Tag Archives: RESPA § 6

WHEN THE NOT-SO-OBVIOUS BECOMES OBVIOUS …

(OP-ED) — The author of this post is not an attorney.  I hate having to put disclaimers on here, but some people can’t separate common sense from what might be termed “legal advice”; thus, given the behavior of  “the system of things” to always backfire at some point in time, caveats are always necessary in any walk of life.

Happy New Year!

Being as it’s 2019 still doesn’t change the fact that on many an occasion, mortgage loan servicers are the parties actually conducting the foreclosures both judicial and non-judicial settings.  We’re seeing an uptick in the number of cases where assignments of mortgage or deed of trust show the “assignee” as the benefactor of the mortgage loan (ONLY) which is when the conveniently-manufactured “excuse” for paperwork is discovered in the land records around the time of the foreclosure action.  This does not excuse the fact that you have no contract with the servicer, but the lender does … maybe.  Some sort of authority has to represent what the servicer can do and cannot do; however … no one bothers to check limited powers of attorney to see if such authority was ever granted.  Are we by-passing that evaluation all because of desperation, which causes us to overlook detail?

The Not-So-Obvious … 

Roughly about a year ago, a sailboat waterfront property in Punta Gorda, Florida was sold at auction.  The winning bidder paid the fees and went to closing, only to find out Select Portfolio Servicing, LP, the mortgage loan servicer behind the auction, wasn’t the proper party to be selling the foreclosed home.  The deal fell through.  Who discovered it?   The title company that was trying to close the deal!

The Obvious …

It looked like all the paperwork was there, except when it wasn’t.  And look who discovered it … the title company.  They weren’t going to insure the home because the seller didn’t have the authority to sell it, nor did the seller (SPS) have an interest in it.  How can a party with no interest in foreclosed property sell it?   Which brings me to another point.  Since this foreclosure auction was in Florida, which is a judicial state … in order to get to the point where it went to auction, a final judgment of foreclosure had to be obtained from the circuit court, which it was. This means that someone had to lie to the judge to get the final judgment in the first place!  Did the attorney(s) who made the misrepresentations in court, both in the pleadings and in oral arguments, get sanctioned or punished?  Hell, no!  Why?  Because the Borrowers (who were from Michigan; Florida has a lot of “snowbirds” that own property there that don’t bother to check condition of title when they purchase Florida property) didn’t bring it up … and …

The Not-So-Obvious …

Because Florida judges only care about the bonuses they get from the State Legislature for kicking people to the curb any way they can!  Generally, that’s done through some overlooked procedural process … or in cases where the Borrowers show up in court, the judge then ambushes the Borrowers (and their attorneys) by asking, “When’s the last time you made a mortgage payment?”  or in the alternative … “Are you in default?”  (as if you know the legal meaning of default).  You blindly answer because of intimidation.

The Obvious …

Instead of objecting to the judge’s question by fundamentally answering that the servicer may have been making the payments for you all along, there is no firm proof of when the last payment was made on the account; and there’s no real proof that anyone is in default, except maybe the servicer, for failing to make the payments as part of their contractual obligation to the lender.  No one ever goes there, especially when there’s a REMIC trust involved.  What the judge is doing is trying to justify the foreclosure by side-stepping your due process rights to discovery.  When you let him/her do that, they get a bonus … AND … you get kicked to the curb!

The Not-So-Obvious … 

The banks already know and assume, because it’s a numbers game, that homeowners don’t have the money to fight and that 95% of them will run if given the opportunity, instead of fighting for what’s theirs.  The banks may be aware that the servicer is the real party retaining the foreclosing attorney or law firm, but they simply look at the complaint caption and take what’s written in the pleadings as the gospel truth, when it is far from it.  This is why it’s disadvantageous to live in a deed of trust (non-judicial) state than in a judicial (mortgage) state, where you get your day in court … because all foreclosures are deemed to be legal until otherwise challenged.

The obvious … 

If and when you find yourself with more month at the end of the money and the mortgage payment is going to be late or short in dollar amount, it is certain your account will be red-flagged after the 10th of the following month when the mortgage payment isn’t received.  As per the patterns discovered in the OSCEOLA COUNTY FORENSIC EXAMINATION, it is also highly likely that the mortgage loan servicer will direct its employees to manufacture a phony assignment, using MERS to cover up the chain of title, to convey your property (along with the note, which MERS cannot do since it admittedly doesn’t have an interest in the note) into a REMIC trust.  This will happen within the 90-day period of you not making timely mortgage payments.  This is all done because the servicer wants your home because it’s going to get reimbursed for all of those payments (principal and interest) it made for you!

The Not-So-Obvious … 

What the servicer doesn’t tell you is that when it starts sending you loan modification paperwork, the foreclosure paperwork shuffle affecting your home is already in progress.  It is at this point in time that borrowers are distracted by distress and frustration, all by design planning on the part of the servicer.  This is why there are so many complaints against mortgage loan servicers these days.

The Obvious … 

You have a limited amount of time to prepare … either to run or to fight the good fight.  Your research should include talking to at least two different foreclosure defense attorneys.  Within 90 days to six months, you can expect to get a notice that the proceedings just got traction and are moving forward.  I can guarantee you 100% that if you do nothing, you lose your home.

The Not-So-Obvious … 

Mortgage loan servicers really hate discovery.  They have limited information in the Borrowers’ Collateral Loan Files.  Most Borrowers take the path of least resistance, which is what the servicers are counting on, and send them a Qualified Written Request under RESPA § 6, expecting to get a document dump of everything in their file, which is NOT what the servicer wants to see or hear.  Borrowers seem to forget that a QWR is not real discovery.  Servicers side-step all sorts of issues in answering QWR’s outside of a court case.

The Obvious … 

The chain of title has evidence which you can readily obtain in certified form, especially the assignments!  The devil is in the details and that is exactly where you’ll find your false and misrepresentative statements!   The Borrower should seek out counsel that is versed in discovery in order to craft questions and statements that are likely to have to set the stage for a Motion to Compel to get the servicer to answer them.  No discovery = No truth!

And the truth shall set you free!

 

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