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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An Editorial

Will we get resolution and restitution or band-aid solutions?

January 14, 2008

By Wendy Clardy (View author info)

Columbus, Ohio -

I was reading an article from The Plain Dealer News (Cleveland, Ohio) on the internet, and Chief Justice Thomas Moyer has come up with a plan concerning fraud, and predatory lending in Ohio; the focus is our economy, because it is at risk.

In the mean time, all attorneys in Ohio have been summoned to give their legal assistance for free to help the citizens of Ohio, that lost homes, and those that are on verge of losing their homes due to more foreclosures.

What is the catch? The attorneys were called to give free legal assistance to the people, but only assist "in general?" What types of help can an individual get that is in a crisis that is only in general? Is this another band-aid solution, to give the suffering Ohioans temporary relief, from deep cut wounds that need stitches? I don't think that a band-aid can help this one.

Moreover, is this help a part of the plan to show that somebody truly cares about what is happening to our communities and families here in Ohio? Or to show up the attorneys who once would not lift a finger to represent without big bucks, and excuse statements that a case is "too complicated" is now to have a heart and give for free their services.

According to Gabriel Baird a reporter who posted this article I read on the internet December 21, 2007, titled "Homeowners in foreclosure need free legal help, Ohio's top judge says" it is stated that Court Spokesman Chris Davey says, "This does not mean Moyer or the court believes lawyers have been slacking on this aspect of their professional code. Instead, it is more of a regular reminder of the importance of this work. Providing free legal counsel has been a professional ideal for lawyers going back centuries. Law schools across the nation encourage or even require their students to do some pro bono work."

There is a number for those to call if they are sure they are victims of predatory lending and/or fraud. I called this 1-877-244-6446 number for help on two separate occasions, there were two different representatives that I talked to about my surety of being a victim to predatory lending and fraud; this particular representative (name omitted) talked about a Senate Bill (185) that was passed January of 2007, and that there was only so much that could be done for my situation. In addition, that they were not helping those that had been victimized by predatory lending or fraud, prior to this passed law from January of 2007. Furthermore, it was stated that they are only helping those that are at risk/victims of predatory lending or fraud after this passed law.

The second representative gave me website information to to complete a complaint form after telling her that I was positive that my home was taken in foreclosure litigation by false claims and fraud 3yrs prior to the this law that was passed.

How can those that are put in position to be our leaders, and protectors justify their actions for turning their backs on the people, by bargaining for a general solution to a major epidemic that need justice and retribution? The individuals are being exposed for their "intents of fraud" and those with documents that can prove this fraud should be given monetary help for sustained injuries on the count of fraud and predatory lending.

We need resolution to a problem that had been in existence for many years; and prior to this law that was just passed last year. It is unjust to only help those that are at risk after a law has passed. It leaves one to think that since a law just passed against such criminal behavior, it was ok to steal our homes, because there was no law before, and those prior to that law are left to fall through the cracks?

To give general help to the masses is not enough to stop the domino affect of homelessness due to fraud and predatory lending that is happening everywhere. We the people need more than general help here in Ohio. We need serious intervention and prevention against those that have been above the law, allowing such matters as mortgage fraud and predatory lending to run wild without a mediator. We are only the consumers; we did not create this problem. The economy is bad because of the predators lending services; they are the ones that have all of our money.

We need more than a general fix it remedy. We need resolution, restitution, and not a band-aid solution. Especially, for those that have their documents to prove there has been a wrong done by our local, state and government leaders. We need a law that is in favor of the people, and a law passed to audit civil court records to correct the damage that have victimized our communities, families homes and finances, because of greed. The law was created to protect the people and to have justice, the law is not just for the rich, but it is for the poor as well.

Our top Judge in Supreme Court of Ohio has created various committees to carry out the basic principles of his plan. In the meantime, individuals that are in need are to call their state and local bar associations to be pointed in the right direction; or call the number stated above if you are certain you are a victim to fraud or predatory lending.

You decide for yourselves, if you are being turned away because you have had your house taken by foreclosure fraud, or predatory lending, prior to a law that have been passed in January of 2007. I have put my put my complaint in to see if there will be any help in my case regardless.

We need real solutions to defeat a monster that is on the loose, called mortgage servicing fraud and predatory lending--the intentions of the predators need to be dealt with. Restore our finances, our homes, our communities, and our lives back to us. We don't want another band-aid solution. We need justice, resolution and restitution.

For more information please refer to this website below.

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It's rather amazing to me to see just how many attorneys stepped up to answer not only the Ohio call for pro bono work but MA as well. The MA program had between 150 and 200 attorneys participate. The thing that really gets me, though, is that if these attorneys are willing to do "pro bono" work then why are they not willing to take many of the same cases on contingency and potentially get paid for their work?

Granted, not every case will lend itself to any recoverable awards but as we, as Mortgage Servicing Fraud victims all know, the potential for finding competent legal counsel to represent us has, at least up to now, been an extremely uphill battle.
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I'm thinking this kind of thing is developing as the result of being challenged
to stop the marauding lenders.

It is no coincidence that all these judges are dismissing cases.  Judges
have meetings too.  What can we do to stop all these foreclosures?

They are smelling something wrong in Denmark.  I am sure they are as surprised as we were when they challenged "standing" to sue the borrower.
You can only speculate why these cases were not refiled in a day or two
if everything was on the up and up.

It is probably a case of "Bad Faith" if they knew that they didn't have the paperwork to prove "standing".

It is not unheard of for Judges to get wind of some irregularity like this
and pull a bunch of past cases, same lawyers and same clients and go after

If the pleadings are false or fraudulent, the judge's decision can be
reversed by the Judge him/her self with an order for the parties to appear
before him/her.

There the borrower is again.  A new cause of action for a new lawsuit without a statute of limitations that expired years ago.

Those are the kind of holes in the armor that would help borrowers.

That is not to say they would ever do that but they can create a living hell for these people.

It doesn't take long before the same issues would develope in the same
state courts either.

I think this is quite a good thing and we should keep track of these cases.
If the people filing these suits can't prove they have standing on these recent cases, I would think the odds would be good to excellent that if old cases were pulled and reviewed, they'd never be able to prove they had standing.

It could be a way for borrowers to disgorge the profits of foreclosure right back to borrowers that were defrauded.

I love the word disgorge.  It paints such a vivid picture in my mind. 

Main Entry: dis·gorge
Function: verb
Pronunciation: (")dis-'go rj
Etymology: Middle English, from Middle French desgorger, from des- dis- + gorge gorge
transitive senses
1 a : to discharge by the throat and mouth : VOMIT b : to discharge or let go of in a manner suggesting vomiting <the train disgorged its passengers> c : to give up on request or under pressure <refused to disgorge his ill-gotten gains>
2 : to discharge the contents of (as the stomach)
intransitive senses : to discharge contents <where the river disgorges into the sea>

Since there is no magic bullet, we can still enjoy every time someone takes a stab at them.  Death by a thousand cuts.

I think I am quite grateful to cranky judges that want proof of allegations.

One step at a time.


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Gov. Martin O'Malley


LANDOVER - Gov. Martin O'Malley announced a wide-ranging plan Monday to confront an unprecedented rise in home foreclosures and combat predatory mortgage scams, including legislation to slow the minimum time for foreclosure from 15 days to more than four months.

The Democratic governor proposed new requirements for brokers and lenders to ensure that borrowers can afford the mortgages, changes to the state's foreclosure process to make it more consumer-friendly and a ban on the conveyance of property in so-called foreclosure rescue schemes.

O'Malley's administration also wants Maryland to become the second state in the nation, after California, to require that loan servicing companies file monthly reports about how many loans are in default and to document their efforts to help borrowers by refinancing or modifying the loan terms. State officials said there is a gulf between what servicers say they are doing and the actual assistance they are providing.

"We have heard time and time again that no one wins in a foreclosure," O'Malley said. "Well, if that is the truth, then we need the information so that we can tell which loan servicers are actually working with homeowners to actually stave off foreclosure."

O'Malley outlined his plan at a news conference on the front lawn of Velma Floyd, a Landover resident who almost lost her first home recently in a foreclosure rescue scheme, in which troubled homeowners refinance and are instructed to temporarily sign over the title of their homes. Floyd's broker is under investigation by state regulators and there fore wasn't named.

"We just want to keep our home, and we want to help others keep their homes," Floyd said.

Tens of thousands of subprime mortgages are expected to go into foreclosure in Maryland over the next two years at a cost of $2.7 billion in lost property value and $19 million in property taxes, according to the Joint Economic Committee in Congress. About one- fifth of homeowners with subprime mortgages in the state were late on their payments or in the foreclosure process during the three months through October, according to the Mortgage Bankers Association.

Foreclosures have risen dramatically across the nation since the housing boom deflated and many borrowers began contending with higher monthly payments as interest rates on adjustable-rate mortgages increased. Many of the troubled borrowers took out subprime loans, which are designed for those with spotty credit histories and come with higher interest rates to offset the risk to lenders.

"These are really, really tough times," O'Malley said. "We are seeing a national economic downturn and we are also seeing a real unprecedented crisis when it comes to foreclosures."

The administration also announced Monday the "Bridge to HOPE" program to provide interest-free loans of up to $15,000 so that homeowners can catch up on their mortgage payments and avoid foreclosure. Raymond A. Skinner, secretary of the Department of Housing and Community Development, said his agency has moved $400,000 from its existing budgets to be able to make the loans with state dollars.

The HOPE loan program, announced last summer by O'Malley, didn't meet expectations. It would have directed $100 million to assist hundreds of homeowners refinance, but only 14 homeowners have qualified. That program was funded through the bond market, so participants had to meet minimum creditworthiness requirements. The standards for the new, state-funded program will be less restrictive.

Many of the governor's legislative and regulatory proposals came from a task force that included industry representatives as well as housing advocates. Administration officials hope that collaborative approach will lead to broad support for the proposals.

One legislative initiative would extend the time between the start of foreclosure proceedings and the point at which the house can be auctioned, which is now 15 days. Under O'Malley's plan, lenders would have to wait 90 days from the borrower's default to file a foreclosure action, and another 45 days until the foreclosure sale. Lenders also would be required to send a notice to homeowners of intent to foreclose.

Kathleen Murphy, president of the Maryland Bankers Association, said that the foreclosure reforms codify what most "responsible lenders" already do. She said the new notices would prompt borrowers who are late on their payments to call lenders to work out a solution. She said that lenders lose on average $68,000 per foreclosure and that it's in their interest to help borrowers.

Another bill would require that lenders screen borrowers for their ability to repay an adjust able loan once the rate resets and verify sources of income. So-called "no doc" loans, which became known as "liar loans," call for very little or no documentation of income, such as tax returns or pay stubs. Many of those loans have gone bad.

O'Malley also wants a criminal statute on mortgage fraud and a ban on prepayment penalties for subprime loans, both of which would enhance current laws on the books.

Regulatory changes include holding brokers, lenders and servicers to a "duty of good faith and fair dealing," a standard of care. Thomas E. Perez, Maryland's secretary of labor, licensing and regulation, has frequently said that it's harder to get licensed as a barber than as a mortgage broker in Maryland, and one regulatory change would increase the amount of experience needed to obtain a license.

"You can be assured that person is qualified to give you a loan," Perez said. "That person would be required to look after the public interest rather than just lining his own pockets."

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Ummm.... Sixty Eight THOUSAND dollars?!?!?!?

So, assuming that every lender in MD goes into each loan knowing this information, there must be one hell of a heavy sigh of relief once sixty NINE thousand dollars is reached in equity in any given property.

Somebody PLEASE once and for all show me a line item breakdown of exactly HOW an average foreclosure action ANYWHERE IN THE UNITED STATES costs this kind of money and isn't recoverable by the foreclosing entity.

According to Kathleen Murphy, if I'm reading this correctly, $68,000 is spent over the course of a FIFTEEN day foreclosure process in MD?!?!? FOUR THOUSAND FIVE HUNDRED AND THIRTY THREE DOLLARS PER DAY?!?!? It took three years of active litigation for Fairbanks/SPS to amass what Matt Hollingsworth claims was 140% of the value of my loan in legal fees. That's a little more than double of what Ms. Murphy claims is spent in 15 days in MD.

Someone please correct me if I'm wrong in this line of thinking. I have to go check my blood pressure....

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