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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Not sure if this has been talked about or mentioned before. If it has I missed it. Seems more and more people who aren't in foreclosure are just walking away in my area because the huge amounts proprty values have lost.

Just on my block in my neighborhood there is one person who is just walking away. They owe way more than what their house is worth and they are just giving up.

They have already bought a house two doors down and they say if the bank won't work with them they will let it fall into foreclosure.

Another guy I know owes $80K on a house valued at $20K now. He didn't refinance or anything. He just bought his house at the wrong time. He told me he has tried to work something out with the bank but they refuse so now he is searching for another house and if he finds one he will just let this one go.

I am also prepared now as well. It has been very hard to come to this conclusion but if the judge allows the foreclosure to proceed and we can't work out a fair agreement with EMC/Chase we are just going to give up and walk away as well.

We owe $50-$60K on a house now valued at 30K. All the equity lost in I would say record time.

I actually saved the tax bill this year and am going to keep it as a reminder of what went wrong in America.

They post the tax bills online for everyone to see so I thought I would share ours with everyone since its public info anyway.

2008 Market Assessed Value -  $171,890.00 -

2009 Market Assessed Value - $33,960.00 -

I knew our house was never worth $171K but we did have a little equity in it before all this happened.

So now the plan is to maybe find a small fixer upper house we can pay cash for and not have to worry.

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There is one problem with "walking away", it will follow you! 

Yes, you could buy another house but the judgement will linger and when you decide to sell the new house...bite.

Oh no, banks don't want to work with you...they don't have a damn thing to gain.  Now they can try to get you to rent the home you once owned, *gag* while holding a judgement over your head that makes it nearly impossible to even rent an apartment.

Honestly, I wish the government would have just let all of them collapse!  Yes, times would have been hard but...  I hate the fact that they cheat, steal, swindle and are given tarp money as a congratulations for a job well done!

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The Equitable One
I think the phenomenon is referred to as "jingle keys." It was getting some coverage in the media last year I believe (or at least 6 - 9 months ago) but I've seen little coverage of it since then.

Each party must act in his or her own best interests. Certainly paying more for something than it is worth is hard to view in a good or wise light. Would you pay $7.00 for a gallon as gasoline when the station is charging only $2.50 for it?

Of course walking away from a property in this situation is in the parties best interests, but it also contributes to the overall problem of declining property values. I say that as a mere statement of fact and intend no judgment whatsoever. Were I in that situation I'd likely walk away.

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Equitable One:  I agree with people hating to pay so much more for a home than the current values.  The only way out is to go bankrupt.  That is the only way the banksters can't come after you, well in theory anyway.

Either way, the outcome is very bleak.

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4 Justice Now
There's absolutely no reason for anyone to continue paying a price that was artificially inflated and completely based on fraud. We all know that if those in government did their job, and actually knew the meaning of the words... honesty and integrity they would direct us not to pay, or they would have already re-evaluated every ones mortgage to where it should be, if it were not for all the fraud. <br><br>After all, why should we just sit back and allow ourselves to be victimized further just because those in government have become too corrupt to do there jobs. Besides, if the law no longer applies to the bank's CEOs and the financial industry in general, why should it apply to their victims? <br><br>And just what have they done for all the hard working tax payers, who were forced to cover the cost of their intentional fraud and treason, to show their gratitude... They have given themselves enormous bonuses and have raised the interest rate on credit cards for everyone at a time when all but them are struggling just to get by. <br><br>IF THEY'RE TOO BIG TO FAIL, THEY'RE CLEARLY TOO BIG TO EXIST IN THE FIRST PLACE.  BESIDES, THEY'VE ALREADY FAILED IN EVERY WAY. THE ONLY THING THEY ARE GOOD FOR: IS DESTROYING LIVES AND STEALING OUR MONEY.<br><br><br>IMHO,<br><br>4J<br>
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Just imagine what would happen if enough people walked away.

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Stephen, that is exactly what is happening.  Entire neighborhoods in places like Detroit and in central FL are walking away.  Contractors are forced to just leave homes they are building at whatever stage. 

But if the entire country would stand together, it would make one hell of a impact!

4J: how true your words are!!!

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The criminals want you to walk away so they can create a new note to replace the fraudulent one.

Two days ago, a lady I know walked in on a Wells Fargo "modification" and found out they were NOT modifying the loan - they were writing a new loan. She asked the Wells Fargo lady: "Where is the original note on this house?" The Wells Fargo lady said she didn't know - and didn't care. So the scam continues.

Now a good lawyer could go in there and hold Wells accountable, but it is extremely rare to find a lawyer who actually understands this fraud, and those who do are swamped with cases.

So suppose the original note was destroyed. Then there is no proof of a debt, the people owe nothing and Wells, or anyone else, have a legal right to even be there. As a matter of fact, they are committing fraud.

Maybe the old note exists. That would mean there are two original notes on the same property. That is illegal too.

What do the lawyers say?
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   I learned alot at Neil Garfields seminar in Clearwater Nov1. Many people under stress need not walk away.
   What you do is send the servicer a "qualified written request" to identify the true Note owner. The servicer has 60 days to respond. If they can't answer the question, than you are in a strong position.
   While waiting for the answer, order a title search to find out the last legal recorded owner of the mortgage. Check with the State to see if it is still in
business and if it was licensed at the time of your loan. If the last lawful
owner of the Mortgage went out of business some time ago and if MERS is
involved, than you may not owe anything. You may have won the "death
gamble". This means the last lender went out of business BEFORE assigning
the mortgage!
    If this is the case, you stop making payments to the servicer since they
have no authority to collect on the debt. Next, you file an action to Quiet Title, which is the opposite of a foreclosure. In effect you are foreclosing on
the last lawful owner of the mortgage to wipe out the mortgage! You should
win by default, since there is no lawful entity to answer your summons and complaint. You'll probably need a lawyer to do this, unless you know how to use a law library. Unfortunately, in Florida, the filing fee is $900 so it is not cheap but it should be a winning case! If you win, you own your house free
and clear.
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MikeH, I envy you for getting to attend Neil's seminar.  Oh how I wish I could have gone!

Can someone actually succeed with this plan of attack even if the mortgage is recorded at the court house and available online?  I know many counties in FL have access. 

In my own foreclosure hearing, the judge felt it was evidence enough because the mortgage was recorded and had access to it through his computer.  The attorney didn't have the "wet ink" copy in his possession.

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A copy in the old days did suffice. In todays market the original should be presented. A judge who doesn't investigate where the original is should be had for treason...

I've gone back and fought them on this. That and fraud upon the court by an officer of the court. While I've been dismissed I know I'm right and their attempting to cover fraud at the highest levels. If you don't agree to their terms for the most part expect to have your home stolen! Even if you have bankers ready to spend $150,000 to $50m per month...So they belong in jail with NO HELP.

There's no difference. It's not like everyone is in these situations entirely on their own doing.
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That's right Digger the whole point of the foreclosures is to replace the fraudulent note with another to end the paper trail. That's also the point behind B.K. to get the borrower to validate a void contract, and the bailout to pay off "toxic" assets which we all know are criminally derived and unprovable.

Couldn't agree more about the crime being treasonous Top Gun especially at the judicial stage ignorance of the law is no excuse, complicity is even worse .

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We go to our first court appearance with our lawyer on December 28th, five minutes have been reserved.

This date has been pushed back many times now but is expected to go through this time.

Our lawyer asked for discovery on a number of things and the bank failed to provide anything meaningful.

It has been established they do not have the note but I fear the judge will put the foreclosure through anyway since we are in Lee county Florida and the rocket docket is still going strong.

We will have a court reporter there though so thats good i guess.

I think we have a good case since our previous mortgage service providers were Fairbanks / Select Servicing and now EMC but it all falls on the judge and what he will do.

That is my biggest fear now, the judge.

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The Equitable One

I dont mean to rain on a parade but loosing in Circuit Courts is usually what happens. I hope your case goes better than that.

Make sure your attorney is pleading the case, making the record, preserving everything that needs to be preserved, in order to appeal a loss in the lower court.

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Dear David Peters,
    You may have more equity than you think. According to Neil Garfield who
runs the Livinglies web site, if your Note was allegedly lost, it may not have
been lost at all. It may have been paid off in full by some unknown third party! You may have lucked out! It depends when the loan was made and
whether MERS was involved. If so, the Note was probably bundled together
with other Notes, and possibly sold ten times over in CDO's on Wall Street.
    The defrauded investors in these CDO's may have received TARP bailout
funds which means the government paid off your Note!
     Wall Street was running a Ponzi scheme which is still under investigation,
where they would sell the same "Note Pool" to several different investors
in the form of CDO's (collateralized debt obligations). So on a $200,000 Note,
the securitizer may have taken in $2,000,000. They used the money from the new investors to pay off the old investors. The scheme collapsed when new
investors got wind of the fraud and stopped buying into the program. When
that happened, the old investors were no longer getting paid and the whole
system collapsed into chaos, which is where it stands now. The government
had to step in to bail out the old investors which included pension funds,
money market funds and even foreign governments. Understanding all this
should help you in your defense. No servicer, who doesn't own the Note should be in Court trying to foreclose on you. The servicer has no standing.
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On the topic of "produce the note" is it still worthwhile doing this after a foreclosure sale has taken place?
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     The opposite of a foreclosure is a "quiet title action". If you were truly
defrauded by a "rubber stamping" Judge, you might be able to get your property back, but unless you know how to use a law library, you'd better
try to find a lawyer to do it for you. Check Livinglies. com to find a lawyer
near you who "gets it".
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I am desperately trying to find an attorney who "gets it"! There are no lawyers for my state on Living Lies so I have put a call in to them. Waiting for a call back in the hopes they can refer me to someone.

A friend just sent this to me - same state:

Hopefully, this will set a precedent.

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I cannot believe how much time has gone by since this post.

All of 2010 was pretty uneventful with our foreclosure case. Our lawyer filed a couple times asking for discovery which they never produced. She even filed sanctions on them once towards the end of 2010 and it was granted. The banks lawyers had to pay a $500.00 fee to our lawyer and also they had 30 days to respond. They paid the money but never responded adequately to what we asked for.

Then in early 2011 a trial date was set for Feb. 14th, time reserved for the trial, 15 minutes.

We met with our lawyer yesterday and she told us she would argue one of the assignments is dated wrong and another was missing.

The good news is that today the banks lawyers dismissed the case. I don't know why they did but they waited till the last moment and did.

I am somewhat happy but still somewhat wondering what happens now.

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I can tell you why - Yours was one of tens of thousands of cases involving fraudulent assignments.  It was cheaper for them to pay the sanction because they most likely could not produce meaningful discovery.  Ask your lawyer if it was dismissed without prejudice.  It most likely was and they will return again once they think they can adequately respond to your anticipated discovery demands.

You might want to lets folks here know what state you are in, much is being discussed with respect to fraudulent assignments which will help if there is a round two.
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It was dismissed by the banks lawyers without prejudice.

I am in Lee County Florida and things here are bad. They are scheduling just 15 minute trials but the hundreds. On Monday for our court date there are 40 cases scheduled for trial.

Ours was dismissed so I guess that will be one less.

Another thing I am hearing is that the banks lawyers just aren't even showing up and the cases our getting dismissed. Our lawyer said she had a case in January she won because the other side didn't show up. Another friend of mine said his boss's foreclosure case was dismissed as well because the other side didn't show.

I think maybe things are starting to change but I feel so bad for those that don't have lawyers and those that have already lost their houses.

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Please keep fighting the banksters cooked up this scheme so they could create highly leveraged assets keep most off the books and blame the borrowers.

We here at the forum knew taxpayers would be left on the hook and it would drag the entire economy down.

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Lee County, home of Edison's winter retreat, the fast boat to Key West and a foreclosure hot-bed.  Your end game is the court granting your Motion for Summary Judgment with prejudice which means they can't ever come back for another bite of the apple.  Be sure you and your lawyer are fully up to speed with all things related to assignments. 

I suspect that Mr. Roper will be along soon with an authoritative lists of what to look for.  If not it is all here.

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Maybe this is the reason the Bank lawyers are not showing up. They are being fired !!! Yeah
When will be Florida Default Law Group turn ?

Palm Beach Post- Fannie Mae fires second South Florida law firm

February 11th, 2011 · Foreclosure

(I wonder what happens to all those files that got transferred? So much for that swarthy swagger I saw in court yesterday, the mill attorney proudly asserting the right for any old party to foreclose, picking up files and arguing for one firm after another, just having a field day in the courtroom…a real grand pooh bah.)

Federal mortgage giant Fannie Mae has cut ties with a second South Florida law firm handling its foreclosure cases, requiring an immediate transfer of those files to other attorneys and likely causing more turmoil in the state’s foreclosure courts.

The termination of its relationship with the Fort Lauderdale firm of Ben-Ezra & Katz, P.A. was announced today in a notice to loan servicers. The notice says payments to the firm should be stopped immediately and gives servicers a Feb. 15 deadline to find new firms to handle the Ben-Ezra & Katz files.

(Full Article)

Fannie Mae fires second South Florida law firm

Palm Beach Post Staff Writer

Federal mortgage giant Fannie Mae has cut ties with a second South Florida law firm handling its foreclosure cases, requiring an immediate transfer of those files to other attorneys and likely causing more turmoil in the state's foreclosure courts.

The termination of its relationship with the Fort Lauderdale firm of Ben-Ezra & Katz, P.A. was announced today in a notice to loan servicers. The notice says payments to the firm should be stopped immediately and gives servicers a Feb. 15 deadline to find new firms to handle the Ben-Ezra & Katz files.

"Fannie Mae has become aware of certain document execution issues at the Ben-Ezra law firm regarding its processing of foreclosure cases on our behalf," said Fannie Mae spokeswoman Amy Bonitatibus.

"It is our expectation that law firms will handle matters in strict compliance with proper procedures, ethical codes of conduct and legal requirements."

Ben-Ezra & Katz has represented banks in 508 Palm Beach County foreclosure cases in the past two years where the homes were ordered to auction.

In a statement, Ben-Ezra & Katz said it was disappointed and surprised by Fannie Mae's decision, and that the issues Fannie Mae is referring to were technical paperwork problems that the firm is correcting.

"When problems of foreclosure files surfaced last fall, we hired an outside law firm to conduct an audit of our processes and procedures," the statement said. "It is ironic that in trying to make sure we were doing everything correctly, we reached this position with Fannie Mae."

The move by Fannie Mae follows its November firing of David J. Stern's Plantation-based law firm, which is one of four so-called "foreclosure mills" under investigation by the Florida attorney general's office.

Ben-Ezra & Katz is not one of those firms, nor was it included in a more recent attorney general query of three additional firms regarding their foreclosure practices.

Staff Writer Christine Stapleton contributed to this story

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