Follow the rules, forfeit your home

October 3, 2012

Cam Carroll

By DANIEL BLACKBURN

Campbell (Cam) Carroll came very close to losing his home to foreclosure earlier this month to people he’d never heard of, the forced sale auction halted only by a last-minute restraining order issued by a San Luis Obispo County Superior Court judge.

Campbell thought he’d take advantage of a mortgage modification offer from his bank after his construction work dried up last year. At that time, he was simply trying to reduce his monthly payments. Now, Campbell’s desperate focus is to save the Paso Robles home he’s owned for 20 years, and he’s locked in a legal battle with banking giant J.P. Morgan Chase (JPMC).

Unfortunately for Campbell, he’s now joined the ranks of literally thousands of homeowners nationwide accusing the same bank of fraudulent and predatory mortgage lending practices. Fortunately, however, Campbell has something most of those other dissatisfied mortgagees don’t have: proof that his home’s original title no longer exists. And that may well be the key to successful litigation, he said.

Campbell fell into his fiscal morass in much the same way many other Americans have — by applying for the “Home Affordable Mortgage Program (HAMP),” a federal program designed to help homeowners facing default of their home loans.

Campbell religiously followed his bank’s refinancing instructions and made his required payments promptly. But in what appears to be a well-established policy pattern with J.P. Morgan Chase, none of that apparently mattered.

In a lawsuit filed Sept. 18 in Paso Robles court, Campbell alleges a laundry list of complaints against JPMC including fraud, RICO violations, conspiracy, breach of fiduciary trust, unfair debt collection practices, and slander of title. He seeks protection of his domicile and unspecified damages.

An attorney for the bank, Michael J. Agoglia of San Francisco, did not respond to email and telephone queries from CalCoastNews.

Campbell’s story has a familiar ring: the tactics he experienced are the same as those being encountered by countless homeowners all over the country. And his litigation parallels numerous other lawsuits, lodged by individuals and government agencies, against JPMC.

He “applied in good faith for a loan modification,” said Campbell. “My mortgagee, Chase Home Finance, LLC, provided a uniform loan document package which I completed and submitted… over and over again, as [bank officials] continually claimed to be missing a document, or required more information. Over a period of six months, my local bank manager assisted me with the task of providing the never-ending stream of demands.

“During this lengthy process, Chase Home Finance told me that I could begin remitting one-half monthly mortgage payments, which I did faithfully. I had never missed a mortgage payment, and was a customer in good standing until I applied for a modification and began following their instructions.”

After nine months, Campbell said he received a denial of his application from the bank, officials of which claimed he had “failed to submit documents in a timely manner.”

He rebutted this effectively after his local Chase bank manager contacted the lending entity and informed them that she had submitted the documents in question herself, and she had retained time stamped copies. As a result, Chase Bank told Campbell to ignore the denial letter.

A week later, he said, he received yet another denial letter, citing his unemployment as a reason for that action.

“I had disclosed that fact in countless documents right from the start,” he said. “I was told that I was a good customer, that it (employment status) would make no difference.”

Along with the denial came a demand to “immediately remit all past outstanding balances, late fees, and interest on amortized interest,” or face foreclosure.

“During this process, they also reported me to credit agencies as delinquent, thus damaging my credit score beyond repair. I was unable to remit all of the funds they were now demanding, and I was told to offer my property up for a ‘short sale’ or they would foreclose.”

Campbell said that was when he decided “to fight J.P. Morgan Chase Bank for my rights and my home.”

He retained Atascadero attorney Curtis Clark just in time to win that restraining order, even as his home was about to be auctioned on the steps of the county courthouse building.

The missing title calls into question the actual ownership of Campbell’s mortgage.

“J.P. Morgan Chase has no standing to collect mortgage payments from me as they don’t possess my note,” said Campbell. “In fact, the note has been fraudulently securitized without my consent.”

Attorney Clark said the case “arises out of the defendants’ egregious, ongoing, and far- reaching schemes” to defraud his client.

“It’s like trying to sue a ghost,” Clark said. Campbell’s loan was “pooled and packaged” into something called a “mortgage backed security.”

This resulted, Clark said in the lawsuit, in the property’s “note and deed of trust being separated, with the note being thereafter ‘fractionalized’ into separate accounting entries and substitute ‘certificates,’ which were then sold to investors.”

Campbell has tried on numerous occasions to induce JPMC to produce the original note and deed of trust, without success, Clark said.

Campbell has a word of warning for other homeowners: “Many of you may not be aware of this, but if you have financed your property in any fashion during the last decade, your loan, like mine, has probably been securitized. What this means is that your note is currently, permanently and illegally separated from your deed of trust. In short, you’re probably remitting mortgage payments to an institution that has no legal grounds to collect those funds; hence, that institution cannot reconvey your clear deed of trust back to you even after you have fully satisfied the terms of your now securitized note.”

The issues faced by Campbell reflect a widespread circumstance. In one major case, a federal judge in New York two months ago rejected a bid by JPMC to dismiss a class-action lawsuit accusing the lender of defrauding thousands of homeowners who attempted to modify mortgages under the HAMP system.

That will allow litigants to pursue claims that America’s largest bank failed to act in a lawful manner in the loan process. U.S. District Judge Richard Stearns, according to a July 30 article by Reuters, “also let stand claims that Morgan’s Chase unit drove homeowners deeper into debt by prolonging the modification process through ‘gross ineptitude,’ sometimes adding fees to loans already in default and starting foreclosures while modifications were being negotiated.”
Cam vs Jpm


65 Comments

  1. The Gimlet Eye says:

    Former Goldman Sachs Director, Rajat Gupta, is sentenced to 2 years in prison and fined $5 million for insider trading by leaking secrets about his company to a hedge fund. [While this may appear to be a reversal of the trend to protect executives of financial institutions from punishment for their crimes, note that Gupta's action was for personal gain at the expense of the bank he served. He did not commit a crime to help his bank, he committed a crime that hurt his bank. He was punished, not because he defrauded investors, but because he acted against the interests of the banking cartel – and he acted alone, not as part of the corporate team. Had it been otherwise, we believe he would have been protected.]

    Yahoo 2012 Oct 24

    http://news.yahoo.com/ex-goldman-director-gupta-awaits-sentence-insider-case-040726889–finance.html

    Like or Dislike: Thumb up 0 Thumb down 0

  2. The Gimlet Eye says:

    US Department of Justice sues Bank of America for $1 billion for mortgage fraud against Fannie Mae and Freddie Mac. [The fraud was committed by Countrywide bank, which later was acquired by Bank of America. If this action proceeds as others have in the past, no executives of either bank will be fined, only the corporation. That means stockholders and taxpayers will pay the fines, the government will get the money, injured parties will get nothing, and the executives will get bonuses. It's political theater.]

    DailyMail 2012 Oct 24

    http://www.dailymail.co.uk/news/article-2222636/U-S-government-sues-Bank-America-1BILLION-mis-selling-Countrywide-mortgages-known-Hustle-loans.html

    Like or Dislike: Thumb up 0 Thumb down 0

  3. The Gimlet Eye says:

    A $43 TRILLION money-laundering lawsuit has been filed against “Banksters and their racketeering partners” including Eric Holder, Jon Corzine, Tim Geithner, Valerie Jarret, and numerous CEOs of major banks. [The plaintiffs are demanding a full audit of the Federal Reserve to find out where the bailout money went. This suit is the first of its kind that is aimed at the criminals themselves and the money they personally stole instead of the corporations and government agencies they control.] PR Newswire 2012 Oct 25

    http://www.prnewswire.com/news-releases/major-banks-governmental-officials-and-their-comrade-capitalists-targets-of-spire-law-group-llps-racketeering-and-money-laundering-lawsuit-seeking-return-of-43-trillion-to-the-united-states-treasury-175828861.html

    Like or Dislike: Thumb up 0 Thumb down 0

  4. The Gimlet Eye says:

    Judge Napolitano slams New York’s $2 billion lawsuit against JP Morgan, not because Morgan is innocent of wrong doing, but because fines will be paid to the state of New York instead of the people who were scammed by the bank.

    [The Judge is right on target with this. He skips over the distracting details and cuts right to the main issue. It is common today for governments to prosecute corporations for their crimes against consumers, investors, and taxpayers but, instead of distributing the millions or billions of dollars in fines to the victims, it all goes to the governments - and people applaud, thinking that justice has been done. Clever!] Fox Insider 2012 Oct 2

    http://foxnewsinsider.com/2012/10/02/judge-napolitano-discusses-the-politics-at-play-in-new-yorks-lawsuit-against-jp-morgan/

    Like or Dislike: Thumb up 6 Thumb down 1

    • whatisup says:

      California had an $8.5 billion dollar settlement with Countrywide/BofA a few years ago for wrongful foreclosures in the state. Once again, BofA neither admitted nor denied any of the claims in the complaint and the settlement was not allowed to be used to support a private lawsuit. Almost none of the money got to the people of California wrongly foreclosed on by BofA, and the people who sued BofA couldn’t use the findings to support their lawsuit. A great deal for the State of California and BofA, but a lousy deal for the people wrongly foreclosed on. Here is the link to the complaint: http://ag.ca.gov/cms_attachments/press/pdfs/n1582_draft_cwide_complaint2.pdf

      Like or Dislike: Thumb up 6 Thumb down 1

      • The Gimlet Eye says:

        Where did all that money go? The same place it did as in New York.

        Only a CRIMINAL state would allow this outrage to happen!

        Where’s all that “good” that comes from government?

        Face the truth, people, you are being ruled by GANGSTERS.

        Like or Dislike: Thumb up 6 Thumb down 2

      • thinkaboutit says:

        Good to see your commentary again, whatisup. Keep informing the public.

        I had an A-paper mortgage loan that was sold to BofA as my servicer. When a divorce left me with a mortgage to pay completely on my own, I applied with HAMP (Obama’s “Making Home Affordable Program”) to moify the interest on the loan. BofA prequalified me for the program and began to put me through the process. This seemed like a godsend, as a lower percentage rate would have enabled me to afford the payments.

        I followed instructions to the tee and submitted my HAMP paperwork to BofA. I checked back often on the progress and was told to wait, only for them to lose everything I submitted. I resubmitted a thick packet of paperwork once again, only for BofA to string me along, saying they were working on it and that I should hear back, etc., etc. Nearly a year later and innumerable calls to BofA, asking about the progress, BofA informed me that the investor would not modify my loan. It was not because my papers weren’t in order or I didn’t not qualify for the program, it was because it was the investor’s policy not to modify mortgage loans.

        When I asked BofA why they simply didn’t advise me of this sooner, they had no answer. When I asked for contact information so that I could contact this faceless, nameless investor myself, they said it was their policy to not disclose this information.

        So instead of receiving a modification, I slid into default. When I tried to work with BofA to make any sort of payback arrangements, they said no and demanded all or nothing.

        All of that waiting and the recession itself dissolved hundreds of thousands from what I had in home equity. While other homeowners used their equity as a piggy bank, I had not. All it got me was an unwitting Christmas gift to the bank and the loss of my family’s home of nearly two decades.

        Had I been informed outright at the beginning of this process by BofA that there was no chance in hell for me to receive a loan modification, I would have put my home for sale in a heartbeat to recoup whatever equity I could before the economy sunk further.

        Instead of the HAMP program enabling me to make payments and retain my home, it went into foreclosure with tremendous equity was lost. When the bank sold my home, the sale price was still above what I owed. When I moved out all of my things, I personally apologized to all of my neighbors for this fiasco, heartbroken over what my foreclosure had not only done to my credit and my living situation, but to my neighbors’ property values.

        Because of this conspired thievery and the ravage done to my once perfect credit, I will never trust the industry to buy another home in the country I love, nor will I encourage my children to do so, either.

        I

        Like or Dislike: Thumb up 9 Thumb down 4

        • grumpy says:

          I had very much the same experience with GMAC except after the “lost” paperwork and the resubmitted paperwork, my contact person was “on vacation,out of the office,etc.” and never returned my calls. This went on for weeks and into months. When I finally got her on the phone she told me I wouldn’t be considered until I was 3 months in arrears. Ok,so the three months pass and I have been laid off my job. After repeated attempts I get through to her and was told that now because I’m unemployed, they won’t consider my application. This leaves me with my credit shot, and no way to make up the three back payments. This whole process which was purported to help took close to a year,ruined my credit and put me in foreclosure. My home of 25 years has been sold. One bright spot in the picture is here.
          https://independentforeclosurereview.com/Default.aspx
          They are looking into situations such as this.

          Like or Dislike: Thumb up 6 Thumb down 4

          • thinkaboutit says:

            I’m so sorry to hear of your misfortune, grumpy. My hope would be that you find restitution for your situation and a written apology…from someone!

            When in the midst of something like this, the feeling is surreal and hard to believe. At the time, I thought this was only happening to me. I did whatever I could to take responsibility on my end, including working two jobs. never in my life did I dream of even consider asking the government for anything. But as fixed interest rates fell, it seemed only reasonable to request a lowered rate for my loan, too. What I did not fathom was what amounted to a conspired takeover of my home. It wasn’t as if I were upside-down or had bought above our means. With time and no secondary loans against it, there was a tremendous amount of equity in my home, which happened to be located in a desirable location. Ripe for the picking, I guess.

            It’s a tragedy to know firsthand that my country does business like this. The fallout from my own situation is profound and long lasting, and my present financial profile and living situation is a far cry from the already modest existence i knew prior. I used to be able to volunteer time to my community in good measure and give to charitable organizations in a more useful way, but no longer. But I do look forward to the day when I can turn that around.

            Again, I wish you and yours well.

            Like or Dislike: Thumb up 4 Thumb down 3

          • abigchocoholic says:

            This whole process which was purported to help took close to a year,ruined my credit and put me in foreclosure. My home of 25 years has been sold.
            —————————
            Nope. If you took out a mortgage 25 years ago, your house would be basically paid off by now and you’d have hundreds of thousands in equity.

            So tell the truth. Some time ago, probably within the last 5-8 years, you borrowed against your house, probably hundreds of thousands of dollars. Yes, you got that money. Yes, hundreds of thousands of dollars in cash. And then you spent it. Recklessly. And now it’s all gone.

            Then what happend was that the bank asked for its money back–you know that’s why they call it a loan— and you said I don’t have it and you started looking around for a way out of paying back the money that you borrowed and it didn’t pan out as just about everyone in your situation has found out.

            In other words, people like you stuck it to the nation big time. You took trillions out in loans that and you got your cash and you left the rest of us holding your empty bag.

            And now you want us to feel sorry for you. But you got the money didn’t you? You just blew through it. We didn’t get anything but a multi-trillion dollar bill from irresponsible borrowers.

            Like or Dislike: Thumb up 8 Thumb down 9

            • grumpy says:

              Well clown. You don’t know me or what I have done.
              You are correct about my refinancing the house but not to the tune of “hundreds of thousands of dollars”
              The rest of it, well,let us just say you’re full of sshitt.
              As for “people like me”, I love the way you can lump everyone into one little fantasy group for yourself. Must may you feel real special.
              No one tried to skip or get out of paying anything.
              I’m not looking for anyone to “feel sorry for me”. Just sharing my experience for others who might be having problems.
              Have you ever considered Chocoholics Anonymous?

              Like or Dislike: Thumb up 5 Thumb down 5

              • abigchocoholic says:

                “You are correct about my refinancing the house but not to the tune of “hundreds of thousands of dollars”
                ——————–
                Nope. You’re still not telling the whole truth. I’ve been in the business a long time and, for the most part, there are only 2 types:

                1. The re fi-as you call yourself aka the consolidation loan aka the home equity line of credit. This is just another way of saying you borrowed hundreds of thousands of dollars using your home as collateral. Notice how you don’t admit how much you took out. It wasn’t a straight re-fi because again, your home would be paid off. Nope, you took out a lot of money probably about 200k using your home as collateral. You probably bought a bunch of toys or maybe even another house. And then you never paid the money back.

                2. The low down payment home buyer. These are the people who bought the 400, 500, 600k or more house for 3-5% down. When their home prices dropped 100, 200, 300k or more those people just lived in those homes for free until their homes were foreclosed on which more than covered their 5% initial investment. This is why all the banks went bankrupt because the banks were stuck with huge worthless loans.

                “No one tried to skip or get out of paying anything.”
                ——————-
                Again, not true. If you had paid your mortgage you wouldn’t have been foreclosed upon. Not paying is called skipping out. If you got foreclosed on, you didn’t pay your loan back. It really is that simple.

                Like or Dislike: Thumb up 3 Thumb down 7

                • grumpy says:

                  Look clown. I’m not gonna get into a online pissing contest with you but it must be nice to have everyone packaged up in a nice little preconceived cubbyhole.
                  You really should try to get over your anger.
                  Grumpy out.

                  Like or Dislike: Thumb up 6 Thumb down 4

              • thinkaboutit says:

                Grumpy, take heart. It sure is easy for some people to “thumbs down” and armchair quarterback all day when they haven’t actually lived it. Arrogance and presumption abounds, doesn’t it?

                Certainly, there are bad apples on both sides of the mortgage industry, but people like you and I know our situations best, what happened *to* us and the long road out of it. The effects of this sort of humiliation are nothing short of stunning, far-reaching, and an experience I would not wish on my worst enemy if ever I had one.

                I do hope there is restitution of some kind available, though. At the very least, I hope there will be a legislative change, lawsuit…SOMETHING to prevent this from ever happening again in a blessed country such as ours.

                Like or Dislike: Thumb up 6 Thumb down 2

        • The Gimlet Eye says:

          This is the folly of trusting the government to “manage” ANYTHING having to do with economics and business.

          HAMP is obviously just another scam.

          Government interference in business will be the downfall of this civilization.

          Like or Dislike: Thumb up 4 Thumb down 3

  5. whatisup says:

    How can we be five years into this mortgage mess with almost nobody understanding what is really going on? Attorneys, Judges, politicians, the news media, nobody gets it!

    I am linking two links:

    This first link is a complaint by the Federal Trade Commission (FTC) against Countrywide and Bank of America in 2010 (BofA bought Countrywide a few years earlier, I believe in 2007). http://www.ftc.gov/os/caselist/0823205/100607countrywidecmpt.pdf

    This second link is the Consent Judgment and Order agreed to by Countrywide and Bank of America only a few days after the Complaint was filed where BofA agrees to pay a $108 million fine and in return they did not have to admit nor deny any of the allegations, although clearly from the consent order and what BofA agreed to there were serious violations on BofA’s and Countrywide’s part. The media never reported any details of this FTC action or the importance of the FTC’s findings. Perhaps CCN could break the story. http://www.ftc.gov/os/caselist/0823205/100607countrywidecmpt.pdf

    Please note: Banks have sold off the loans they made to investors. THE BANKS DO NOT OWN THE LOANS. So why are the banks fighting so hard to foreclose instead of modifying mortgages? As the FTC found in its investigation, Countrywide/BofA had a scheme to make huge profits from foreclosures on the mortgages it did not own, but where they acted as the MORTGAGE SERVICER.

    This is the situation with almost all residential mortgages from all the big lenders, including Chase, the Defendant in the lawsuit in this case profiled here by CCN. The bank sells off the mortgage to an investor, but retains the roll as mortgage servicer for the new owner of the loan. All the major banks are doing the exact same thing.

    A mortgage servicer’s roll is similar to a property management company’s roll with rental properties. In property management the owner of the rental property hires the property management company to rent the house out, collect the monthly rent, take care of repairs, etc. In return the property management company usually charges the owner of the rental property a portion of the monthly rent collected as a fee for performing these property management services.

    A bank as a Mortgage Servicer does similar services for the owner of your mortgage as the property management company does for rentals. The mortgage servicer collects the monthly mortgage payment from you — this is why you still make the check out to BofA or whatever bank is your mortgage servicer EVEN THOUGH THAT BANK NO LONGER OWNS YOUR MORTGAGE. The bank performs other services for the owner of your mortgage such as taking care of filing the mortgage interest tax forms that go to the IRS and State at the end of the year. The bank takes their cut of your monthly mortgage payment for performing these services and then pays the owner of your mortgage the balance.

    So how does the bank as Mortgage Servicer make a big profit from a foreclosure on a mortgage it does not own? The contract between the owner of your mortgage and the mortgage servicer (bank) has a clause that the mortgage servicer will perform certain duties on behalf of the mortgage owner IF A FORECLOSURE BECOMES NECESSARY. The mortgage servicer (bank) charges big fees to the owner of your mortgage for handling these foreclosure services and, as the FTC found out, the mortgage servicers (banks) have a slew of affiliated companies the handle different parts of the foreclosure process so the bank makes money from virtually every part of the foreclosure process, not just as the mortgage servicer. A good example is that when a mortgage is foreclosed on in CA the owner of the loan has to use an Independent Foreclosure Trustee to handle the legal part of the foreclosure procedure. Of course the “Independent Foreclosure Trustee” gets paid a substantial amount of money for handling the legal aspects of the foreclosure. The Independent Foreclosure Trustee, in theory, neither represents the owner of the mortgage nor the owner of the house being foreclosed on. However, the FTC found in BofA’s case that virtually all the mortgages BofA sold listed Recon Trust as the Independent Foreclosure Trustee if a foreclosure became necessary. Guess who owns 100% of Recon Trust? Bank of America. So, the Independent Foreclosure Trustee does not represent the owner of the loan or the homeowner, but does represent the mortgage servicer (BofA) since BofA owns both the mortgage servicer and the “Independent Foreclosure Trustee”. This is a key to what the FTC called a foreclosure scheme on page 6, paragraph 15 of the Complaint linked above.

    It is most important you understand that the mortgage servicer (bank) can not make the huge profit from your house being foreclosed on unless it actually is foreclosed on, which sounds kind of stupid until you actually think about it, i.e., the mortgage servicer (bank) has a huge business profit motive to see your mortgage foreclosed on. It is strictly business profit, nothing else.

    Here is the very sick and despicable part of this whole mortgage mess: Why did the banks give adjustable rate mortgage loans to millions of people with low teaser rates that the banks knew the homeowner would not be able to afford the monthly payments when the interest rate adjusted higher? Because the bank got the crappy mortgage loans rated as Triple A loans and sold them off to unsuspecting investors as a sound investments. This eliminated the bank’s risk if the loans were foreclosed, which was almost guaranteed to happen. However, the banks stayed on as the mortgage servicer and would make a huge profit if the mortgages were foreclosed on, which was virtually guaranteed due to the Banks’ phony underwriting of the mortgages. It was a guaranty that millions of mortgages would be foreclosed on to the huge profit benefit for the banks acting as the mortgage servicer. So, to re-cap, the banks knowingly made mortgage loans they knew they would be foreclosing on later, then sold the loans off to unsuspecting investors, and then made huge profits by charging fees to those owners of the mortgages (the unsuspecting investors) for handling the foreclosures!

    I want to take a moment to make it clear that in today’s real estate market that usually when a mortgage is foreclosed on the house is completely upside down, meaning the house is worth less than the amount owed on the mortgage. What does this mean for the owner of your mortgage? If your house is foreclosed on the owner of your mortgage is going to take a huge financial hit, so why would the owner of your mortgage want to foreclose on your mortgage today, especially if you could pay a reduced monthly amount for now. Answer: The owner of your mortgage does not want it foreclosed on because they will take a financial bath, but the mortgage servicer (bank) DOES want your mortgage foreclosed on because it will make a huge profit charging the fees for handling the foreclosure. The question is how in the world is the bank getting the mortgage foreclosed on when the owner of the mortgage does not want the mortgage foreclosed on?

    It doesn’t seem possible, but the banks figured out a way. When you sign your mortgage note it has a clause in it that says the owner of the mortgage or the NOMINEE BENEFICIARY can foreclose on your mortgage loan. Who or what the heck is a nominee beneficiary. Well it turns out when you sign your mortgage note there is usually a clause where you agree that some entity will be the Beneficiary Nominee and it has the right to start foreclosure procedures. Many times your note will list a company called MERS as the Beneficiary Nominee. Guess who owns MERS. It is jointly owned by the majority of all the largest banks in the U.S. So, the mortgage servicer, owned by the bank, tells you to start making reduced payments as part of the mortgage modification process; then the same Mortgage Servicer which makes a huge profit if your mortgage is foreclosed on, tells the Beneficiary Nominee, also owned by the bank, that you are behind in mortgage payments, so the Beneficiary Nominee (bank) then instructs the Independent Foreclosure Trustee, also often owned by the bank and not independent at all, to foreclose – all without the true owner of your mortgage having a clue what is going on.

    If you start a mortgage modification review you are often told by the mortgage servicer to make reduced monthly payments. However, once you make reduced monthly payments you are now technically behind in your mortgage payments and in default. The same bank owned Mortgage Servicer that told you to make reduced payments then starts performing various pre-foreclosure procedures with fees that add up fast. If your mortgage modification is turned down and you are foreclosed on, the bank that turned your mortgage modification down because it claims you never filed the proper paperwork is the same bank that will make a huge profit handling the foreclosure procedure. The same mortgage servicer, owned by the bank, then informs the Beneficiary Nominee, also owned by the bank, that you are behind in payments. The Beneficiary Nominee then notifies the “Independent Foreclosure Trustee” also often owned by the bank, to start the legal foreclosure procedure.

    If your mortgage modification is turned down by the bank then you have to pay all the missed mortgage payments PLUS all the late fees, inspection fees, legal fees, and pre-foreclosure fees that have racked-up in order to keep you mortgage from being foreclosed on. Most people simply don’t have the missed mortgage payments plus all the fees to pay so the mortgage is foreclosed on with the real owner of the mortgage taking a substantial financial hit as the house is sold at foreclosure auction for often $100.000’s less than is owed on the mortgage loan.

    As the Federal Trade Commission found, this scheme is so complex and involved, nobody understands it except the banks who continue to make profits from turning down mortgage modifications and foreclosing.

    Like or Dislike: Thumb up 9 Thumb down 7

    • abigchocoholic says:

      “The owner of your mortgage does not want it foreclosed on because they will take a financial bath, but the mortgage servicer (bank) DOES want your mortgage foreclosed on because it will make a huge profit charging the fees for handling the foreclosure. The question is how in the world is the bank getting the mortgage foreclosed on when the owner of the mortgage does not want the mortgage foreclosed on? ”
      ———————————
      Nope. The fees for a foreclosure are just a couple of thousand. Hardly a fortune. And mortgage servicer fees are miniscule. And the owner of your mortgage does want it foreclosed on and gave direction to have your mortgage foreclosed on because you haven’t made your payments in about 9 months and in many cases for years and the owner’s only remedy when you don’t make your payments is to foreclose.

      ” Attorneys, Judges, politicians, the news media, nobody gets it!”
      —————————
      But you do “get it”? Don’t you think it’s much more likely that you don’t get it and the lawyers and Judges and economists and politicians do get it? See we had this little thing called a national real estate crisis that basically took our banks under. Yes, it was the biggest banking crisis in the history of our nation. Were you not around for that? It was pretty well publicized, don’t know how you could have missed it. In this crisis, banks were not only not making huge profits as you repeatedly allege, they actually went bankrupt. How? Well, it’s actually pretty simple. They loaned money to 10s of millions of Americans for home purchases and equity lines of credit and those 10s of millions of Americans didn’t pay the money back. Is that so complex? The money went out of the banks and into 10s of millions of homes and the money never came back even though the money was only loaned. Basically, 10s of millions of Americans were living way beyond their means—let’s just call them liar loans because that’s basically what they were. 10s of millions of Americans lying about their ability to pay back the money they were borrowing.

      When economic times got a little difficult, those 10s of million of lying Americans walked away from their legal obligation to pay back their home loans causing our banks to go bankrupt because the money went out but never came back. As a nation, we had no choice but to bail out our banks to save our national financial system. It was either bail out our banks or today we would be trading chickens or bartering finstead of using money.

      Now, do the banks bear some responsibility? Of course they do. They should never have made those 10s of millions of loans to those lying Americans. But the loan origination profits were good and the system allowed even encouraged the banks to make the loans. And, of course, those 10s of millions of lying Americans put their hands out and took the money and then defaulted on their legal responsibility to pay the money back. If they had paid the money back there wouldn’t have been a real estate crisis, but they were in way over their heads and they just walked away from their legal responsibilities and the house of cards came tumbling down and the rest is history.

      Like or Dislike: Thumb up 2 Thumb down 5

      • r0y says:

        Do you understand HOW money is created? We have a debt-based system of monetary creation, that is (in simplest terms): money does not exist until you borrow it.

        So the money going “out of the banks” is misleading; it makes it appear as though the money existed prior to the loan. No, it did not. By a borrower signing a promise to pay it back, the bank (essentially) turns around to the next bank up (or the Fed, if they’re one of the big boys) and says “here, I got this promise that this person is going to pay me – so give me this money” – in turn, the fed creates the money OUT OF THIN AIR. From nothing. DIGITALLY, so there isn’t even printing involved! Poof! $400K, $500K, whatever amount. Poof, there it is.

        So to have banks “fail” is also misleading. They are part of the centralized banking system we have (and other countries, but I’ll keep this within US borders). The premise of the “banking crises” was that some banks failed! Yes, and here’s why: As stated above, whenever money is created, it is created because of a promise to pay it back (plus fees, interest, etc). Congress GAVE this authority to the Federal Reserve (a private bank, like BofA, Chase, etc) and PAYS them to give us our currency. Sweet deal for the fed!

        Now, every time you want to buy something, and take a loan, it is basically the same principle that the government uses to avoid raising taxes to pay for things: ISSUE BONDS (bonds are like a mortgage, except without collateral). A Bond and a Mortgage usually mean that if you borrow X, you’ll pay back 2X in a number of years (the term, 30 year, 40 year, 10 year, whatever).

        OK, so we need 1,000 to borrow. We sign something saying we’ll pay them 2,000 over the next 20 years if it’s a mortgage, or AT the end of 20 years if it’s a bond. But we’ve only created 1,000 – how are we supposed to get the other 1,000 in interest? Another bond/loan.

        Do you see the pattern in this CLOSED centralized banking system? The SAME PROCESS must be followed to create the money to pay off the first bond/mortgage. THERE IS NO WAY TO PAY OFF THE DEBT. EVER. PERIOD. At least not without some Earth-shattering financial changes.

        HOW CAN WE PAY OFF DEBT without going into debt? We cannot. All money (except coins) is created FROM debt. Even if you think you’re going to mine some gold and sell that, unless they take gold as money (oh sorry, the Fed thought of that and had congress make it illegal to use precious metals or anything but Federal Reserve Notes and Treasury coins as currency). Convenient, and ANOTHER sweet deal for the Fed!

        The problems in the housing market are only just the tip of the iceberg of this financial debt monster that WILL consume everything if we stay with debt-based currency. Why do you think the governments of the world want to move to digital-only money (Sweden or some country is already embarking on this). It is a lot easier to add a single “0″ (zero) to the end of an account balance (a la TARP) and say, “Hey, your balance of 1,000,000 is now 10,000,000! Isn’t that neat-o?” Yeah. Great. Thanks for increasing every consumer good, robbing all savings and retirement, etc.

        What backs up the U.S. Dollar? In all seriousness? F-16′s and Marines.

        Hiding in plain sight: our “currency” has no value and the Fed has been allowed to create as much of it as they want. They have to, they own 60% of our debt. Ever wonder what happens when a country owns it’s own debt? Technically we don’t, as the Federal Reserve (as stated earlier) is NOT a federal agency, nor a reserve (though they did steal most of the U.S.’s gold); however, they ARE the authority for issuing our currency, so it’s a convenient little gray area (well, it’s pretty black and white to things like China, Russia, OPEC, etc.).

        If any other country did what we have been doing the last 5 years or so, we’d call them Zimbabwe. Ever wonder if you’ll put a $500 bill into a coke machine to get a soda one day?

        Like or Dislike: Thumb up 4 Thumb down 3

        • zaphod says:

          Plate of shrimp^
          our federal reserve is a government agency (the board of governors appointed by the POTUS) . the fed is not perfect but it is ours they are us this happens to be the united states of america
          Marriner Eccles included full employment as a mandate for the fed FYI
          use the links to fact check for your self you can drill down and find the local people who serve at various levels of all classes of banks all over america the fed is made of people!

          Like or Dislike: Thumb up 1 Thumb down 4

          • r0y says:

            I went to your link and found this:

            “The Federal Reserve System is considered to be an independent central bank because its decisions do not have to be ratified by the President or
            2
            Overview of the Federal Reserve System
            anyone else in the executive branch of government.”

            …from the link you provided. Maybe you should actually READ them yourself, instead of regurgitating the huffpo? Just a thought.

            You’re welcome.

            Like or Dislike: Thumb up 2 Thumb down 2

      • whatisup says:

        You are so wrong! You don’t know why the banks were in trouble. You don’t know how banking works, you don’t understand the leverage banks use, you don’t understand the mortgage insurance market fraud, you don’t understand the incredible risk the banks were taking on the “investment side” of their business and the losses the banks incurred when the economy froze and you don’t understand the credit default swap market fraud that froze the banking system and caused the liquidity problem that buried the banks, etc. You don’t understand that banks are exempt by special law from having any fiduciary duty when making a bad mortgage loan which is the law they are now hiding behind to try to protect themselves legally (everyone else has a fiduciary duty except the banks that conveniently got a legal exemption from the U.S. Congress). And you most decidedly did not read the Federal Trade Commission Complaint or the Consent Judgment and Order agreed to by BofA that is linked above.

        Read the FTC Complaint. The banks set up the foreclosure for profit scheme from the beginning as a profit center to balance their profit flow when the economy went bad. Both Countrywide and World Savings top executives are on record admitting it. The World Savings Executive called it their SEE-SAW business strategy — make money writing bad loans and selling them off when times are good, and make money foreclosing on the bad loans they wrote when times are bad. All the other big banks had the exact same programs in place.

        Your problem is you have a preconceived idea what happened and a specific group you want to assign all the blame to. New information that has not made it mainstream but is accurate is starting to surface and it does not agree with your preconceived beliefs or who you want to blame. That is your problem and no amount of you denying the truth will change the truth except in your own head.

        You clearly just make things up as the total fees and related costs for foreclosure the banks and their Vertically Integrated Subsidiaries collect on can easily run to $15,000 – $30,000 per home foreclosed on. You didn’t know that did you? Vertically integrated means, by the way, that all of the profits from these foreclosure related subsidiaries flow directly back to the bank holding company for the profit of the stock holders. Take the total profit per foreclosure after costs and multiply it by millions of foreclosures and you have a profit center for the banks.

        Like or Dislike: Thumb up 3 Thumb down 4

        • abigchocoholic says:

          You clearly just make things up as the total fees and related costs for foreclosure the banks and their Vertically Integrated Subsidiaries collect on can easily run to $15,000 – $30,000 per home foreclosed on.
          —————–
          Nope. There is no money for the bank to collect on a foreclosure, that’s why it’s in foreclosure. Nobody is paying bank anything. That’s why they are mad and want to foreclose. It’s all money going out, none coming in.

          Typical foreclosure scenario. Pay $1,000 to the title company, $1,000 to the trustee to conduct the trustee’s sale, 5k to bring the taxes current. All real cash leaving the bank. No money coming in, ever. In exchange bank ends up with a house that’s worth 200k less than what the bank loaned on it, (not to mention the owner got to live in the house for free for 1.5 years prior to foreclosure actually taking place) and now the bank gets to spend 30k to fix up the house and 15k in realtor’s fees to sell it. Again, real cash leaving the bank. No money coming in ever.

          When the bank finally sells a foreclosed home, the bank has taken about a 250k hit on average. Hardly a profit center.

          Nough said.

          Like or Dislike: Thumb up 1 Thumb down 3

          • whatisup says:

            You are a funny guy. The bank does not own the loan. The bank sold the loan to an investor. The bank loses no money when the house is sold in foreclosure, the investor does. I am not sure what you don’t understand about these facts, but apparently the Federal Trade Commission fining BofA $108 million for their foreclosure for profit scheme never happened in your mind either. Understanding the role that the Nominee Beneficiary and MERS plays might help you to understand the mortgage industry is quite different from what you describe. The fact you are describing how the mortgage industry operated 50 years ago and not today’s completely different mortgage industry operating structure indicates a real naivety on your part and yet you are so adamant you are right despite not understanding the basics of how the mortgage industry operates today. There must be a reason why. In re-reading your original post I realize you are one angry person. Care to elaborate why? Anyhow, you can say “Nope” all you want but it doesn’t change the truth and you do not come close to speaking the truth. It appears to be more about “winning the argument” with you than about trying to educate yourself and arriving at the truth; and that makes debating you any further worthless. Good Luck!

            Like or Dislike: Thumb up 3 Thumb down 3

            • abigchocoholic says:

              The bank does not own the loan. The bank sold the loan to an investor. The bank loses no money when the house is sold in foreclosure, the investor does.
              ——————
              Nope. The banks carried trillions in these home loans. That’s why virtually all of them went bankrupt. That’s why we had to bail them out. Obviously, if they sold all the loans they wouldn’t have gone bankrupt and we wouldn’t have had to bail them out.

              You are seriously confused seeing conspiracy at every turn. You have the mortgage service providers making 30k off each foreclosure and the mortgage service providers being wholly owned by the banks all at the same time when there there is no money coming in and the banks are taking hundreds of thousands in real cash hits off each bad loan. It’s nonsensical.

              Just stop and use your common sense. Bank loans out money, money never comes back. Bank loses money and is in big trouble. The American public fleeced our banking system by taking out trillions in loans and then not paying the loans back. It’s that simple. You don’t get to shout “you should never have loaned me that money, you scammed me” because it’s a non-starter argument. You have to look in the mirror. The fact is you got the money and you have to pay it back or get foreclosed on.

              The lawsuit complained of in this article and the “woe is me” stories that followed are all about people who did not abide by the agreement they entered into. If they had paid their mortgage nothing would have happened. But they didn’t pay their mortgage and the politicians scam them with government programs to get them out of their deals and mortgage recovery outfits that scam them out of fees claiming they can stop foreclosures and it’s all a scam, scam, scam. Look up the definition of ex post facto–it’s illegal under our constitution to try and force people to change the legal agreements they entered into.

              Like or Dislike: Thumb up 0 Thumb down 5

              • whatisup says:

                You are seriously confused seeing conspiracy at every turn. You have the mortgage service providers making 30k off each foreclosure and the mortgage service providers being wholly owned by the banks all at the same time when there there is no money coming in and the banks are taking hundreds of thousands in real cash hits off each bad loan. It’s nonsensical.

                _ _ _ _ _

                Nope. The owner of the loan pays the mortgage foreclosure fees once the house is sold in foreclosure, i.e., once the foreclosure sale takes place the mortgage servicer gets paid all the fees it is owed and then the owner of the loan receives the balance of the proceeds from the sale.
                I notice you have yet to refer to the FTC Complaint filed against BofA and the $108 million dollar fine BofA paid for their foreclosure for profit scheme. Doesn’t fit your incorrect analysis so you chose to ignore it. I am sure you would have fought just as hard to prove the world was flat 500 years ago. Bully for you!

                Like or Dislike: Thumb up 3 Thumb down 1

                • abigchocoholic says:

                  The owner of the loan pays the mortgage foreclosure fees once the house is sold in foreclosure, i.e., once the foreclosure sale takes place the mortgage servicer gets paid all the fees it is owed and then the owner of the loan receives the balance of the proceeds from the sale.
                  —————————-
                  The balance of the proceeds from the sale? Hah? There are no proceeds. The bank only gets the house back not money. Come on, get up to speed.

                  When a home gets foreclosed on it is because the mortgage is much greater than the value of the home. (Otherwise the owner of the home would just sell the home and keep the net proceeds for himself.) The owner of the mortgage (bank) gets a credit bid up to the value its mortgage and takes the house in the foreclosure as the highest bidder with its credit bid. Again, no money coming in. Ever. No money from the foreclosure sale–ever. All the owner of the mortgage gets is a house worth 100-200k less than the money it loaned.

                  Then the bank has to fix up the home and then pay a realtor to sell it. Again, the bank takes a huge hit in a foreclosure.

                  Like or Dislike: Thumb up 0 Thumb down 2

                • whatisup says:

                  abigalcoholic – On top of avoiding commenting on the Federal Trade Commission’s Complaint against BofA/Countrywide for their foreclosure for profit scheme, you also insist that the banks own the mortgage loans and did not sell them to investors. Here is part of the complaint against Countrywide/BofA (BofA bought Countrywide) from the State of California Justice Department. BofA agreed to settle this case for $8.5 billion to avoid prosecution. Countrywide was the largest mortgage lender in the U.S. with 30% of the U.S. mortgage market and sold virtually 100% of the mortgages it originated to investors as did all the other big mortgage lenders (banks) as described in the Complaint.

                  This is directly from paragraph 19 of the Complaint which is linked below so you can view it for yourself and become updated and modern in your thinking of how the mortgage industry operates today. From paragraph 19:

                  The mortgage market changed in recent years from one in which lenders originated mortgages for retention in their own portfolios to one in which lenders attempted to originate as many mortgage loans as possible for resale on the secondary mortgage market.

                  http://ag.ca.gov/cms_attachments/press/pdfs/n1582_draft_cwide_complaint2.pdf

                  Like or Dislike: Thumb up 2 Thumb down 1

                • abigchocoholic says:

                  Of course many of the loans were sold to Fannie Mae, Feddie Mac, private investors etc. but it doesn’t really change anything for the borrower. And trillions were not sold.

                  And yes, I’m familiar with the 108m FTC settlement against Countrywide for adding hundreds and sometimes thousands to mortgage balances–again doesn’t change anything for the borrowers.

                  This stuff is pocket change compared to the fleecing of America by Americans taking out loans they can’t pay back. The stuff I”m talking about is trillions. The stuff you’re talking about is 100m— 1/1000 of what I’m talking about. Pocket change.

                  Like or Dislike: Thumb up 0 Thumb down 3

  6. Ted Slanders says:

    .
    Seriously, can anyone spell “ C-R-E-D-I-T U-N-I-O-N-S?”

    It goes directly against any logic and reason that one stays in one of the large banks that, in part, caused this economy downturn. It’s like you’re supporting the burglar with food, water, and other necessities, that robbed your home of your prized possessions!

    In reality, 99 percent of the alumni here at CCN would be better off at one of our County’s Credit Unions. They operate under the concept of “nonprofit” and you have a part in the ownership of said Credit Union. Get it, nonprofit?

    The executive management of the big banks, aka, “the banksters”, must answer to its owners, the shareholders, of which only care about one thing; making money at your expense! Their recent insidious business practices of credit false swaps, derivatives, etc., makes one sick with the greed that was shown, and that tumbled the world’s economy!

    This is barring the factoid that these bankster crooks knew of the status of these derivatives as being, for the most part, worthless! In return, your big bank’s management and CEO’s still retain their exorbitant salaries and were never brought to justice! If you’re still at a big bank, this must make you feel all warm and fuzzy inside, doesn’t it?

    With a Credit Union, the difference is that there isn’t pressure to find ways to make money off the customers. What a novel concept! A Credit Union offers what the big banks do, and at a lessor cost.

    When was the last time you heard of a Credit Union Bank, that is owned by it’s customers, getting involved with credit default swaps, derivatives, and other questionable acts, and turning itself into a Las Vegas gambling casino that took this planet to it’s knees? 2+2=4.

    This CCN article only supports the notion of why one should leave the big bank and move into a Credit Union. Enough is enough!

    Like or Dislike: Thumb up 9 Thumb down 3

    • r0y says:

      While this is true for day-to-day banking needs, most credit unions do not issue home mortgage loans because they would never be able to compete with large-volume lenders.

      But I agree: get out of a Bank and into a CU.

      Like or Dislike: Thumb up 1 Thumb down 3

  7. thinkaboutit says:

    First, my sympathies AND thanks to Mr. Campbell, for taking on the Bank.

    Second, my hope is to see the mother of all class action suits against the banks in what is a grand scheme to rip off the American people of their hard-earned equity and property.

    Third, I hope this subject gets more Web presence than the hot piece on Dick Mason and two-part porno-tisement of Gary Lee.

    Like or Dislike: Thumb up 10 Thumb down 3

  8. CA Native says:

    Why is J.P. Morgan Chase still in business and why aren’t all the executives and the board of directors in prison? They’re criminals.

    Like or Dislike: Thumb up 11 Thumb down 2

    • The Gimlet Eye says:

      Because this country is run by people who control our money supply. Control the money, and you control EVERYTHING.

      Like or Dislike: Thumb up 9 Thumb down 2

    • r0y says:

      Because BANKINGS biggest friend is in the White House and banking IS the executive branch. Ever heard of Goldman Sachs? (or Government Sachs, as it’s often called since Obama took office).

      Just saying…

      Like or Dislike: Thumb up 1 Thumb down 3

  9. danika says:

    “… that institution cannot reconvey your clear deed of trust back to you even after you have fully satisfied the terms of your now securitized note.”

    So, I pay my mortgage on time, pay it off, and I can’t get my lender to reconvey a clear deed of trust back to me? Then how are people to get the clear deed of trust reconveyed to them after paying off the loan?

    Like or Dislike: Thumb up 16 Thumb down 0

    • Cindy says:

      Good question, I refinanced and paid off my loan to Bank of America (although BofA wasn’t who I originally financed with). After the loan was paid off, they (BofA) never reconveyed my deed of trust, obviously because they never had my deed of trust but they had been collecting my mortgage payments for years after they purchased my note from Provident Funding. The reconveyance came from New York and is simply signed by a person with a title that say’s “Employee of MERS”. Huh? MERS has no employees, that’s a fact. Currently, there is no longer a clear chain of title on my property. In fact, I’ve learned that BofA never had the note and MERS certainly didn’t have it yet BofA was paid off when I refinanced.

      This would indicate that my note is still floating around someplace and someone can return someday holding a promissory note from me that say’s I owe them the funds. They can’t take my home as that note is now separated from the deed but they still can demand payment of the note which was paid off to the wrong holder (which becomes my problem). What a mess.

      Like or Dislike: Thumb up 13 Thumb down 2

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