Tag Archives: the system of things

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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Filed under INVESTOR END-GAME STRATEGIES, OP-ED, Securitization Issues

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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HAWAII SUPREMES TELL U.S. SUPREMES TO PISS OFF … AND OTHER STUFF!

(BREAKING NEWS — OP-ED) — The author of this post does not posit legal advice here.  It’s is food for thought for your own educational value! 

Honolulu … Gary Victor Dubin has done it again!   This time, it’s a rehash of the Reyes-Toledo case “perfected”!

Bank of America, NA v Reyes-Toledo et al, Hi Sup Ct No SCWC-15-0000005 (Oct 9, 2018)

I know it’s a week old case, but it’s worth the commentary because of something the Hawaii Supreme Court basically told the U.S. Supreme Court (who basically came up with their own “plausibility” pleadings scenario when they ruled in Bell Atlantic Corporation v. Twombly and Ashcroft v. Iqbal.  It basically gave attorneys that represent the banks the opportunity to get 12(b)(6) dismissals of foreclosure cases simply by removing them to federal court and citing the two foregoing cases, which basically … in layman’s terms … requires a pleading to contain facts that are totally “fact”, enough to substantially prove their case.  That also meant (in Hawaii) that their “Notice” pleadings weren’t sufficient.  In the foregoing ruling, the Hawaii Supremes said otherwise!   That is significant for homeowners living in Aloha because the judicial foreclosures commenced there (because Hawaii is a mortgage state) get to review cases that have minimal allegations instead of having to write a non-fictional “book” every time an attorney had to answer or file a complaint to shut down the other side’s foreclosure attack.

In the foregoing instance, the Hawaii Supremes told the Hawaii Appellate Court and the Circuit Court, “You BOTH got it wrong!”

First, understand that the entire merger scenario presented by Bank of America, N.A. is false.  It did NOT happen that way.  Every time Countrywide Home Loans is mentioned (in any form), Bank of America conveniently neglected to mention Red Oak Capital or any other entity involved in the actual acquisition of Countrywide Home Loans, Inc.  That in of itself is false and misrepresentative and Bank of America had to have relied on an Assignment of Mortgage that was “manufactured” to create standing in order to bring its claim in the first place!  Therefore, B of A’s attorneys should be brought up on charges to the Hawaii Bar and either get heavily sanctioned for wasting the Court’s time or face disbarment for committing repeated ethical violations!  Yes, Hawaii does have “Misconduct” as a section in its Rules of Professional Conduct that mirror the ABA’s own set of rules.

Page 3 of this 44-page Ruling clearly cites how the Appellate Court applied the “plausibility” standard set by the U.S. Supreme Court, when in fact, Hawaii has its own set of pleading standards!  Page 4 at Paragraph 2 REJECTS the plausibility standard.  If this doesn’t send a clear message to all of the Circuit Court justices in Hawaii, nothing will.  In fact, this Ruling should be shoved up every one of their asses until they “get it”!  Otherwise, the system of things could see to it that each county in the State of Hawaii “pays dearly” out of its own coffers and each circuit judge is removed from the bench.  This is why we have Appellate Courts (because Circuit Judges do not always, in fact almost always, DON’T DO THE RIGHT THING!) and in this case, the Appellates applied the wrong standard as well.

As to where MERS is concerned … I don’t believe that any Court in the land has been tasked with having MERS and its representatives answer to HOW an agency relationship was established and HOW MERS had any right to transfer a mortgage loan, given the fact that on its own website (owned now by ICE), MERS declares that it has no interest in loans and doesn’t take any monthly payments.  Only one judge in Florida (that I am aware of) did the RIGHT THING in knocking out a servicer’s phony document from the land records because MERS never gave any rights to HSBC Bank USA N.A.!  How then can MERS transfer interests it doesn’t have?  It’s the phony document scam again.  It always has been.  And the banks’ attorneys keep relying on these phony documents to foreclose and no one does the right thing to expose the document for what it is and hold the attorneys liable.

You see, great discovery is like an enema.  It’s supposed to help flush out the shit!   Can I be any more succinct than that?

The problem is, MERS hardly answers any of the discovery propounded against it.  And now that MERS is owned lock, stock and server by the parent company of the New York Stock Exchange, how much of a conflict of interest is there in our court systems now?!?!?!?!?!?!?!?!?  MERS and its counsel seemingly don’t believe they have to answer any of the discovery served upon it.  If it does, it’s with an objection.  Homeowners would rather waste thousands of dollars plying discovery on MERS rather than go after the notary and the executor(s) of the phony document that contains the false representations the bank’s attorneys keep relying on!   It’s no wonder they’re losing!  Sadly, in one particular case I’m personally aware of, an attorney was paid $6,000 (by his client) to take the depositions of a notary and a robosigner that clearly lied on the assignment … and he took the money and spent it and did nothing.  In fact, the attorney didn’t even plead the phony document was phony!  When you have homeowner’s attorneys that can’t or won’t do their jobs properly, you wonder how homeowners are getting wins at all!

Such was the case in Alabama.  The attached case made its way to the 11th Circuit Court of Appeals.

Jackson v Bank of America NA, 11th App Cir No 16-16685 (Aug 3, 2018)

Needless to say, the attorney for the homeowners in this case is in real trouble!  To my personal knowledge, this is not the first case he’s had that has been mishandled or improperly filed.  (Let’s see what the 11th Circuit does!)

The foregoing represents a sheer waste of homeowner money and resources.  The foregoing represents a delay game gone wrong.  The foregoing represents clear attorney misconduct.  The foregoing represents an opportunity for a federal appellate court to really mete out a severe punishment hefty enough to put the attorney out of business for good without even having to bring him on on State Bar ethical violations!

The irony of the fact that both cases involve Bank of America NA … and they ended up with different results.

The system of things worked superbly in one instance … and clearly failed in the other.  Ah, the “learning curve” we all must face.  At least the Hawaii Supreme Court appears to have its stuff straight!

For those dealing in Bank of America merger issues, it’s all going to be about the assignments and all of the false and misleading statements contained within them!  Chase isn’t much better with its self-dealing assignments.  Sadly, title companies and the U.S. government are all “in bed” with them.  This is what happens when we move away from the truth and the liars are allowed to get away with it.  They get arrogant and believe they can keep doing the same thing over and over again.

History Repeats Itself … get ready for another round of subprime mortgage lending … a New York attorney just sent me the linked article.  Read it and weep.

SUBPRIME MORTGAGE LOANS BACK ON MARKET … 

Listen to Dave Krieger on City Spotlight – Special Edition on WKDW-FM, 97.5 FM, every Friday night at 6:00 p.m. Eastern.  This week, Dave will be discussing the attached article with co-host, R. J. Malloy (retired attorney and former Clerk to a U.S. District Court judge), along with Jacob Gil regarding Florida’s Amendment 2 campaign.  If attorneys and judges are listening to Dave’s show, you should too!  In fact, over 7,000 listeners dial us up every week on kdwradio.com from all over the globe!  Knowledge is power!

 

 

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RISK MANAGEMENT TAKES SO MANY FORMS

(OP-ED) — The author of this post is a consultant to attorneys on matters involving chain of title, foreclosure matters and matters involving in “the system of things”.  None of  what you’re reading here is anything but common sense, not legal or financial advice … and a matter of fact explanation about how one manages risk!

PROFESSIONAL LIABILITY IN A LITIGIOUS SOCIETY

If “the system of things” teaches us anything, it would be what the legal costs would be for having to defend a professional negligence suit … anywhere from $66,000 to $250,000.  If you have to retain an expert witness to testify on your behalf, fees could run has high as $10,000 … all this over about a two-year period.  That’s two years of hell for anyone.

A lot of these attorneys representing the banks think just because their firm has E&O insurance, they have nothing to worry about.”   That’s what they think.

Again, we think of professional liability carriers and wonder what exactly is covered under such an event as described above.  Professional liability insurance places the law firm under a microscope.  Insurance companies are by nature risk averse and so they’d be reluctant to insure anyone with a propensity to commit statutory or ethical behavior on an ongoing basis for which the insurance carrier would have to pay a damage claim for harm caused by the attorney.

Remember in previous posts, I mentioned how insurance companies became so filthy, stinking rich?   They avoid paying claims on cases at all costs.  They invest in things that will bring them a maximum rate of return and shelter their profits inside of real estate and other wealth-building mechanisms.  But they will look to shave off dollars paid out in damage claims by settling for a lesser amount to keep more of what they make.  I don’t mean to irritate you with more “facts”, but that’s the nature of the beast.  This is why I wrote the ten-part series on “Gutting the Underbelly of the Beast”.   Professional liability insurance, of which errors and omissions falls under, is there to help manage risk.

IT’S TOO BAD HOMEOWNERS IN THE NEW MILLENNIA WEREN’T RISK AVERSE 

If homeowners (as borrowers) would have taken that to heart long ago, we wouldn’t be in such a mess nationally.  The rate of foreclosures wouldn’t have been so damned high.

It’s sad that we’ve been so conditioned to want everything “sooner than later” and “more of it than less of it”.  We’ve been programmed to have feelings of “entitlement” … to reward ourselves handsomely for a job well done.  Hell, even Presidents of the United States have gone on TV and told us that we deserve the American Dream at a time when credit was plentiful and anyone could virtually buy the home of their dreams.  With the Glass-Steagall Act being repealed, the banks became sponsor-sellers, the MERS® System took root and the end result was bad banking behavior which fueled the 2008 crash.   It fascinates me that Wall Street would assume so much risk without first figuring out how to manage it.  I’m talking about mortgage loans, student loans, car loans, payday loans, installment loans to buy appliances … and we’re not even touching credit card debt yet. Much of this debt has been securitized.

Student loan debt has now replaced mortgage debt as the number one crisis in America!   Student loan debt collectors have become more unscrupulous in dealing with consumers.  Baby boomers over 60 years of age are financially liable for $66.7-billion worth of student loan debt (whether co-signed or originally taken out to finance their own education).

I used to clean up people’s credit for a living.  My success rate was 85% in removing negative trade line items from people’s credit reports.  I decided to write a book about it: The Credit Restoration Primer.  It was the first of many books that explained how the credit system works and how credit bureaus are governed by law to make sure your credit reports are accurate.

WHAT WE LEARNED IN PRINCIPAL ISN’T PRACTICAL

Mom and Dad always told me that if you want something bad enough, you save up and pay cash for it.  Right?  Radio talk show host Dave Ramsey promotes debt-free living.

But wait!  The world won’t wait for me to save up for a house!  Right?

By the time I save up enough money to pay cash for a house, prices would be so inflated I couldn’t afford to pay cash.  Plus, I’ll be a retiring. (the afterthought)

Once health issues set in, it will be too late to take care of a home. It wouldn’t be advantageous to pay cash for a house in the future while I’m throwing away money on rent (paying someone else’s mortgage) while trying to save on my own terms just because mom and dad told me to avoid debt whenever possible. (just looking at semi-rational scenarios)

But wait!  Mom and Dad worked like slaves to put food on the table and seemed to be doing okay.  Or did they?   Look at their outcomes.  Work for the Company Man.  Get a gold watch. Get a kick in the ass (out the door, to old to work when we can find younger people to replace you at less cost) and then retire, get sick and die.   The “get sick” part is where the family again struggles to make ends meet while coping with huge medical bills because of lack of health insurance or high deductibles.

We’ve taken from what we’ve learned and decided that based on current data, we’d be better off in debt.  How crazy is that?  The banks and credit card companies would just love it if you got yourself in head over heels in debt.  They’re rich and you’re broke.  Yes, you may have “stuff”, but you’re broke!

BECOMING RISK AVERSE IN A SOCIETY THAT PROMOTES DEBT

Whether you like it or not, the Age of Entitlement is upon us.  We have nice things because we want them, no matter the risk in obtaining them.  We cannot become financially successful without a plan.  Then again, there are some that are just happy being able to make ends meet.  But it’s never enough, is it?  You always want what your parents had and then some.

The media is guilty of putting ideas in your head.  Ideas that promote debt. We allow it to permeate our thought processes because it expands our comfort zones and makes us feel better.  We have become programmed to make bad decisions because we “want it now, not later”.  Lacking legal and financial education seems to have been a deliberate thing, despite the fact the government keeps telling us it’s budgeted money to educate us in certain financial matters (like the money appropriated for “education” under the new Fair Credit Amendments Act in 2003). Where was that “education”?  I sure didn’t see any of it.

Why didn’t they teach “Checkbook 101”, “Mortgage 101” or “Student Loan 101” in high school?   I personally didn’t learn too much in civics class.   Maybe my teacher really didn’t give a shit whether I learned anything or not.  In high school, it’s all about the annual test scores and nothing else.

In the land of plenty, why are so many people starving?  Why are there still homeless people?  Have our principles simply been ignored?

Being homeless or without food presents a personal safety risk.  Thus, the government steps in and has the answer: Welfare, Section 8  housing, homeless shelters and food stamps!

But wait!  You have to fill out a form, giving Uncle Sam all of whatever personal information you can give, so the government can build a database with you in it.

The ideas that run through your head when it comes to food, water and shelter involve risk management (believe it or not).  If you can’t plan for a rainy day, why take the risk?  There’s always welfare.  Someone has to pay for it.  Let’s all have a pity party while we figure out who.

We have a government that writes checks its body can’t cash.  Our national debt is into the trillions.  Every time a new budget gets passed, a huge chunk of it is “pork”, so politicians will keep getting re-elected to keep the special interest groups that got the “pork” benefits happy.  This is the Congress that is bought and paid for by lobbyists, like those who work for Fannie Mae and Freddie Mac.

Our government has set such a wonderful example for us, hasn’t it?  Congress can’t balance its own budget, so why should we?

Spending makes us feel better. People get all emotional over colors, floor plans and styles, they forget practicality and price. To top that off, many buy over budget because they think they can afford it.  Prior to the 2008 crash, people took out risky loans, most of whom could never repay them. Many folks allowed the lenders to inflate their earnings so they could buy more home, which was a great disservice.  I’m not saying it’s all the homeowner’s fault.  The lenders played right into the game, offering predatory loans which were risky in an already unstable, credit-saturated market.  The teaser rate was merely a game played by unscrupulous lenders on uninformed borrowers who wanted their piece of the American Dream, only to find themselves on the street years later.  Our government promoted all of this and America bought into it.  Congress repealed Glass-Steagall through the Gramm-Leach-Bliley Act. It was a bipartisan effort.  No one but the banks knew how they were going to use securitization to “rig” the economy.  Notice how the government hasn’t put any of them in jail?  Our executive branch is supposed to enforce the laws that Congress makes.  Why did we forget that?  Why wasn’t that drummed into our heads in high school?

Do we chalk up our current system of behaviors due to lack of knowledge?  It’s no wonder insurance companies are rich.  They avoid risk.   Why aren’t we doing that?

CERTAIN WAYS TO AVOID RISK (MY PARTIAL LIST … TAKE IT FOR WHAT IT’S WORTH): 

(1) Research your planned purchases BEFORE you spend money!  See if you can get products that are either more durable or have a longer shelf life.  America has been so conditioned to mass produced products we’ve become a “throw away nation”.  We’re already seeing difficulty in America in disposing of trash.  Spending a little extra for something that has a longer warranty or shelf life is more prudent in the long run. If you have to use credit to buy that item, make sure it fits within your budget and have a time frame set in your mind (and on paper) on when you intend on paying it off.

(2) Investigate all insurance policies BEFORE you invest … and don’t over insure!  Compare policies.  The last policy I got didn’t cover that much in computer replacement in case of a lightning strike, so I upgraded my policy for $204 more to cover replacement of ALL my computers in my home.  Sometimes, not having ENOUGH insurance puts you at risk … and, in the alternative … sit down and total up all of your policies’ annual premiums.  If you’re paying more than 10% of your income on insurance, you’ve bought too much in policy benefits (or you bought a policy that doesn’t fit your current needs).  It’s like buying whole life insurance policy when pure term is cheaper and you can gage your financial position based on your age and what your current needs are and not get killed financially by changing face value amounts.  Having insurance is part of managing risk.  When homeowners default on their loans, hazard insurance is the first thing that gets cancelled for non-payment of premium.  This is why I pay annually.  It’s cheaper and you have a definitive date to plan for, so your risk is calculated.  General liability insurance on the average runs $350 a year!  If you’re going to protect yourself against high-risk situations, it’s a good thing to have.  I’m not a big fan of homeowners’ indemnity policies.  They essentially insure nothing and with MERS around, shit happens.  There’s nothing like buying a piece of real estate with a tainted MERS mortgage somewhere in the chain of title.  You never know what the future holds if your home’s fate is in the hands of some unknown REMIC.

(3) Avoid impulse spending!  I go shopping just to see how informed the clerks are.  I will rarely buy anything unless I absolutely need it.  This type of buying is especially true in grocery stores.  Why do you think they have food samples for you to try?  To get you to buy extra!  If you have a frustrating time buying groceries and stretching your family’s budget at the grocery store, you have no business going out to eat (because you’re frustrated with high grocery prices) and you’ve probably succumbed to the grocery chain’s slick marketing campaigns.  The stuff they WANT YOU to spend extra on is always in the middle of the aisle or on the end caps.  If you have to take your kids shopping with you, make them go into the check-out lane BEFORE YOU and make them watch the clerk load the cart to make sure nothing you bought was missed.  That way, you give them something responsible to do and they’re not basking at the candy racks at the checkout counter and bugging you with “I want! I want! I want!” overtures.  Hey!  They learned this conditioning on television.  It’s called cartoons (advertising targeted at children in between the cartoon segments).

(4) Plan your educational expenditures by properly planning your career move! Many folks went to college and majored in stuff that had no career future.  They went to school and took classes they liked and spent a fortune (in student loan money) over-educating themselves in foolish majors (like forestry or liberal arts, for example).  It’s one thing to double major in horticulture and business if you’re going to manage a food production facility (like a farm, poultry or egg production or similar skill set) or work for a Fortune 500 company with a guaranteed paycheck.  But wait!  There are risks there too!

First, there is no guarantee that you’re not replaceable!  The first time you make a sexist remark in the workplace, you’ll be labeled a target of some political movement that is responsible for polarizing America.  You’ll be shamed.  This is what you have to look forward to in the national workplace now.  Everyone’s got a political opinion. Everyone’s got Twitter.  Everyone’s got Facebook.  Everyone’s got Instagram. Ask Anthony Weiner (who’s getting out of jail soon) what the consequences are of putting sexually explicit pictures on your phone and sending them to someone.

Second, if you’re nearing retirement age, but have great experience factored into your work history, you can bet the company will be looking for someone younger with much less experience that they can pay less of a salary to.  This posits a risk in this day and age.

Third, there are unplanned illnesses.  You know your body better than your doctor does.  If you have health issues, get them fixed FIRST before embarking down the path to a new career.

(5) If you have to retrain to get out of being unemployed or underemployed just to stay afloat … research self-employment FIRST … then the skilled trades! 

Anything involving food, water, shelter and personal welfare (medicine, nursing assistant, dental assistant) are the BEST career moves NOW.  I know for a fact that my kids are not like me.  They do not have the discipline to be self-employed like I am. I always told my kids to work off the “trade side” and go to a short-term facility that offers grants more than student loans.  In the alternative, attempt to get a job in a trade that is willing to train you while you work (OJT).  True, it doesn’t pay much but the gains from improving your learning curve far outweigh the temporary disadvantages. If you’re going to have to take out a student loan, put a limit on what you’re willing to borrow.  The average student loan debt in America at present is $30,000!  That means, if you can stay at the lower end of that curve, say, $10-15,000, you’ll pay it off in less time.  But you’d better have a job lined up (or at least research enough to know there will be a job in that career path for you) when you graduate.   Paralegal certificates are easier to get these days and there are certain parts of the legal field where jobs are plentiful for lower-echelon workers.

Again, I like self-employment better.  I can work from home and be a consultant when I want.  I can do seminars when I want … or not.  I can work as much as I want or as little as I want.  Every day however, I’m up by 6 a.m. doing research for an hour or so!  Old habits die hard.

I had fun as a mobile DJ.  I made good money too and didn’t have to spend a fortune on equipment.  I rented someone else’s gear first.  When I got enough to buy my own gear, I continued to rent the gear for another DJ to use and over time, I was able to put 28 DJ’s to work and make damned near a six-figure income! That was in 1983.  Imagine what self-employment could do for you and research all of the possibilities.  In some trades or skills, you can rent what you need before you have to make a commitment to purchase stuff.

Avoid franchises!  I know … they look attractive, but there’s a hefty price tag and a huge commitment to follow their schools of thought, whether they work or not.  This is why they put ads in entrepreneurial magazines, to snag the ignorant who are attracted by their teasers.  If you don’t have a couple of million bucks lying around, you’re not going to be able to get into a McDonald’s franchise or a Hooters franchise or any other franchise you think is sexy or at best attractive.  A lot of people like to compete with Starbucks and open coffee shops or coffee carts.  Not a bad living.  Any kind of food cart is a cheap date, but you’ll face local licensing issues and potential consumer issues (conflicts on the street, hold-ups, shoplifters, etc.).

My mom had her own news stand inside the Rochester Gas & Electric building for a number of years before she passed.  It was a safe environment (there was a security guard in the lobby near where her stand was set up, inside a rented nook in the lobby) and she made a modest living and did well despite renting a studio apartment (unfortunately, she never had the opportunity to own a home).  She never got a college degree.  Back then, you just applied yourself.  But the work ethic has changed and so has the marketplace we live and work in. People seemingly care less about the end result (doing a good business) so long as they get a benefit from it (a paycheck with no commitments).

Self-employment is the “new shit”!  Set up an LLC or a full C-Corp. I don’t know if you knew this or not, but the IRS audits full corporations and LLCs less than self-employed sole proprietors.  LLC’s (I’m told by several credible CPAs) get up to 75 deductions a year, while sole proprietorships only get 35 deductions annually.  Full C-Corps get up to 350 deductions per year!  Put your personal property and your homestead into separate trusts as part of asset protection to guard your investments.  Being a consultant or an investor is NOT a bad thing, especially with the right training.  I spend a ton of time researching other people’s careers to determine their longevity.  I can look at a credit report and tell a lot about the consumer (how leveraged they are).  They may have a great cash flow and credit that sucks.  That tells a lot about how they manage risk (0r don’t).  When you can get to the point of investing in other people’s projects (with them doing all the work), then you’re really on top of your game!

(6) Learn to construct a financial statement!  There are FREE classes both online and offered by community colleges and libraries that will teach you how!  Once you know HOW to build a financial statement, you can then figure out what kind of a budget makes you more attractive to expand your horizons. It takes less than a day out of your schedule to learn how.

(7) Do NOT buy vacant land unless you intend on a pre-planned build job! There’s nothing worse than buying a vacant lot (and overpaying for it) only to find that you’re about to get hit with high sewer assessments or increased property taxes due to an unforeseen annexation.  Don’t buy land in flood plains!  I don’t care how glamorous the lot is.  If you’re going to buy, buy in secure areas with a home-building plan.   I actually acquired a 3/4-acre tract and put a used mobile home on it from a lot I bought through the Texas Veterans Land Board for $75 down and made payments on both until the timing was right to sell the 12-acre parcel.  I ended up with a $222 a month land payment and a paid off mobile home, which I fixed up and later made a $27,000 profit selling it.  In the process of selling the 12-acre lot, which was soon to be adjacent to a major toll road, I paid off $35,000 worth of debt!  Being mortgage free is wonderful.  I wish everyone in America could experience it.

Land purchases are great if you have a definite plan to build.  Getting suckered into development purchases is penny-wise and pound-foolish!  Avoid HOAs!  Research chain of title to make sure there’s no restrictions on the lot you’re going to buy and that the title is clean.  If you can buy 5+ acres, owner financed, even better.  You can put a used mobile home on it and build as you go.  A lot of people are doing that these days.  I would do it again if I had to (in a heartbeat)!  You can put in a garden, a well and eventually solar panels … and live off the grid.

AVOID buying second or vacation homes! I know this goes against the grain of you overachievers out there that think you deserve everything. Part of the problem is, second homes or vacation homes is nothing but an equity builder and equity is “fake” until realized.  Many people rent out their second homes but with this creativity comes more legal restrictions. I just don’t like tying up money you could use to really build wealth owning a business.  If you’re going to plan your career, look at self-employment and design your home purchase in an area as your principal residence that doesn’t have to support your business in order for it to survive.  Truck farming is another creative way to stay “under the radar”, eat well and have plenty of fresh, healthy fruits and vegetables left over for bartering.  Farm organic (but don’t advertise it … it raises an FDA red flag and subjects you to scrutiny). I’ll write another book about “being invisible” at some point.

From the investor’s perspective, forget the idea of a second home or a vacation home.  Build a rental income portfolio by investing in distressed properties that you can rent out and make a decent return, while making the bank payments.  There are people with money that have crappy credit, so option payment financing puts instant cash in your pocket you can use to buy another property or fix up your own place or pay down debt!

I know a couple that started out with a mobile home on 8 acres. They originally purchased a mobile home.  They put up a garage and pens and she got her veterinary assistant’s certificate (short term skill training) and got a business license to open up a kennel.  They eventually managed to build their mortgage-free home from scratch.  Yes, it took time, but the rewards were realized in the profits they made from their home-based business!  Ah, the peace and quiet of country living along with the security of knowing you’ll have lots of barking dogs to warn you of unwanted intruders!  I know that a lot of you aren’t cut out for that kind of work, so I posit this as a creative example of “putting your mind to something” to have a working investment.  Credit card companies are throwing credit card applications at these folks because they have cash flow.  They are credit resistant though, because they’ve budgeted and saved for a rainy day, mixing old school principals in today’s modern times.

(8) Say “NO!” to MERS mortgages!  Getting a loan that you know is going to be securitized is crazy because with the digital age, you’re putting your whole future at risk.  Your chain of title is going to ride on someone else’s say-so! You don’t want an electronic database involved in your life any more than you’d want your mother-in-law calling every other minute to query where you’re spending your next dime!

(9) Bank with public banks and credit unions!  Only go with banks that portfolio their loans (meaning they hold the loan in their own vault) and don’t sell them to any entity outside of their own bank!  If the bank is a member/subscriber of MERS, go somewhere else.  You don’t need to support these mega corporations any longer!  Generally, the credit unions give you savings accounts and additional protections that the mega-banks take for granted (when they’re taking YOU for granted).  AND … DO keep cash on hand.  I recommend at least $500 for every person in your household.

(10) Consolidate and pay down on credit cards!   Close the ones you hardly use, have high interest rates or hit you with annual fees.  Unless there’s a real purpose for having a department store credit card … those cards should be the FIRST cards you get rid of!  All your other plastic will work in those stores.  I take issue with these low-dollar credit campaigns like Macy’s and JCPenney’s do as a means to get customers. It’s not worth the hassle of applying for a $300 credit limit just to get a deal on buying one item or saving money on your initial purchase.  You’ll have an inquiry on your credit report, which could bring down your overall credit score.  It’s too easy to forget paying on cards with really low balances, which could jack up your credit score when you least expect it. I find keeping a credit card available for travel or emergencies is the most prudent, don’t you?

TEN WAYS TO “CLOCK” YOUR OPPONENTS UP SIDE THE HEAD! 

Read the 10-part series on this blog: “Gutting the Underbelly of the Beast”!

That way, you’ll learn how “the other side” manages risk.

Listen to this author (Dave Krieger) on City Spotlight-Special Edition, every Friday night at 6:00 p.m. Eastern Time on WKDW-FM!  Get the latest financial news and education!

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MERS HAS A NEW OWNER … THE SAME BUNCH THAT OWNS THE NYSE!

(BREAKING NEWS — OP-ED) — 

It’s official and still under investigation (by me) … but the reasons that the author of this blog post wrote the book Clouded Titles goes to the very core of an argument I made ages ago, siding with various law professors and legal minds in the world of foreclosure defense:  MERS cannot be trusted to be a reliable source for the truth!

Now it has been announced by multiple news pieces within the financial sector that Intercontinental Exchange, Inc. (“ICE”) has announced that it has acquired ALL of MERSCORP Holdings, Inc.’s assets, namely, the MERS® System and everything that goes with it.

ICE also announced that it has moved all of the MERS® System’s operations to its data center in Mahwah, New Jersey.  ICE acquired the New York Stock Exchange in November of 2013.

You’re probably all wondering why this happened.  In one short statement, ICE claims that the addition of MERS will help ICE “serve its customers better as the U.S. mortgage industry is gradually shifting to more digital mortgages and electronic notes from a paper-based process.”

WARNING — There’s a signpost ahead.  It says you’re about to enter “The Twilight Zone”! 

There are some serious repercussions with this acquisition.  I spoke with California attorney Al West yesterday about this acquisition.  Here are some of the components to consider:

(1) There is a movement afoot to privatize the entire land record system and take it away from the state-sponsored, state-sanctioned, state-mandated public databases and archives! 

Since this country was founded, our Framers gave the States certain rights to govern their own affairs, one of which was to establish land recording systems.  The purpose of this was to establish who owned what parcels of land.  Each state legislature voted on setting up these archival databases, which in of themselves, have evolved into (at least many of them) digital centers of database retrieval.  While it is certainly convenient to go online and search out your chain of title, taking all of this and putting it into ledger technology that is decentralized (“blockchain”) is dangerous because ANY system (over time) can be hacked and tampered with.

(2) The fact that there was even a mention of moving towards “digital mortgage” means that the possibilities do exist that you can easily get a mortgage loan from your smartphone or your home computer, all with the push of a button that applies your “digital signature” through your IP address. How convenient for the mortgage banking industry and MERS! Isn’t that wonderful?  NOT! NOT! NOT!

Part of the problem that precipitated the 2008 financial collapse was easing up on credit restrictions.  Credit was available everywhere (as long as you “could fog up a mirror”). History repeats itself and those who are ignorant of it are doomed to repeat it.  For starters, even though taking out one of these “digital mortgage loans” may supply you with a copy of what you signed … (a.) digital signatures are NOT your actual signatures; (b.) the digital signature you picked will be present on the “copy” of the mortgage paperwork you received; (c.) in all likelihood, your IP address from your computer or digital technology relative to your smartphone will be stored for retrieval in case you default on your loan and then that technology will be used against you for sure; (d.) all of this technology will be registered within the MERS® System now that ICE owns it lock, stock and server.  You can bet the obfuscation towards consumers will be just as prevalent, if not greater, as it has been in the past; and (e.) because the increased use of MERS will be tolerated, you can bet more foolish investors will keep buying into the thought that securitization is a great way to make money.  As history has shown us, even with its lingering effects, a lot of investors lost money while the sponsor-sellers made off (Madoff) like bandits!

(3) With “digital” technology, there are no “originals”!  

That means no original “note”, no original “mortgage”, no original SQUAT!  And ICE will keep the disclaimers on the “MERS” website it now owns, making sure things are just as “fuzzy” for everyone but “investors” and actual subscribers of the MERS® System.  It is unknown at this time WHO will actually entertain the previously-referenced “executory contract” now that MERSCORP Holdings, Inc. appears to have sold off all interest in its patented process (or so we might think).   Verifiability will shrink making it harder to defend mortgage foreclosure actions.

(4) The U.S. Securities and Exchange Commission’s role in determining MERS® System violations is undetermined!

Given what we know about lax prosecutions in the revolving door business known as the “SEC”, it is hard to ascertain at this time what we’re dealing with as to potential non-disclosure violations or other liabilities first assessed against the MERS business model.

(5) Even more serious … using any digital technology puts you at risk of identity theft!

Look … if hackers can get into the Equifax database … put your thinking cap on before you fill out an online mortgage loan application!

WARNING TO THE JUDICIARY! — You … as a judge … may play into “the system of things” in an adverse way! 

Because the same parent company to the NYSE owns MERSCORP’s “MERS® System”, all state and federal judges holding any NYSE-traded shares may have a conflict of interest!

It is seriously important to recognize, as Al West pointed out to me yesterday in our phone conversation, that any judge having any stock in the NYSE, now that MERS is a directly-linked, wholly-owned subsidiary, may represent a conflict of interest if that judge’s portfolio contains any NYSE-traded stock, which could be stock in any financial institution or any loan with MERS in it that is connected in any way to an NYSE stock, which could be cause to have the judge recused from your foreclosure case!

Further, my radio co-host (on WKDW-FM’s City Spotlight-Special Edition), R. J. Malloy, also intimated that in Florida, all of the senior judges presiding over foreclosure dockets could also be at risk of being recused based on similar conflicts of interest because their pension funds are vested in these types of stocks, bonds, securities, etc.  Not good!

If the judge is called upon to recuse himself from a case because he holds stock in the NYSE, which is connected to MERS, or has a pension vested with anything related to either, and fails to recuse himself, it could trigger an attack on the judges bond for a multitude of behaviors, including non-disclosure, which if played out to its distinct finality, could represent an ethical violation for which he could be permanently removed from the bench.  This would include federal judges (who, for the most part, have their finances laid bare at Judicial Watch!) who end up getting cases that have been removed by foreclosure mill attorneys who think they can get a 12(b)(6) out of the federal districts.

Besides clogging up the judicial system throughout the United States, all of the U. S. counties that employ judges that are even remotely “attached” to “the system of things” are at risk of having their treasuries plundered because most U.S. counties are self-insured.

For one minute, I do not believe that any of the people involved in the acquisition of the MERS® System even thought about the repercussions of having MERS connected to the NYSE!

If you thought that the idea of shredding documents was an option, with digital technology, there won’t be any originals to shred … and loan mods will probably be done online … reviewed online … and denied online.  Information gathering technologies will put all of your personal identifying information at risk, because ALL systems at some point, can be hacked. That furthers your risk for identity theft if you “play the digital game”!   Be forewarned!  Things are about to get dicey!

 

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