will connect you to Allied Van Lines after you LOSE YOUR HOUSE. They can help move all your stuff when you get evicted. You will lose the house, you know…
… UNLESS you heed the comments below.
NO defense exists against a foreclosure of a valid mortgage note that you breached.
None. Nada. Zero. Zilch. Niente. Niemals. Bupkis.
All foreclosure defenses eventually fail. Only a crooked foreclosure defender hides that ugly truth from you. The foreclosure eventually goes through to completion. The foreclosure victim loses the house. OR, if qualified, the victim accepts an onerous loan modification. You probably don’t qualify. Fewer than 20% do.
If you face foreclosure and don’t hire a competent professional to examine your mortgage comprehensively, YOU WILL LOSE YOUR HOUSE, one way or another, sooner or later. If you cannot prove that the lender or lender’s associates injured you at the inception of your loan, YOU WILL LOSE YOUR HOUSE. If you can prove it but fail aggressively to negotiate or litigate on the basis of those injuries, YOU WILL LOSE YOUR HOUSE.
And that means you will have to move out. So, I decided to do you a favor and give you the above number of Allied Van Lines. Call them and they will move everything you own to your new home.
Oh, right, I nearly forgot. If you complain that you cannot afford a mortgage examination, or the litigation or negotiation to use it effectively, then you will really whine about what Allied Van Lines charges to move you across town or to another state.
That’s IFF (if and only if) you have a home to which you can move.
And if you cannot afford the move, here’s what your house can looklike after you get evicted:
|You KNOW Whom to Call|
The worst part of disasters like those shown above: generally the mortgagor (that means YOU, the borrower in default on your loan) will end up owing money for all the necessary repairs, the eviction cost, the litigation cost, lawyer fees, accrued interest, etc.
Only the Mortgage Attack methodology will give you the opportunity to save your home from such a disaster AND win concessions or money from those who injured you.
That means you must get your mortgage examined comprehensively by a competent professional. Then you can use the causes of action from the examination report as leverage in a settlement negotiation or a lawsuit against the lender and lenders associates or agents.
See? You use the causes of action to attack the crooked mortgage instead of defending against an indefensible foreclosure.
“Causes of action” means “reasons to sue.” They can consist of a wide array tortious conduct, contract breaches, legal errors, and violations of state and federal regulations. Examples include appraisal fraud, loan application fraud, wrongful credit reputation damage, and many other terrible injuries that cost you a lot of money or put you in unnecessary jeopardy.
Some mortgage borrowers get injured badly, some get injured little, and some not at all. But any injuries can justify a set-off from the amount of your debt OR another settlement that benefits you, such as a favorable loan modification like a balloon-free reduction in your debt and interest rate, or a keys for cash deal.
You might even win a huge amount of compensatory and punitive damages (money) if you sue successfully for the injuries. In my experience, over 90% of those who get their mortgage examined have suffered injury by the lender or associates.
Yes, you can get a favorable loan modification if you negotiate from a position of power. That means you tell the lender to give you favorable terms (for example assumable 3% fixed rate for 30 years, loan balance reduced to the present value of your home, all accrued interest and costs forgiven, no 1099 to the IRS).
But you have no negotiating power without a mortgage examination report that shows how the lender or others injured you.
If YOU don’t want to lose your home to foreclosure, you know what to do. Call me today to get started on a mortgage examination by a competent professional.
Here’s another number to memorize while you make up your mind whether to lose your house or to take practical action that will give you some hope of redemption in your mortgage:
727 669 5511
It’s your choice:
- Allied Van Lines (800 444 6787 FREE), or
- Mortgage Attack (727 669 5511). Now.
Which makes most sense to you?
What? You still don’t feel “convinced” that you need to call me right now?
Okay, I have taken the time to write up a couple of examples of the benefits you can enjoy IF you act NOW to get your mortgage examined:
And here’s a little help for developing a MORTGAGE ATTACK MENTALITY:
Okay. Now call me. I wait expectantly to hear from you.
727 669 5511
By Bob Hurt, 4 November 2015
The 2 November 2015 US Supreme Court denial of certiorari in Tran v Bank of New York settled once-and-for-all the spurious assertion that borrowers can challenge putative violations of the Pooling and Servicing Agreement (PSA) creating a securitization trust. Borrowers, encouraged by Glaski v BOA, a California appellate win for the borrower, have claimed that because New York Law voids assignment of a note into a trust after its closing date in the PSA, the assignee has no authority to enforce the note in a foreclosure effort.
This argument boils down to nothing more than a borrower’s effort to use quirks in the law to get a “free house” by preventing foreclosure because the borrower did not make timely payments. Bottom line the courts will not allow a borrower to get a free house unless the lender team injured the borrower sufficiently to justify it.
Numerous California courts have deprecated the Glaski opinion, as have other courts across the land. Now the US Supreme Court has flicked its chin at it, and in doing so has buried it for good.
The US 2nd Circuit supported the NY Southern District in its reliance upon the 2nd Circuit’s Rajamin v Deutsche Bank opinion that borrowers lack standing to challenge the PSA or any assignment of the note because they
- Never became a party to the PSA or assignment
- Did not get injured by the PSA violation or assignment, and
- Receive no 3rd party benefits from the PSA or assignment.
Now, the SCOTUS has put the KIBOSH forever on the frivolous argument that the borrower can cite irregularities in obeying the PSA and assigning the note as a basis for stymieing a foreclosure. I have presented full opinions of the relevant cases. READ THEM.
If you want to know how to prove the lender team injured the borrower, and how the borrower can use that proof to win millions in compensatory and punitive damages, visit http://MortgageAttack.com.
- Tran v. Bank of New York, Supreme Court of the United States 2 Nov 2015
- Tran v. Bank of New York, Court of Appeals, 2nd Circuit 2015
- Tran v. Bank of New York, Dist. Court, SD New York 2014
- RAJAMIN v. DEUTSCHE BANK NATIONAL TRUST COMPANY, Court of Appeals, 2nd Circuit 2014
- Glaski v. Bank of America, 218 Cal. App. 4th 1079 – Cal: Court of Appeal, 5th Appellate Dist. 2013
Download this article with the above opinions embedded. Distribute broadly.
NORMAN BRADFORD SHOWS THAT THE COURTS LIKE RESCISSION and OTHER FORMS OF MORTGAGE ATTACK, etc, IF THE BORROWER ARTFULLY MANAGES THE ATTACK.
If you want to see a case where the court denied rescission pre-Jesinoski, but the court awarded damages and attorney fees to the plaintiff, and where the MORTGAGE ATTACK lawsuit shows you how to set up a win, read up on Bradford v HSBC. Get the PACER docket report for this case:
1:09-cv-01226-TSE-JFA Bradford v. HSBC Mortgage Corporation et al
If you use the RECAP THE LAW extension in Firefox or Chrome browser, you can get an abbreviated docket report and some case docs FREE. Get the Docket Report I just ran HERE:
You can get the case opinions at Google Scholar here.
22 July 2011 – Bradford v. HSBC Mortg. Corp., 799 F. Supp. 2d 625 – Dist. Court, ED Virginia 2011
8 Dec 2011 – Bradford v. HSBC Mortg. Corp., 829 F. Supp. 2d 340 – Dist. Court, ED Virginia 2011
5 March 2012- Bradford v. HSBC Mortg. Corp., 838 F. Supp. 2d 424 – Dist. Court, ED Virginia 2012
26 April 2012- Bradford v. HSBC Mortg. Corp., 859 F. Supp. 2d 783 – Dist. Court, ED Virginia 2012
This case has not ended yet, partly because the creditor filed for bankruptcy and has not come out yet.
As the above opinions show, Bradford took out a refi loan in 2006, and paid on it for two years even thought the loan broker had lied, bait and switched him, then Bradford send the lender a justified notice of rescission in 2008. He sued for TILA rescission, for related damages including credit reputation damage for failure of the creditor to remove the lien and to tender after he offered to tender, for FDCPA violations for trying to collect a rescinded debt, for RESPA violations because the servicer refused to tell him the identity of the creditor (for which Bradford won costs, $4K damage, and over $25K legal fees), and for wrongful foreclosure. He filed the lawsuit 1 year and 16 days after sending notice of rescission.
Document 56 shows that a competent plaintiff like Bradford can craft a multi-count complaint so that it sails past a motion to dismiss with flying colors. The judge analyzes the complaint carefully and seems to love it.
The court ended up dismissing the rescission complaint because the 4th Circuit had opined that the borrower must sue within 3 years after closing, and Bradford sued a little over 4 years after closing. Thereafter, the 4th Circuit changed its view about the timing of rescission lawsuit, incidentally aligning with the Jesinoski opinion.
After the creditor comes out of bankruptcy, Bradford will have the ability to challenge the rescission dismissal in light of later Circuit position on suing for rescission, and in light of Jesinoski. The court would, of course, reverse the dismissal and order the unwinding of the loan. However, Bradford will have a considerable amount of setoffs, and the creditor knows it.
So, instead of challenging the dismissal right off, he can demand a settlement from the creditor (“Give me the house free and clear and call us even”). He will point out how badly he has beat up his adversaries already, and how much more he will beat them up with the rescission and setoffs and enormous legal fees, etc. They might make him a suitable counter offer. Or he might have to take them back to court. Time will tell.
Regardless, Bradford has not made a house payment since late 2008, he does not have to make payments because of the justified rescission, and interest stopped accruing on his debt in 2008, giving him free use of that money in the form of his house
In summary, Norman Bradford has, though his case, conducted a Mortgage Attack seminar for anyone wanting to know how to beat up the bank and its team members. The pleadings sit there on PACER for you to study.
All of you who simply cannot believe that borrowers can beat the bank by proving the bank and its agents and allies injured the borrower, TAKE HEART. Here I present a crystal clear example of the MORTGAGE ATTACK methodology:
Bank of America, NA v. Pate, 159 So. 3d 383 – Fla: Dist. Court of Appeals, 1st Dist. 2015
Don’t waste your time whining about the banking industry, fractional reserve lending, the Federal Reserve, the money system, securitization, and such irrelevancies. Get a mortgage examination if necessary to find the causes of action, and use them to HAMMER the lender, creditor, servicer, appraiser, loan broker, closer, title company, etc (whoever hurt you) IN COURT.
As you can see, the Florida appeals court upheld the BENCH TRIAL (not jury) award of $250,000 in PUNITIVE DAMAGES and over $60,000 in compensatory damages for the INJURIES the BANK did to the BORROWER. The Pates could probably have won much more in a jury trial.
If you want to deploy the MORTGAGE ATTACK strategy in your own mortgage dispute, visit http://MortgageAttack.com to learn what works and what does not.
BANK OF AMERICA, N.A., and Third-Party Defendant, Homefocus Services, LLC, Appellants,
Phillip V. PATE and Barbara Pate, Robert L. Pohlman and Marcia L. Croom, Appellees.
ROWE and OSTERHAUS, JJ., concur; THOMAS, J., CONCURS SPECIALLY WITH OPINION.
THOMAS, J., Specially Concurring.
In this civil foreclosure case, the trial court found that Appellant Bank of America (the Bank) engaged in egregious and intentional misconduct in Appellee Pates’ (Pate) purchase of a residential home. Thus, based on the trial court’s finding that the Bank had unclean hands in this equity action, it did not reversibly err in denying the foreclosure action and granting a deed in lieu of foreclosure. In addition, the trial court did not err in ruling in favor of the Pates in their counterclaims for breach of contract and fraud, and awarding them $250,000 in punitive damages and $60,443.29 in compensatory damages, against the Bank and its affiliate, Homefocus Services, LLC, which provided the flawed appraisal discussed below. Finally, the trial court did not reversibly err in granting injunctive relief and thereby ordering the Bank to take the necessary measures to correct the Pates’ credit histories.
In the bench trial below, the trial court found that the Bank assured the Pates, based on the appraisal showing the home’s value far exceeded the $50,000 mortgage loan, that it would issue a home equity loan in addition to the mortgage loan. This was a precondition to the Pates’ agreement to purchase the home, which was in very poor condition but had historical appeal for the Pates. The Pates intended to restore the home, but needed the home equity loan to facilitate restoration.
Before the closing on the property, the Bank informed the Pates that it would close on the home equity loan “later,” after the mortgage loan was issued. The Bank later refused to issue the home equity loan, in part on the ground that the appraisal issued by Homefocus was flawed. The Pates were forced to invest all of their savings and much of their own labor in extensive repairs. Thus, the trial court found that the Pates detrimentally relied on the representations of the Bank that it would issue the home equity loan. The record supports the trial court’s conclusion that the Bank acted with reckless disregard constituting intentional misconduct by the Bank. See generally,Lance v. Wade, 457 So.2d 1008, 1011 (Fla.1984) (“[E]lements for actionable fraud are (1) a false statement concerning a material fact; (2) knowledge by the person … that the representation is false; (3) the intent … [to] induce another to act on it; and (4) reliance on the representation to the injury of the other party. In summary, there must be an intentional material misrepresentation upon which the other party relies to his detriment.”).
The trial court further found that the Pates complied with the Bank’s demand to obtain an insurance binder to provide premiums for annual coverage, and that the Bank agreed to place these funds in escrow, utilizing the binder to pay the first year of coverage and calculate future charges to the Pates. Although the Pates fulfilled this contractual obligation, the Bank failed to correctly utilize the escrow funds. Consequently, the Pates’ insurance policy was ultimately cancelled due to nonpayment. The Pates attempted to obtain additional coverage but were unsuccessful due to the home’s structural condition. The Bank then obtained a force-placed policy with $334,800 in coverage and an annual premium of $7,382.98, which was 385*385 included on the mortgage loan, quadrupling the Pate’s mortgage payment.
The Pates offered to pay the original $496.34 monthly mortgage payment, but the Bank refused, demanding a revised mortgage payment of $2,128.74. The trial court found it “disturbing that Bank of America could financially profit due to [the Bank’s] failure to pay the home insurance…. [T]he profits for one or more months of forced place insurance would have been substantial.”
The trial court further found that during the four years of litigation following the Pates’ default, the Bank’s agents entered the Pate’s home several times while the Pates resided there, attempted to remove furniture, and placed locks on the exterior doors. Following the Bank’s action, the Pates had to have the locks changed so their family could enter the residence. During two of the intrusions, the Pates were required to enlist the aid of the sheriff to force the Bank’s agent to leave their home. The trial court found as fact that, due to the Bank’s multiple intrusions into their home, the Pates were forced to obtain alternative housing for 28 months, at a cost of thousands of dollars.
The Bank’s actions supported the trial court’s finding that punitive damages were awardable. In Estate of Despain v. Avante Group, Inc., 900 So.2d 637, 640 (Fla. 5th DCA 2005), the court held that “[p]unishment of the wrongdoer and deterrence of similar wrongful conduct in the future, rather than compensation of the injured victim, are the primary policy objectives of punitive damage awards.” See also Owens-Corning Fiberglas Corp. v. Ballard, 749 So.2d 483 (Fla.1999); W.R. Grace & Co.-Conn. v. Waters, 638 So.2d 502 (Fla.1994).
In Estate of Despain, the court held that “[t]o merit an award of punitive damages, the defendant’s conduct must transcend the level of ordinary negligence and enter the realm of willful and wanton misconduct….” 900 So.2d at 640. Florida courts have defined such conduct as including an “entire want of care which would raise the presumption of a conscious indifference to consequences, or which shows… reckless indifference to the rights of others which is equivalent to an intentional violation of them.” Id. (quoting White Constr. Co. v. Dupont, 455 So.2d 1026, 1029 (Fla.1984)). Here, the Bank’s intent to defraud was shown by its reckless disregard for its actions. The facts showing the Bank’s “conscious indifference to consequences” and “reckless indifference” to the rights of the Pates is the same as an intentional act violating their rights. See White Constr. Co., 455 So.2d at 1029. The record evidence provides ample support for the trial court’s ruling in favor of the Pates’ claim for punitive damages against the Bank.
The learned trial judge found that the Bank’s actions demonstrated its unclean hands; therefore, the Bank was not entitled to a foreclosure judgment in equity. Unclean hands is an equitable defense, akin to fraud, to discourage unlawful activity. SeeCongress Park Office Condos II, LLC v. First-Citizens Bank & Trust Co., 105 So.3d 602, 609 (Fla. 4th DCA 2013) (“It is a self-imposed ordinance that closes the doors of a court of equity to one tainted with inequitableness or bad faith relative to the matter in which he seeks relief[.]”) (quoting Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 814 (1945)). The totality of the circumstances established the Bank’s unclean hands, precluding it from benefitting by its actions in a court of equity. Thus, the trial court did not err by denying the foreclosure action.
Statute of Limitations Applies to Whole Payment Stream
By Bob Hurt, 18 September 2015
Florida’s 1st District Appellate Court gave Germaine and Andrea Brown a rude awakening by telling them the Florida foreclosure 5-year statute of limitations does not apply a 30-year stream of mortgage payments even after the creditor accelerates the loan, making the entire balance immediately due and payable. The panel cited the Florida Supreme Court opinion in Singleton v Greymar (2004) as the controlling authority (“the unique nature of the mortgage obligation and the continuing obligations of the parties in that relationship.”). The panel held that “the subsequent and separate alleged default created a new and independent right in the mortgagee to accelerate payment on the note in a subsequent foreclosure action.” In other words, every default of a scheduled payment provides a new right to sue, throughout the original term of the loan.
The panel admitted that Florida’s 3rd District had reached a contrary conclusion in Deutsche Bank v Beauvais (2014). But the panel harked to the USDC adverse opinion in Stern v BOA (2015) which claimed that Beauvis opinion went against ”overwhelming weight of authority.” Now the Beauvais court plans to review its decision.
This should make it abundantly clear that the foreclosure statute of limitations in Florida does not constitute a valid defense against foreclosure, except on payments more than 5 years overdue on which the creditor has failed to take action.
Why should this matter to mortgage victims facing foreclosure? Because you cannot depend on Foreclosure Defense to defeat foreclosure. The court/trustee will NOT give you a free house.
ONLY ONE methodology gives home loan borrowers a reliable chance beat the appraiser, mortgage broker, title company, servicer, and creditor in a mortgage dispute: MORTGAGE ATTACK. Borrowers must ATTACK THE VALIDITY OF THE LOAN, and to do that, they must get a comprehensive mortgage examination.
If you have a mortgage dispute, contact Mortgage Attack NOW for a full explanation of the ONLY WINNING METHODOLOGY.
NATIONSTAR MORTGAGE, LLC v. Brown, Fla: Dist. Court of Appeals, 1st Dist. 2015
NATIONSTAR MORTGAGE, LLC, Appellant,
GERMAINE R. BROWN a/k/a GERMAINE R. BROWN; ANDREA E. BROWN, Appellees.
District Court of Appeal of Florida, First District.
Opinion filed August 24, 2015.
Nancy M. Wallace of Akerman LLP, Tallahassee; William P. Heller of Akerman LLP, Fort Lauderdale; Celia C. Falzone of Akerman LLP, Jacksonville, for Appellant.
Jared D. Comstock of John F. Hayter, Attorney at Law, P.A., Gainesville, for Appellees.
Appellant challenges a final summary judgment holding that the statute of limitations bars appellant’s action to foreclose the subject mortgage. We agree with appellant that the statute of limitations did not bar the action. Thus, we reverse.
It is undisputed that appellees have failed to make any mortgage payments since February 2007, the first month in which they defaulted. In April 2007, appellant’s predecessor in interest gave notice of its intent to accelerate the note based on the February 2007 breach, and filed a foreclosure action. However, the trial court dismissed that action without prejudice in October 2007, after counsel for the lender failed to attend a case management conference.
The next relevant event occurred in November 2010, when appellant sent appellees a new notice of intent to accelerate, based on appellees’ breach in March 2007 and subsequent breaches. Appellees took no action to cure the default, and appellant filed a new foreclosure action in November 2012. Appellees asserted the statute of limitations as an affirmative defense, arguing that the new action and any future foreclosure actions were barred because they were not filed within five years after the original 2007 acceleration of the note. § 95.11(2)(c), Fla. Stat. (2012) (establishing five year statute of limitations on action to foreclose a mortgage).
The principles set forth in Singleton v. Greymar Associates, 882 So. 2d 1004 (Fla. 2004), apply in this case. In Singleton, the Florida Supreme Court recognized “the unique nature of the mortgage obligation and the continuing obligations of the parties in that relationship.” 882 So. 2d at 1007 (emphasis added). The court sought to avoidboth unjust enrichment of a defaulting mortgagor, and inequitable obstacles “prevent[ing] mortgagees from being able to challenge multiple defaults on a mortgage.” Id. at 1007-08. Giving effect to those principles in light of the continuing obligations of a mortgage, the court held that “the subsequent and separate alleged default created a new and independent right in the mortgagee to accelerate payment on the note in a subsequent foreclosure action.” Id. at 1008. The court found it irrelevant whether acceleration had been sought in earlier foreclosure actions. Id. The court’s analysis in Singleton recognizes that a note securing a mortgage creates liability for a total amount of principal and interest, and that the lender’s acceptance of payments in installments does not eliminate the borrower’s ongoing liability for the entire amount of the indebtedness.
The present case illustrates good grounds for the Singleton court’s concern with avoiding both unjust enrichment of borrowers and inequitable infringement on lenders’ remedies. Judgments such as that under review run afoul of Singleton because they release defaulting borrowers from their entire indebtedness and preclude mortgagees from collecting the total debt evidenced by the notes securing the mortgages they hold, even though the sum of the installment payments not made during the limitations period represents only a fraction of the total debt. See GMAC Mortg., LLC v. Whiddon, 164 So. 3d 97, 100 (Fla. 1st DCA 2015) (dismissal of earlier foreclosure action “did not absolve the Whiddons of their responsibility to make mortgage payments for the remaining twenty-five years of their mortgage agreement”). We further observe that both the note and the mortgage at issue here contain typical provisions reflecting the parties’ agreement that the mortgagee’s forbearance or inaction do not constitute waivers or release appellees from their obligation to pay the note in full. These binding contractual terms refute appellees’ arguments and are inconsistent with the judgment under review.
We have held previously that not even a dismissal with prejudice of a foreclosure action precludes a mortgagee “from instituting a new foreclosure action based on a different act or a new date of default not alleged in the dismissed action.” PNC Bank, N.A. v. Neal, 147 So. 3d 32, 32 (Fla. 1st DCA 2013); see also U.S. Bank Nat. Ass’n v. Bartram, 140 So. 3d 1007, 1014 (Fla. 5th DCA), review granted, 160 So. 3d 892 (Fla. 2014) (Case No. SC14-1305) (dismissal of earlier foreclosure action, whether with or without prejudice, did not bar subsequent foreclosure action based on a new default);Evergrene Partners, Inc. v. Citibank, N.A., 143 So. 3d 954, 955 (Fla. 4th DCA 2014)(foreclosure and acceleration based on an earlier default “does not bar subsequent actions and acceleration based upon different events of default”). The dismissal in this case was without prejudice, so much the more preserving appellant’s right to file a new foreclosure action based on appellees’ breaches subsequent to the February 2007 breach asserted as the procedural trigger of the earlier foreclosure action. We find that appellant’s assertion of the right to accelerate was not irrevocably “exercised” within the meaning of cases defining accrual for foreclosure actions, when the right was merely asserted and then dismissed without prejudice. See Olympia Mortg. Corp. v. Pugh, 774 So. 2d 863, 866-67 (Fla. 4th DCA 2000) (“By voluntarily dismissing the suit, [the mortgagee] in effect decided not to accelerate payment on the note and mortgage at that time.”); see also Slottow v. Hull Inv. Co., 129 So. 577, 582 (Fla. 1930) (a mortgagee could waive an acceleration election in certain circumstances). After the dismissal without prejudice, the parties returned to the status quo that existed prior to the filing of the dismissed complaint. As a matter of law, appellant’s 2012 foreclosure action, based on breaches that occurred after the breach that triggered the first complaint, was not barred by the statute of limitations. Evergrene, 143 So. 3d at 955 (“[T]he statute of limitations has not run on all of the payments due pursuant to the note, and the mortgage is still enforceable based upon subsequent acts of default.”).
We are aware that the Third District has reached a contrary conclusion in Deutsche Bank Trust Co. Americas v. Beauvais, 40 Fla. L. Weekly D1, 2014 WL 7156961 (Fla. 3d DCA Dec. 17, 2014) (Case No. 3D14-575). A federal district court has refused to follow Beauvais, noting that it is “contrary to the overwhelming weight of authority.” Stern v. Bank of America Corp., 2015 WL 3991058 at *2-3 (M.D. Fla. June 30, 2015) (No. 2:15-cv-153-FtM-29CM). The court in Beauvais acknowledges that its conclusion is contrary to the weight of authority on the questions presented. 2014 WL 7156961, at *8-9. That court’s docket shows that the court has set the case for rehearing en banc; it remains to be seen whether the merits disposition will change.
Accordingly, we reverse and remand for further proceedings on appellant’s foreclosure action.
THOMAS and MARSTILLER, JJ., CONCUR.
NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED.
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Conundrum: You find out that the
assignee of your California Deed of Trust never acknowledged and
recorded the deed of trust with the clerk of courts, and now wants
to enforce the mortgage in order to foreclose. You dig around and
find these California Civil Code sections below. Should you attack
the assignee’s standing to foreclose?
Answer: No. In California, the assignee of
beneficial interest in a mortgage security instrument must duly
acknowledge and record the assignment in order to have the right to
force a foreclosure sale. The assignee of a beneficial interest in
a deed of trust need not record the assignment in order to force a
Discussion: A mortgage differs from a deed of
trust. Both secure the note, such that they entitle the owner of
beneficial interest in the note (or agent) to enforce the note by
foreclosure and forcible sale of the property. However, a mortgage
requires enforcement through judicial action – the foreclosing party
must sue the borrower for breaching the note. By contrast, a deed
of trust involves a trustee who receives notice of the breach and of
fulfillment of conditions precedent from the owner of beneficial
interest in the note (or holder or agent), then orders the sale of
the property held in trust. A mortgage operates as a lien with
title remaining in the borrower (technically, it goes to the
mortgagee for purposes of a mortgage only), and a deed of trust
conveys title to the trustee until the borrower has retired the
It seems axiomatic that owner of beneficial interest in the note
(oobi) may, in the event the borrower breaches the note, enforce the
note through foreclosure and forcing the sale of the property
securing the debt. Furthermore, it seems axiomatic that the oobi may
assign the security instrument, to another party who may enforce the
security instrument by forcing a foreclosure sale.
But… always verify what the law means by looking at how the courts
For reference see Calvo v HSBC Bank, 199 CAL.APP.4TH 118 (CAL. APP.
Civil Code Section
2932. A power of sale may
be conferred by a mortgage upon the mortgagee or any other
person, to be exercised after a breach of the obligation for
which the mortgage is a security.
2932.5. Where a power to sell real property is given to
a mortgagee, or other encumbrancer, in an instrument intended
to secure the payment of money, the power is part of the
security and vests in any person who by assignment becomes
entitled to payment of the money secured by the instrument.
The power of sale may be exercised by the assignee if the
assignment is duly acknowledged and recorded.
2924. (a) Every transfer of an interest in
property, other than in
trust, made only as a security for the performance of another
to be deemed a mortgage, except when in the case of personal
property it is accompanied by actual change of possession, in
case it is to be deemed a pledge. Where, by a mortgage created
July 27, 1917, of any estate in real property, other than an
at will or for years, less than two, or in any transfer in trust
after July 27, 1917, of a like estate to secure the performance
an obligation, a power of sale is conferred upon the mortgagee,
trustee, or any other person, to be exercised after a breach of
obligation for which that mortgage or transfer is a security,
power shall not be exercised except where the mortgage or
made pursuant to an order, judgment, or decree of a court of
or to secure the payment of bonds or other evidences of
authorized or permitted to be issued by the Commissioner of
Corporations, or is made by a public utility subject to the
provisions of the Public Utilities Act, until all of the
apply: (1) The trustee, mortgagee, or beneficiary, or any of
authorized agents shall first file for record, in the office of
recorder of each county wherein the mortgaged or trust property
some part or parcel thereof is situated, a notice of default.
notice of default shall include all of the following: (A) A
statement identifying the mortgage or deed of trust by
stating the name or names of the trustor or trustors and giving
book and page, or instrument number, if applicable, where the
mortgage or deed of trust is recorded or a description of the
mortgaged or trust property. (B) A statement that a breach of
the obligation for which the
mortgage or transfer in trust is security has occurred. (C) A
statement setting forth the nature of each breach actually
known to the beneficiary and of his or her election to sell or
to be sold the property to satisfy that obligation and any other
obligation secured by the deed of trust or mortgage that is in
default. (D) If the default is curable pursuant to Section
statement specified in paragraph (1) of subdivision (b) of
2924c. (2) Not less than three months shall elapse from the
filing of the
notice of default. (3) Except as provided in paragraph (4),
after the lapse of the
three months described in paragraph (2), the mortgagee, trustee,
other person authorized to take the sale shall give notice of
stating the time and place thereof, in the manner and for a time
less than that set forth in Section 2924f. (4) Notwithstanding
paragraph (3), the mortgagee, trustee, or
other person authorized to take sale may record a notice of sale
pursuant to Section 2924f up to five days before the lapse of
three-month period described in paragraph (2), provided that the
of sale is no earlier than three months and 20 days after the
recording of the notice of default. (5) Until January 1, 2018,
whenever a sale is postponed for a
period of at least 10 business days pursuant to Section 2924g, a
mortgagee, beneficiary, or authorized agent shall provide
notice to a borrower regarding the new sale date and time,
five business days following the postponement. Information
pursuant to this paragraph shall not constitute the public
declaration required by subdivision (d) of Section 2924g.
comply with this paragraph shall not invalidate any sale that
otherwise be valid under Section 2924f. This paragraph shall be
inoperative on January 1, 2018. (6) No entity shall record or
cause a notice of default to be
recorded or otherwise initiate the foreclosure process unless it
the holder of the beneficial interest under the mortgage or deed
trust, the original trustee or the substituted trustee under the
of trust, or the designated agent of the holder of the
interest. No agent of the holder of the beneficial interest
mortgage or deed of trust, original trustee or substituted
under the deed of trust may record a notice of default or
commence the foreclosure process except when acting within the
of authority designated by the holder of the beneficial
interest. (b) In performing acts required by this article, the
incur no liability for any good faith error resulting from
on information provided in good faith by the beneficiary
the nature and the amount of the default under the secured
obligation, deed of trust, or mortgage. In performing the acts
required by this article, a trustee shall not be subject to
1.6c (commencing with Section 1788) of Part 4. (c) A recital in
the deed executed pursuant to the power of sale
of compliance with all requirements of law regarding the mailing
copies of notices or the publication of a copy of the notice of
default or the personal delivery of the copy of the notice of
or the posting of copies of the notice of sale or the
a copy thereof shall constitute prima facie evidence of
with these requirements and conclusive evidence thereof in favor
bona fide purchasers and encumbrancers for value and without
notice. (d) All of the following shall constitute privileged
communications pursuant to Section 47: (1) The mailing,
publication, and delivery of notices as required
by this section. (2) Performance of the procedures set forth in
this article. (3) Performance of the functions and procedures
set forth in this
article if those functions and procedures are necessary to carry
the duties described in Sections 729.040, 729.050, and 729.080
Code of Civil Procedure. (e) There is a rebuttable presumption
that the beneficiary
actually knew of all unpaid loan payments on the obligation owed
the beneficiary and secured by the deed of trust or mortgage
to the notice of default. However, the failure to include an
known default shall not invalidate the notice of sale and the
beneficiary shall not be precluded from asserting a claim to
omitted default or defaults in a separate notice of default. (f)
With respect to residential real property containing no more
than four dwelling units, a separate document containing a
the notice of default information in English and the languages
described in Section 1632 shall be attached to the notice of
provided to the mortgagor or trustor pursuant to Section 2923.3.
COURT OF APPEAL OF
CALIFORNIA, SECOND DISTRICT. EIGHT.
CALVO V. HSBC BANK USA, N.A.
199 CAL.APP.4TH 118 (CAL. APP. 2011)
DECIDED SEPT. 13, 2011
of Appeal of California, Second District. Eight.
from the Superior Court of Los Angeles County, No.
BC415545, Mark V. Mooney, Judge. *119
Moore for Plaintiff and Appellant.
Allison, Eric D. Houser, Robert W. Norman, Jr., and
Carrie N. Heieck for Defendant and Respondent.
Eugenia Calvo obtained a loan secured by a deed of trust
against her residence. The original lender assigned the
loan and deed of trust to HSBC Bank USA, N.A. (HSBC Bank).
A new trustee was also substituted after the loan was
originated. Plaintiff defaulted in payment of the loan.
The new trustee initiated foreclosure proceedings and
executed a foreclosure sale of plaintiffs residence.
Notice of the assignment of the deed of trust appeared
only in the substitution of trustee, which was recorded on
the same date as the notice of trustee’s sale. The second
amended complaint seeks to set aside the trustee’s sale
for an alleged violation of Civil Code section , 1 which requires the
assignee of a mortgagee to record an
assignment before exercising a power to sell real
property. HSBC Bank and its agent, the nominal beneficiary
under the deed of trust, demurred to the second amended
complaint, and the trial court sustained the demurrer
without leave to amend.
references are to the Civil Code unless otherwise
find defendant HSBC Bank did not violate section 2932.5
because that statute does not apply when the power of sale
is conferred in a deed of trust rather than a mortgage. We
affirm the judgment dismissing the complaint.
sued HSBC Bank and Mortgage Electronic Registration
Systems, Inc. (MERS), its agent and nominal beneficiary
under the deed of trust recorded against her residence.
Plaintiff had borrowed money from CBSK Financial Group,
Inc., which is not a defendant in this lawsuit. Her loan
was secured by a deed of trust against her residence that
was recorded on September 1, 2006. The deed of trust
identified plaintiff as the trustor, CBSK Financial Group
as the lender, MERS as the nominal beneficiary and
lender’s agent, and Lawyers Title Company as the trustee.
In the deed of trust, plaintiff granted title to her
residence to the trustee, in trust, with the power of
sale. The deed of trust stated: “MERS (as nominee for
Lender and Lender’s successors and assigns) has the right:
to exercise any or all of those interests, *121 including, but not
limited to, the right to foreclose and sell the Property;
and to take any action required of Lender including, but
not limited to, releasing and canceling the Security
Foreclosure Corporation was substituted as trustee under
the deed of trust on or about June 2, 2008. The
substitution of trustee stated that MERS, as nominee for
HSBC Bank, “is the present Beneficiary” under the deed of
trust, as MERS had been for the original lender. The
substitution of trustee was not recorded until October 14,
2008, the same date on which Aztec Foreclosure Corporation
recorded a notice of trustee’s sale. More than three
months before recordation of the substitution of trustee,
Aztec Foreclosure Corporation had recorded a notice that
plaintiff was in default in payment of her loan and that
the beneficiary had elected to initiate foreclosure
proceedings. The notice of default advised plaintiff to
contact HSBC Bank to arrange for payment to stop the
Bank bought plaintiffs residence in the foreclosure sale,
and a trustee’s deed upon sale was recorded on January 9,
2009. The gist of the complaint is that HSBC Bank
initiated foreclosure proceedings under the deed of trust
without any recordation of the assignment of the deed of
trust to HSBC Bank in violation of section 2932.5.
demurrer tests the legal sufficiency of the complaint. We
review the complaint de novo to determine whether it
alleges facts sufficient to state a cause of action. For
purposes of review, we accept as true all material facts
alleged in the complaint, but not contentions, deductions
or conclusions of fact or law. We also consider matters
that may be judicially noticed. ( Blank v. Kirwan (1985) 39 Cal.3d 311, [ 216 Cal.Rptr. 718, 703 P.2d 58].) When a
demurrer is sustained without leave to amend, “we decide
whether there is a reasonable possibility that the defect
can be cured by amendment: if it can be, the trial court
has abused its discretion and we reverse; if not, there
has been no abuse of discretion and we affirm.” ( Ibid.) Plaintiff has
the burden to show a reasonable possibility the complaint
can be amended to state a cause of action. ( Ibid.)
trial court did not err in sustaining the demurrer without
leave to amend. Plaintiffs lawsuit rests on her claim that
the foreclosure sale was void and should be set aside
because HSBC Bank invoked the power of sale without
complying with the requirement of section 2932.5 to record
the assignment of the deed of trust from the original
lender to HSBC Bank. We find no merit in this contention. *122
2932.5 provides: “Where a power to sell real property is
given to a mortgagee, or other encumbrancer, in an
instrument intended to secure the payment of money, the
power is part of the security and vests in any person who
by assignment becomes entitled to payment of the money
secured by the instrument. The power of sale may be
exercised by the assignee if the assignment is duly
acknowledged and recorded.”
has been established since 1908 that this statutory
requirement that an assignment of the beneficial interest
in a debt secured by real property must be recorded in
order for the assignee to exercise the power of sale
applies only to a mortgage and not to a deed of trust. In Stockwell v. Barnum(1908) 7 Cal.App. 413 [ 94 P. 400] ( Stockwell), the
court affirmed the judgment against a plaintiff who sought
to set aside and vacate a sale of real property under a
deed of trust. In Stockwell, a couple
borrowed money from two individuals and gave them a
promissory note that provided, in case of default in the
payment of interest, the holder of the note had the option
to demand payment of all the principal and interest. To
secure payment of the note, the borrowers executed and
delivered a deed of trust by which they conveyed to the
trustee legal title to a parcel of real estate, with the
power of sale on demand of the beneficiaries of the
promissory note. The borrowers defaulted. The original
lenders assigned the note to another individual, who
elected to declare the whole amount of principal and
interest due and made demand on the trustee to sell the
property. Before the trustee’s sale was made, but on the
same day as the trustee’s sale, the defaulting couple
conveyed the real property to the plaintiff, who then sued
to set aside the trustee’s sale.
of the bases on which the plaintiff in Stockwell sought to set
aside the sale was that no assignment of the beneficial
interests under the deed of trust was recorded and
therefore the original lender’s assignee had no right to
demand a trustee’s sale of the property. The plaintiff inStockwell relied on former
section 858, the predecessor of section 2932.5, as support
for this contention. (The parties correctly acknowledge
that § 2932.5 continued former § 858 without substantive
change.) (Law Revision Com. com., Deering’s Ann. Civ.
Code, § (2005 ed.) p.
454.) TheStockwell court found the
statute did not apply to a trustee’s sale.
The Stockwell court
distinguished a trust deed from a mortgage, explaining
that a mortgage creates only a lien, with title to the
real property remaining in the borrower/mortgagee, whereas
a deed of trust passes title to the trustee with the power
to transfer marketable title to a purchaser. The court
reasoned that since the lenders had no power of sale, and
only the trustee could transfer title, it was immaterial
who held the note. ( Stockwell, supra, .) “The transferee of a
negotiable promissory note, *123 payment of which
is secured by a deed of trust whereby the title to the
property and power of sale in case of default is vested in
a third party as trustee, is not an encumbrancer to whom
power of sale is given, within the meaning of section 858
. . . .” ( Id. at p. 417.)
holding of Stockwell has never been
reversed or modified in any reported California decision
in the more than 100 years since the case was decided. The
rule that section 2932.5 does not apply to deeds of trust
is part of the law of real property in California. After
1908, only the federal courts have addressed the question
whether section 2932.5 applies to deeds of trust, and only
very recently. Every federal district court to consider
the question has followed Stockwell. (See, e.g., Roque v. SunTrust
Mortgage, Inc.(N.D.Cal., Feb. 10, 2010, No.
C-09-00040 RWM) , p. *8 [“Section 2932.5
applies to mortgages, not deeds of trust. It applies only
to mortgages that give a power of sale to the creditor,
not to deeds of trust which grant a power of sale to the
trustee.”]; Parcray v. Shea
Mortgage, Inc. (E.D.Cal.,
Apr. 23, 2010, No. CV-F-09-1942 OWW/GSA) , p. *31 [“There is no
requirement under California law for an assignment to be
recorded in order for an assignee beneficiary to
foreclose.”]; Caballero v. Bank of
Nov. 4, 2010, No. 10-CV-02973-LHK) , p. *8 [“§ 2932.5 does not require the
recordation of an assignment of a beneficial interest for
a deed of trust, as
opposed to a mortgage”].)2
Plaintiff cited only one
bankruptcy court decision in support of her argument
that section 2932.5 applies to deeds of trust. ( U.S. Bank N.A. v.
Skelton (In re Salazar) (Bankr. S.D.Cal. 2011) .) We find the analysis in that case
unpersuasive. Holdings of the federal courts are not
binding or conclusive on California courts, though they
may be entitled to respect and careful consideration. ( Bank of Italy etc.
Assn. v. Bentley (1933) 217 Cal. 644, [20 P.2d 940] ( Bank of Italy).) A
federal bankruptcy court decision interpreting
California law, however, is not due the same deference.
(SeeStern v. Marshall (2011) [ , 131 S.Ct. 2594].)
argues that Stockwell is “[o]utdated”
and, that in the “modern era,” there is no difference
between a mortgage and a deed of trust. Plaintiff
misconstrues Bank of Italy, supra, 217 Cal. 644 as holding that
deeds of trust are the same as mortgages with a power of
sale, and therefore, as supporting her argument that
section 2932.5 applies to both mortgages and deeds of
trust. First, our Supreme Court inBank of Italy did not consider
or construe section 2932.5 or its predecessor statute.
the court in Bank of Italy did not hold that
a mortgage is the same as a deed of trust. Far from it;
theBank of Italy court recognized
that the distinction between a mortgage, which creates
only a lien, and a deed of trust, *124which
passes title to the trustee, “has become well settled in
our law and cannot now be disturbed.” ( Bank of Italy, supra, .) Third, the court’s holding was
expressly limited to the question (not in issue here)
whether in California it is permissible to sue on a
promissory note secured by a deed of trust without first
exhausting the security or showing that it is valueless.
The trial court had found “that no action may be brought
on a note secured by a deed of trust unless and until the
security is exhausted. The correctness of this conclusion
is the sole point involved on this appeal.” ( Id. at pp. 647, 648,
plaintiff in Bank of Italy had argued the
only statute requiring that security be exhausted before
suing on the note was limited to mortgages and did not
include the distinctly different deeds of trust. ( Bank of Italy, supra, .) The Bank of Italy court therefore
considered whether the differences between a mortgage and
a deed of trust under California law should permit the
holder of a note secured by a deed of trust to sue on the
note without exhausting the security by a sale of the
property. The court recognized there were an increasing
number of cases that applied the same rules to deeds of
trust that are applied to mortgages and concluded that
“merely because `title’ passes by a deed of trust while
only a `lien’ is created by a mortgage,” in both
situations the security must be exhausted before suit on
the personal obligation. ( Bank of Italy, supra, .) Nothing in the holding or
analysis of the Bank of Italy opinion supports
plaintiffs position here that we should find section
2932.5 applies to a deed of trust.
also is mistaken in contending that Strike v. Trans-West
Discount Corp. (1979) 92 Cal.App.3d 735 [ 155 Cal.Rptr. 132] ( Strike) supports her
position. In Strike, a homeowner
had a judgment entered against him on a business debt he
had guaranteed. The homeowner later defaulted in payments
on a bank loan that was secured by a deed of trust against
his home, and he asked the judgment creditor to help him
out. The judgment creditor agreed to buy an assignment of
the home loan and deed of trust from the bank, consolidate
the indebtedness on the home loan with the amount owed to
satisfy the judgment, and extend the maturity date of
homeowner defaulted again, and the judgment creditor
initiated nonjudicial foreclosure proceedings. The
homeowner sued in an attempt to avoid foreclosure and
eviction but did not prevail at trial. The Court of Appeal
affirmed. Among the homeowner’s arguments that were
rejected on appeal was the contention that the judgment
creditor’s interest in his home was an equitable lien that
could only be foreclosed by judicial process. The Court of
Appeal found the creditor had the right to pursue
nonjudicial foreclosure, distinguishing an equitable
subrogee from an assignee of a deed of trust with *125 the power of sale.
The court stated: “A recorded assignment of note and deed
of trust vests in the assignee all of the rights,
interests of the beneficiary [citation] including
authority to exercise any power of sale given the
beneficiary ([§ 858]).” (Strike, supra, .)
contends the sentence quoted above establishes that
section 2932.5 (formerly codified at § 858) applies to
deeds of trust. But the Strike court was not
asked to consider or construe the predecessor of section
2932.5. TheStrike court briefly
referred to the predecessor of section 2932.5 by way of
illustrating the difference between an equitable subrogee
and an assignee under a deed of trust with a power of
sale. ( Strike, supra, .) “`It is axiomatic, of
course, that a decision does not stand for a proposition
not considered by the court.`” ( Agnew v. State Bd. of
Equalization (1999) 21 Cal.4th 310, [ 87 Cal.Rptr.2d 423, 981 P.2d 52].)
California, over the course of the past century, deeds of
trust have largely replaced mortgages as the primary real
property security device. (See 4 Miller Starr, Cal. Real
Estate (3d ed. 2003) former § 10:2, p. 15.) Thus, section
2932.5 (and its predecessor, § 858) became practically
obsolete and was generally ignored by borrowers,
creditors, and the California courts. On the other hand,
other statutes expressly give MERS the right to initiate
foreclosure on behalf of HSBC Bank irrespective of the
recording of a substitution of trustee. Section 2924,
subdivision (a)(1), states that a “trustee, mortgagee, or
beneficiary, or any of their authorized agents,” may
initiate the foreclosure process. MERS was both the
nominal beneficiary and agent (nominee) of the original
lender and also of HSBC Bank, which held the note at the
time of the foreclosure sale of plaintiffs residence.
Thus, MERS had the statutory right to initiate foreclosure
on behalf of HSBC Bank pursuant to section 2924,
also had the right to initiate foreclosure on behalf of
HSBC Bank pursuant to the express language of the deed of
trust. Plaintiff agreed in the deed of trust that MERS had
the right to initiate foreclosure and to instruct the
trustee to exercise the power of sale as nominee (i.e.,
agent) of the original lender and its successors and
assigns. (Gomes v. Countrywide Home Loans, Inc. (2011) 192 Cal.App.4th 1149, ,
fn. 9 [ 121 Cal.Rptr.3d 819]
[construing a deed of trust identical in pertinent part to
the trust deed in this case as granting MERS power to
initiate foreclosure as the agent of the note holder, even
if not also as beneficiary].) HSBC Bank was the assignee
of the original lender. Accordingly, HSBC Bank and MERS,
its nominal beneficiary and agent, were entitled to invoke
the power of sale in the deed of trust, and plaintiff has
alleged no legal basis for setting aside the sale in this
affirm the judgment of dismissal. Respondent is to recover
its costs of appeal.
P. J., and Flier, J., concurred.
Bob Hurt Blog
1 2 3 f t
2460 Persian Drive #70
Clearwater, FL 33763
Call: (727) 669-5511
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Mortgage Exam Ethically Mandatory Prior to Negotiation with Bank
I write to toss a business philosophy gauntlet before you. I do not run a business. I function as ombudsman and consumer activist in support of mortgage victims. I help people with mortgage problems obtain the best possible advantage for any negotiation with the bank and its agents, or to beat them in a lawsuit.
I consider ANYTHING that operates to defeat that purpose as inimical to it. So, I might become YOUR enemy. I DO NOT SUPPORT efforts of negotiators and other service providers who undermine the mortgage victim’s ability to negotiate from a position of power. I shall explain why.
Mortgage Attack, the Only Worthy Methodology
ONE and ONLY one methodology has proven worthy at enabling the best financial outcome possible for mortgagors. I term it the “Mortgage Attack” methodology. The Mortgage Attack methodology consists of finding any and all of the ways the mortgage lender and its agents and associates injured the borrower, and using those injuries as negotiating leverage against the bank. This applies whether or not the borrower faces foreclosure. And the negotiating scenario can include a simple negotiation for a loan modification favoring the borrower, as well as a lawsuit or counter/cross-complaint against the injurious parties.
The Mortgage Attack methodology provides a negotiating advantage to the borrower because it carries an explicit or implicit threat of litigation against the injurious parties for injuring the borrower. It has become common knowledge that jurors loath lenders and associates who injure borrowers with scurrilous tactics. Since lawyers for the bank know this, the smarter ones will encourage their clients to settle in some way to avoid the litigation and related damage to the lender’s reputation, not to mention the possibility of monumental damages awards against the bank by the courts.
The Bad Guys in the Transaction
By “lender and its agents and associates” I mean the loan originator, owners of beneficial interest in the note, Realtor, mortgage broker, appraiser, title company operative, servicer, and/or related attorney. In short, it includes everyone involved in the mortgage transaction and related events other than the borrower. These are the “Bad Guys” in the transaction, EVEN IF the borrower erred too. Why? Because YOU work for the borrower, not the bank, etc.
The borrower’s own attorney or other practitioner can become culpable for injuries to the borrower resulting from the attorney’s failure aggressively to look for such causes of action and to lodge corresponding affirmative defenses, motions to dismiss, or counter/cross-complaints against the lenders and its agents and associates who injured the borrower.
By implication, EVERY PRACTITIONER employed by the mortgagor, including agents for short sale and loan modifications, has ethical and moral duties to guide the borrower toward the Mortgage Attack methodology before undertaking any negotiation for short sale or loan modification on behalf of a mortgage victim. The reason: only that methodology lets you negotiate from a position of power for the borrower.
Mortgage Examination Critically Important for Finding Evidence of Wrongdoing
The Mortgage Attack paradigm requires a comprehensive mortgage examination by a competent professional to find the causes of action against the lender and its agents and associates. The examination service provider should render a report showing the causes of action in a form that facilitates admission into evidence in a court of law. I know of only ONE firm capable of performing such an examination and delivering such a report. I shall happily divulge the identity of the firm to any with sincere need for the information.
The Challenge, the Gauntlet for Negotiators
I write this commentary to challenge short sale and loan modification agents to encourage their mortgage victim prospects to spend the necessary money on a proper mortgage examination (as above) BEFORE undertaking any short sale or loan modification effort. The reason should seem obvious, but I’ll explain it anyway. The prospect might decide to sue the injurious parties instead of negotiating from a position of weakness. As a consequence of winning such a law suite, the borrower might win huge compensatory and punitive damages, enough to buy several houses. That will certainly leave the borrower in possession of the mortgaged property at risk. Furthermore, the borrower can negotiate a short sale or loan modification or keys for cash deal from a position of power and strength, rather than from a position of weakness.
Certainly, the agents for short sale and loan mods will lose some commissions by advocating Mortgage Attack. But they will also win better negotiated settlements AND more clients because of their integrity.
In essence, I assert in this commentary that agents for short sale and loan mod commit ethics breaches and violate their duties to their prospective clients by telling them a mortgage exam is not always the best way to go when the opposite is obviously true.
Mortgage Attack and Mortgage Exam ALWAYS Come First
Mortgage Attack paradigm demands that the mortgage examination ALWAYS comes first in an effort to deal with a troubling mortgage. In point of fact, a mortgagor who owes more for a property that its actual value, and a mortgagor facing foreclosure, should ALWAYS purchase a comprehensive mortgage examination by a competent professional FIRST AND FOREMOST, before doing any other thing, to minimize the danger in the mortgage. ONLY a mortgage examination can give the mortgagor the necessary negotiating leverage for dealing with a bank and its stable of attorneys.
You’ll Earn More Commissions If You DO THE RIGHT THING
Agents for short sale and loan mod seem so terribly desperate for commissions that they will sacrifice the mortgagor client’s best interest by denigrating a mortgage exam as the primary step in resolving the mortgagor’s problems. That is, plainly, unethical and immoral.
Thus the gauntlet becomes the challenge to do the right thing. Recommend a mortgage examination for all of your clients as a prerequisite for doing business with them.
Contact me NOW for free help with that process.
Call 727 669 5511 • Or Click Here.
Do you have an underwater mortgage (you owe more than the value of the property)?
Do you face foreclosure?
You can solve those problems with relative ease and minimize damage to your credit rating if you follow the below decision tree.
You have two battles to fight in the war against the bank over your mortgage.
1. Foreclosure Defense – On one side of the hill you have the foreclosure. If you fight the foreclosure battle, you always lose because of several factors – you signed the note and mortgage, failed to pay, and must forfeit the collateral.
2. Mortgage Attack – On the other you have the mortgage itself. When you fight the mortgage (challenge its validity), you can get the loan balance reduced (a “cram-down” loan mod) or get financial compensation or the house free and clear IF you find sufficient causes of action and prosecute them effectively. The mortgage examination finds those causes of action. The examination report shows the causes of action so you can point them out to the bank or judge.
It’s that simple.
Now you face a variety of courses of action depending on your financial condition and the mortgage exam results:
Mortgage Examination Decision Tree
- If you are broke
- go to Minimize Loss
- Else (you are not broke)
- get the mortgage examined
- If the exam shows causes of action
- Negotiate settlement with lender (may need to hire lawyer for $1000)
- If you can accept the settlement
- embrace the settlement
- go to Enjoy Life
- else (settlement unacceptable)
- Sue lender for causes of action or file counter/cross claim
- embrace the result
- go to Enjoy Life
- else (no causes of action)
- go to Minimize Loss
- Minimize Loss:
- Do Short Sale, Deed in Lieu, or beneficial Loan Mod
- go to Enjoy Life
- Enjoy Life:
- Live happily ever after
I imagine you signed a note and mortgage in which you admitted receiving a loan, having seisen (possession) of the estate, and conveying the estate to the mortgagee for purposes of the mortgage. Article I Section 10 of the Florida Constitution forbids any law from impairing the obligation of contracts (like the note and mortgage) and Section 21 grants injured persons (including banks) the right to use the courts for redress and justice. You must forfeit the house for defaulting on the note. You might drag out the process through legal shenanigans, but I guess you will lose the house in the end at great expense to your fortune and peace of mind…
Unless you can prove that the lender or lender’s agents injured you first.
The key to saving a house from foreclosure AND obtaining financial compensation lies in a comprehensive, competent mortgage examination, and negotiating with or suing the originating lender for the related causes of actions. If the exam report reveals tortious conduct, legal errors, or contract breaches underlying the mortgage loan, those will provide a measure of opportunity to hammer the lender into a settlement. Otherwise you don’t negotiate from a position of power, and you lose. Done right, settling or suing stops the foreclosure, of course.
I know only one mortgage examiner with any degree of competence. He does not negotiate on price, period. You fill in a non-disclosure agreement and a questionnaire. You scan and zip them and all your mortgage and foreclosure related documents (plus loan app and appraisal) and upload the file to the examiner. He invoices you by PayPal. You pay with Credit Card or PayPal account. 7 business days later you receive the report. If it shows causes of action (red ink), you or your attorney negotiate settlement with the originating lender and plaintiff. If you like the settlement, you settle. If you don’t, you hire another attorney (fee or contingency) and sue. The process might drag out a couple of years, but you will probably win (just like the mortgagee wins foreclosures).
- Click the Contact menu item on the Mortgage Attack web site.
- Email a request for the Non-Disclosure and Services Agreement, and the QUESTIONNAIRE.
- When you receive them, fill them in and execute the agreement.
- Scan those with all mortgage and foreclosure related documents (closing docs plus appraisal, loan application, etc.) and compress them in a ZIP archive file.
- Contact Mortgage Attack again for an explanation of how to send the archive file. You will receive necessary details.
- Upload the archive to the location provided. The examination firm will invoice you. Pay the fee, then receive the report in 7 business days
- Settle or sue for the causes of action in the report, or (if no causes) walk from the house with short sale, deed in lieu, keys for cash, etc.
Some gentle reminders…
- I am not a lawyer and don’t give legal advice
- NO foreclosure defense works – defenders always lose because the borrower breached the terms of the note and must forfeit the collateral
- Even if you win the foreclosure or do a loan mod, you end up owing more than the house is worth (typically) and having onerous repayment terms
- You can only save your house and obtain financial compensation by ATTACKING the lender and/or agents for injuring you
- You can only discover the bases for an attack through a comprehensive, competent mortgage examination
- You don’t need to face foreclosure to justify the mortgage examination – lenders and their agents have cheated 90% of home mortgage borrowers over the past decade or so.
- The mortgage examination cost is a cheap price to pay for the benefit of saving your house or getting compensatory and punitive damages. Look at these examples:
- *House free and clear, legal fees/costs paid, $2.1 million in punitive damages*-http://wvrecord.com/news/233771-quicken-loans-on-losing-end-of-3-million-predatory-lending-verdict
- *$250K compensation, $1 million punitive* – Wells Fargo lied on the loan application–http://www.bizjournals.com/baltimore/stories/2008/08/11/story8.html?b=1218427200^1681713<http://www.bizjournals.com/baltimore/stories/2008/08/11/story8.html?b=1218427200%5E1681713>
- *$10 million actual damages, $1.5 million mental anguish and economic damage*- Ocwen lied to borrower who missed loan payment –http://www.bizjournals.com/southflorida/stories/2005/11/28/daily20.html?page=all
- *reinstated $6 million punitive damage arbitration award*against servicer (8th USCCA W. Mo.Stark v. Sandperg, Phoenix & von Gontard, et al.) – http://mortgage-home-loan-bank-fraud.com/legal/Stark%20vs%20EMC.pdf
Contact me by phone (727 669 5511) or Email for further details. I’ll put you in touch with the Chief Examiner after I have answered all your questions.
Yes, you may distribute this article Far and Wide.
You Can Win Colossal Damage Awards in a Jury Trial by Proving the Lender Injured you at the Inception of the Loan
The Linza v PHH case shows the good
sense of MORTGAGE ATTACK (http://mortgageattack.com) as a methodology for dealing with foreclosure. It shows how to win $16 million if the mortgagee cheats you in the loan modification process.
In a nutshell, mortgage company PHH agreed to a loan modification to reduce Phillip Linza’s payments about $500, then jacked the payments higher than before, then demanded over $7000, and then refused to accept payments, and THEN foreclosed. Linza hired a lawyer, sued, and after 3-years of legal combat the jury awarded $16 million to Linza because of egregious lender behavior including credit rating damage.
If a lender/servicer has jilted YOU in a loan mod, you might see something familiar in this scenario. If so, you should do what Linza did: SUE.
This does not exactly constitute a Loan Mod Lottery, but it might as well because so few mortgagors sue the lender for cheating them in the loan mod. You can easily see why. In a lottery you pay a dollar for a ticket and have a slim chance of winning. In a loan mod lawsuit, you must find an attorney willing to take the case on contingency, or have enough money to pay for a 3-year litigation, but you have a HUGE chance of winning IF your lawyer has sufficient skill and perseverance.
I see a major problems with Loan Modifications. To begin with the interest rate goes sky high in 5 years and you have a balloon you can never pay off. Most loan mod agreements require the borrower to agree to an indemnity clause which waives the right to sue for prior injuries in the loan. I see THAT as INSANE because lenders and their agents have injured 90% of all single family home mortgagors in the past 12 to 15 years.
If you need help unraveling the weirdness of your mortgage and loan mod, and finding the causes of action underlying either, visit http://mortgageattack.com to learn the basics, and then call me for a discussion. I don’t practice law or give legal advice, but you might appreciate my business perspectives.
Yuba jury awards homeowner $16 million in mortgage case
It started out as a simple loan modification for a troubled homeowner. It turned into a $16.2 million jury verdict against a nationwide loan-servicing company.
A Yuba Superior Court jury this week awarded $16.2 million in damages to a homeowner who nearly lost his home to foreclosure after the loan servicer botched his mortgage modification, the homeowner’s lawyers said Friday.
Phillip Linza, a homeowner in Plumas Lake, was awarded the damages after a three-year battle against PHH Mortgage Services, a loan servicer based in Mount Laurel, N.J.
Linza’s attorneys, Andre Chernay and Jon Oldenburg of the United Law Center in Roseville, said the award included $514,000 in compensatory damages and $15.7 million in punitive damages.
Here’s Proof that A Talented Attorney Can Beat the Stuffing out of a Crooked Mortgage Lender
Okay to distribute this freely.
THE BEAUTY OF BROWN V QUICKEN LOANS
The outcome of the Brown v Quicken Loans case gives hope to all mortgage victims and should embarrass all Foreclosure Pretense Defense Attorneys. This compilation shows the public and the legal community HOW TO BEAT THE ABUSIVE MORTGAGE LENDER and obtain a nearly $5 million judgment. I challenge every Mortgagor to READ the above-linked document COMPLETELY.
Hats off to Jim Bordas and Jason Causey of Bordas & Bordas Law firm, Wheeling WV, for engineering the defeat of Quicken Loans and using the LAW to bludgeon them into submission. I expect the final opinion in Quicken’s second appeal from the WV Supreme Court soon.
THE KEY TO WINNING – ATTACK THE MORTGAGE, NOT THE FORECLOSURE.
How did the Bordas team win? They examined the mortgage and discovered a horror story of criminal and civil abuses by lender Quicken Loans. Quicken made the loan so toxic they couldn’t sell or securitize it.
Quicken refused to offer Brown a reasonable settlement, so Bordas sued, and won a whopping $2+ million judgment. Quicken appealed, the Supreme Court of WV remanded, the trial court upped the judgment to nearly $5 million. Quicken appealed again, and the Supreme Court of WV will soon end the case with a final opinion against Quicken.
What lesson shall we learn from this? Just this… If you face foreclosure, you need a comprehensive mortgage examination to prove the causes of action against the lender, and you need a lawyer willing and able to attack the mortgage, not merely defend against the foreclosure.
If your lawyer won’t seek and find the causes of action underlying your mortgage and then attack the lender on that basis, you need to FIRE that attorney. Don’t rest until you have found a competent litigator like Jim Bordas.
LEGAL MALPRACTICE LAWSUIT OPPORTUNITIES FOR FORECLOSURE VICTIMS
If you have already lost your home to foreclosure AND you had a lawyer helping you who FAILED to seek causes of action or to attack on that basis, you may have a valid legal malpractice claim against that attorney. Call me at 727 669 5511 to discuss your issues.
STEP-BY-STEP PLAN FOR COMING OUT AHEAD
In order to save your home from foreclosure, or become able to negotiate a cram-down of the loan balance (and other favorable terms), or to sue the lender for injuring you, you must do one thing first:
- HIRE A COMPETENT MORTGAGE EXAMINER OR ATTORNEY to examine your mortgage and find all the causes of action.
Of course, a good mortgage examiner will charge you a fraction of what the lawyer will charge, IF you can find an examiner or lawyer with the requisite competence. Which worries me. Which is why I have gone to the trouble of writing this message.
Read http://MortgageAttack.com then call 727 669 5511 for more info. I know the only competent professional mortgage examiner in America.
What? You want to know steps 2 and 3? Okay, I’ll give you the other steps…
- If the examination report reveals causes of action (torts, breaches, legal errors) against the lender or lender’s agents (title company, mortgage broker, appraiser, servicer)…
- Notify the servicer and then attempt to negotiate a settlement. I suggest finding a “CLOSER” type of lawyer to negotiate for you. I suggest a “loan mod” type of settlement where the lender lowers the balance to the present market value, gives a favorable fixed interest rate, sets the term for 30 years, no prepayment penalty, assumable, no balloon, forgive arrears and legal fees/costs. If this fails…
- Sue via complaint, counter complaint, cross complaint as necessary. I suggest hiring a COMPETENT lawyer (not a foreclosure pretender defender) for this purpose. If possible, find one to take your case on contingency. The lawyer will use the causes of action from the mortgage examination report to formulate the pleading.
- Go to next step if you have no money or no causes of action.
- DO NOT let your home go to foreclosure final judgment. If you do, it will haunt your credit record for 10 years AND (depending on your state) leave you owing a huge deficiency judgment when the auction does not bring enough money to discharge your debt. Instead, try to work with the lender to do one of these:
- Short-Sale: Bank agrees that you may sell the house at a discounted price in order to end the foreclosure, and hand over all the proceeds from the sale to the bank. This imposes some work and stress on you, but if you have equity in the house (it has higher resale value than you owe on the mortgage note), this should be your first choice
- Keys-for-Cash: Bank pays you cash ($2,000 to $20,000, depending on the value of the home) to move out, leave the home broom clean, and deed the property to the bank. This can save a huge litigation cost for the bank, and make leaving the property less stressful for you. Sometimes a mortgage examination can reveal weak causes of action that can pressure the bank to give you a Keys-for-Cash deal.
- Deed-in-Lieu-of-Foreclosure: Same as Keys-for-Cash, except the bank gives you no cash.
TAKE THE RIGHT ACTION – CONTACT ME NOW
Okay, I have given you the proof that you can beat your abusive lender, and I have shown you the strategic plan for doing so. If you simply refuse to do what I have outlined above, then you really deserve to lose your home to foreclosure, or to make underwater loan payments. But if you feel READY TO ACT SENSIBLY, contact me immediately for help.
And if you don’t need help, SOMEBODY you know DOES. Pass on this message and encourage your friends, associates, family members, loved ones to call me or write me for help. And send them to http://MortgageAttack.com for an education on the issues.
No, I have no authorization to practice law or give legal advice, so I refrain from both. But I’ll discuss the academic and strategic business aspects of your situation as necessary.
Yes, if you fit into the category of “Foreclosure Pretender Defender,” you can contact me too, and I’ll help you the best I can. Believe it or not, training for kool-aid drinkers like you has become available. Sorry, no CLE credits.
AND… I don’t charge money for giving business guidance. So, what do you have to lose? Give me a call. 727 669 5511