Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Predatory Lending Are you the victim of predatory lending? You're not alone. Learn about the laws and from experts who can direct you in the right direction.

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Old Yesterday, 01:34 PM
Nathan Fransen's Avatar
Nathan Fransen Nathan Fransen is offline
Join Date: Sep 2007
Location: California
Posts: 15
Nathan Fransen will become famous soon enough
Thumbs up Fight Back Against Your Lender and Win Big Time

If you are a victim of predatory lending or mortgage fraud, it's sometimes possible to have your mortgage voided and to apply 100 percent of your payments to the principal balance. There are certain consumer protection laws in place that are truly affective in helping homeowners fight against lenders who are trying to foreclose on their homes.

Many homeowners are unaware that they can fight back against their lenders and win!

The Truth in Lending Act (TILA) is a very powerful tool in preparing a defense against your lender for violations of predatory lending law. If simple violations of the TILA can be proved in your loan documents, then you can sue your lender. That's great news in a market where borrowers think they have no defense against big lenders with deep pockets.

Many consumers are tricked into signing documents they don't understand. These same documents cleverly hide fees like the yield spread percentage (YSP) and charges. Does your loan have a prepayment penalty? Maybe your lender paid money to your mortgage broker and your weren't aware of this "kick back". Or maybe you signed a disclosure at closing stating that you were not canceling (waiving your right to a 3 day right of rescission)?

Even though these issues may be be insignificant to you, they are very significant in bringing suit against your lender. A simple review of your loan documents can uncover these predatory lending law violations and save your home.

Take for instance this homeowner who we helped out of foreclosure. The homeowner was actually officially foreclosed on and the title was taken out of her name.

Many would come to believe that someone in her shoes was done and there would be nothing that can be done, right? Wrong!

I conducted an audit of the loan documents, discovered predatory lending and thus began the fight against her previous lender to save Carol’s home.

Recently, Carol Tounget was the victim of a predatory lending practice that is unfortunately all too common. Lenders pray upon the needs of desperate homeowners by offering them exorbitant interest rates and fees. After falling behind in payments, Carol found herself facing foreclosure and loosing the house she had lived in for so many years. Realizing that the practices of this lender must be prohibited by some law, Carol sought out my law firm of Fransen and Molinaro, LLP .

“I knew something was wrong, but I couldn’t put my finger on it”, says Carol. Meanwhile her husband had spent countless hours on the internet and stumbled across some information on the Truth In Lending Act. “After, reading as much as I could I sought out an attorney that had experience with these issues. I eventually talked with Nathan Fransen who confirmed my wife’s instinct and my research”, says Howard Tounget. The key to the case became the borrowers “extended rescission rights”. When certain provisions of the Truth In Lending Act are violated, borrowers are allowed to cancel their loan even after it closes.

In this instance, the Tounget’s were able to recover all interest payments they had made as well as the closing costs they had paid. All told, the borrower’s recovered about $40,000. The lender was even required to pay the Tounget’s attorneys fees.

Talking to an attorney as soon as possible is critical”. When searching for the right attorney it is important to find one that has experience in the mortgage industry. Predatory lending and unscrupulous loan practices requires a unique understanding of the ins and outs of the mortgage business.
Best Regards,

Nathan Fransen

Mortgage Law & Real Estate Attorney
Fransen & Molinaro Law Firm
1101 California Ave. Ste. 102
Corona, Ca. 92881
(951) 520-9684 Direct
(888) 756-2652 Toll Free
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Let me explain to you what he means...for he stated it but did not explain it...


Yield spread....

It's when the BANK or the Mortgage company gives the Loan officer a monetary incentive to charge you a higher interest rate.

Example... the loan officer has a rate sheet from the bank...

the bank states on the sheet...  9% interest rate = 1 point
                                            9.5% interest rate = 1.5 point
                                            10.% interest rate = 2 points

Money example:

If I am purchasing a home for 100,000.00 and my loan officer is giving me a 9% (stating that is what I qualify for) she will get $1,000.00 in commission from the bank.  This is not including what she/he makes on the front of the loan...(origination fee)

If she gives me 10% - she will get $2,000.00 in commission...

So what do you think she will try to offerr me....the 10% interest rate because she makes more commission.  She has to try and convince me that my credit is so bad that all she can offer me is a loan for 10%.

You see this amount on the Settlement statement call the HUD -1 but the attorney don't go into great detail with you about it...

It's a dollar amount that will have (POC or YSP) next to it...

If you went through a BROKER - they HAVE TO DISCLOSE IT on the GFE (good faith estimate) - but if you went throug a BANK they did not have to disclose it to you. will find this information on your "Mortgage Note" as well..

They are soft pre=payment  and HARD pre-payments.

Soft is a 1 year pre-payment penality...and a HARD is up to 3-5 years.


if you refinance or pay off your mortgage before 1 year they will penalize you for 1-3 or even 5%

If you have a Soft...and wait the year out before you refinance or pay off your mortgage (win the lottery - lol) then they waive it...and you don't have to pay it...

A hard is the same but you have to wait longer before they will waive the fee

You can buy out of a pre-payment penalty loan - it's a higher interest rate that you will receive in turn...

I hope this helps

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YSP'S are legal here in oHIo.

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Ann where on the mortgage papers do I see if he got a comission.Smurf

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Joe B
Yeah, but the other thing that he doesn't mention is that even if you were charged a YSP, you only have a small window to do a right of rescission. So, if you've been in your home for a while, he can't help you! So, before you get too excited, check your state laws on right of rescission ,because that is what he is talking about...

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Where I live upstate New york  is 3 day's.Smurf

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Millions of U.S. homeowners have been cheated or overcharged by mortgage lenders when financing or refinancing their home a new survey/study finds. The potential liabilty to the mortgage industry may be in the tens of billions of dollars. The study also discovered widespread abuse of real estate valuations.

(PRWEB) April 4, 2005 -- For those waiting for the shoe to drop in relation to the real estate housing/refinance boom/bubble, it may have just happened. According to the Justice & Integrity Project in its newest home lending survey, overcharging the homeowner and or out right fraud have reached epic proportions in the U.S. mortgage markets. The net result is that mortgage lenders and or those who purchase mortgage portfolio's may be at risk for tens of billions of dollars in liability for fraud or for the intentional overcharging of tens of millions of U.S. homeowners.

According to the survey, the number one culprit in lender overcharging is a mortgage fee called a "Yield Spread Premium". A "yield spread premium" is a term for a fee that is paid as a kick-back to mortgage brokers for increasing the borrowers interest rate over the best rate the consumer could have received at time of the closing of the home loan. While mortgage brokers must disclose these hidden fees, mortgage bankers and or banks have no such requirement. What is astonishing about the bank/mortgage banker exemption from yield spread premium disclosure to the consumer is the fact banks/mortgage bankers like mortgage brokers get these kick backs too-they simply are not required to disclose them.

Of the over 1000 homeowners polled, less that 3% realized that the mortgage broker had received a yield spread premium/extra compensation on their mortgage transaction. Put another way, if a yield spread kick-back is received by the mortgage broker, the homeowner is now paying a higher monthly mortgage payment. The survey also discovered that far less than half of all homeowners receive the federally mandated Good Faith Estimate and or Truth in Lending Agreement within three business days of the homeowner making application for a home loan. In the instance of mortgage brokers; a yield spread is supposed to be disclosed on the Good Faith Estimate; but according to the survey results, it is disclosed less than 1% of the time. To make matters worse, the yield spread premium kick-back is rarely disclosed on a HUD-1 Settlement Statement as a "Yield Spread Premium", rather it is disclosed as a "POC Broker Comp" or something else as confusing to the consumer. The vast majority of consumers surveyed indicated that if they had known the broker was receiving this additional compensation that resulted in a higher monthly mortgage payment...they would not have gone through with the mortgage transaction with the broker. Again, for some unknown reason banks and mortgage bankers are not required to disclose their yield spread premium kickback to the homeowner even though they receivce them too. Many to most banks or mortgage bankers simply give the consumer a higher interest rate and pocket the extra profits with no disclosure. In this example the consumer gets a higher monthly mortgage payment and never knew it happened.

With respect to Yield Spread's, the survey concluded that lack of meaningful or understandable disclosure of the yield spread could mean tens of millions of individual law suits asserting the claim that the borrower never knew about the yield spread premium or kick-back for increasing the borrowers interest rate/monthly mortgage payment.In some states, this can get expensive because the borrower may be entitled to the difference between the rate that the homeowner deserved versus the rate the homeowner received multiplied by 360 payments.

As an example, a borrower received a 6.50% interest rate versus a 6.0% rate they could have received from the broker & the broker received his or her kick-back (perhaps thousands of extra dollars). The difference in the monthly payment was $100. The unaware borrower/possible victim may be able to sue for $100 X 360 in this example (the number of payments in a 30 year mortgage) and actually win. In this case, the recovery would be $36,000 plus potential legal/court costs. While no one affilitated with this survey is a lawyer, and while this is not an attempt to practice law/render a legal opinion, there may be case law to support tens of millions of individual yield spread lawsuits on the part of homeowners; especially in light of the fact that over 90% of consumers never even knew what yield spreads were or what they did to their monthly mortgage payment.

HUD's various statements on the topic are at best contradictory,unclear and very confusing. One thing that HUD has been clear about is that yield spread premiums must be disclosed to the borrower (unless you are lucky enough to be a bank or mortgage banker). The survey discovered yield spreads are not disclosed because 97% of the homeowners surveyed never knew what a yield spread was/what the yield spread meant to their monthly mortgage payment. Up until this point the mortgage industry has tried to explain away yield spreads as a fee the broker gets from the mortgage banker/bank so that the consumer does not have to pay for the costs associated with the mortgage out of their pocket/home equity. In fact, in the vast majority of cases we observed the broker was paid twice, once for their standard origination and other fee's and at the same time they were paid a yield spread premium kick-back for increasing the borrowers interst rate with little or no disclosure, or a disclosure that could be described as impossible for almost any consumer to understand. As a footnote...many in the mortgage industry refer to "yield Spread Premiums" as "back-ending" or "back loading" the borrower/the deal. Even banks and mortgage bankers use these terms...they simply are not required to disclose the "back-ending" to the uninformed U.S. consumer.

The survey also discovered junk mortgage fees and or needless and or duplicative mortgage fees are on the rise. According to the survey typical junk mortgage fees are "loan application fee's", "document prep fees", "loan discount fees" (with no discount),"funding fees","Table funding fees" and or "appraisal review fee's". In the strongest terms possible, the survey/study suggests that the Department of Housing & Urban Development should level the playing field for consumers and inact an immeadiate requirement that banks and mortgage bankers be required to show yield spread premiums on all HUD-1 Settlement statements & Good Faith Estimates, (as do mortgage brokers) along with a new requirement for a simple form signed by the borrower explaining the extra compensation from a yield spread to a broker, mortgage banker or a bank along with what this fee will do to a borrowers monthly mortgage payment. The study also suggests a $25,000 fine per occurance for duplicate or upcharged mortgage fees or poorly disclosed yield spread premiums as a way to deter this type of activity and or provide for additional consumer protection in the home mortgage process.

While the forgoing is a biblical type disaster for the mortgage industry that may rival or exceed the S & L Crisis of the 1980's, the other situation discovered may turn out to be just as bad. This newest survey/study contacted appraisers mortgage brokers & real estate agents nationwide on the topic of phony real estate appraisals and or appraisals that over-estimate a homes value. The results were startling. According to nationwide interviews of appraisers, mortgage brokers and real estate agents, 15%+ of all real estate appraisals puff up or overstate the value of a home.

According to those polled, the mortgage lender or the real estate agent calls the appraiser and says "I need a certain value on this home". (regardless if the homes value is in fact anywhere close to the desired value)If the appraiser refuses to do the phony/puffed up appraisal, the real estate agent or mortgage lender will simply find another real estate appraiser who wants the money for the appraisal, regardless if the appraisal is based on fact or in many cases fiction. The transalation on all of this is simple. This nations real estate markets may all have over-stated value. This suggestion is based on the fact that if a home's value was founded on false or inaccurate comparable home values, all appraisals and or notions of value might be impacted.

Members of the media are encouraged to contact local real estate appraisers, mortgage lenders and or real estate agents to verify our real estate valuation findings. It goes without saying that a real estate market that is not worth what it says it is worth puts at risk nearly every type of citizen, homeowner, financial institution and or pension fund in this nation. Once again this begs the question...where was the Department of Housing & Urban Development when all of this was/is happening? As for members of the U.S. House or U. S. Senate Banking Committee's...the question may be...How do they protect 75 million U.S. Homeowners when their biggest campaign contributers are the mortgage or banking industries?

The study concludes that of the current 75 million U.S. homeowners, 50 million plus were chagred yield spread premiums that were never disclosed or were poorly disclosed to the consumer. As a result we have 50 million plus U.S. homeowners who have paid or are paying a higher mortgage payment every month. For homeowners wishing to discover if they might have an undisclosed or poorly disclosed yield spread premium in their mortgage documents they are welcome, to contact the National Mortgage Complaint Center through our web site (Http://NationalMortgageComplaintCenter.Com/) for a thorough and affordable examination along with the names of lawyers or law firms that might be able to help them in their state. According to the study there are tens of millions of U.S. homeowners who may be owed thousands, if not tens of thousands each, because of the yield spread premium kick-back scheme. If plaintiffs law firms and or individual attorneys have an interest in possible individual yield spread consumer cases and or mass torts involving possible improper disclosure of yield spreads, they are encouraged to contact The National Mortgage Complaint Center.If you are a current or former employee of a mortgage firm, a mortgage banker or a bank that intentionally cheats or overcharges consumers we would also like to hear from you at the National Mortgage Complaint Center.

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A Buckeye

You may find this site interesting...

Those YSP'S may not show up on your GFE, as they may be called different things, such as points, origination fees, discounts, etc.

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Joe B
OK, I think I am confused. Whether or not a yield spread premium is disclosed, what good does finding out about it 5, 10 or 15 years after your loan is in place?

It doesn't sound like there's any recourse... The guy mentions a 'potential liability' of the difference each month times the number of months in the loan, but not if the loan has been in place for years. Either I am mis-read something or I am confused.

What do you do if you now find out that there was a YSP for your loan, or if you finally found out what a YSP is? I don't know of any case law out there that says this is an illegal practice for which compensation can be derived.

I still think this applies to people within days of closing, and exercising their right of rescission.

Maybe someone can help...

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You are correct...this information is for you to share with family and friend or in the future... (there is nothing you can do at this time for your loan) -to my knowledge...unless you want to report it to Banking and Finance Department within your state....

If you were not aware of it the YSP within 3 days after your loan application...they violated what is called Req Z...RESPA...

Let your family and friends that you know who are buying homes to be aware that the interest rate could be higher because the loan officer wants to make more commission...

You have a right to ask if they are getting a YSP (points) on your loan in the back end...

This is not A KICK BACK....(kick backs are something else and it's illegal).

Again...a lender DO NOT HAVE TO DISCLOSE THIS information to you on the HUD-1 or GFE...only brokers...

Have a great day!

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Consumer Alert: Unscrupulous Online Lenders Scam Borrowers

Would-be borrowers in the U.S. and Canada are being bilked out of thousands of dollars.

PC World
Thursday, October 25, 2007; 5:19 PM

Authorities are warning of yet another scam targeting online loan applicants. This time it's an advance fee loan scheme involving MortgageTree Lending, a company that is finding plenty of victims online.

Advance fee loan scammers typically request a would-be borrower to make a 10 to 20 percent deposit on the money they want to borrow. MortgageTree Lending is asking its customers to wire money to Canada to cover miscellaneous loan and finance charges, according to authorities.

MortgageTree Lendinglists its headquarters and central offices in San Jose, California. However, the local Better Business Bureau says no such offices exist, and a search of California's Department of Corporations turns up no records on MortgageTree Lending of San Jose.

Zach Vander Meeden, public relations director for the San Jose BBB, says complaints against MortgageTree Lending began on September 24. The BBB has received 14 complaints in the past month, and losses to victims total $20,000. Canadian authorities say they've also received several complaints about the firm.

Canadian law enforcement says that advance fee loan scams are finding new life as cash-strapped people with bad credit turn to alternative lenders who advertise online.

"When every traditional lender turns you away, people click onto the Internet and are surprised how easy it is to get a loan," says Louis Robertson, corporal in charge of the criminal intelligence analysis unit for the Royal Canadian Mounted Police.


"Now it seems really stupid to have sent them my money," says Lekiesa Willis, of Hope, Arkansas. Willis says she lost $1630 in advance fees when she was told by MortgageTree Lending that in order to borrow $5000 she would have to wire fees up front.

Willis found MortgageTree Lending in September when she typed in the questions "Where do I get a $5000 personal loan with bad credit?" into the search engine. She followed a link in the search results and was taken to a site that prompted her to provide an e-mail address and phone number. The next day Willis says she received a phone call from MortgageTree Lending asking her to fill out a formal loan application and fax it back.

At first she was told to wire $950 as an "insurance premium" and she would get that money back. Days after Willis wired the money, a MortgageTree Lending representative asked her to wire an additional $680 in taxes and fees. She wired the money and waited, and waited.

Willis says it's been hard to get in touch with MortgageTree Lending. When she does, she is told to be patient. Last week, Willis says, a representative of Mortgage Tree Lending called to inform her that her loan had been increased to $9000, and asked her to send an additional $860. Willis refused and asked for a refund. The representative told her it would cost $309 for a refund and it would take three months to have the money mailed to her, she says.

"I feel humiliated and defeated," Willis says. "Worst of all, I still need the money."

MortgageTree Lending representative Arnold Curry says the company has been in business for five years.

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SMURF, please stop spam'n

     I am glad you are active on the board, and many of the news articles are worthy of reading. However, many have absolutely nothing to do with the post they are under, and it just looks like plain old spam.

     Here's the problem.... If I look at a headline for a post, and the topic is bad lawyers, I don't want to read your news article about payday lenders. If you want to put in a new post with an appropriate heading, super! But having to filter through all your news articles to get to the issue that I have an interest in, is getting old.

     This morning for example, there were somewhere around nine or ten news articles from you trailing nine or ten different posts, and many of them had nothing to do with the topic they were filed under.

     I am not suggesting that you stop posting. Rather, I am just asking if you could apply some discipline in your posts. Would you consider changing the way you post so that the news articles have something to do with the post topic, or if not, start a new thread? It would make it much easier...

     Again, I point to this morning as an example. You posted about payday lending. I would have preferred to see a OT heading with the article. Rather than putting it in with a legitimate MSFraud topic.

     Maybe I am alone in feeling this, but I know it would help me tremendously in my fight if I didn't have to sort through all the off topic news articles to get to the topic that helps my fight....please!!

In the fight!!!
Quote 0 0
Thank You
for asking this person to stop this madness already.
I come onto the site to see what's up and all I see is Smurf. I think this is crazy that the MSFraud manager is allowing this take over.
I get fed up and go other places on the net to get caught up.
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Links are Great!

Some of this OT stuff is not as bad as not providing links to stuff. Why hide the links? Pi$$es me off.
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