THE MINDSET OF SOME FEDERAL JUDGES IS DISCONCERTING …

(OP-ED) — 

It scares me when I have spent hours upon hours doing research into the behaviors of the American federal judicial system and after fully digesting the U. S. Supreme Court cases of 07-1015_Ashcroft v Iqbal and 05-1126_Bell Atlantic Corp v Twombly et al … I find it a bit disconcerting when I talk to attorneys about their experiences in federal court and they tell me that suicide would be a better alternative.

From recent white papers I’ve read on the subject, legal scholars have pegged the federal judiciary as nothing more than glorified “case managers” … and the most recent article posted by the American Bar Association confirms my suspicions when I read that judges now want to eliminate discovery in cases involving less than $500,000!  The average homeowner’s residence in this country is less than that sum, so what does that say for your due process rights in courts of limited jurisdiction, which the federal courts are?

If this was not a significant assertion, made by a 3rd U.S. Circuit Court of Appeals judge at a Federalist Society panel last month, I would have dismissed the white papers I read as speculation backed by demonstrative case law.

(Hon. Thomas Hardiman)

This judge received applause for his remark to the panel when he said, “If I were to do something unilaterally, I would probably institute a new federal rule that said all cases worth less than $500,000 would be tried without any discovery.”   Another 6th Circuit judge, Hon. Amul Thapar, another judge said to be on President Trump’s short nominee list to the Supreme Court, said that clients and their lawyers would both be happier if they could get to trial more quickly, to which Hardiman added that because vanishing jury trials in federal courts are more common, judges have put increasing reliance on alternative dispute resolution, stating, “How many clients win, and the judgment they earned was less than the fees they paid their lawyer?  That’s a Pyrrhic victory.”

What then does that say for the idea that banks are so willing to remove foreclosure cases to federal court because they already are aware of the outcome (a 12(b)(6) dismissal)?   Yet, homeowners are so eager to file cases in federal courts using federal questions and statutory violations like TILA and RESPA, when the actual damage suffered has yet to be determined.

Other judges attending the panel discussion also noted that federal rules already require that discovery be “proportional to the needs of the case”. Others stated that “discovery is a key element of our current adversarial system, often leading to obtaining evidence of legal violations via admissions in sworn testimony, smoking-gun documents or memos that demonstrate wrongdoing.”

While the federal system has apparently recognized abuse in the discovery process, their roles as case managers appears to be expanding so they can rid their dockets of garbage lawsuits, citing one means of doing so is by implementing a civil Brady Rule, which basically promotes the idea that in civil litigation, the parties would have an affirmative obligation to turn over discovery, even if it’s harmful to them!  Under the status quo, such damning evidence might get buried under a pile of evidence like “a needle in a haystack”.

This would imply (at least to me in my non-lawyer mindset) that I’m not going to get a fair shake in any federal court anywhere in the United States of America because everyone’s simply looking to find ways to chuck my hard work … case in – case out … by applying case management standards, mediation and when necessary, applying the “big stick” of sanctions if I insist on my due process rights to discovery.

It’s no wonder the banks play their crooked games in state court.  They know they’ve got a “back door” if the homeowner responds with removal to federal court or comes forward in the state court action with something that could hang the banksters and their lawyers out to dry. When threatened, the bank’s lawyers remove the case to federal court, because most cases involve an out-of-state lender and/or servicer and an amount necessary to sustain diversity jurisdiction ($75,000).  This is why class actions are starting to be frowned upon at the federal level.  Boutique law firms can get rich off the backs of our dilemmas!  Examine the number of FCRA and FDCPA actions being filed singularly versus class action and you’ll see what I mean as to the treatment they get.  And these are statutory violations that mandate federal district level filings!

Lazy man’s way out, I say!

If no one wants to get to the truth, why do we keep supporting this federal justice system by electing folks who nominate and vote them into permanent judicial status, giving them loads of inherent power, when you can’t get a fair shake?   What a waste of tax dollars!

It’s a Catch 22 of “feeding the monster” that at a point in time will devour us! This is why I advocate keeping your cases on the “local level” and letting “the system of things” do what it’s supposed to do.

 

 

 

 

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AMERICA’S HOUSING CRISIS, LIKE EVERYTHING ELSE, IS THE GOVERNMENT’S FAULT!

(OP-ED) — The author of this post is a consultant to trial lawyers handling chain of title and foreclosure matters and thus, cannot render legal or financial advice.  This post is for educational purposes only. 

I was reading a news article in the local paper by a local columnist entitled, “There’s no place for you here …”   The article basically pontificated that low and middle class workers cannot afford this area’s housing market.  If what that columnist said were absolutely true (and I debate his viewpoints in so many ways), whose fault is that?

America continues to face a housing crisis that state governments could create a master plan to solve, yet nothing obvious and straightforward is being done.  We all think that our elected congresspeople and senators in DC will do something about it, since the issue seems to be promoted as a national issue and not a state one.  Not so in my book because it’s all become politically relative.  Politicians simply say what the voters want to hear, whether what they say means anything or not.  The system is rigged to favor the elected and not the body politic.  We need to wake up and face that fact.

THE FORECLOSURE CRISIS CONTINUES TO FUEL THE HOUSING CRISIS … AND VICE VERSA

The “American Dream” has brought with it a ton of lobbying by the banks and their minions and history has shown us the “American Dream” has brought with it a ton of scandal, including the illicit manner that continues to happen in every county’s land records: manufactured assignments.  This garbage is the by-product of Wall Street and its desire to make itself rich through securitization, off the backs of investors and borrowers alike.  Because the laws that are legislated into existence seem to favor the banks and the oligarchs that run this country, a number of ideas are contemplated here:

  1. The politicians that run this country, BOTH Democratic and Republican, have notions in their head that they think they’re better than we are.
  2. Every two to four years, we all get to watch them smear each other on TV with negative campaign ads that frankly unzip the fly of dysfunctional governments at both state and federal levels.
  3. The two-party system rightfully caused this mess and the mess won’t stop until “the system of things” is changed in favor of the people and not in favor of politicians, who get to live out their retirement better than we Americans could ever have it, if we even get to retire.

Despite what you’re reading that is spewed from spoon-fed, government sources, fake news or not, foreclosures are continuing, whether in record numbers or not … and talk about a resolution to this mess is cheap in DC.  With the CFPB (or whatever “new and improved” acronym they want to apply to this now-seemingly worthless bunch of bungling bureaucrats) being watered down, aggrieved consumers can now stop turning to the U.S. government for answers and resolution because it won’t be there for them.

Our problem is … we depend too much on government to be our savior because the government has a bad habit of promising everything, but not without strings attached.  The banks have made sure of that.  Thus, securitization is back in full swing again and the same people who got stung by the last housing crisis are the first in line to apply for their MERS-originated mortgages … rinse and repeat.  Drink the Kool-Aid … rinse and repeat.  People who are ignorant of history are doomed to repeat it. 

This means more theft of homes, more trashed out and worthless chains of title and more shadow inventory being kept off the books, thus skewing the real numbers of  what’s being illicitly taken … and taken for granted … maybe we don’t have a crisis after all … ahhh … but we do.  And it’s not going away any time soon. As long as builders are building unaffordable homes (homes with a market value of over $250,000), this will force Americans to have to borrow more and drive them deeper into debt.  This is the typical Catch 22 syndrome of the mistakes we made in the last housing boom. Until builders are reigned in or people stop drinking the Kool-Aid, it will be status quo in America. The state and local governments could change that, but they’re not doing anything worth mentioning.

THE “CLASS SYSTEM” GAP IS EXPANDING IN AMERICA

I live in a county where retirees (some with accumulated wealth) comprise better than 25% of the population.  Home building permitting is at a standstill because of the backlog of builders coming back into the picture and the government has complete control of what these builders do, what they build and who they employ while building what they’re building.  Because permitting is taking so long and counties are becoming more particular about construction and design issues as well as code enforcement, the cost of housing becomes the victim of cost overruns.

Only one “affordable housing” project has been contemplated for this area and surprisingly, the home builders who are continuing to build “upscale” housing are part of the debate to limit that type of housing because of the “riffraff” it brings with it.  No one said anything about building “projects” here, as if that has some sort of negative connotation attached to it.   These builders however seem to forget that if only the wealthy people can buy homes in this area and rents are too expensive to support the lower income and middle income families, there won’t be any labor force to accommodate the service businesses needed to wipe the noses (and asses) of the rich people.  Yowsah! Yowsah! Yowsah!  I’m perturbed by this, because I used to own/manage/work in the restaurant business for many years and I can tell you how unpleasant things can get when people who have money take people for granted who are just trying to keep up, absent the snobbish behavior.  I must be a black man trapped in a white man’s body because there are days I wake up and I feel like a “slave to the riddim”.

And I’m not being facetious here.  I’m one of the lower to middle class, just like most of you.  Sure, I have my “American Dream” but it’s different from yours.  I do not support the DC behaviors.  Deep State is counterproductive to forward-thinking government progress because it seeks to disrupt change for the better.  I do not support the two-party system because of what it’s done to America.  I am non-partisan in my thinking here.  I have to be.  We all need to be realistic for the moment because our “spending habits” (Americans are deeper in credit card debt than ever before), which are created by the spending boom that occurs with “holidays” like Black Friday, fuels negative habit patterns that will drive lower to middle-income wage earners deeper into the abyss of debt and make them less likely to be able to even afford to rent because they’re too consumed with their “comfort zones” (what it takes to make us happy in the short term).  Americans rarely ever save (unless they’re rich and they can afford to save) and most live paycheck to paycheck.  What’s in your wallet?  More month than the end of the money?

So if you were fortunate enough to have been born into wealth or accumulated it through investing and working smart, then you can certainly understand what might be in the mindset of that waitress or waiter that takes your order the next time you go out to feast at a corporate restaurant chain because all of the mom and pop operations have since become scarce due to the way our economy has made it unaffordable to start competing small businesses … and yes, not without strings attached … again.

Our state and local governments have played right into this scenario by not mandating affordable housing as part of their “master plan” (albeit Multnomah County/Portland, Oregon is attempting a stab at it) in subdivisions that still provide decent living standards for lower to middle income families with homes priced between $50,000 and 100,000.00!  The success of that program remains to be seen.  The days of the McMansion are gone thanks to the new tax laws that limit the amount of property taxes that can be deducted on a 1040 tax form.  You can thank your DC bunch for that. Only the rich will be able to afford them … and with that … comes a whole different set of problems and risks.

Coupled with the foreclosure crisis, anyone attempting to buy shadow inventory at a discount risks legal battles (prolonged quiet title actions for example) that could prevent them from actually getting a bargain, unscathed.  This includes investors that are trying to accommodate the poor in making housing affordable.  There is going to have to be consideration factored in for rents, because what people will be able to afford will be way less than what the rich can afford.

There is further conflict in reports of whether millienials migrate to the inner city because of job growth or in the alternative, move out into “the ‘burbs” because of space and security.  While one study says millennials can’t afford today’s housing because they don’t save, live from paycheck to paycheck, continue to rely on mommy and daddy when things get tough and are least immune from impulse spending … another study says they’re just fine if they want to move to suburbia and that most of them are, according to studies.  The disinformation campaign isn’t helping matters much because it means more gobbledygook to wade through to get at the real truth.

The influx of foreign workers into this country isn’t helping our economy much because jobs are being created to accommodate those who will work for less.  This is forcing the class system in America to widen because the rich are paying this influx lower wages so they (the rich) can make more money.  Many workers who have migrated into the U.S. seek jobs that pay cash; thus, they pay no taxes, yet they get social security benefits and free health care, which someone else has to pay for.  The two-party system sees this as a means to an end … to woo more non-citizens to become voters so they can vote for the “party”, who influences their choice.  In the meantime, you saw what banks like Wells Fargo did to “encourage” migrant illegal aliens to open bank accounts.  The banks are supported by the U.S. government.  The servicers who work of the banks lie, cheat and steal in the name of the banks, taking property away from hard-working Americans using servicer-manufactured documents containing false and misrepresentative declarations.

WE HAVEN’T EVEN APPROACHED THE IDEA OF A CASHLESS SOCIETY YET

What the banks really want is a cashless society.   Many in the U.S. government support this idea.  Why?

  1. It’s a way to gain personal control of every hard-working American, forcing them to do transactions using a debit or credit card.
  2. Every transaction of the type identified in #1 is already being monitored by the U.S. government (FINCEN) and the private banking sector.
  3. It reduces the amount of goods and services sold and traded in the underground economy (or so they think).  It would actually promote and increase (incentivize) participation in the underground economy, more in rural areas than in the major cities.
  4. The U.S. government can simply take earned “credits” right out of peoples’ bank accounts any time it wants to, for taxes, child support, etc., leaving the individual with nothing to live on.

No one would want to migrate here after a move like that because illegals work for cash.  If no one possessed fiat “cash” (M1) then privacy rights would be completely removed.  By tapping into a bank account, the government could purposefully screw with anyone it wanted to, knowing exactly how much an individual is “leveraged”.  How in the world do you think the writers of Enemy Of The State fathomed this story line?  Do the writers know something we don’t?

When an individual can’t eat and feed his family because his “line of credit” or cash flow is suddenly cut off, what do you think will happen?   A classic “have not” scenario.  He takes from the “haves” by whatever means possible.   You really want to live in a society like that?  America is already ranked as one of the most dangerous places to live by Atlas & Boots and Forbes Magazine.  A cashless society would make a bad thing worse because the police cannot stop random acts of violence when they themselves could become instant victims.  No amount of deposited “fiat credit money” can stop a rebellion or even a full-scale revolution, which is what you’d have if the government insisted on going this route. The major cities would turn into blood baths.  I’m not being paranoid here.  Think about what you would do if you had to face this situation head-on.  What would you do?  After all, you gave the government your tax dollars and you voted for all of these politicians who loaded your “Government By The People” with hundreds of layers of bureaucracy, some of which has broken off and become a part of Deep State.

DO YOU SMELL SOCIALISM?

I majored in political science and journalism in college; thus, I posit the following scenario:

Imagine taking all of the money away from the rich and passing it around to all of the poor to fund the services necessary to accommodate the influx of non-citizens into America.  The poor will spend through all of their newly-found gratis like shit through a goose (an old saying of Gen. George S. Patton) and will then expect MORE.  Now there’s no future for American businesses because the wealthy will not be able to support their businesses and expand their businesses to accommodate more employees because they are broke (or taxed into non-existence), just like the rest of us.  This is why socialism hasn’t worked wherever it’s proliferated because someone has to pay for the “nanny state”, which the government created with your tax dollars. Socialism begats authoritarianism, which begats communism.  The result of communistic behaviors promotes crime (e.g. the Russian mafia, etc.) in order to circumvent and deliberately retaliate against government behaviors.

Everybody likes free stuff!  However, someone has to pay for the services that illegal immigrants are receiving in this country.  Someone has lost a job to an illegal immigrant.  Someone died at the hands of an illegal immigrant.   And more than 5,000 people are trying to get into this country illegally and the whole mess at the San Ysidro border crossing has been politicized to the point of nauseation.  No one is a racist just because they are implementing the laws that are in place in this country.  This is what the executive branch of our federal government was designed to do.  Blame our founding fathers for even thinking that we should all be safe and secure and live in peace and freedom.  Now I’m being facetious.  Depending on which political party (of the two) you belong to, you see 5,000 new voters, voting towards socialism and getting free stuff, or you see 5,000 new voters sucking off the teat of America and at some point in time, someone will have to pay for it. But how?

INCREASING TAXES PROMOTES REVOLUTIONARY IDEAS

Yes … just like in America’s Prohibition Era, whenever taxes were increased, people went underground to survive and the shadow economy flourished.  History has not changed.  U.S. government economists (like Bruce Bartlett) and socialist think tanks are still trying to figure out how to bring the shadow economy under control so they can tax it … yeah, good luck with that.  And who profits from all of this?  The banks.  After all, their “fed” is the one who keeps “loaning money” to the government, so it can continue to write checks its body can’t cash to support “nanny state” philosophies.

People seem to forget how history repeats itself.  It further seems to me that we got into a war with the British over a 3% tea tax, right?

The big outcry at the time was taxation without representation.  Think about the 23 taxes you pay on a loaf of bread and tell me that this country is not the frog swimming around in luke warm water. Unbeknownst to him, the master of the fire is turning the heat up to gradually boil him alive! Think about that the next time you have to pay for someone else’s direct benefit to your detriment (you’re broke again?).

TAXING APPROPRIATE SOURCES

Colorado and Washington State have discovered just how much extra revenue the recreational marijuana business brings in.  The federal government however, ironically doesn’t want to allow marijuana businesses to have bank accounts that the government can get legitimate tax gains from.  The irony of it all is that banks are great sources for laundering drug money, aren’t they?  When people who buy controlled substances like marijuana use cash they’ve taken from their pocket or their bank account, give it to a drug dealer in exchange for pot, who then uses those funds to go out and buy basic necessities to live on and spends the cash right back into the mainstream economy … that money ends up getting deposited into someone else’s bank account at some point in time down the road.  Yet, those in government that have created all of this “reefer madness paranoia” legislation seem to believe that the banking system Uncle Sam borrows from (and then spends it like a drunken sailor) plays no part in it; thus, the government shouldn’t be held accountable, even though it provided the vehicles and the mechanisms in which buying drugs is facilitated.  People pay for drugs with cash … not a debit or credit card.  Any cash can be “laundered” no matter what source it came from, even if legitimate.  Our foolish government could be taxing pot sales at all levels but the politicians won’t listen to the voters, will they?  And that’s just one area that the politicians who allegedly run this country aren’t listening to … or if they are listening … they don’t care and they vote the way they want to vote.  If they want to keep pot illegal, despite what the voters want, they’ll keep pot illegal.  This is another prime example of the way our government is to blame for its failure to counterbalance revenue shortfalls.

THE “CLASS SYSTEM” GAP FUELS THE CRIME RATE

And just when you thought that a cop shooting an unarmed “African-American” wasn’t bad enough, I still maintain that when you displace a family on the street … and the head of household runs out of options, you end up with more murder-suicides, suicides, death by cop and crimes against property when the system can ill afford to maintain law and order in the present day as it is … all because the local government, which has every means to change the environment in every one’s favor, still wants to make its “master plans” cater to those who can afford it.  It doesn’t matter what race, color or creed you are!  The biggest mistake facing America today is allowing the class system “gap” to widen. By allowing the class system gap to proliferate throughout America, the scales could tip to the point that when there’s nothing the “have nots” won’t do to take from the “haves”, we’ll end up in another civil war (regional in nature, maybe) … and it’s our state and federal politicians that have widened this gap … so they can come in and play nanny state.  The widening of the gap promotes the idea that socialism will fix it, which is false (if you’ve studied economics).

When it comes to a prime example of how easy it would be for civil insurrection to occur, visit an area that’s been placed under martial law (you may not see eye to eye with me on this).   Here’s a mild example … go into any hurricane-affected area and see how the government treats the locals.  Why was Blackwater brought into New Orleans following Hurricane Katrina?  To prevent armed insurrection … because that’s where the city was headed. Anyone who has been through the “Superdome” experience can attest to that. When disaster strikes, what’s the first thing the “have nots” do?  Loot!  It never ceases to amaze me that “have nots” would grab TV sets while looting a disaster area when the electricity is out.  You can’t eat or drink a TV.  You really think the pawn shops are going to accept stolen merchandise, just so you can have a cheeseburger?  The “have nots” come in every race, color and creed.  If they have no money and they’re hungry, what do think they’re going to do at the first opportunity? (I’ll let you figure that one out.)

When the 2008 financial collapse occurred on Wall Street, then-Secretary of the Treasury Hank Paulson was calling congressmen telling them that if they didn’t bail out the banks, martial law might have to be declared.  You see how the government’s mindset behaves when a disaster strikes. Hence, TARP was created.  Even more sadly, most government employees believe everything their government tells them!  That’s how the government gets more support for its nanny state policies!

THE FOUR MOST IMPORTANT BASICS IN LIFE: FOOD, WATER, SHELTER … AND A WAY TO MAKE A DECENT LIVING

If you’re employed in any one of these first three areas, you will always have an income because everyone needs these three things to survive in America.  This is no longer the American Dream but the American Nightmare.  Anyone living under substandard conditions will agree with me that the family unit is in jeopardy.  Tempers flare because of lack of money or the sudden shift in any one of the basic three things needed to survive, which includes being displaced from your home.  I wrote about this in Clouded Titles.

Now that I’ve painted a minuscule picture of  “the ghost of things to come”, we need to take a stand (at least on our own behalf) to take all of these factors into consideration … and then do something civil about it.

FOOD

I find it best to research one of the basic first three areas and find a niche within it.  I know a lot of people that are resellers for survival foods.  I know fewer who have actually now resorted to truck farming (it’s also an underground economic niche and can be very profitable) and I used to help pay my mortgage payments on my first home with a hen house full of laying hens (eggs are great barter material too).  In order to accomplish all that, you might think “country”.  There is a lot of unrestricted land out there and folks living in these areas tend to think a lot alike (they don’t like big government) … something the U.S. government doesn’t like.  Whatever the government doesn’t like is probably a great thing for America because anything that happens in the hinterland benefits the local economy, not DC.  All of the possible changes you could employ to affect a positive outcome for your local economy are a good thing, even if you’ve been foreclosed on and have to start over again.   There are areas of the country where land is still cheap and food production is in demand.  Even in WWII we had “Victory Gardens”.  Flea markets are a great source of networking!  Food trucks can also be a profitable business if run right, albeit you’ll be facing permitting issues and health regulations.

WATER

I cannot believe that people have actually run afoul of the law for harvesting rainwater.  However, it’s a great source of income.  Who would have ever thought that putting water in a plastic bottle and selling bottled water would ever work?  Whoever did is making a killing now because the well hasn’t run dry and the merchants have made the bottled water industry a necessity of life, even if it means you have to dispose of something that’s not biodegradable. With our water supplies / groundwater becoming contaminated (see Flint, Michigan), water filtration systems is also another big business that the wealthy certainly can afford.  Even smaller supply, pour-over systems sell well during hard times.  Man cannot live without water … so getting into any business that involves the production or supply of clean, potable water is a good thing.

SHELTER

Your PLAN B might include doing what I did in buying a tract of land, owner finance. My payments were $222 a month for 10 years.  Even on a fixed income, pulling a used mobile home out onto a tract of land works, especially if it’s paid off.  I used an investment return to pay for getting set up on 3/4-acre mortgage free.  Just to show you I’m not kidding, see below (front and back yard).  I was only 40 minutes from Austin, Texas!

This is what mortgage-free living can look like, if you have a PLAN B that you can start up on a small budget without having to get a mortgage. Anything relative to setting up shelters for people on unrestricted land out in the country is a good thing.  We had German Shepherds roaming the property so we never had to worry about break-ins.  It cost me less than $15,000 out of pocket to set up!   You could even do it for less with a little creative thinking!

It is amazing what you can find out there to live in, it’s peace and quiet country living … and you could put your property into a trust for asset protection to keep it away from the money-grubbing banksters or debt collectors trying to collect on judgments!  Sure, it’s not a McMansion, but it’s home and it’s a stress-free environment!  It’s also far from the madding crowd … so in the event of unrest, you’ve got more time to plan and react if you need to.  Anything connected to real estate … agents, brokers, investors, developers, storage sheds, portable buildings (which can be converted into housing) and cabins … can be profitable with a little marketing. Any carpentry skills become a real plus!

MAKING A DECENT LIVING

Retirement is NOT a part of my vocabulary. I don’t see what the big rush is to retire anyway, given the fact that the government would like you to wait until you’re 70 to start drawing Social In-security. Besides, any business worth having means that an entrepreneurial spirit is probably alive and well and is driving the business forward.  If you’ve lost your regular job (or you think you might lose your job), this is the time to start planning for your future.  An active LLC or incorporation costs next to nothing to set up and consulting businesses (like mine) take a lot less money to start up.  There are books out there that have oodles of information in them on how to start your own business. Find something you’re good at and go for it.  Don’t turn a negative foreclosure into a pity party.  Use it as your learning curve and don’t make the same mistake next time.  Examine what caused you to get into the mess in the first place and then … go out and do just the opposite.  The banks may hate you … but hey, mortgage free living is really where it’s at!  Being self-employed means taking home more of your paycheck NOW and not having to wait on a tax refund from the government, which has been operating in the negative since 1933.  It’s also another great way to live without borrowing!  Being creative about it is what I find most rewarding.  As an afterthought, only create these entities if you have the means to keep track of their accounting and tax filing status.

Retraining in later life is not as bad as it sounds, even if you’re disabled.  As long as you’ve got brains, there’s a consulting position out there or a desk job that will pay you a decent living with little up-front investment.  Thinking positive in this day and age is hard to do. There’s so much negativity around. The idea behind all of what I’ve just stated in my foregoing diatribe is designed to get your inner sanctum churning because the times, they are a-changing, again!

 

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THE ARROGANCE OF BANKS!?

(OP-ED) — The author of this post is not an attorney and none of this should be construed as legal advice but is put forward for educational purposes only. 

No matter what defensive (or offensive) strategy is seemingly employed by homeowners (as borrowers), not only do we still get the same ‘ol, same ‘ol from bank attorneys (who actually represent the mortgage loan servicer and not the owner of the note themselves) as to their defamatory conjecture from “Your Honor, they (meaning the borrower) just want a free house!” … we still get the continued misrepresentation of the facts in a foreclosure action, whether it be judicial or non-judicial in nature.

In a judicial scenario, the arrogance is blatant. The attorney files the foreclosure action (generally employed by a foreclosure mill that gets paid a low winning bid dollar amount) and puts all of the same, standard “trash talk” about the homeowner (as the borrower), claiming the borrower is in default and that it (the client) is entitled to enforce the security instrument.  This isn’t personal really.  It’s a numbers game and if you’re a borrower who hasn’t made his payments in ages, it does not necessary mean that the burden of proof shifts to you, just because it’s your home and you’ve been served with papers which, nine times out of ten, contain pleadings that have notably false and misrepresentative statements contained within them.  In a judicial state, it’s still up to the alleged claimant-Plaintiff to prove its case or go home. This is why the banks want everything changed to non-judicial in nature, so they don’t have to work so hard to steal people’s homes.

Instead, the borrower opts to defend his position by putting forward an answer and affirmative defenses to the Plaintiff’s assertions.  The very act of this filing and anticipated response immediately gives the court jurisdiction to hear the matter before it (with an assigned case number and recorded lis pendens).  At the point of the recording of the lis pendens, the borrower’s title is slandered (not the filing of the case with the applicable court).  It is the notice of lis pendens that gives the world constructive notice of the proceedings against the property because it is the security instrument that the Plaintiff seeks to enforce.  However, in a judicial state, the Plaintiff must possess the Note, or in the alternative, sufficiently demonstrate that it had the note, but lost it, and made every effort to find it, but couldn’t.  Instead of looking for the note (or dummying one up out of nowhere like we know they do) and presenting a complete case, the arrogant bank and its lawyer press forward anyway and prey on the emotion of the court, backed by the reasoning that since they filed a complaint to foreclose, they must be the lender, right?

Generally, when the Plaintiff can’t produce the note, it produces an assignment of mortgage, which is generally “manufactured” by the mortgage loan servicer’s employees in favor of the servicer.  Half the time, the assignment includes the language “together with the note”, which, if MERS is involved, is a physical impossibility because MERS cannot transfer something it does not own.  This makes the assignment false and misrepresentative.  Instead of questioning the tactics of the servicer, on many an occasion, the banks’ own attorneys just take it and run with it, or even worse, are complicit in its manufacture!  This makes it even worse because the bank’s attorney (and law firm) would be suborning perjury, which, the last time I checked, was a felony.  It’s even worse when they try to rely on the assignment to steal the house.  It is the INTENT that is made known when the misrepresentations within the assignment are orally pontificated upon the court by the bank’s attorney in his arguments … thus, the arrogance of the bank is transferred to its lawyer, who can then claim reliance on the document because the attorney (or the “cover lawyer”, different from the attorney who filed the original pleadings) is now at greater than “arm’s length”position from the transaction and thus will claim plausible deniability (as in “I had no idea, Your Honor.”)

In a non-judicial setting, the scenario is much more deceitful.  If the borrower doesn’t stop the proceeding with something factual that can be proven in court, followed by a temporary restraining order, it is assumed that whoever commences a foreclosure action against the property is going to get their wish because going to court is not required in deed of trust states, except in certain cases, which is why the arrogant banks keep trying to lobby legislatures to change their method of enforcing security instruments to non-judicial, because all non-judicial actions do not require a court’s approval and thus all foreclosure actions are deemed legal unless proven otherwise.  This too is a numbers game of greater proportions because most homeowners in deed of trust states do not have access to competent foreclosure defense attorneys because “the system of things” does not warrant a board specialized attorney (in real property law or foreclosure defense) to come forward and shut the door on the foreclosure.  Most attorneys in deed of trust states really don’t know how to defend against foreclosures but they sure know how to structure a business model to take a retainer, followed by monthly payments, making their newly-found client their newly-created annuity payment.  This is great for business because it boosts cash flow.  But, it doesn’t nothing for the homeowner (as the borrower) unless the homeowner has something in the chain of title worth arguing.

Such is the case in South Carolina, where a MERSCORP attorney has allegedly testified under oath (in a deposition) that MERS cannot act for a “non-functional entity” (which means an entity that has gone out of business and years later, all of a sudden uses MERS (through the actions of the servicer’s own employees or another third party) to cover up the chain of title and bring the note and mortgage or deed of trust from the originating, out-of-business lender, to the present tense, in an attempt to allow whatever party comes in with a claim against the property, to foreclose on it.  Apparently, this same testimony allegedly worked on  a case in New Mexico as well, allegedly.  I use the word “allegedly” here because there’s no attached “oral transcript” or “order” from either court to validate the claims made by attorney Jeff Barnes, who goes into court pro hac vice (a guest of the court, using the resident attorney’s bar license) to help the homeowner (who is paying major dollars to both Barnes and the resident lawyer) get out of their foreclosure jam.

I find it odd that a post, dated October 29, 2018, on Barnes’s website, would make such statements without completing the grandstanding against MERS by actually including “hard evidence” in the form of a transcript or order, don’t you think?  In the New Mexico case, it wasn’t a slam dunk, however, it appears, without verification, that most of the borrower’s affirmative defenses would be sustained based on this new admission of MERSCORP’s own lawyer.  If one wanted to really make themselves appear “credible” with their “victory lap”, don’t you think one should brandish the sword they used as the weapon of choice?  (I put this in here for you Game Of Thrones fans!)  But, seriously, wouldn’t that make logical sense?   So we could read HOW the defeat occurred?

But wait, that would make the grandstanding (to get more business obviously) more plausible and less arrogant, right?  We can’t have THAT now, can we?  We need to further our business model and leave borrowers in the dark, only to surmise that somewhere out there, a MERSCORP attorney was indeed deposed and testified that his client has no right to transfer the note (something I’ve been saying for years) because MERS has no interest in it.  Factually, even if such an order or transcript WERE included, do you really think most borrowers would know HOW to take what they’ve learned from it and apply it to their own scenario?  Not hardly.  Not in today’s court systems.

It should be noted that the claim was made (in Barnes’s website post) that a deposition was taken, which means the only way you’re going to get damning information to shut down the banks’ arrogance, it to get damning information by conducting a deposition.  This is where the rubber meets the road with foreclosure defense attorneys because great discovery wins cases and if your attorney is “lacking” when it comes to getting the right set of facts out of a deposition, you’ve lost not only your home but all those financial resources you could have used to move onto PLAN B. Pro se litigants rarely, if ever, conduct a deposition, let alone a proper and complete one.

In sum, you’re either going to fight the bank’s arrogance with provable facts or you’re not.  The system of things supports more than just an affirmative defense against the bank’s lawyer because of the misrepresentations in his pleadings.  It supports a bar complaint.  I don’t see too many foreclosure defense lawyers putting forward bar complaints based on false and misrepresentative pleadings from foreclosure mill attorneys, do you?  (This is why we focus more these days on “the system of things” and how that plays out!) 

And somehow, the good ‘ol boy network seemingly continues to survive.

NOTE: If you want to hear multiple scenarios explained about why our voting system may be all f**ked up (especially in Florida with the recent negative spotlight put on it), listen to Dave Krieger tonight (6 p.m. EST) on WKDW-FM’s City Spotlight – Special Edition, just by clicking on this link and then clicking on LISTEN NOW!  Joining Dave and co-host R.J. Malloy as their guests are North Port, Florida City Commissioner Jill Luke and outgoing City Commissioner Linda Yates.

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Clouded Titles Author Dave Krieger on WKDW-FM Friday Night!

Tune in to City Spotlight – Special Edition this Friday night (and every Friday night) at 6 P.M. (Eastern time) and hear the latest news on legal and financial issues, as well as local area concerns.  Click this link:  CITY SPOTLIGHT and then click LISTEN NOW to gain internet access to the program!

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UPDATE: PRO-BANK 5TH U.S. CIRCUIT APPELATES TAKE DOWN ANOTHER HOMEOWNER … MAYBE?

(BREAKING NEWS — OP-ED) —  The author of this post is a paralegal and consultant to attorneys in foreclosure matters and issues involving “the system of things”.  None of what you’re reading in this post should be construed as legal advice nor posited to guarantee a legal outcome.  

UPDATE: Now that the legal community has had somewhat of a chance to review the previously discussed Fifth U.S. Circuit ruling (in THIS case), let’s see what one law firm has to say:  5th Circuit Holds Bankruptcy Stay Tolls Statute of Limitations | Weiner Brodsky Kider PC – JDSupra

This will certainly give you an idea of how the other side thinks.

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As promised, I bring you the latest relevant case from the Fifth U.S. Circuit Court of Appeals in the Big Easy.  But wait … it wasn’t a “big easy” for the borrower, whose case I worked on long ago (in doing a chain of title assessment for) and whose assignments of deed of trust I use in my chain of title workshops to show “document manufacturing gone wrong”.  Wilshire Credit Corporation, used by Countrywide as one of its servicers,  is to blame for that screw-up.

None of what you’re about to read in this ruling appears proper because no one ever attacked the assignments head on, even when it was suggested to do so. Remember, I can’t give legal advice and it’s sad when I have to read rulings like this, knowing what I know that should have been done, but wasn’t.

So … let’s read the ruling first, then we’ll analyze how the homeowner shot himself in the foot because he put his money where it shouldn’t have been put and didn’t put his money where it should have been put:

HSBC Bank USA NA v Crum, 5th App Cir No 17-11206 (Oct 17, 2018)

We’ll do a little analysis on the chain of title and show you what suspect document manufacturing looks like and my perspective on HOW it should have been challenged.  Is it because of attorney ignorance or just plain and simple frustration?

Let’s see how sharp you are in detecting WHAT went wrong here:

ASSIGNMENT NUMBER ONE                                                                                              

NOTE: Click on the assignment to see it in larger print and click the BACK tab on your computer screen to get back to the article.

I put this assignment FIRST for a reason … look at the time (in the upper, right-hand corner) as to WHEN the assignment was recorded … 11:04:32 a.m. on July 14, 2009.   I surmise that this document was manufactured by employees of the servicer, Wilshire Credit Corporation, to create standing for HSBC Bank USA NA as Trustee for MLMI (that’s Merrill Lynch Mortgage Investors) Trust Series 2005-WMC1.  It should be clear to you that “WMC” in the REMIC series was a REMIC set up by WMC Mortgage Corporation, which was the alleged original lender.

The 5th Circuit has already ruled that it doesn’t matter if the original lender went bust BEFORE the documents were created.  How could they do that?   Corruption?  Maybe?   Maybe it was given the wrong information in the pleading.  Maybe?   The appellate court can only rule on the information it was provided and I don’t believe that any of this stuff I’m showing you here was properly vetted in discovery, was it?

Notice something else?   The signer executing this document (a known robosigner), claims to be an “Attorney-in-Fact” for MLMI Lending, Inc., however; as I will show you, she’s not acting as an attorney in fact for WMC Mortgage Corporation, is she?   There’s no written evidence of where the Limited Power of Attorney is recorded on this document, is there?

Also notice that Wilshire Credit Corporation (the mortgage loan servicer) prepared this document and after it was recorded, got it back through the U.S. Mail. This will be important to note for future discussion.

This recording was a 3-page document.  Page 2 contained the legal description.  Now … wait until you see Page 3!

What’s wrong with this picture?  These F**KTARDS can’t even do their job right, can they?   The executor of this document prepared this Allonge to show that the Depositor conveyed it into the REMIC on July 6, 2009.  If you look at the Trust’s 424(b)(5) Prospectus (shown below), the Cut-Off Date for assigning the note and mortgage to the REMIC was January 1, 2005, because (according to the IRS’s Start-up Date for the REMIC) the Closing Date of the REMIC was January 27, 2005.  This Allonge was done over 4-1/2 years later … in violation of the REMIC’s own regulations!  Besides, what do $10/hour employees of Wilshire Credit Corporation know anyway, right?   Who investigated this?  I did!  I told the Borrower long ago what happened to his chain of title.  His attorney apparently didn’t care enough to depose anyone.

Here’s what wrong with this picture:

First, you attach an “Allonge” to the promissory note, NOT an assignment!

Second, the executor of the document, a robosigner-employee of the servicer, claiming to be an attorney-in-fact for MLMI Lending, Inc., not WMC Mortgage Corporation, executed this Allonge less than a WEEK PRIOR TO the actual recording of this assignment!   How convenient is that, considering she is NOT the Lender.

Third, WMC Mortgage Corporation, owned by GE, was closed in 2007 due to the subprime mortgage collapse.  So here we have a servicer’s employee, two years later, claiming she has “attorney-in-fact” status, when most powers of attorney expire when the company GRANTING the LPOA ceases to do business!  It doesn’t take a rocket scientist to figure this out!  AND …

Fourth, the signer of this document and Allonge is claiming she has power of attorney for MLMI Lending, Inc., right?  Would you please look at the above list of Principal Parties and tell me you see MLMI Lending Inc. anywhere in that document as a listed party to the equation?   So where is Treva Moreland’s authority as a $10/hour mortgage loan servicer’s employee attorney-in-fact status for a lender that closed up shop years earlier?  Oh, wait, the Pro-Bank 5th Circuit doesn’t give a shit, do they?   Or was it the Borrower or the Borrower’s attorney’s fault for not checking into this further?

But wait … it gets better!  (That’s an Al West sarcastic remark!) 

ASSIGNMENT NUMBER TWO

I put this assignment SECOND for a reason … look at the time (in the upper, right-hand corner) as to WHEN the assignment was recorded … 11:13:08 a.m. on July 14, 2009. This document was recorded SEVEN MINUTES AFTER THE FIRST ASSIGNMENT!  Again, I surmise that this document was manufactured by F**KTARD employees of the servicer, Wilshire Credit Corporation, to create standing for HSBC Bank USA NA as Trustee for MLMI (that’s Merrill Lynch Mortgage Investors) Trust Series 2005-WMC1.  Notice the same Oregon notary (Justin M. Burns) appears on this assignment as well, claiming that on July 6, 2009, the same day as Treva Moreland, the signer of the first-recorded assignment claims to have attorney-in-fact status …

Here comes Melissa Tomlin (another $10/hour Wilshire Credit Corporation F**KTARD employee), claiming she’s an Assistant Secretary for “MERS” as Mortgage Electronic Registration Systems, Inc. for then-defunct WMC Mortgage Corporation … AND … she’s assigning BOTH the Note and Mortgage to Merrill Lynch Mortgage Lending, Inc. from WMC Mortgage Corporation who (now-defunct) is a “valid Assistant Secretary” for MERS … WOW!  MERS’s resolutions must really be legally sound to be able to have servicer’s employees creating shit documents out of thin air using MERS as a nominee for a closed company … Hmmm … I wonder what agency relationship existed between MERS and WMC after GE closed WMC over two years earlier?

This assignment was also 3 pages in length and was prepared and mailed back to Wilshire Credit Corporation after it was recorded.  Page 2, like before, contains the legal description of the subject property.   And now … for the GRAND FINALE … let’s see what’s on Page 3, shall we? (I am chuckling at this juncture, see if you can figure out why):


Notice what’s on the last page?   AN INDORSEMENT STAMP to Merrill Lynch Mortgage Lending, Inc. by WMC Mortgage Corporation!   Again, I surmise the following:

First, endorsements belong on either the promissory note or the allonge to note (if the promissory note is full of endorsements and cannot accommodate any more of them) … NOT ON A RECORDED ASSIGNMENT!

Second, the executor of the document, a robosigner-employee of the servicer, claiming to be an Assistant Secretary for MERS as nominee for then-defunct WMC Mortgage Corporation, HAD KNOWLEDGE OF what she signed when she affixed her signature to the document (that the indorsement stamp was affixed to page 3 therein), or should have had knowledge of it, right?

Third, you’d think she’d have every opportunity, being an Officer of Mortgage Electronic Registration Systems, Inc. (Assistant Secretary), by alleged resolution ONLY and not attorney-in-fact, that she’d have some smarts about stuff like this. Nope! Doesn’t appear that way, does it?  In fact, I’m not even sure that Melissa Tomlin (after doing several signature comparisons on assignments from around the country) actually was the party executing this document!

Fourth, remember, WMC Mortgage Corporation, owned by GE, was closed in 2007 due to the subprime mortgage collapse.  So here we have a servicer’s employee, two years later, claiming she has an agency relationship with MERS as an Assistant Secretary, when in fact she’s a Wilshire Credit Corporation employee (clearly, a misrepresentation of fact), when the company GRANTING the nominee status to MERS to create an alleged (unproven) agency relationship in the first place, is no longer business!

Fifth, it doesn’t take a rocket scientist to figure out that when a company goes bust, agency relationships can be challenged!  I don’t ever see that happening in this case, do you?  (If you do, please correct me in the comments section of this post so everyone can see how uninformed I am!)

But wait … it gets better!  (That’s another Al West sarcastic remark!) 

No one knows how this happened … BUT … either the documents were improperly submitted wrong by Wilshire Credit Corporation when they mailed the packet to the Dallas County Clerk’s Office for recording in his Official Real Property Records … OR … the Clerk’s office juxtaposed the documents … SO … here’s what happened (you may have already figured this out … this is a fun example of a brain teaser for you researchers out there) to screw up the borrower’s chain of title with suspect documents (fact check these if you will):

(1) At the time BOTH assignments were executed, WMC Mortgage Corporation was no longer in business (not that the 5th U.S. Circuit really cares).

(2) MERS was used to cover up the chain of title, even though the agency relationship more than likely ended when WMC closed up shop (there was never a repudiation agreement against the MERSCORP executory contract ever filed in WMC’s bankruptcy, if it fact, it filed for such).

(3) In order for the facts to present themselves in proper order, the second assignment SHOULD HAVE BEEN recorded FIRST to reflect the transfer of the Note and Mortgage to MLMI Lending, Inc. from WMC, so MLMI Lending, Inc. could properly convey it into the REMIC Trust.

(4) But wait!  MLMI Lending, Inc. is nowhere to be found in the Prospectus for the REMIC under “Principal Parties”.  The originating lender was subprime mortgage lender WMC Mortgage Corporation.  True sale #1 would have been from WMC to the Seller, Merrill Lynch Mortgage Capital, Inc., an entirely separate corporation from Merrill Lynch Mortgage Investors Lending, Inc., right?  So True Sale #1 was F**KED UP!

(5) True Sale #2 should have been from Merrill Lynch Mortgage Capital Inc. to Merrill Lynch Mortgage Investors, Inc., the Depositor for the trust, who, under the Pooling and Servicing Agreement found in the Prospectus, signed under penalty of perjury under the Sarbanes-Oxley Act, would have and should have completed True Sale #3 by transferring it into the REMIC itself, as the Issuer of the Certificates!

(6) All true sales had to be completed before the Cut-Off Date … so in fact we have a violation of the trust agreement and a misrepresentation in the Prospectus, if we are to believe what just happened here was factual.

(7) The misrepresentations contained within the Assignments themselves purport to have transferred everything (in order) from WMC to MLMI Lending, Inc. and from MLMI Lending, Inc. to the REMIC Trust; however, with them being recorded in reverse, it would have been impossible to represent this the other way around, so the entire chain of custody of the note is convoluted and so is the chain of title, creating suspect issues for discovery.

(8) Because MERS (Mortgage Electronic Registration Systems, Inc.) cannot convey Notes because it doesn’t have an interest in the Notes (it only allows lenders to record them in the MERS® System database), then the entire claimed transfer by the servicer’s employee (and NOT the lender itself, who was by then defunct) was also misrepresentative in fact.

(9) Further, all of these misrepresentations appear to constitute violations of the Texas Penal Code and the fact the U.S. Mails were used could constitute felony mail fraud (two counts), which is a 95% slam dunk for the prosecution.  Thus, had “the system of things” played itself out the way it should have been played out, Treva Moreland, Melissa Tomlin and Justin Burns would all be doing time instead of going about their feeble lives doing whatever.

(10) Under “the system of things”, the attorneys for the bank relied on these assignments to steal Mr. Crum’s property and should be disbarred.  The judge in the state court could obviously NOT be held accountable for the fraud on his court, because he wasn’t made aware of it at the time the suit was filed and answered (the Texas Constitution requires all HELOC’s to be judicial challenges under Rule 736 of the Texas Rules of Civil Procedure).  If the judge was made aware, he could have lost his bond and have been removed from the bench and the headlines would have grabbed national attention!

(11) And now … for the piece d’resistance … the lawsuit filed by the alleged REMIC, for which it got a judgment against Mr. Crum, conveniently alleged that Mr. Crum was in default, when in fact, the REMIC’s own Prospectus required Wilshire Credit Corporation to make Mr. Crum’s payments on the home if he couldn’t make them … see here, see here:

Notice where is says (in Paragraph 2 of the foregoing paragraphs) that the Servicer (Wilshire) is obligated to make such advances with respect to delinquent payments of principal and interest on each Mortgage loan … how then, could Mr. Crum be in default?   If MLMI 2005-WMC1 was never aware of the default, which we know probably didn’t happen since the servicer was making all of the advance payments, then WHO actually was foreclosing on Mr. Crum?

(12) Wilshire Credit Corporation … using what I claim are false and misrepresentative documents!  But I’m not the expert witness here (but I have an attorney who is though).  I still see a mess in the constructive notice to the world of when the documents were juxtaposed.  Improperly recorded documents put the cart before the horse, didn’t they?  Can you see it spelled out now?

Any decent, well-informed, non-agenda’d judge should have been aware of all of this … but then again, they only review what’s put in front of them and what’s challenged and why.   You be the judge as to WHO failed WHO here and why.

I had all the facts in 2011.  Now they’ve come home to roost over seven years later … in a bad way!  I can definitely say discovery was sorely lacking here!

Join Dave Krieger and R. J. Malloy for another exciting segment of City Spotlight – Special Edition on WKDW-FM, 97.5 in North Port, Florida, this Friday night at 6:00 p.m. (Eastern) … the subject matter this week … blockchain, jurisdictional issues, societal breakdown and the latest from the ABA blogs!  To listen to the show, CLICK HERE!

 

 

 

 

 

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