Op-Ed — (continued from the previous post) STEP TWO …
The Internet can be a dangerous thing, especially when doing research, trying to find answers to questions surrounding a potential financial issue that could become a crisis, like a foreclosure.
One of the reasons why I post blogs is because people share them. Others who are in despair happen to run across these posts and some of them walk away with reason. The “reason” I speak of is the need to recognize when there is a problem and the HOW TO’s to do something about it. Being in denial solves nothing. It simply prolongs the problem. Sometimes, it makes the problem worse.
The bigger part of the problem is the second issue I spoke of in the previous article: Confusion. Understanding what is happening in its most blatant aspects is that there is the potential of losing one’s home. The WHY of it all stems from the alleged lender’s assertion that payments were missed and that the loan is in default.
In mortgage states, or states that are commonly referred to as judicial states, you not only get your “day in court”, but the bank has to actually PROVE that you are in default AND that they hold your promissory note AND have the right to enforce the terms of the mortgage (and note). In all cases, the mortgage FOLLOWS the note. The mortgage is a recorded security instrument, which is found in the public record in the county in which the mortgaged property is located. It contains terms and conditions which must be adhered to in order to keep the note holder from foreclosing and taking their “security for the loan” back.
In deed of trust states, or states that are commonly referred to as non-judicial states, you don’t get your day in court unless you file a lawsuit and demand that the court issue a temporary restraining order (TRO), which prevents the lender (or its alleged servicing representative) from advertising and conducting a sale of your property on the courthouse steps at a prescribed point in time. The deed of trust is also a recorded security instrument, which operates similarly to a mortgage, and if properly recorded, is also found in the public record in the county in which the mortgaged property is located.
You should know that if lenders had their way, EVERY STATE would be a deed of trust state. That way, the lenders and their henchmen would have nothing to prove when it came to advertising and selling homes on the courthouse steps. Until they actually bribe every state’s legislature to change over to non-judicial from judicial, homeowners still have their day in court. This is the only way the banks can win. Knowing of this potential makes me wonder why people are taking out loans to buy property when, if they know there is a possibility of their financial future turning dismal, they don’t just buy a small plot of raw land and “build as they go”. This would seemingly make more sense and involve the banks less.
Another reason the lenders prefer a deed of trust to a mortgage is that when examining the 2007-08 financial crisis, homeowners were affected to the point where most in financial straits could not afford an attorney let alone keeping food on the table. Knowing the homeowner won’t fight back increases a successful outcome by the lender of taking the property back without much hassle. Now that the Dodd-Frank Act has been molested and degraded to the point of history repeating itself, how many potential homeowners will be sucked into taking out mortgages from the mega-banks, which the gutting of Dodd-Frank was clearly designed to benefit. You can bet the major lenders had a lot to do with those major changes to the most recent passage of the “Economic Growth, Regulatory Relief and Consumer Protection Act”. Because these bills are so voluminous and partisan, they create more “confusion” for the average person on the street who didn’t go to law school.
Your “property” has a chain of title …
Researching your property’s chain of title is like peeling away the layers of an onion. The more research you do, the more layers you peel away, leaving the real truth on the table, which, after peeling an onion, leaves most people in tears. This is why I used the “onion” analogy because peeling onions makes my nose run and my eyes water. Finding out what really happened to you as the result of your being duped by an unscrupulous mortgage loan officer would make anyone cry, especially when they discover that they made a mistake getting that particular mortgage loan in the first place. And now, you’ve opened “Pandora’s Box” and found the onion.
Accepting the “truth” for what it is …
During the times prior to the 2007-08 financial crisis, banks and mortgage companies were loaning money to anyone who could “fog up a mirror”, altering mortgage loan applications, baiting loan applicants with teaser rates tied to adjustable rate, interest-only and negative amortization loans and mortgages that looked normal, only to end up finding one got stuck with a balloon note or interest rates that put their monthly payments out of reach of their paychecks. This was deliberate and calculated. The banks played both sides of the coin when they lured the investors into the schemes of securitization and lured the homeowners into loans they neither could afford nor deserved. The first “truth” you need to recognize is whether you’ve bitten off more than you can chew. Once you realize what the truth is, it makes it easier to come to grips with and deal with HOW the mistake was made that got you into the dilemma you’re in now. I went through this “dilemma”. I got stuck with an “80/20 loan”. That’s two separate mortgages, wherein the second mortgage (the “20”) had a much higher interest rate and was generally tied to another Wall Street security altogether. I used the foregoing phraseology to describe “securitization”.
It does not take an Einstein to figure out that when there’s more month at the end of the money, you’re not making it. When you’re even one day late on your mortgage payments, the servicer handling your mortgage “red flags” your account and starts a file on you. The servicer is generally looking for excuses to take your home away from you. No servicer in today’s times is “nice”; in fact, they’re all common liars from time to time, especially those $9/hour cubicle employees who tell you that you have to be 90 days late before you can apply for a loan mod. THAT IS THE BIG LIE! The servicer knows that on Day 91, the REMIC’s credit default swaps, default insurance and any other PMI or LPMI that’s been tied to the loan will be negotiated and the alleged “Lender” will reap over 200% profit off of your mortgage loan … and that’s without even applying for the title insurance payout (the principal amount of the loan less 27% administrative costs) because the chain of title is jacked up (due to the Lender’s own ineptness).
The next major ploy of disbelief is the then-servicer (on or before DAY 90) has its employees dummy up an assignment of mortgage or deed of trust and cause it to be recorded into the land records in the county where your home is located so they can “structure” or “manufacture” standing to foreclose. The term “standing” in of itself intimates that the lender (or its servicer) has the right to do what it’s doing to you. Most attorneys I know assert “lack of standing” in almost every foreclosure defense, because the simple statements of the servicer (who claims to represent the real party in interest) are not sufficient enough to prosecute a foreclosure.
If your loan is in the MERS® System, it is likely to have been securitized, which means that the chain of title is really messed up an there is likely a REMIC (Real Estate Mortgage Investment Conduit), a tax-exempt entity that soaked investors for loan money, who has no idea you’re in default (the servicer knows!) and the servicer comes in disguised as the Lender, retains an attorney, obtains a foreclosure, sells the house post-judgment and runs away with your earnings. This is why mortgage loan servicers are in business. You make gobs of money when 95% of the homeowners run away and leave their homes to the servicer and their law firms, who split the booty, post-sale. MERSCORP (in whatever form) and its wholly-owned subsidiary, Mortgage Electronic Registration Systems, Inc. were created to bolster lighting fast transfers of loans electronically, that have allegedly been securitized (paid for with investor money instead of the bank’s own money) and sold and re-sold multiple times on Wall Street. This can only happen if the loan is securitized. MERS IS NOT (AND SHOULD NOT BE) USED IN PORTFOLIO LOANS!
If you just understood what I just said … the REMIC does NOT know when you are in default because the servicer is required to make your payments to the investors, even when you don’t. When people realize this, they get really pissed off because all along they thought it was all their fault. The “noose” was tightened around your neck when you signed the mortgage loan in the first place! Speaking of fault … did you come to realize the word “fault” and “default” are similar? How do you know you’re actually in “default” if the servicer has been making your mortgage payments all along? This is the “power over” debt collection game they play with you when you’re late on your mortgage payments. All this time, the servicer has been making the payment for you and you never knew it.
These are only a fraction of the “truths” I teach at my workshops!
Homeowners who think they’ve been defrauded want to sue everyone tied to the mortgage loan. THAT is the first big mistake that homeowners make. That’s because their confusion has caused them to become angered (the third phase of foreclosure) for all the wrong reasons, to the point where they lose all rational consciousness in making proper decisions about litigation. Listening to people putting forth information and then acting on that information (without first vetting it just because it supports some sort of rational argument they have in order to make a living steering people down rabbit holes) accomplishes nothing either. This is why many people become confused. Once they enter the cesspool of foreclosure cases looking for answers, they get so overwhelmed they don’t know where to turn or who to trust.
My research shows me that if the banks and mortgage companies were conniving and calculated enough to pull one over on you at closing, then the obvious objective is to give them their just desserts in return. “Wise as serpents, harmless as doves.” Going out and filing big lawsuits against lenders without a reason or any “litigation logic” using that same rationale is futile and fatal. Why waste your money and your time? The fact you are being foreclosed on brings an undue psychological burden on the mindset, which in turn induces stress, which in turn affects both your mental and physical health. This is why 95% of homeowners “run away” and don’t fight. This is why America can easily be “taken over” by the “party elite”, because most do not know HOW TO fight, let alone WHY. If you knew HOW TO fight, wouldn’t the WHY develop into something more logical? This is like taking karate or some other form of martial arts training. There’s no “false hope” here because you are confident you stand a chance of winning. You either choose to fight or you don’t. You can still walk away from a fight and save your mental and physical anguish by formulating an alternate plan (otherwise known as PLAN B).
Everything from taking out the mortgage loan to fighting the alleged “lender” in court has a certain amount of risk. Some of this risk is calculable. Some of it is not. You chose the path you are on for a variety of reasons and now you must choose the right reasons to either run and hide from your creditors or to get educated, stand up and fight them. Filing bankruptcy only aggravates your struggle and to that end, I will explain that in the next step.
The journey begins with the chain of title …
There is only one place that you’re going to be able to locate the foregoing and that is in the office of the clerk or recorder of your county records. These folks get paid to help you search out the necessary documents. If you live in a rural area with an underdeveloped county recording system, it’s highly likely that you will have to search all of this by hand through the index, which is organized by last name, then first name until you locate the recorded copy of your warranty deed. This is your proof that title has been vested in you and no one else.
As a title consultant for many years, I can safely say that in most instances, this is your starting point. You do not need certified copies of everything, just regular printed copies you can scan and mail to others who may have more research knowledge than you. Getting together with other homeowners to discuss your findings after a visit to the land records may expose you to more research truths, which you need to begin your quest to justice.
You MUST collect the entire chain of title for your property in order to be able to fully analyze it (or have someone else that is more formally trained analyze it). Skimping to only obtain the first couple of pages of a mortgage or deed of trust is just plain penny wise and pound foolish. You need to see the whole document to see HOW you got screwed. The devil is in the details!
Mortgage = Payments until Death (Duh … “mort” … in several languages, means “Death”)
STAY TUNED FOR STEP THREE! (I will discuss HOW the chain of title is used to formulate your case for trial!)
For more information on the Foreclosure Defense Workshop, click on the link!
I’m only doing this once this year!
For more information on Dave Krieger’s information library, CLICK HERE!
NOTE: Foreclosure defense attorneys are attending this Workshop!