Foreclosure Bombshell

By Greg Hunter’s USAWatchdog.com (revised)

With all the attention stories such as WikiLeaks and Irish bailout have gotten the last few days, a bombshell judgment against Bank of America in a New Jersey foreclosure case has been overlooked.  The judgment happened 2 weeks ago in a case involving the home of John T. Kemp.  His original mortgage company was Countrywide, but B of A bought Countrywide a few years back and, in turn, also acquired servicing rights to Kemp’s mortgage.      U.S. Bankruptcy Judge Judith Wizmur rejected a claim by Bank of America to foreclose on Kemp’s home.   According to a Bloomberg story yesterday, Bank of America had failed to deliver the note to the trustee. That could leave the trustee with no standing to take the property, and raises the question of whether other foreclosures could similarly be blocked.”   According to one witness, this was a common practice.  The Bloomberg story goes on to say, “Linda DeMartini, a team leader in the company’s mortgage- litigation management division, said during a U.S. Bankruptcy Court hearing in Camden last year that it was routine for the lender to keep mortgage promissory notes even after loans were bundled by the thousands into bonds and sold to investors, according to a transcript. Contracts for such securitizations usually require the documents to be transferred to the trustee for mortgage bondholders.  Following the decision, the bank disavowed the statements by DeMartini, whom it had flown in from California to testify”  (Click here to read the entire Bloomberg story.)

This is an earth shaking setback, not only for B of A, but for all banks involved in mortgage-backed securities.  The Promissory Note is the actual proof the bank owns the home.  No “note” means no proof of ownership.  You must possess the original Promissory Note for ownership to be valid.   I wrote about this enormous mortgage mess in an October post called “The 6 Trillion Dollar Problem.” I said, “The lack of the Promissory Note is the biggest of all the problems in this chain of chicanery.  Here’s why.  A Promissory Note is a financial instrument.  It is in the same family as a Federal Reserve Note.  For example, if you copied a $100 bill and then tried to spend that copy in a store, because you lost the original, is it still money?–Of course not.  You need the original financial instrument (in this case a $100 Federal Reserve Note) to make a legal transaction in a store.  The same is true for a Promissory Note. You need the original note to legally complete a foreclosure.  A counterfeit or copy of a Promissory Note is not a financial instrument, just like a counterfeit or copy of a $100 bill is not a financial instrument!”

No Promissory Note means banks like B of A sold un-backed securities instead of mortgage-backed securities.  This is not a simple case of sloppy paperwork as the mainstream media would like you to believe.   The evidence suggests it is layer upon layer of widespread criminal activity.  Here’s the way I explained it in a post called “The Perfect No-Prosecution Crime.”  In October, I wrote,There was “rampant” mortgage fraud in the loan application process according to the FBI as far back as 2004.  (Click here to see one of many stories of the FBI warning of mortgage fraud.)  There was real estate document malfeasance when the original Promissory Notes and loan documents were “lost.”   The Promissory Notes were required to create tens of thousands of mortgage-backed securities (MBS).  No “note,” no security.  No security means the special IRS tax status for the MBS were improperly obtained.  Because there were no documents, the rating agencies fraudulently made up triple “A” ratings for the securities.  When the whole mess blew up, big banks hired foreclosure mill law firms to create forged documents.  That phony paperwork was and is being used to wrongfully remove homeowners from their property.  That is foreclosure fraud.” 

The Bloomberg story also said,“The Kemp case is also being examined by lawyers for investors in mortgage-backed securities. Owners of the bonds have been cooperating in an effort to force sellers to take back loans, saying they were misled about their quality. The Wizmur ruling may give investors an additional opportunity to push for mortgage buybacks on grounds that the bonds weren’t created in keeping with securitization contracts.”

Mortgage-backed securities have to meet what is called “contractual representation and warranties.”  That basically means the MBS are required to be free of fraud and be exactly what the seller says they are.  Do you think mortgage-backed securities are free of fraud?  Do you think these securities are the triple-A rated risk free investment the big Wall Street banks claim?—NO WAY!  The banks are going to be forced to buy back all the toxic mortgage junk they sold.

 That is the least they can do because, so far, there has not been a single prosecution of a high ranking mortgage lender or Wall Street banker.  That is outrageous because this will surely go down as the biggest financial white-collar crime rip-off in history.

Comments
  1. George

    Greg, I don’t think you are saying the the home buyer not paying his loan will get a “free” house. This gives the troubled homeowner leverage to reneogotiate. It does mean a world of hurt for the banks that sold these worthless almost MBS to investors. Fraud= treble the damages and when even the damages will sink the financial system

    • Greg

      George,
      You are correct and sinking the economy should be everyone’s biggest fear.
      Greg

      • Al

        Greg

        my dear Boy.

        the economy is already sunk.

        consider yourself on the Titanic.

        it just hit a DebtBerg.

        you are in steerage.

        there are no lifeboats that you can get on.

        (except gold/silver and related)

        the only difference is that while you are still breathing, you are actually “sunk”.

        regrets to the family.

        Al

        • Greg

          Al,
          I get the same sinking feeling as you.
          Greg

    • MarkM

      Hello George,

      To some degree you are correct. However, if BofA does not “perfect” their claim of lien, they will not collect debt service, nor can they foreclose.

      If Countrywide/BofA cannot produce the original promissory note, and have its transfer to BofA legally recorded at the county recorder’s office, the registered owner of the home is off the hook for debt service or foreclosure.

      George, who does the home buyer negotiate with? No one knows who legally holds the promissory note. Countrywide is dead–the transfer of Countrywide’s assets, and to whom, was never recorded. Who holds the lien on the house? No one legally knows.

      This property owner is a few judgements away from having a free-and-clear title to his house.

      In a non-corrupt world, the incompetent bankers would go bankrupt, and our gubmint would not gaurantee a profit or survival of the lending institution. However, BO received campaign money from BofA execs; therefore, the losses will be made whole by gubmint (my “feeling”). Jeffrey Immelt donated to BO and received 14 billion from the US treasury for GE. I think Nancy Pelosi calls this “Pay-go”.

      markm

      • Owen

        You are correct. If there can be no proof of any legal lien against a home I guess the one you lives there and/or the one who claimed legal ownership of it from the get go (in the case of rental) would own it.

        • Greg

          Thank you Owen for reading the site.
          Greg

  2. John Bernard

    Greg
    Stop beating your head against the wall. Nothing is going to happen to these criminals. They will get their bonus payments, homes will be foreclosed, with such exceptions as this. The corruption in the USA is now at astronomical levels. The recent S-510 is the result of bribery from the large commercial food industry; ObamaCare is simply a way to further subjugate the sheeple, the incoming Republican majority is demonstrating that business as usual will prevail.

    There is only one thing that will happen and that is the collapse of our nation, among others, and rebuilding it into something else. It is the something else that should be worrying.

    Foreclosure fraud is a fact; global warming is a hoax and for some a religion. Which gets the most press?

    It is difficult to think about and then comprehend the extent of the disaster that awaits us.

    No one is paying attention.

    • Greg

      John,
      I hope your are wrong but I fear you are right. Thank you for weighing in on this post.
      Greg

    • PatriotWatch

      WOW that was great brother. My thought are exactly the same. Surely you could go on and I could take your lead.

      I am counting on Tea Party candidates to expose and turn us around. people like Col Allen West. If by Feb 15th I DO NOT see what I and MILLIONS of AMERICANS expect to see Plan B goes into motion. If the game continues at the peoples expense i will have to do what is best for my family and not what is expected of me.

      Hope you read it and understand my jargon.
      Ithought your comment was excellant and i learn more from this site than any other

      • Greg

        Thank you Patriot. You are a good soldier.
        Greg

  3. Art Barnes

    Greg, I don’t believe the banks will be forced to buy back the toxic mortgages, simply stated they will shed some tears and the U.S. Government will come with the Fed and start bailing again; wallstreet will also demand it. Some late night session near the back door of Congress, couched on a “rider” to give some unemployment benefits to the poor and downtrodden they will make their play; the president will sign it and announce he has taken another step to continue the road to recovery then go an play some b-ball. The national media will go along and talk about how in the long run all will benefit, abeit after they run with their first 12 minute story of a non-important topic of low interest or concern to the nation. Frankly Greg, I can’t say whether or not this mortgage stuff is criminal or not, but I can say that the Government, the media, the fat cats, wallstreet, the Fed and the 2 percent elite who have demanded the bail outs, both in the past and the the bail outs coming to fuition shortly are guilty of treason.

    • Greg

      Art,
      Somebody is going to buy it back. Why do you think the Fed has set aside $275 billion to buy more MBS? You may be right about the taxpayers buying it but say so long to the dollar at that point. Thank you.
      Greg

  4. Jim in GA

    The same thing happened in Nebraska some time ago and was never widely reported, just like this case. The banks and MSM don’t want to publicize this major problem as it jeopardizes their position in foreclosures. Since foreclusure is a state process (not federal) most states require the forecloser to produce the note to prove their standing, and most of the notes are bundled in boxes somewhere, possibly never to be found. Every homeowner subject to foreclosure needs to just ask the judge to see the original note, including any assignments of that note. I know it’s a novel concept these days but it is the rule of law.

    • Greg

      Thank you Jim in GA.
      Greg

  5. Sam

    When BofA took over my mortgage from Countrywide, they claimed that I owed more than I actually did. I compared invoices, and found that BofA tacked on an additional $12,000, wiping out in effect what had been a years’ worth of payments. Nice to see that BofA is finally getting slapped down. And, did you read the latest? Wikileaks has promised to release documents about a troubled major bank. On this news, BofA stock has gone down. Thank you, God! What goes around, comes around.

    • Greg

      Sam,
      I can’t wait for the next revelations about B of A! Thank you for sharing your story here.
      Greg

      • Alessandro Machi

        Hi Greg, I saw you on Max Kleiser’s show. What do you think about what I consider to be illegal “change in terms” that appears to have occured as these mortgage notes were sold and resold?

        I’m also concerned that the term http://www.parallelforeclosure.com is not being used even though it is a KNOWN internal banking term that is used by the banks. I heard one reporter use the quote from a Chase Bank rep over a year ago, and since then, no reporter uses the term.

        I realized back then how unethical and probably illegal parallel foreclosure was so I purchased the domain address to make sure the banks did not get it and bury it. But to my surprise, reporters have let Sarah Buduson twist in the wind when she should be a hero for getting the banks to admit they practice parallel foreclosure.

        • Greg

          Alessandro,
          Thank you for sharing this information here!
          Greg

  6. James M

    I think this is an excellent chance for the states to stand up to the federal government. Unfortunately, congress has already tried to legalize forclosure fraud as you mentioned in previous writings. I think I read that they are trying it again right now. Also rulings can be fought in court until they reach a corrupt federal court judge. This is great news, do not get me wrong, but as we all know the banks never lose in this rigged system. The powers that be will find some way, legal or illegal, now synonomus words, to find a way to cover the banks. If the banks are forced to buy this worthless junk back then they will probably buy them back for far less than they sold them and then just sell them to the Fed at origional face value for a profit. Let the taxpayers pick up the tab once again, why not? Nothing surprises me any more. If you think the system is going to force banks to buy back all that junk and make right the people that were ripped off in the fraud then you have obviously not been paying attention lately. We can hope but I have long ago run out of hope. I have resigned myself to expect the worst and I am seldomly disappointed.

    • Greg

      Thank you James M. I hope you are right!
      Greg

    • NotApplicable

      James, the states have no bargaining power, as they are all bankrupt. Worse still, come Jan ’11, they are supposed to start paying back the billions borrowed to fill the holes in their unemployment funds.

      They will have no choice but to roll over and play dead.

      • James M

        I agree they will roll over but I was simply stating that this is a great situation for upholding state law and using the 10th ammendment to shove the fed back for a change. Do I think it will happen? No but it would be a perfect time to do it and if enough people understood this it could help. Unfortunately not to many people know to much these days, gotta run Dancing With the Stars is coming on lol.

      • Lets Get Honest

        I found this site from another one who reports on collective government assets (Comprehensive Annual Financial Reports) which, when I found this particular financial tool, I decided to start publishing. Actually I believe someone else referenced your article here.

        I’ve never been a homeowner, I’m an individual who has experienced my own government as a wealth-seeking/wealth-destroying missile. I’m the daughter of a non-Ph.D. whose personal work and creativity contributed (major invention) to the functionality of the Internet, but didn’t live to see it in full operation, live to see any of his grandkids, in fact live one month past retirement. I have often wondered why, and never gotten a really straight answer. And that was about 40 years ago.

        As a person, later parent single parent by choice (in this millennium) and for safety reasons, I simply sought to work and support myself, but found it impossible around the family court system, so started looking into its operations a few years ago, after a few devastating events. I have always sought (perhaps a family tradition) to find out why things work, and thought in terms of systems, and how systems interact with each other.

        I don’t want to talk any more about this just now, but I know that the USGovernment is not something to be messed with lightly; and it’s very dangerous to its own citizens. A diagram from the referring site (paperempire.org) had several diagrams (which I find sometimes helpful), including the Bell Curve of Humanity (i.e., sociopaths, Sheep (in the middle) and truth-seekers (who tend to be the creative sorts, including artists and inventors) on the right. Institutions are run by the sociopaths — which the MBS frauds seem to indicate. People get accustomed to dealing in and believing in dollars, which their jobs pay them in, while more an more financial instruments, and banks, and procedures, are invented. Those profiting from them are often Grrr-e-a-t at lecturing everyone else about J.O.B.S. as if this were where the same were actually earning the wealth FROM.

        I was driven out of a profession I LOVED and was good at, and which there was work in, through the courts, and currently am being subject to extortion from the family after having been artificially kept dependent in this manner. I’m fighting for something better for my kids (now young adults) but they have been alienated, and exposed to hell first in the home, and when I took action to get free from it, thereafter in the courts. We cannot afford so many deaf, dumb and economically blind as to the impact this is having on society (collectively). I’ll tell you, I am really frightened, except for what remains of my FAITH. To continue in the face of this scope of deceit does require a reason to persist and believe, literally, in the impossible, illogical and irrational.

        However, I am the daughter of someone who did just that — in his work life. As we know, most complex technology was funded and developed for military purposes, although it can be put to other purposes. This includes the technology of “money” and “speed of light” transfers of real estate (securities etc.) (fake or real).

        I’d also like to point out that a SIMILAR and WIDE-RANGING scope of fraud is possible, and active, in the court (and prison) systems — dual docketing, electronic filing and such. It has been documented particularly in the Los Angeles Area; I’m talking about case docketing systems not backed by bona fide court orders, and one system for the public, another for others. We are starting to understand how this happens in individual custody cases. See Joseph Zernik or Janet Phelan for more info.

        I really was forced back to begging a few years ago, for the simple reason that fighting to retain custody of my own children is not possible when there is no court which processes evidence properly, and police only enforce resulting court orders when they feel like it. We really have only the semblance of law operational, I found out the hard way.

  7. Chris

    Wow! Score one for Joe and Jane Public! However, anyone with half a brain knows by this point we are in a depression and not a recession. The public knows something is seriously wrong. The corporate media has beaten the word “recovery” to death. They need to find a new word and not be afraid to say the word “depression”—-it isn’t that hard!

    • Greg

      Yes Chris, but the truth always hurts and in this case it really hurts for the unemployed!! Thank you for the comment.
      Greg

  8. Robert

    Just like the Supreme Court made a one time ruling that allowed the 2000 election in favor of GWB, I suspect a similar ruling will be made to exempt the banks from any wrongdoing and will not be able to be used as precedent in any future trials …A ruse of we must allow this foreclosure problem to be quickly remedied and decisions as the judge made in the above noted scenario will be overruled for the betterment of the country…

    Penalties and prison is just for the little people who can’t donate enough to political parties to make their positions valid and worth fighting for by a majority of politicians… How sad that’s the political system we now live under.

    The 50 state AG’s that filed lawsuits against the big banks know all the details and will use it as leverage to get back the monies their constituents invested in these worthless securitized loans (or they’ll be bought off with job offers in the private sector with more perks and bonuses than serving the peoples needs would ever provide), but I severely doubt that anybody will go to prison that enabled this mess… If anybody does, it will be low levels sacrificed as tokens for the bigger picture.

    I wish I was wrong.

    • Greg

      Robert,
      That is simply not going to happen given the multiple layers of criminal conduct in this rip-off. Thank you for giving your opinion on this post.
      Greg

      • dtester

        Mr Hunter, Robert will be right in due course… Washington Post, 11/19/2010 report..

        Posted at 10:20 AM ET, 11/19/2010
        Aggressive lobbying defends mortgage-trading system
        By Ariana Eunjung Cha and Brady Dennis
        From today’s print edition:

        The financial services industry has launched an aggressive campaign on Capitol Hill to bolster the legality of the way companies have turned mortgages into securities and traded them across the globe in recent years.

        The companies have opened wide their wallets for lobbying and are flying top executives to Washington for one-on-one meetings with lawmakers. They are holding briefings for key staffers, including an event last week that drew more than 60 aides. And they are blanketing Congress with white papers, memos and other documents that lay out their arguments.

        The focal point of their efforts is Mortgage Electronic Registration Systems, or MERS, the controversial, privately run electronic database that is used by practically every lending institution and investment company to track the transfer of the ownership of mortgages as they are packaged into securities and traded at lightning speed around the globe.

        But MERS does more than just track the trading of loans. In the vast majority of mortgage documents at local courts and offices across the country, it is listed as the holder of the loans. That allows the financial industry to trade mortgages as much as it wishes without spending the time and money to refile the paperwork.

        The industry is seeking legislation that would effectively affirm MERS’s legality and block any bill that would call into question what MERS does. MERS has spent more than $1 million in lobbying since fall 2008, when lower courts around the country began to rule against it. But MERS had kept its name under the radar until the recent uproar over foreclosures revealed broad problems in mortgage paperwork.

        • Greg

          dtester,
          There are people with hundreds of billions if not trillions of dollars in losses on the other side of the trade. Those people will also be heard. One thing is for sure, this is one hell of a mess. Thank you for the comment.
          Greg

          • Bob

            You are right many rich people have been rip off, they will have there day in court. But all this bank stuff won’t matter when the SHTF, we will wish it was just a court deal not a civil war. peace

  9. Roger

    This is a nuclear time bomb! Its final outcome could be catastrophic! Who owns what? Who pays whom? I live in a house, and I have been paying my mortgage to A, but B has my loan docs. Now what?
    Roger Good

    • Greg

      Roger,
      You got it man!!! Even if you are paying your mortgage on time, “Who owns what?” This is a giant mess! Keep very good records and do not be late for a payment!!
      Greg

  10. david

    Great article, but my cynic-o-meter is pegging right now, and telling me that the banks will just pressure Congress to get the rules changed on their behalf, and everything will be just fine (for them).

    • Greg

      David,
      There are just too many layers of criminal fraud for Con-gress to wave a legislative magic wand and make everything go away. Who knows I could be dead wrong and you could be right but I don’t see how that feat can be pulled off. Thank you for your comment.
      Greg

      • Bob

        You could be wrong Greg,anything goes in a lawless land.

  11. Tom

    This whole piece is horribly confusing the way it has been presented.

    For starters:
    “His original mortgage company was Countrywide, but it was bought a few years back by B of A. U.S. Bankruptcy Judge Judith Wizmur rejected a claim by Bank of America to foreclose on Kemp’s home. According to a Bloomberg story yesterday, “Bank of America had failed to deliver the note to the trustee. That could leave the trustee with no standing to take the property,…..”

    If I understand written English correctly, that means B of A is the original note holder and the verbiage above clearly states that the claim was filed by B of A. Why can’t they foreclose? Who is this “trustee”? The trustee of the MBS’s? If so, he/she deserves to be out in the cold for failing to ensure that all proper documentation was delivered, and besides, the trustee didn’t file the claim. There’s a separate course of legal action for the trustee against B of A, but it doesn’t involve the house. In fact, it is this: “The banks are going to be forced to buy back all the toxic mortgage junk they sold.” That’s how the MBS holders will be made whole (they hope).

    Having just read the Bloomberg article I see what the problem is. The Bloomberg article does not state that the claim was made by B of A. Greg, that’s a thirty-five yard penalty and the down becomes fourth instead of second.

    • Greg

      Tom,
      I see your point and I have added to the post B of A bought Conutrywide a few years back, and in turn also acquired the mortgage. The judgment was clearly against B of A in this case. Thank you for the constructive criticism.
      Greg

      • Tom

        Greg,

        I’m the one who gets the thirty-five yard penalty. I reread the Bloomberg article and at the end it specifically refers to the case Kemp vs Countrywide (aka Conutrywide). I missed that the first time around. I was already aware of the fact that BoA bought Countrywide in 2008. So clearly, that’s essentially Kemp vs BoA, and you are correct that BoA filed the claim and there was a clear decision against BoA.

        What I don’t understand is why the MBS trustee and his lack of standing in this foreclosure was a consideration in this case. The MBS trustee didn’t file the claim. The logic seems to be that BoA’s possession of the note is considered to be fraudulent, but that’s not clearly stated.

        The B’berg article is poorly written in the sense that it goes off in several different legal tangents, none of which is clearly resolved. We have New York trust law but that is considered to be irrelevant. Why?

        The only thing that is really clear is that the f&^%ing bankers and the bastards on Wall Street have created one hell of a mess – and no one is paying for the crime.

        • Greg

          Tom,
          You helped make this post better and for that I thank you. Really, your comment got me to take a second look and make this better. Peace bro. You get No penalty from me.
          Greg

  12. Brian

    This is so bad. If the big banks have to eat this and in doing so implode setting off a chain reaction. MBS’s detonate, derivatives detonate, stocks and bonds detonate, Gov implodes. Bad. Am I seeing this fairly? Thank god for You and all the other knowledgeable folks on the net. JSminset, Martin Armstrong, ZeroHedge and Jim Willie

    • Greg

      Thank you Brian and Zulu I definitely get your drift. Thank you both.
      Greg

  13. zulu127

    I’m Canadian and when I read about this HUGE problem I sent it to media centres suggesting that this was a big story. So far there has been very little coverage. I’m somewhat taken aback by the lack of reaction of homeowners in the US. Surely there is some sort of campaign [I’m hoping!] to inform as many foreclosed individuals as possible about this ruling and what it could mean for them.

    If corporations wish to consider themselves as proto-human they must suffer the full consequences of breaking the law. Let’s see, destroying millions of people’s lives, stealing their homes, forgery……the list is long, as is the list of institutions who are culpable. Shut them down for life…as a corporation is immortal that means forever. Also, when a human is thrown in jail all the little bits and pieces inside go there too…..same should go for the corporations, if you get my drift.

  14. Geofizz

    Here’s hoping the mountain of evidence continues to grow and work it’s way to the surface, thanks to those like Greg here who continue to report on this matter. Didn’t the Fed just try to get banks to buy back some of the toxic stuff from Freddie and Fannie? Response was “no thank you.”

    How do you see this playing out Greg? There’s already some legal action on the part of investors addressing these unsecured “mortgage-backed” securities, but that takes time… Meanwhile, the Fed is trying to help out the TBTF banks who are perpetrating these crimes by undermining the Truth in Lending Act of 1968:

    http://www.nytimes.com/2010/11/29/opinion/29mon2.html?_r=4&ref=opinion

    • Greg

      Geofizz,
      Thank you for the comment and link.
      Greg

  15. Eric

    Hi Greg,

    Thanks for that, this is very interesting. I have one question. Why would the lenders keep the mortgage promisory notes instead of transfering it to the trustee? What was the rational behind that practice?

    Eric

    • Greg

      Thank you Eric for your comment and support.
      Greg

  16. karen1p

    Yep, I have this evidence in my documents. My note is not encumbered by MERS, therefore all transfers need to be recorded. The banks recorded the transfer to the MBS pool only AFTER:

    1) AFTER there was no clear chain of title (against the PSA rules)
    2) AFTER the MBS pool closing date had passed (2 years and 4 days passed to be exact.)
    3) AFTER the notice of default had been delivered to my home (clear violation of PSA, as only PERFORMING LOANS are accepted.)

  17. Edward Ulysses Cate

    Interesting commentary, Greg.
    It makes me wonder about something
    perhaps even more frightening:
    When a home owner pays off their mortgage,
    will the owner actually have CLEAR TITLE and OWNERSHIP?

    • Greg

      Edward Ulysses Cate,
      Everyone with a mortgage should be worried even it they are making their payments on time.
      Greg

  18. horace manoor

    at last i understand what’s going on — thank you

    james m, above, says a ruling can be fought in court

    i would suggest altering that by saying a ruling can be bought in court

    • Greg

      Horace,
      You and James may be proven correct but I hope not. Thank you for the comment.
      Greg

  19. Mark

    I can’t wait until some of these cases of promissory notes and other documents are actual precedent… because when they are, I and MILLIONS of others will be seeing Sallie Mae and others in court when we find out we can emancipate ourselves from the slavery of student loans!

    • Greg

      Mark,
      Thank you for comment and good luck with your loan.
      Greg

  20. EC Steve

    Greg:

    Does the same analysis apply to HELOCs? Were their securitizations equivalent?

    When, after he is foreclosed and gone from the property, a bank tries to collect on one’s (no longer secured) equity line, can the erstwhile home owner demand proof that they have custody and control of the note; and, if they have no proof, just tell them where to go?

    • Greg

      ECD,
      You will have to consult a real estate attorney in your state on that one. Thanks for the question.
      Greg

  21. Alyce

    I am under the impression that individual states treat this “note” issue differently. Some states, such as Calif, do not require a note and rely only on the word of the bank. I’d like to be wrong about this, please clarify if you know otherwise.

    • Greg

      Alyce,
      The bankruptcy laws are different from state to state. The “note” issue is fairly consistent but I am not a real estate attorney.
      Greg

  22. ken

    My niece was going to buy a nice forclosure. They made an offer. The bank couldn’t get it together to close. They walked away. If the Real Estate Market is going to have this on top of what is already wrong, and mortgages have been the biggest asset backed way for the fractional reserve system to generate new cash in the economy….it looks like this sector will totally implode. What puts should I buy? ( where should I “put” my money? ha ha)

    • Greg

      Ken,
      I do not give trading advice. I can tell you this is NOT a good time to buy a home. I predict prices have more downside risk. Interest rated have nowhere to go but sideways and then up. If you do buy, then buy a home from a private owner with no mortgage.
      Greg

  23. PeteCA

    Greg: Great job with the comments on the absence of Promissory Notes, and the forgery of duplicates to perpetuate foreclosure fraud.

    If the banks are forced to take some of the marginalized properties back – they will eventually be bought up by the Fed. As someone observed above, the Fed is already committed to buying almost $300 billion in MBS this next year.

    And the point of the Fed’s acquisitrions of MBS???
    Not only does it “save” the US banks (and Fannie Mae) by purchasing worthless assets – but it also piles all of those fraudulent documents into a giant federal trashcan. Once all the bogus paperwork is stuffed into that trashcan, how can the FBI (or anybody else) possibly analyze the remnants for evidence?

    That was the whole point … right from the get-go. The Fed purchase of MBS is a brilliant scheme to ensure that the major bankers never face criminal indictments. Period.

    PeteCA

    • Greg

      Pete,
      You are correct, but keep in mind the Fed has a heck of a lot more of this toxic junk to buy. This will crater the U.S. Dollar in the end. Thank you for your comment.
      Greg

  24. Griz

    I smell another bankster bailout coming.

    • Greg

      Griz,
      You have a good sense of smell.
      Greg

  25. lostinmissouri

    The banks have got themselves into “quite a dogs dinner”….as Nigel Farage would say.

  26. James M

    After reading the posts and replys, I must agree that this is just to big of a mess to sweep under the rug by simple legislation. There are to many people, unions, states and even countrys that will not allow it to go away easily. Multiple layers of fraud times 10 going on here. That must be why Obama pocket vetoed the last bill to cover the banks, only to cover his own arse when the pot boils over. There are not enough light posts on Wall St to hang the crooks, there going to need Pearl St and William St too lol. This is a great time or terrible time to be alive depending on wheather you’ve been paying attention or not. Regardless, the FED can’t print enough to cover now so to say the least it is going to be quite a show I think. I still think they will cover the banks some how. If they can’t we can rejoice. I will buy the first keg and pig with silver, bring a steer down from Vermont to Battery Park and we can have one hell of a bar-b-que to celebrate. That’s how they did it in 76.

  27. Susan

    The lending practices were deliberately designed to fail for the purpose of obscene profits in betting against the MBS on the OTC derivative market. That is the treason. They didn’t make all the “exotic loans” and “no money down deals” where you “didn’t even need to have a job to get a mortgage” to “borrow 150% of the value of the property” because they were stupid. This “designed to fail” fraud was blatantly out in the open, yet the root cause of Robert Rubin, Alan Greenspan, and Larry Summers all claim they didn’t see it coming and walk away with a slap on the wrist. Justice has been made a joke. It’s hard to believe the devil will get it’s due from this failure to produce an original document after seeing no consequences from the openly advertised fraud. Something might happen if the elite decide it’s time to throw some of their own under the bus, but I wouldn’t call that justice. The corruption is just so deeply pervasive; I can’t see that it will unwind without a complete collapse.

    • Greg

      Susan,
      Thank you for adding to this post. Love your comment!
      Greg

    • Tom

      Susan,

      You are one of very few people in this country (other than the crooks who planned all this destruction) who understands what is going on. You are correct – it was all deliberate, every bit of it – starting with the 1990’s stock market scam.

  28. John in NC

    Its US GOVT property, it was our tax money that bailed out the banks that owned these mortgage back securities.

    So boot the deadbeats who failed to make payments, sell the properties for whatever you can get for them and send that money to the government to pay back our debt end of story, lets get on with it and start the healing process shall we.

    • Greg

      Thank you John, Anders, Art, and Bob for the great comments.
      Greg

  29. Anders

    Please people of america find another political party such as greens party,your democrats and republicans are in bed with wallstreet,broom them out there frauds and banksters bitches,the good folk of america should have better,you need a new party that is for the people,good luck,Anders Australia.

  30. Art Barnes

    Look here, the banks are not going to have to pay for squat, the Fed will purchase the junk or whatever it has to to do in order to maintain the status quo. The result of which will be the dollar’s devaluation; meaning, the american people will pay the bill with inflationary future money they earn and become even poorer than they are now. Is treason sill a crime cause I can think of at least 535 plus some select others who could be charged!

  31. Paul

    Hello Greg,

    I too have a B of A mortgage that was purchased from Countrywide. I am current on my mortgage, but the more stories that are coming out regarding B of A, mortgage servicers, lost notes, etc, doesn’t make me feel warm and fuzzy inside to continue making payments throwing good money after bad. Is there a way I can obtain proof that B of A has the note in connection with my property and the mortgage attached to it? I intend to pay my mortgage off completely someday, but I will not do so if the owed party (B of A?) cannot prove they are the valid recipient of my hard earned funds. If B of A cannot provide the promissory note, how do I know that I’m even paying the correct bank/lender? Any advise is greatly appreciated.

    Sincerely,
    Paul

    • Greg

      Paul,
      To actually prove that B of A has your promissory note, you would have to see the original. ONLY the original document is a financial instrument that also proves ownership of a property. You could ask for a copy and assume they have the original but they may not even be able to provide you with a copy. In that case, you could assume B of A does not have the original. If you want to stay in the house keep making the payments on time. Also keep all original loan documents and very good records. This is a gigantic mess and there are no easy answers or quick fixes. Thank you for sharing your story here.
      Greg

  32. Robert

    In a related story, get a load of this bombshell… $9 Trillion for just one program alone….! Ive read where this mess with the CDO and CDS’s totals over $50 trillion in worthless securities, many of them sold to city, state, police and fire pension funds around the world..

    Do you think the managers of these pension funds might be pissed and telling their state AG’s to go for the jugglers?

    I’m curious just how successful these state AG’s will be or if they will somehow settle for a less punitive or retaliatory action in return for some good old fashioned one hand washes the other exchanges of “what can you do for me” behind the scenes justice…

    http://www.csmonitor.com/USA/2010/1201/Federal-Reserve-s-astounding-report-We-loaned-banks-trillions

    • Greg

      Good points Robert!
      Greg

  33. James

    A message to all of the folks on Greg’s Blog.

    If you can listen live, please check out http://www.fmtalk1011.com and hit the “Listen Live” button at 8:00 am EST to hear Greg ramble with Brad & Britt.

    Otherwise go to their Netcast Central and download the podcast.

    You won’t be disappointed

    Peace

  34. Rick

    Greg,

    At least you presented most of the facts. First have you read any of the securitizations ?. I think not, because if you had you would know that outside of Fan/Fred they are very clear on the credit quality and have very little reps/Warrants. Just the opposite, they make the claims that these morgages are of very poor quaility and losses should be expected and most state that there could be more of any type loan then specified. It was the purchasers responsibilty to verify quality and to determine to buy or not to buy. BofA has not lost a single case on this issue and probably will not. Take the recent case thrown out in CA on on a 300billion MBS . There will be put-backs, but only on a loan-by-loan case and this will take years. This is why PIMCO is not after BofA on Loan quality but trying from the servicing angle. They actually want BofA to foreclose faster and not modify them at all.
    Second, you conveniently leave out the part about Dimartini later recanting her statement after she was pressure to answer a question on a procedure about a dept. in which she did not work in. She assumed this was happening. The banks have made mistakes, but the people bying the homes knew what they where doing, they first commited the fraud by lying on the application, they broke the contract by not paying and should have no right to the property. I believe you are trying to prove your point by extrapolating from a few cases. This only works in theoretical mathematics problems not law. I will note this a check in to see who is right now and then. I hope if you are wrong you will stand up an admit this and I will do the same.

    • Greg

      Rick,
      If your Wall Street buddies represented the MBS as “poor quality” then how did it get triple-A ratings on the debt. You know as well as I do pension and retirement funds that bout a lot of this crap are required to only buy debt of the highest quality. If this would have been disclosed this would not be a story. By the way, the Fannie and Freddie MBS represent a $6 trillion dollar liability to the country. I guess that is just small potatoes to the Wall Street pigs ripping-off the country. I also did not “conveniently leave out” anything! I put a link to the complete Bloomberg story I quoted from. I do that in nearly all of my articles so readers can instantly fact check my work. If I get it wrong (and sometimes I do) I want to correct it as soon as possible. The banks did not simply make “mistakes.” Many of my sources, including Professor of economics and former bank regulator claim the mortgage mess is wide-spread criminal activity. From everything I have researched and read I concur with my sources. Finally, about the “put back” or buy back question of these securities by the banks that sold them, some of the best legal experts in the country say this is an enormous problem. Adam Levitin, Professor of Law at Georgetown University said recently, “If the notes weren’t properly transferred to the trusts, then investors have the mother of all put-back claims.” That was also contained in the Bloomberg story link I PUT IN MY STORY. By the way, I find it really disgusting that financial elites want to kick people out of their homes at and even faster pace. I don’t mind criticism. In fact, I welcome it because, if I get something wrong, (and sometimes I do) I want to correct it as soon as possible. Your criticism is factually weak and unfounded. I do agree with one thing you wrote, this is going to go on for “years.” Thank you for your comment.

      Greg

      • Rick

        Greg,

        thanks for the response. But agaion you have made a statement without providing me fact. If my arguments are weak please point out the weakness. I believe every argument I made was without judgment, but just facts. I never said the banks don’t have a problem, just you and your quoted sources tend to over state the problem. Like the whole system might colapse… last you did not answer my first question of have you personally read a securitization? You need to before you trust what others tell you, yea that includes me. But if you do then we might be able to have a conversation of what might or might not happen as this plays out.
        I am not from Wall Steet and I do take offense to you initial statement, but I will tell you how they got Triple-A ratings. The rating agencies screwed up. They are paid by the people on both sides of the trade and they just did not do their jobs. They like the money more than the Banks & Investors. It is their job to sample a large number of loans and make sure they meet the needed thresholds. All the rating agencies had to do was their jobs and a most of this would not have happened. Don’t blame the Banks for the system the Fed setup and every knew did not work. You should be writing on this subject because it is still in place and no one has still be held accountable for their actions. And yes, If you dont pay you dont get to keep. I was brought up to believe that this was stealing, how about you ?. Just because the banks screwed up, how can someone believe they are entitle to keeo a house they did not pay for. Thats not what this country was founded on.

        • Greg

          Rick,
          I pointed out the weakness of your comment in detail. I don’t think someone is entitled to keep a house. I just don’t believe a bank is entitled to take one through fraud. As I always say “Good men can disagree.”
          Thank you for your comment and for supporting this site.
          Greg

  35. nm

    Greg:

    You said: “Somebody is going to buy it back. Why do you think the Fed has set aside $275 billion”?

    Yes, Bernanke will print (QE3) and buy it back, but they’ll come up with a creative name for it (the world bailout is tainted)

    Besides, the republican controlled congress will NEVER allow the banks to go down. NEVER. That is their bread and butter.

    I think voters know something is wrong. They sent Obama a message and voted in Republicans, but they too will screw up because they are too skewed in favor of big banks and big business.

    For the first time in my life, I actually think a 3rd party candidate might have a good chance in 2012 because neither party is getting it done right now.

    ** Why would you encourage people to keep making their payments on time? seems to me you’d be better off not paying and then daring the bank to go out and prove they have the original document (& while they’re doing that, you can pretty much live in your house for a couple of years for free)

    • Greg

      NM,
      I do not want to encourage people to get into a fight with a big bank that could cost them dearly. If someone decides to stop paying a mortgage they could lose their home and ruin their credit.
      Greg

  36. Jay

    Interesting information. Help me out here:

    Does this mean that foreclosures that have already been executed can be reopened? If so, what is the statute of limitations to reopen, say in Maryland?

    • Greg

      Jay,
      Yes it does. Foreclosure laws can vary widely. I am not a lawyer so if you want concrete specific answers, then you will need to ask a real estate attorney in your state. Thank you for the comment and question.
      Greg

  37. Jay

    Interesting information. Help me out here:

    Does this mean that foreclosures that have already been executed can be reopened and challenged for original documentation if copies were used during the original foreclosure? If so, what is the statute of limitations to reopen, say in Maryland?

    • Greg

      Jay,
      The short answer is YES, but you must consult a real estate attorney in your state for exact concrete answers.
      Greg

  38. Rose Morgan

    Thanks, Greg for your faithful reporting. Many times I wonder what my friend, Gammage thinks about this from his heavenly viewing post. Surely he’s shaking his white haired head. He sure had faith in your analysis and ability to write it up, correct and true!

    Thanks again!
    Rose

    • Greg

      Rose,
      Did Gammage pass away? If so I am sorry for your loss and thank you for the kind words.
      Sincerely,
      Greg

  39. messianicdruid

    It is time to observe a Jubilee.

    http://www.yesmagazine.org/issues/living-economies/532

    Our government can issue it’s own money based on the people’s productivity. Metals will still circulate as money. Local currencies can circulate as well as our ability to barter. A few months of sorting things out is far preferable to a fraudulent debt burden, designed to destroy us and allow the wealthiest thieves on the planet to basically steal our homes and all the natural wealth, which is our birthright.

    In the Jubilee ancestoral land is also returned to the people. Each extended family is allotted a parcel of land so that they can work and live together {if they will} and provide for themselves. Large parcels for large families and smaller parcels if the land is highly productive. Some families in America have never had their own land, meaning they have always been in economic bondage to the rich.

    A well thought out plan to make such a transtition is very much doable. Can you imagine?

  40. roger

    How will insolvent banks buy these mortgages back? This is a mind boggling problem. Maybe if they were solvent but we know they are not. And, how many other banks? What a monumental task for the justice system (assuming we have one) will have to tackle. The outcome will be, no maybe about it, catastrophic.
    Good work as always Greg.

    • Greg

      Roger,
      I think you have been seing it already with the more than $1 trillion of MBS already bought by the Fed. I think you acn count on more money printing by the Fed in the future.
      Greg

  41. Mike

    Interesting battle of levels of cynicism here: will the Feds find a way to provide blanket retroactive immunity, or not?

    I have no doubt that the Feds will find a way. Some here think this is too deep a fraud to get away with. Haw haw. These people are on a roll man. They have already shattered many previous illusions of boundaries – in every realm from bank bailouts to illegal wars to stripping US citizenship. Changing foreclsoure rules is small beans.

    Don’t worry about the end investors; they will be made whole thanks to the marvelous laundry down at the federal reserve. Except for public pension funds; whose bankruptcy is useful.

    • Greg

      Mike,
      I hope you are wrong but fear you may be right. Thank you for the comment.
      Greg

  42. Dave

    Apparently much of the hundreds of billions sent to overseas banks like Credit Suisse and Bundesbank by Bernanke was to make good on the mortgage backed securities which used these mortgages as collateral.
    We had to make good on this fraudulent garbage, otherwise there would be international lawsuits, embarrassing disclosures and paybacks.
    It gets worse, some of these “investment vehicles” used the same mortgage multiple times…
    The fallout from all of this will bring us some terrific deals on real estate in the next few years.

    • Greg

      Thank you Dave!
      Greg

  43. Robert

    Here’s another effort by the FED you won’t like but supports my first comments that the banks will win and paperwork disasters will be overlooked for the greater good… http://www.mcclatchydc.com/2010/12/01/104568/fed-wants-to-strip-a-key-protection.html

    I don’t think people should necessarily get a free house, but it would be good to see their loan terms rewritten to keep as many people in their homes as possible..

    Sometimes it looks like the FED and governing bodies really want property values to come down, which massive foreclosures will do.

    Does it make you wonder that some people in high up positions of influence and power have an agenda that none of us really know or understand but I’ll specualte, its about making our economy and associated wage levels become more aligned with the countries that the corporations have outsourced our high paying jobs to, thus making our workers able to compete in the global markets… I think its called resetting the economy… and it will hurt for a generation or two…. hell of a time to do this with the boomers heading into retirement.

    • Greg

      Robert,
      I think the criminal activity is just too great and is on many levels. For you to be correct, all investors will have to take tremendous losses. I think the investors have and will hire lobbyists and lawyers of their own. But who knows you may be right. Thanks for the comment and the link. By the way, the “greater good” you talk about is really just the greater good for the banksters
      Greg

  44. 2dogsdad

    Greg,,,great report and even better discussion,,thank you for your hard work.

    I think we all agree,,,the United States and it’s constitution will not
    be the same in a very few short years!

    People are waking up but, I hope we weren’t sleeping too long?

    God Bless and never quit!

    • Greg

      2dogsdad,
      I won’t quit, I just hope they don’t shut me down someday. Thank you for the complement and comment.
      Greg

  45. Louise

    What a loopy, irresponsible judgement. This money is someone else’s life savings. This money is someone else’s tax return. This money is a Treasury Bond being held by a foreign nation. Judges should have to pass an accounting course before being seated.

    • Greg

      Louise,
      So, you think we need fraud and criminal activity in the mortgage market so the economy will run smoothly? Please explain your comment.
      Greg

  46. Bob

    89 Thanks Greg, you make life better.

    • Greg

      Bob,
      Happy to bring you some joy, we all need that now.
      Greg

  47. nm

    Maybe someone here can answer this question for me:

    What is Bernanke’s end goal here? Like, when Bernanke and Geitner meet, do they actually believe that whatever it is they are doing is going to work or do they have no choice, but to keep lying to the public and hope that the public buys it? Geitner said today that the economy was “healing”.

  48. Bob

    Our leaders in DC have no idea that the people are going to unglue, are they would be enforcing the laws of the land. I write my congress person and say the truth about how the people know they are living in a lawless land. This wikileak is only the tip and the truth is just going to come out about these lawless bankers and these worthless wars. The Congress must be brain dead they must think this is 1960 there is no hiding the truth 2+2=4 and the age off computers are here. They can try and keep the citizens a sleep but the SHTF is going to happen when the bill is handed to the citizens in the next few months. They can try and shut the net down and make up more lies but this will end up in more people unemployed more unrest just insanity is coming out of DC. What are they thinking like the people are just going to sit in homes they don’t own and watch dancing with the stars. I just can’t believe how this Sara Palin person is not laugh off TV and how the news gets all wet over her. I’m a old hillbilly and know I have read more books and know were the countries are located on this earth but be the leader of America not me,the news people would laugh me off. This might not be the end times but hard times isn’t the right words, maybe the crazy times. PEACE TO ALL HONEST PEOPLE

  49. Elizabeth McDaniel

    It’s a pretty sad day when we have banks who created this mess in the first place, going to the goverment for help ie bailout money, because they could’nt stop writing bad loans for the commissions. They were like a kid in a candy store, reckless!! and then boom their broke. And of course goverment with more of our money bailed them out so they could again play god start taking our homes from us, if we did not have to give all our money to these banks, maybe we would’nt have the need for loan mod. and they put the very people in charge of approving these mod. to the very people who made it the need for us to get them. What troopers they are. We now live in a Country where the american homeowner is made to take out a loan secured by our homes, to bail out banks.

    • Greg

      Thank you Elizabeth, Art, and Suburbanite for the good comments.
      Greg

  50. Suburbanite

    Panic in the streets. Let’s all run from our office spaces and homes and fill the streets screaming.

    The key to recovery is job creation. This administration has to extend itself to private enterprise to help create employment of the unemployed. And I’m not talking about dumping cash indecrimnately into the economy (what a experiment that was).

    Instead creating real programs, to yield tangible results, to help real people. Like looking into partnering with private business to push renewable energy. Working with industy to move forward with high speed and high efficient rail. New programs that create a new sub-economies for this country and jobs.

    Employed Americans don’t have to fall into default with their morgages. Covering up the fact that lenders had poor record keeping.

  51. James

    So the foreign banks were going to kick up a fuss about the dodgy securities they had been sold, and were bailed out as hush money?

    • Greg

      James that may be corect!
      Greg

  52. Edgo

    Hi Greg,

    Nice article. I got here by way of your interview on Max Kieser.

    I was looking into this a couple of weeks ago and I basically realized then what you’re saying. My jaw dropped when the light went on. I don’t think you’ve even scratched the surface as to the extent of fraud. It goes well beyond the banks and rating agencies.

    At this point the basic question is: “Is there such a things as ‘rule of law’ anymore”? I would say flat out NO.

    I’ve been buying storable food, stocking up on other necessities and getting gold and silver for the past few weeks. Looks like just in time too. This can’t/won’t go on much longer. Sorry to say, you can only trust what you’ve got right in you hand.

    God help us all as to what’s coming. I hope the good guys win at the end of this one….

    -edgo-

    • Greg

      Edgo,
      Max is a great guy and I am going to put the interviews up on my site this week. Happy you found this site through Max Keiser!!
      Greg

  53. signalfire

    Hi Greg,

    I just found this site off of Max Keiser’s after your interview with him. Good work, good interview!

    I wanted to respond to the people who are afraid that someone ‘might get a free house’ out of this. They need to be educated that the money they ‘borrowed’ was created out of thin air. ALL MONEY IS CREATED OUT OF THIN AIR, FOLKS!!! When you borrow for a mortgage, the money is created by virtue of your signature alone; it’s just One’s and Zero’s in a computer somewhere; note that in this scam/game/way things are, the money to pay back the loan’s interest does not exist. You work your 30 years to ‘create’ the money to pay back that. You’re a debt slave, in other words.

    Please see Chris Martensen’s ‘Crash Course’ and The Zeitgeist Movement to learn more, and for a way things could be improved (i.e. a resource based economy, not a money based one.)

    People really need to understand how fractional reserve banking works (or doesn’t, as we’re finding out) before they demand people ‘pay back the banks and not get a house for free…’

    And what do you suggest otherwise? Do you really want 40+ million families thrown out of their homes and standing on every streetcorner with placards begging for money? With their children and their dogs? Really, is that what you want?

    Not everybody lied on their loan documents, oftentimes the bank officers lied for them. How many loans in red-hot markets like California do you think were actually originated by people able to afford 500K for a tiny house? How do you think the prices of all houses got so outrageous, so fast? Because the money never really existed, it was created out of thin air, and the banks not requiring down payments or true income documentation blew the market up against all semblance of sanity. The banks, the mortgage brokers, the appraisers, were all complicit. It’s RICO and it’s treason and 250 years ago, this was guillotine-shot by firing squad-hanging behavior.

    As Gerald Celente says, ‘when people lose everything and they have nothing left to lose, THEY LOSE IT!’ It’s getting near that time for a lot of people, especially if the CONgress does not pass an unemployment insurance extension. Everyone also needs to remember~ those people who you want removed from their houses because they can’t pay their mortgages? They have guns and bullets. We’re the most heavily armed population in the history of the planet… how do you think THAT will end up?

    Okay, I’ll stop ranting now. Thanks.

    • Greg

      Signalfire,
      Rant here anytime you wish. I love it!!
      Greg

  54. Mike

    Greg,

    Very helpful comments – excellent site. I have been fighting one of the biggest banks for the past two years in an eviction action on behalf of my sister-in-law via a limited power of attorney (I am a tenant in the action) Two weeks ago I filed a default motion against a major bank. Is this the first you heard of the banks actually giving up via default rather than face greater exposure via further opening a larger Pandora’s Box? Our case involves a lease buyback scheme where the straw person borrowed 440 grand from Countrywide and then they pocketed the rent money eventually leading to default. Is it possible that the lease buyback schemer could theoretically end up with the property if the assignment transfer from Countrywide to MERS to the trustee Bank was fraudulent? Of course this weird scenario could not happen here as the straw buyer in addition to the multi- trillion dollar bank has also defaulted. If and when banks begin defaulting in the face of a rescission motion – now this is truly frightening. What deeper darker secrets are they hiding?

    • Greg

      Thank you Mike for sharing your story. Please keep us updated on how this turns out. Folks can learn something from you!!
      Greg

  55. Mike

    Greg,

    If and when the bank attempting to foreclose produces the promissory note, how do I determine that it is in fact the original? Do I need a forensic document expert witness? Actually, the contract of sale has forged signatures on it anyway, so I will be needing such an expert at any forthcoming inquest. I do not think that this will happen in this case as they would have produced it by now (in addition to the fraudulent robo-signer’s affidavit). In the event the court rules against my default motion, especially if it is unopposed, I will introduce an equal protection argument. In essence, we presently have the Judge Shacks and the anti-Shacks – some in the same level of court and only miles apart in the same state! It is sites such as yours that put the fear of god into these anti-Shack judges. Thank you.

    • Greg

      Mike,
      You should be able to see the original in court. You should have a copy of the Promissory Note in your original loan documents. If you do you will have something to compare it to. Please run this all by your real estate attorney. Let us know what happens and thank you for your kind words.
      Greg

  56. Frankie

    I got me a shotgun, a rifle and a four wheel drive,
    and a country boy will survive (and bullets! LOTS AND LOTS AND LOTS O’ BULLETS, unless you plan on throwing your guns at the nice folks breaking down your door to get your food and rape your wife).

  57. Ken

    Trust is still the key ingredient in business. People demand regulation in order to augment their trust and avoid risk, but all the government did was to aid and abet the most untrustworthy people on the planet.

    I hate to say it, but they all deserve to lose their business and go to jail. That is the only thing that can restore trust. Without trust, or at least the belief that the untrustworthy will be held accountable, we don’t have an economy.

    Ken

  58. Barbara Ann Jackson

    http://www.change.org/petitions/view/request_for_congressional_foreclosure_panel_to_examine_foreclosure_lawyers#

    LAWYERS WHO FILE FORECLOSURES SHOULD BE INVESTIGATED

    Scores of homeowners do not contest foreclosures because:
    1. They don’t have knowledge of the law in order to recognize which aspects of foreclosure are legally challengeable or even fraudulent.
    2. Even those who identify wrongdoing, lack funds to pay for attorneys to represent them.
    3. Homeowners are told to come to foreclosure auctions with money that they do not have, so they stay away from foreclosure auctions.

    These homeowners are oblivious about sometimes “straw buyers” and sometimes lawyers in charge of foreclosures, obtaining illegal ownership of people’s homes, and pay literally nothing through “credit bids;” and that those recorded deeds from such auctions are Null! For these very reasons, there needs to be a probe of lawyers who file foreclosures.

    Also, the average lay person doesn’t know about legal requirements of “standing” that prevents their homes from being repossessed via non-existent lenders, or via lenders who have no ownership of promissory notes.

    Yet, courts are supposed to enforce “standing” and compliance with established laws! Illegal, defective, fraudulent foreclosure causes useless deeds for property sales; title insurance denials –and more!

    Further, after certain foreclosure auctions (via simulation) result in fraudulent –NOT lender acquisitions, by lawyers or straw buyers, the common scenario becomes property flipping, neighborhood blight, rodents, and so on!

    *Sample of fraudulent foreclosure acts:

    -Deliberately use defunct lenders, lenders without “standing” for false civil and bankruptcy foreclosure proceedings
    -Create and conceal malpractice foreclosure delays and engineer billable litigation
    -Orchestrate sham foreclosure auctions; property never acquired by lenders, but ‘straw buyers’
    -Commit actionable wrongs (unfair debt collection, fraud, various torts) that create lawsuits
    – Foreclosures naming defunct lenders, illegally recorded property deeds, flipping, blighted communities
    -Unconscionably create false deficiency judgments against property owners after straw buyers acquire homes for pennies on the dollar
    -Intentionally false Bankruptcy court “Motion to Lift” and “Proof of Claim” on behalf of non-existent lenders which conceals fact of a “non-secured” mortgage debt
    -Involved in fraudulent collection of property damage insurance, as well as mortgage-default insurance
    – Fraudulent foreclosures abet loss of property taxes to city revenue, and invites rodents, vagrants
    – Thousands of families made unlawfully homeless from null foreclosure proceedings

    Foreclosure lawyers are officers of the court. Lawyers are required to know applicable laws and civil procedure. This knowledge is not required of mortgage lenders, nor loan servicers.

    *more @ Request for Congressional Foreclosure Panel to Examine Foreclosure Lawyers
    http://www.change.org/petitions/view/request_for_congressional_foreclosure_panel_to_examine_foreclosure_lawyers#

    • Greg

      Barbara,
      Thank you for your informative comment and the links you provided. Please comment here anytime, because you give thought provoking information for our readers.
      Greg

      • Barbara Ann Jackson

        I am glad to do what I can that might be of help to people, as the deck is so stacked against people who are already in distress because of possible loss of roofs over their heads.

        Also, PLEASE urge the public to read, share, and sign the Request for Congress to investigate lawyers who file foreclosures:

        Request for Congressional Foreclosure Panel to Examine Foreclosure Lawyers http://chn.ge/eU2zAm

        -Barbara

        • Greg

          Barbara Ann Jackson,
          Done. Thank you again.
          Greg

  59. Troy

    Greg,

    Thanks for another great post! I have dealt w BoA a bit after my “Where’s the Note?” submission through SEIU’s website. BoA responded with a “You have no right” letter, and followed with copies of the docs I signed at closing (Countrywide at this point). They then sent a record of all transactions related to the mortgage, I assume to prove they were servicing the account. I received an additional letter stating that, in fact, FDMC held the note, and BoA was servicing the mortgage. A few things about this bother me, relative to my situation. First, I called BoA’s Cust Svc, and explained what was going on. They have no record of anyone sending me the unsigned “You Have No Right to Know” letter, which I now believe was an implied threat to back off. Second, they never sent any documentation that proves Freddie Mac now owns the note, nor that the note had been legally transferred from the closing mortgage company, to Countrywide, to BoA, to FDMC. If BoA only services the note, am I paying FDMC the interest, or is BoA keeping that as “service fees”? After all, BoA should have received payment in full from FDMC, according to their own admission. I did a search on the FDMC website, and the search does say they hold my note. I believe the words (the warnings!) of our Founding Fathers regarding banks and monetary control are ringing true in these days.
    Keep up the good work!

  60. Mike

    This past Monday, I received an order from the judge in my tremendously complicated foreclosure fraud, lease buyback scheme case set in Long Island. In response to a major US Bank as trustee attempting to evict after foreclosing on the straw buyer in the lease buyback scheme involving my sister-in-law and late brother-in-law, I began to fight back personally two years ago as a tenant. The appeal to the eviction ordered in LTC is pending presently in Brooklyn. I started a new action going after all of the corruption in more vivid detail this past August as a pro-se litigant and to eliminate any issues of standing, my sister-in-law granted me a limited durable power of attorney to litigate the theft of her home on her behalf. This right is stated explicitly in New York State’s 2009 Power Of Attorney Law.

    Though I have done a superb job in exposing the phonies and frauds in this blockbuster fiasco, the judge has cited an older (2006) “Judicial Law” vis. statutes 478 and 484 basically barring me from representing my sister-in-law in this action. This order involves a motion to dismiss on the part of two of the more notorious defendants; MERS and Countrywide. The other four including the major bank are in default. Keep in mind a detailed response was filed by me to this motion to dismiss authored by a blue chip, high priced Manhattan law firm. Interestingly, the high priced firm did NOT make this “defense”, but the judge found it in him to produce this dubious argument. I will obviously move on in any way I can. Some of us litigants have the pleasure to come up against judges such as judge Shack in Brooklyn, but the rest of us are forced to deal with the many variations of that obstinate alternative “the anti-Shack”. I welcome any comments to this seemingly unusual act of judicial intervention. On a final note, this action began as a foreclosure against my late brother-in-law and sister-in-law SOLELY filed by MERS. MERS was the only plaintiff in the original foreclosure which led to the lease buyback scheme. My sister-in-law has gone to several attorneys, some of whom took substantial amounts of money and did nothing. This case is just one of thousands that place an embarrassing stain on this nation.

    • Greg

      Mike,
      You fought the good fight. You have nothing to be ashamed of! Thank you for sharing your horrible story here!!!
      Greg

  61. Rick

    Gregg,

    Just checking in to remind you of our previuos discussions. I told this would be nowhere as bad as most made out. Hope you read about the settlement with the GSE’s With BofA, 1.3b, this makes BofA total exposure probably around 3b going forward, not the 50B+, everyone thought. Addiionally, BofA audit by Moody’s and others has been complete and found that Loan doc’s were delivered. PIMCO will settle for very little in the coming weeks and AG’s to follow. NO Conspiracy and Fraud as you have promoted on your blogs, just very bad process. As stated in our last exchange, I hope you man up and write a new blog retracted and admitting you got a little carried away with you statements. This is what happens when you repeat from others and do not do your own homework. Just remember the fraud was committed buy the rating agencies not the Banks.

    • Greg

      Rick,
      I did not get carried away, I reported what was going on at the time. What a surprise, the taxpayers (Fannie and Freddie) settled a case that could have brought great harm to a major bank in the Federal Reserve system. Just because there has been one settlement doesn’t mean all is fixed. Do you work for a major Wall Street bank or mortgage company? I “repeat” from others because they are sources. That is part of the “homework.” Finally, you say, “Just remember the fraud was committed buy the rating agencies not the banks.” Really? Who paid the rating agencies? Peace Rick.
      Greg

  62. Rick

    Gregg,

    No do not, I am retired. I worked in the Finance industry until 2006 and was part of a group to come in a clean up one of the first subprime messes. So I do know alot about securitizations, bondholder responsiblities, and investor responsibilities. Most people you quote think they know alot, but are clueless when comes to these morgage instruments. Banks have to use the rating agencies by law and the investors require it also. Who pays, both parties pay the agencies as stated before. Thats the problem, they want to make everyone happy, and do not have to be held accountable for their actions. Please reference the securitization council in the furture and you will get a less bias an more accurate position to start from. The are not completly unbias, just have the real facts.

    Rick

    • Greg

      Thank you Rick.
      Greg

  63. jamie

    When I bought my first home my loan was with Taylor Bean and Whittaker. I always made my payments on time to them. Then in Sept.2009 I get this statement from BAC that I hadn’t made a house payment to them in 2 months. I called BAC and told them that I don’t have a loan with them and that’s when BAC informed me that they took over for Taylor bean and Whittaker. I asked why I am now just being told this? I never got a straight answer from BAC. that’s also when I found out that Taylor bean and Whittaker went belly up and everything was being tied up in federal courts. BAC even told me that they didn’t have everything on my mortgage yet due to it being tyed up in courts but yet they was demanding the payments that I had already sent to Taylor bean and Whittaker before informing me that they took over the loan. BAC was not only demanding the monthly payments but other fees as well along with late fees to boot. Before we knew it BAC was wanting the whole mortgage paid in 30 days of they would forclose on my home which they did to. They didn’t care about no government programs to help what the bank did was held a sale on the court house steps and sold my home to them self. BAC is worthless in my book and I feel that BAC needs fully investigated 3 times over. I feel for all the wrong that BAC has done and what homes they stole from people should have to give the homes back with the deed to their home and the loan should be paid in full. Case closed.

  64. Sally

    Hi Gregg,
    Thank you for your insight. I have current litigation pending in CA. My attny is in Riverside, I am in Kern Co. about 3 hrs away. We have been paying him $2000/mo to fight this as our Countrywide loan was made in 2006 and sold to B of A. We went through hard times and had to sell our business and filed BK. We were asked to have B of A produce our note and they couldn’t. We are now tying to stop the sale of our house through injunction because we are in mediation right now…B of A keeps postponing the sale…what else can we do to get B of A to negotiate? Not taking it seriously it seems, like not being able to produce the note is no big deal!! We haven’t paid our note in 2 years and we are still in our house….our attny advised us to stop paying, it will get their attn to negotiate…still waiting and playing this dumb game in court…should we look for new attny to put more heat on?

    • Greg

      Sally,
      If you change horses in mid stream it could cost you dearly. This is a very complicated issue and the banks are fighting every case tooth and nail. Stay with it, unless you are sure your attorney is ripping you off. I am not a legal expert but this is a huge mess and banksters are not going quietly.

  65. George

    MORTGAGE CRISIS

    Years back the banks began to turn a mortgage into a commodity, with good paying mortgages, then they saw they were running out of this commodity, so the big banks, including Fannie & Freddie started approving loans to almost anyone and everyone, not so much to just give that person a home to have, but they were more concerned about creating more of the commodity. More securities to sell to investors. They even knew some home owners would not last several years or several months, as long as they could say to investors, “Hey, we have more mortgage backed securities to sell”.

    Now, to sell all these securities, they would have to create a mortgage assignment which is normally recorded with the county land recorders office for a fee. Physically, that would take up too much time and money, so the big banks invented and created MERS,(Mortgage Electronic Registration System). This electronic service was only created to track mortgages sold and bought in the secondary securities market. MERS legally has no invested interest in the mortgage, so they truly are not able to transfer or assign the mortgage acting as a nominee of the loan. But they are! Wrong. The chain of title of the mortgage is broken right here at this very early stage. The mortgage/note has to be assigned from one owning entity to the next owning entity. MERS never owns the loan, but they are creating and are listed on assignments at the local land recorders office. Now that the mortgage was bundled, sold and bought back and forth with investors, no continuing assignments are recorded with the county recorders office. By not recording these documents, Fannie & Freddie & and all your Big Mortgage Servicing banks are saving millions-billions on recording fees, and possible taxes, etc.

    What I have found was that the Servicer of the mortgage is listed with the county recorders office as if they own the mortgage, while Fannie & Freddie or other Big Banks are selling the bundled mortgages as securities. Kind of like a Pizza shop cooking pizza legitimately up front, and a mobster selling off investments in the back. (Racketeering). The Servicer up front really is not the owner of the loan, and they tell you this. They also admit that your loan is owned by Freddy or Fannie, or the Investors. So when the Servicer now tries to foreclose on a homeowner, they are not truly the owner of the loan, and you have to own the loan to foreclose!!! Many never even question the Servicer and walk away from their home. Now to foreclose as quick as they can, that’s where the robosigners come in. These people do not review anything in the foreclosure paperwork about the loan, but only sign a name on the affidavit page on thousands of mortgages to get the foreclosure going before any homeowners begin to catch on.

    You see, its a matter of a quick process the Servicing banks want to achieve in order to get the property in their possession, only to sell it. The crazy thing is, when the originating bank gives the loan, then sells it to the 2nd bank which mostly ends up being the servicer, they again sell it to the 2 major players (Freddie & Fannie) and they sell the mortgage back securities to investors. So the servicing bank gets paid for the mortgage and still collects payments toward the mortgage and a percentage goes to the Servicer, Fannie & Freddie and the Investor. So they are all making money. Then the Servicing bank comes to foreclose and if they are allowed to foreclose they get the home without true ownership, even though the loan is actually sold off into bits and pieces to investors. I can go on further, but to conclude, if this were a murder case, I would call this act of the banks premeditated, not an accident. This was all planned out in order to reach the highest profit they could using the mortgage backed securities as a commodity, and have total disregard, deliberately, intentionally ruining the lives of millions of homeowners.

  66. Tom

    I hear a lot of attorneys banking on the philosophy that a judge will not give somebody a free house. My question is, why not? Let that thought sink in for a minute. If a lender has so mishandled paperwork, cheated by presenting forged and bogus documents, and as a result, cannot prove his case in court, then why is a court so loath to say to a lender, you lose. Failure to pay a mortgage does not give these lenders a free license to cheat their way into the courthouse and succeed in a lawsuit that, if presented in any other context, would lose.
    So long as these lenders know that the courts will pave their way to success they have very little incentive to mediate in good faith.

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