BEWARE: USING THE FOUR-LETTER WORD “NOTE”

Niel Garfield's Comment: Like a breath of fresh air, I received Bill's email and I encourage anyone in Minnesota to seek him out. He totally gets it , explains it, and understands it. Here is the beginning of the attached article:

BEWARE: USING THE FOUR-LETTER WORD “NOTE” IN MINNESOTA FEDERAL DISTRICT COURT MAY COST YOU $337,603.08

The Butler Liberty Law firm has commenced 27 lawsuits involving 197 plaintiffs challenging the mortgage foreclosure rights of the October 2008 Bailout Banks holding “securitized” mortgages. The plaintiffs’ claims in all of these cases is based on a “quiet title” cause of action.

Quiet title law allows a person in possession of real property (or a person asserting a title interest in vacant property) to bring suit against someone claiming a lien or other interest in real property. A successful quiet title action results in a court “quieting” title to the real property; that is, resolving the claims and interests of the parties and removing and/or voiding any invalid liens or claims.

In 1995 I tried and won the only case I am aware of that resulted in the voiding of two securitized mortgages. In that case, First National Bank of Elk River v. Independent Mortgage Services, 1996 WL 229236 (Minn. Ct. App. No. DX-95- 1919) (FNBER v. IMS), I represented a bank against a mortgage loan securitizer who was claiming rights in a mortgage without having possession of the homeowner’s promissory note and without having ever advanced any funds to the homeowner. As indicated in the decision above, my bank client won the battle of the putative mortgagees because my client was able to produce the original promissory notes with endorsements that clearly indicated that the defendant securitizer and pretender mortgagee had no right, title or interest in the notes.

A note is a promise to pay. A mortgage is security for that promise to pay. No note = no mortgage. The rubber meets the road reality of FNBER v. IMS clearly illustrates this ancient legal principle.

BEWARE Article by Bill Butler

Borrower Beware: Don’t Payoff Without Tender of REAL Original Note

Posted on February 27, 2013 by Neil Garfield

The Perils of Payoff

On the road again: I met a fellow on the Red Coach from Tallahassee to Fort Lauderdale who is pursuing a case that proves the central point of this blog: Whether you are selling, refinancing, Short-Selling, or otherwise paying off your supposed loan balance, the institution that receives the payoff (a) has no right to the money and (b) has no authority to execute a satisfaction of the note and mortgage even upon receipt of the money. And the reason is that in most cases they don’t have the note, which means it is still in circulation somewhere supporting as much as 42 times the face value of the note in hedges and derivatives. When confronted with a payoff of the loan, the institution is more than happy to take your money but will lie and cheat to avoid providing you with a real non-photo-shopped original note.

Unfortunately, most people are still taking ... More

A List of Mortgage Closures, Mergers and Layoffs

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BOA Whistle Blower

New Whistleblower Describes How Bank of America Flagrantly Violates Dual Tracking, Single Point of Contact Requirements in State/Federal Mortgage Settlement

Remember that big, ballyhooed mortgage settlement of early last year? The one where homeowners got $25 billion of relief (well actually only around $5 billion in cold cash, but why bother with pesky details?) The one made possible by Eric Schneiderman abandoning his fellow state attorneys general to grasp the brass ring of a do-just-about-nothing Residential Mortgage-Backed Task Force? The one that would make banks clean up their act and stop using robosigned documents and deal more fairly with borrowers?

Specifically, that agreement provided for strict limits on one practice, dual tracking, and the creation of a new one, single point of contact. Both relate to mortgage modifications. Dual tracking is when a bank starts and continues to advance the foreclosure process at the same time a borrower is being considered for a modification. That play out badly for a lot of borrowers during HAMP mods, when they would receive foreclosure notices, get understandably freaked out, since they had a modification application in with their servicer, and would typically be told to ignore the foreclosure mortgages. That was bad, and perhaps deliberately duplicitous advice, since many people lost their homes that way. Single point of contact is the requirement that a bank provide one person for a borrower to deal with during the mortgage modification process

Read more at Naked Capitalism:

http://www.nakedcapitalism.com/2013/02/new-whistleblower-describes-how-bank-of-america-flagrantly-violates-dual-tracking-single-point-of-contact-requirements-in-statefederal-mortgage-settlement.html#WhzXuaegZ6LdBFiQ.99 

MORTGAGE CO. EXECS SUED OVER ROBOSIGNING DEFENSE FEES

Law360, Wilmington (February 13, 2013, 7:53 PM ET) — Lender Processing Services Inc. directors were hit with a shareholder derivative suit Tuesday alleging their failure to go after higher-ups responsible for the “robosigning” of foreclosure documents and other faulty practices left the mortgage servicer on the hook for hefty legal expenses.

Shareholder Steven Hill claims in a complaint filed in Delaware Chancery Court that while Florida-based LPS has borne the high cost of resolving litigation over the business practices of subsidiaries LPS Default Solutions and DocX, including a recently announced $127 million settlement, the company’s…

More @Law360, or read complaint below

Hill Complaint by

SUMMARY JUDGMENT REVERSED

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
January Term 2013

SERRANO V. HSBC | FL 4TH DCA – SUMMARY JUDGMENT REVERSED: DISPUTE RELATED TO PARAGRAPH 22 CONDITION PRECEDENT TO FORECLOSURE

GIL L. SERRANO, ONELIA SERRANO and TIULANG VALDES,
Appellants,

v.

HSBC BANK USA, NATIONAL ASSOCIATION AS TRUSTEE FOR WELLS
FARGO ASSET SECURITIES CORPORATION, MORTGAGE ASSETBACKED
PASS-THROUGH CERTIFICATES, SERIES 2007-PA1,
Appellee.

No. 4D11-1767

[February 20, 2013]

PER CURIAM.

Appellants Gil L. Serrano, Onelia Serrano, and Tiulang Valdes, defendants below, appeal a final summary judgment of foreclosure in favor of appellee HSBC Bank USA, N.A. as Trustee for Wells Fargo Asset Securities Corporation, Mortgage Asset-Backed Pass-Through Certificates, Series 2007-PA1. We reverse the summary judgment because there remains a genuine issue of material fact regarding whether appelleecomplied with the condition precedent contained in the mortgage to provide pre-suit notice of acceleration. See Dominko v. Wells Fargo Bank, N.A., 102 So. 3d 696 (Fla. 4th DCA 2012). We find no merit in the other issues briefed by appellants.

Reversed and remanded.

STEVENSON, GERBER and CONNER, JJ., concur.

pdf here: http://www.scribd.com/doc/126899088/Serrano

Judge Rejects Wells Fargo's Bid to Have Case Dismissed

The federal judge who approved last year’s National Mortgage Settlement between the government and the five largest servicers turned down Wells Fargo’s claim that a federal lawsuit against the bank violates settlement terms.

District Judge Rosemary Collyer wrote in her opinion that Wells Fargo took “a leap of logic” in its interpretation of several settlement provisions that would bar the government from bringing certain claims against the bank.

Read more...