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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I ran across this little gem of case (Towery v. Select Portfolio - 05-7000) - it's Select Portfolio being Select Portfolio.  Only thing is, they tried it in Texas and it did not go over well for them in court.  In a 13 page Finding of Fact and Conclusions of Law, a judge for the Northern District of Texas Bankruptcy Court found that Select Portfolio willfully violated the stay, disregarded the Court and the express protection of Section 362 and should be assessed punitive damages for each major violation of the stay: for (1) the foreclosure; (2) the insulting notice to vacate and eviction letter; and (3) the eviction proceeding.  SPS was assessed $20,000 for each of the violations. 

One thing I have to say about Texas - Don't Mess with Texas (this is from a dead set Floridian).

If anyone would like a copy of the pdf, I would be glad to share.

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When was this?
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The judge signed it in April 2006.  So it's a little old, but still on point with they way SPS conducts business today. 

In this case, SPS foreclosed on a home after bankruptcy had been filed and SPS served.  The debtor filed an adversary proceeding against SPS challenging the Proof of Claim.  The judge requested a hearing.  At the hearing, the debtor presented evidence that her payments were never late.  SPS's representative could not explain the charges and fees on the account to the judge's satisfaction.  Additionally, SPS charged the debtor with forced placed insurance even though the debtor had presented proof that she had hazard insurance.  SPS further charged the debtor interest on the insurance at the rate of 11.20% per month. 

The judge, to say the least, was extremely irate with SPS.  He ruled that the debtor was able to present credible evidence while SPS could not. 

SPS has never changed its ways and most likely never will.  I am sure to come across many more like this.  I have only started delving deeper into this company.

btw, I am new to this forum, so feel free to let me know if you already know about this case.
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Alina and others:

Please email the documents to the cases you would like to have added to the Legal Lounge to and we will put them up.


We have the Towery v. SPS case and will put it in the Legal Lounge today under Faibanks/SPS.

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