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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East Bay - News - Stolen Property?

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THIS HOUSE IS STOLEN. The words are spray-painted in what was once black along the sidewalk directly in front of 2122 Ward Street. It's old graffiti. Over time, sunlight and foot traffic have reduced it to a shade of gray only slightly darker than the concrete.  

But the message is unlikely to be overlooked. Just feet away, on the paved landing leading up to the steps of the gray, wood-paneled south Berkeley house, someone has stenciled DONT BUY THIS HOUSE in smaller, darker block letters. Just beyond, a six-foot chain-link fence encircles the rest of the property. Inches farther, on the same landing, are more stenciled graffiti: STOLEN PROPERTY and GIVE IT BACK and RETURN JIM & BRETT.

These unequivocal slogans began cropping up in the summer of 2005, just weeks after Jeff and Loren Toews bought Jim Hultman's house at an Alameda County trustee's sale. The Toews (pronounced "taze") brothers are retired NFL players turned San Jose businessmen who have made a small fortune in Bay Area real estate. It wasn't the brothers who "stole" the house, but they bought it after an unscrupulous mortgage servicing company foreclosed on the property — fraudulently, according to Hultman. That's why he thinks the new owners ought to sell it back to him and his partner Brett for what the brothers paid, rather than to a third party at the market rate.

The graffiti has served half of what appears to be its intended purpose: Jeff and Loren Toews have been unable to make a sale. They balked at Hultman's offers — and vice versa — but haven't found anyone willing to buy the contested property. The two-year stalemate has whittled away at the patience of all the parties: The businessmen have a high-six-figure asset that is now essentially frozen, Ward Street residents have an eyesore and a headache for a landmark, and Hultman and his partner Brett are stuck living at Brett's mother's house. Hultman, meanwhile, is at his wits' end, and by many accounts has become reclusive. The Express, in fact, was unable to track him down for a photograph to accompany this article.

The way Hultman tells the story, his despair is understandable. The house had been in his family since 1911, when his maternal grandfather bought the property. Seventy years later, Hultman moved in to care for his ailing grandparents, and inherited the property when they died. In August 2001 he took out a $170,000 loan with Aames Home Loan to pay off some property taxes and do a series of long-overdue repairs. At the time, the house was appraised at $850,000, but many of its parts — roof, plumbing, wiring — hadn't been replaced since his grandfather bought it. Hultman, an assistant property manager and home stager for local real-estate agents, planned to do most of the work himself.

About a month later, he got a call from a representative of Fairbanks Capital Corporation asking for his mortgage payment. This was news to Hultman, who insisted he'd sent his $1,200 payment to Aames earlier in the month. The Fairbanks rep politely informed him that the company had bought servicing rights to his loan from Aames, and would be managing his payments thereafter.

Confused and a bit suspicious, Hultman immediately went online to research Fairbanks, which was then the nation's tenth-largest loan servicing company, owned by the PMI Group, a publicly traded mortgage insurance corporation.

What he found frightened him. Roughly a dozen Web sites warned of the company's practices. Among the many grievances of fellow Fairbanks clients: The company charged them unwarranted late fees, demanded payments already made, and falsely stated customers' account balances. "I knew it was trouble," Hultman recalls.

Still, he figured there was little he could do except pay on time and keep record of it: "I went ahead making my payments. They were never late, and I always mailed them before they were due."

Hultman provided the Express with photocopies of his canceled mortgage checks from the time he became concerned right up through the date his property was auctioned.

Sure enough, the homeowner says, the company would occasionally claim his payments were late. "But I knew that was one of their ploys," he says. "I would just argue with them and just get it straightened out."

In November 2003, the US District Court of Massachusetts settled a national class-action lawsuit Alana L. Curry, et al., v. Fairbanks Capital Corporation. While the company admitted no wrongdoing, the lawsuit represented the first significant legal action by a regulatory agency against a large mortgage servicer. The $40 million settlement sent a mixed message to customers. While both the settlement deal and an accompanying order from the Federal Trade Commission demanded that the company reform its exploitative business practices, they also confirmed customers' widespread suspicions.

Hultman qualified for the settlement but decided to opt out. "I had followed the lawsuit against Fairbanks," he says. "Everything I read said, 'Opt out; don't go along with it.' If you stayed in as a class in the lawsuit, you gave up all rights to ever sue the company." In addition, the settlement made little financial sense. The $40 million in consumer redress was split among nearly 300,000 homeowners for an average payout of less than $200.

The following February, a man appeared at Hultman's door hoping to buy the house. Hultman had defaulted on his mortgage, the man said, and the house was in foreclosure. Bewildered, Hultman dismissed the man from his property. The last time he'd spoken with Fairbanks, the rep had told him his account was current. Moreover, he says, he'd received none of the documents that always accompany a foreclosure.

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Jeremy must've spent close to six months researching/interviewing for this piece. Probably one of the longest, most in depth studies of MSF from a retail/borrower's perspective I've seen. He even got Maureen McGrath's congressional testimony in there.

I've been watching Jim's story for a few years now. Even tried finding out who the owner of the house was. Probably one of the reasons that Alan Wolf doesn't like the internet...


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         I'm Jim, and it's my house  you see in the picture. I can't thank you (and MSFRAUD.ORG) enough for helping Jeremy with the story. He did a great job.  He gave me your message and I will be in contact.  So far we my wonderful neighbors have held them off selling the house to anyone else for almost 2 years now. Hopefully Jeremys article will be of some help! Again, thanks to everyone at MSFRAUD for their help and prayers. - Jim  & Brett
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Good to see you, Jim! I'm just sorry I wasn't able to find you a few years ago when I first heard about your case. Drop a line or give a call when you're up for it. You're not the only Fairbanks/SPS victim I know in CA. I'm looking forward to comparing notes with you...

Oh, for those who may not have realized it yet, this story is actually five pages long on the web.

This is an excellent example of why USFN and foreclosure mill law firms don't like the internet. Without it, mortgage servicing fraud victims wouldn't stand a snowball's chance of finding each other or educating John and Jane Q. about this issue.
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4 justice now

It appears the Toewse brothers are simply no better than the slime bags they are in bed with. They can all share their stories of greed with the MS Fraudsters while they burn in hell together, provided justice finally prevails.

Just my opinion. 



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