Sunday, July 11, 2010

Daniel P. Stipano states National Banks Are Subject to State Laws When Foreclosing Mortgage Loans They Did Not Originate

Seal of the United States Office of the Comptr...
Seal of the United States Office of the Comptroller of the Currency, part of the Department of the Treasury. The design is the same as the Treasury seal with a Comptroller of the Currency inscription. (Photo credit: Wikipedia)


















NATIONAL BANKS ARE NOT ALWAYS EXEMPT

I am not a lawyer, please do not take my interpretation as legal advise.  I am only giving you my interpretation of what I've read.  Please seek the advise of an attorney. 

National Banks usually attempt to claim they are exempt from any state requirements of either registering with the Secretary of State or securing a license to conduct mortgage business in the state prior to filing a foreclosure action.  However, Daniel P. Stipano, Acting Chief Counsel, Comptroller of the Currency, Administrator of National Banks confirms in his letter below if the entity foreclosing on a piece of real property in a particular state did not originate the mortgage on the property they are petitioning to foreclose, if the entity is only acting as a servicer, or a trustee, or an assignee of a mortgage, the entity attempting to foreclose is subject to the laws of the State in which they are foreclosing.



January 14, 2005

Anthony J. Sylvester
Headquarters Plaza
One Speedwell Avenue
Morristown, NJ 07962-1981

Madeline L. Houston
Houston & Totaro
56 Broad Street, Suite 1
Bloomfield, N.J. 07003


Subject:           Wells Fargo Bank, Minnesota, N.A. v. Alberta Harris, et al.
                        Docket No. ESX-L-4676-02

                                                and

                        Bank One National Association v. Feinstein
                        Docket No. F-11450-00

Dear Mr. Sylvester and Ms. Houston:

This letter is in response to your letter dated December 13, 2004, seeking the views of the Office of the Comptroller of the Currency (“OCC”) concerning preemption of certain state laws in connection with claims and defenses asserted by the parties in the above-named cases.  You requested the OCC’s views at the direction of the Honorable Kenneth S. Levy, J.S.C., presiding judge in this litigation.  For the reasons stated below, based on the facts presented in the materials provided to us, we believe that neither 12 C.F.R. § 34.4 nor the National Bank Act preempts application of the state laws at issue here to loans simply because they were purchased and held by national banks acting as trustees in connection with issuance of the mortgage-backed securities involved in this case. 

Background


According to the materials provided with the December 13th letter addressed to me, Delta Funding made a mortgage loan to Alberta Harris in December 1999 (Wells Fargo Complaint, First Count ¶1), and subsequently assigned the mortgage to Wells Fargo “as Trustee for Delta Funding Home Equity Loan Trust 2000-1” (Wells Fargo Complaint, First Count ¶4).  Delta Funding made a mortgage loan to Dequilla Robinson in November 1999 (Bank One Statement of Material Facts Not in Dispute ¶3), and subsequently assigned the mortgage to Bank One National Association “as Trustee in Trust for the Registered Holders of Delta Funding Home Equity Loan Asset-Backed Certificates Series 1999-3” (Certification of Harold L. Kofman, Esq. ¶¶1, 3).  There is no indication that either Wells Fargo or Bank One made the original mortgage loans to Alberta Harris or Dequilla Robinson, nor does any party assert that Wells Fargo or Bank One has any other interest in these transactions except as trustees for investors in the mortgage-backed securities. 

As trustee acting on behalf of the investors in Home Equity Loan Trust 2000-1, Wells Fargo filed suit against Ms. Harris alleging that she had defaulted on the loan made by Delta and sought to foreclose on the real estate she had pledged as collateral for that loan (Wells Fargo Complaint, First Count ¶¶1-14).  As trustee acting on behalf of the investors in Delta Asset-Backed Certificates Series 1999-3, Bank One filed suit against Jack Feinstein, as Administrator Ad Prosequendum for the estate of Ms. Robinson, seeking to foreclose on the real estate she had pledged as collateral for the loan made by Delta (Memorandum of Law in Support of Plaintiff Bank One National Association’s Motion for Summary Judgment at 3-4).  Ms. Harris and Mr. Feinstein (“Defendants”), through counsel, opposed the foreclosure actions.  They alleged in counterclaims against the Banks (and third-party claims against Delta and others) defenses based upon alleged violations of the New Jersey Consumer Fraud Act (“CFA”), N.J.S.A. 56.8-2, which, among other things, proscribes unconscionable practices in real estate transactions.  N.J.S.A. 56.8-2.  See Defendant’s Brief in Opposition to Plaintiff Wells Fargo’s Motion for Partial Summary Judgment at 3; Defendant’s Brief in Opposition to Plaintiff Bank One’s Motion for Summary Judgment at 4.  Asserting that federal law authorizing national banks to make and purchase real estate loans preempted the Defendants’ state law defenses under the CFA, Wells Fargo and Bank One, as trustees acting on behalf of the investors, sought partial summary judgment on the cross-claims. 

Discussion


Pursuant to 12 U.S.C. § 371, national banks may “make, arrange, purchase or sell loans or extensions of credit secured by liens on interests in real estate, subject to * * * such restrictions and requirements as the Comptroller of the Currency may prescribe by regulation or order.”  The OCC’s real estate lending regulations provide that, “[e]xcept where made applicable by Federal law, state laws that obstruct, impair, or condition a national bank’s ability to fully exercise its Federally authorized real estate lending powers do not apply to national banks.”  12 C.F.R. § 34.4(a). 

The Banks assert that application of the CFA is preempted because it would interfere with their power as national banks to purchase loans as authorized under 12 U.S.C. § 371, and that holding them liable for violations of the CFA as loan purchasers would be contrary to 12 C.F.R. § 34.4(a), which preempts state laws that interfere with national bank real estate lending authority.  

Section 34.4(a)(10) states that national banks “may make real estate loans under 12 U.S.C. § 371 without regard to state law limitations concerning * * * [p]rocessing, origination, servicing, sale or purchase of, or investment or participation in, mortgages.”  12 C.F.R.§ 34.4(a)(10) (emphasis added).  However, in no sense, under the facts presented, can the Banks be viewed as making a real estate loan under 12 U.S.C. § 371 and 12 C.F.R. § 34.4.  The Banks did not originate the loans.  They did not fund the loans at inception.  Nor did they “purchase” the loans as part of any real estate lending program comprehended by the regulation.  Here, the Banks act as trustees for the benefit of investors in the trusts.  The substance of the transaction is that the investors, not the Banks, are purchasing the loans that have been made by Delta.  The investors own the beneficial interest in the loans held by the Banks as trustees.  And the effect of any liability for violation of the CFA ultimately falls on the investors.  Nowhere do the Banks allege that they themselves, as opposed to the trusts they represent, are exposed to liability for any violation of the CFA.  For all these reasons, 12 U.S.C. § 371 and 12 C.F.R. § 34.4(a) simply do not apply to the transactions by which the Banks acquired legal title to the loans in the circumstances at issue here. 

With respect to the activities of Wells Fargo and Bank One as trustees, the banks derive their power to act as trustees from 12 U.S.C. § 92a.  When state law conflicts with national banks exercising powers granted to them by federal law, the Supremacy Clause of the United States Constitution requires that the state law yield to the paramount authority of federal law, with the result that application of the state law to national banks is preempted.  The Supreme Court has explained this principle stating that it interprets “grants of both enumerated and incidental ‘powers’ to national banks as grants of authority not normally limited by, but rather ordinarily pre-empting, contrary state law.”  Barnett Bank of Marion County v. Nelson, 517 U.S. 25, 32 (1996). 

As the Supreme Court demonstrated in its review of preemption cases in the Barnett case, Supremacy Clause principles animating conflict preemption have been expressed in a wide variety of phrases that do not yield materially different meanings, including “stand as an obstacle to,” “impair the efficiency of,” “significantly interfere,” “interfere,” “infringe,” and “hamper.” See Barnett, 517 U.S. at 33.  Thus, if application of the CFA to the loans held by the Banks as trustee were to obstruct, impair, condition, or otherwise interfere with the Banks’ exercise of fiduciary powers granted to them under federal law, the state statute would be preempted. 

Based on the facts presented, we do not believe that to be the case.  The Banks have not claimed that application of the CFA would impair their ability to act as trustee in these circumstances or that the state law otherwise interferes with the performance of their legal obligations as trustee.  Nor could they claim that having to respond to state law defenses to recovery on assets held in trust obstructs or impairs their power to act as trustee absent some indication that the state law infringes their authority, conditions their actions, or imposes a burden in a way prohibited by federal law.  In short, the Banks’ authority to act as trustees under federal law does not insulate the assets the Banks hold in trust for the benefit of investors from state law requirements otherwise applicable to those assets. 



We trust that the foregoing is responsive to your request.


Sincerely,

/s/ Daniel P. Stipano

Daniel P. Stipano
Acting Chief Counsel


Cc:       Hon. Kenneth S. Levy, J.S.C.
            212 Washington Street
            The Wilentz Justice Complex
            General Equity, 8th Floor
            Newark, New Jersey 07102


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Wednesday, July 7, 2010

PLEASE VISIT OUR NEW BLOG

THORNTON, CO - AUGUST 22:  Barbara Daily drill... http://www.shelterforhomeowners.blogspot.com/

Tuesday, July 6, 2010


HOMEOWNERS HELPING HOMEOWNERS

THIS IS WHAT IT IS GOING TO TAKE, DEAR ONES, TO SAVE OUR HOMES. HOMEOWNERS HELPING HOMEOWNERS. WE CAN ONLY DEPEND ON GOD, AND ONE ANOTHER. FINANCIALLY, EMOTIONALLY, SPIRITUALLY, PHYSICALLY. AND IT'S GOING TO TAKE ALL WE'VE GOT.

All homeowners are encouraged to jump in, head first! Don't think too much, or you will be filled with doubt. Just decide, do you need help? If you need help, give it. Give what ever you've got. You will receive in direct proportion to what you give. That is just how things work.

You may share what help you need by e-mailing and a registry detailing the "needs" of all homeowners by state will be created. Each homeowner will be assigned a homeowner number, which will show in which state the homeowner lives, the date the homeowner made the need known, and the order in which the need came in on that particular day. Homeowner names will not be given out.

If you receive help and win your home, you give back, so others can stay in their homes. We all must start a place where homeowners can give what ever they have to give, time, money, energy, legal expertise, etc. to help all homeowners stay in their homes.

You may donate by clicking on the donate button, or by e-mailing and sharing the details of what you would like to do for homeowners. The gifts you share will be published, and the homeowner giving the gift will be assigned a homeowner number, which will show in which state the homeowner lives, the date the homeowner made the gift, and the order in which the gift came in on that particular day. Homeowner names will not be given out UNLESS A HOMEOWNER GIVES WRITTEN AUTHORIZATION APPROVING IT.

I always prefer to thank someone by name. I think it makes the entire process of giving gifts, and helping each other a much more personal and rewarding experience.   However, because the protection of all homeowners who want to offer their help or who need others help, privacy of all homeowners will always comes first.

Of course, if a professional is offering their services free of charge to homeowners on a case by case basis, such as an attorney, or a loan  modification expert, etc., definitely their names will be posted, and their services will be allowed space and acknowledgement as thanks for their tremendous gifts.
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Sunday, July 4, 2010

ARE YOU SUDDENLY BEING FORECLOSED UPON? IS YOUR MORTGAGE HITTING THE THREE YEAR MARK?

LENDERS ARE PUSHING HOMEOWNERS
OUT OF THEIR HOMES
AT EXACTLY THE THREE YEAR MARK
TO REAP THE BENEFITS OF "REO"
A LIE, BUT WELLS FARGO DOESN'T CARE
THEY ARE QUICKLY FORECLOSING
AGAINST SEC TRUST LOANS
AND THEY TAKE THE BENEFITS
AS IF THEY WERE REO'S


Real Estate Owned (REO): Any Mortgaged Property the title to which
is acquired on behalf of the Trustee through foreclosure, deed-in-lieu of
foreclosure, abandonment or reclamation from bankruptcy in connection with a
defaulted Mortgage Loan

Realized Loss: As to any defaulted Mortgage Loan, any loss realized
by the Trustee of such Mortgage Loan as calculated pursuant to Section 7.7
hereof.

Recovery : As defined in the Pooling and Servicing Agreement.

Reference Bank: Wells Fargo Bank, N.A. or if such entity is no
longer lending money or no longer quoting a prime rate, such other entity as the
Master Servicer may specify by written notice to the Servicer.

Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
publicly provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506 (Jan. 7,
2005)) or by the staff of the Commission, or as may be provided by the
Commission or its staff from time to time.

Relevant Servicing Criteria: The Servicing Criteria applicable to
the Servicer, as set forth on Exhibit R to the Pooling and Servicing Agreement.
For clarification purposes, multiple parties can have responsibility for the
same Relevant Servicing Criteria. With respect to a Subcontractor or Subservicer
engaged by the Servicer, the term "Relevant Servicing Criteria" refers to the
portion of the Relevant Servicing Criteria applicable to the Servicer insofar as
the functions required to be performed by the Servicer are to be performed by
the Subcontractor or Subservicer, as applicable.

REMIC: The segregated pool or pools of assets designated as one or
more real estate mortgage investment conduits, within the meaning of the REMIC
Provisions, pursuant to the Pooling and Servicing Agreement.

REMIC Provisions: The provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Sections
860A through 860G of the Code, and related provisions, and regulations and
rulings promulgated thereunder, as the foregoing may be in effect from time to
time and including any proposed legislation or regulations which, as proposed,
would have an effective date prior to enactment thereof.

Remittance Date: The 24th day of each month (or the preceding
Business Day if the 24th day is not a Business Day). Each month, the Servicer
must transfer all required funds from the Custodial P&I Account to the
Certificate Account on or before the Remittance Date.

Rents from Real Property: With respect to any REO, gross income of
the character described in Section 856(d) of the Code (generally, rent for the
use of real property, the amount of which is not dependent, in whole or in part,
upon the income or profit of any person, including certain payments for certain
services and personal property incidental to and customarily provided in
connection with the rental of such real property.)

REO Disposition: The receipt by the Servicer of Liquidation Proceeds
and other payments and recoveries (including proceeds of a final sale) from the
sale or other disposition of the REO.

REO Disposition Period: The period of time in which the Servicer
shall dispose or cooperate with the Trustee in disposing of an REO as set forth
in Section 14.4.2.

ARTICLE 14

REO Administration

Section 14.1 General Provisions

14.1.1. REO Action Plan. With regard to each REO which is acquired,
the Servicer shall prepare a plan of action within 30 Business Days after the
date on which the Trustee acquires marketable title to such REO. Each plan of
action shall set forth (i) a recommendation for the most effective manner to
dispose of the REO, based on a current appraisal report, a broker's price
opinion and a market analysis; (ii) the steps to be taken by the Servicer to
secure such REO; and (iii) an estimate of the amount of time that is required to
dispose of such REO. The Servicer shall promptly submit copies of each plan of
action to the Master Servicer and, where applicable, to the respective Primary
Mortgage Insurer, and/or the respective Pool Insurer. The Servicer shall
implement each plan of action in an expeditious manner. The Servicer shall
maintain monthly progress reports with regard to each plan of action detailing
the status of the related REO and the progress achieved in implementing the plan
of action.

Section 14.2 REO Servicing

14.2.1. REO Servicing Requirements. The Servicer shall service each
REO from its acquisition through its disposition and shall ensure that all funds
received with respect to such REO are deposited to the appropriate Custodial P&I
Account for remittance to the Trustee, unless the Master Servicer has relieved
the Servicer of these responsibilities by written notification.

14.2.2. Servicer's Responsibilities. In addition to any other
obligations set forth herein, upon acquisition of each REO, the Servicer shall
be responsible for:

(a) managing, maintaining, securing and, where applicable, renting
such REO until it is conveyed or sold;

(b) inspecting such REO at least once every 30 days and promptly
sending the Master Servicer an updated Property Inspection Report upon
request;

(c) paying all taxes, insurance, maintenance, management and
foreclosure costs relating to such REO;

(d) submitting recommendations for listing and soliciting offers on
such REO;

(e) marketing such REO;

(f) completing the sale of such REO;

(g) depositing sales proceeds relating to such REO into the
appropriate Custodial P&I Account for remittance to the Trustee;

(h) where applicable, satisfying all of the Primary Mortgage
Insurer's procedural requirements and filing all required forms and
claims;

(i) where applicable, depositing Primary Mortgage Insurance or Pool
Insurance proceeds relating to such REO into the applicable Custodial P&I
Account for remittance to the Trustee; and

(j) processing the conveyance of such REO to the Primary Mortgage
Insurer, where applicable.

14.2.3. [Reserved].

Section 14.3 REO Records and Reports

14.3.1. Records Retention. The Servicer shall retain in its files
copies of all documents, reports and invoices described in this Section.

14.3.2. Evidence of Title. Evidence that title to a REO is held by
the Trustee shall be submitted by the Servicer to the Master Servicer and, if
applicable, to the Primary Mortgage Insurer and/or the Pool Insurer, within ten
Business Days after marketable title to such REO has been acquired.

14.3.3. REO Expenses. At the request of the Master Servicer, Primary
Mortgage Insurer and/or the Pool Insurer, the Servicer shall send a report
listing all expenses in administering each REO. The Servicer shall retain such
invoices in its records and shall, by request, (i) produce any such invoices for
inspection or (ii) at its own expense, provide copies of any such invoices to
the Master Servicer and, if applicable, to the Primary Mortgage Insurer and/or
the Pool Insurer, as directed. The foregoing expense invoices shall include,
without limitation, the following:

(a) insurance premiums;

(b) real estate tax bills;

(c) special assessments;

(d) owners' association dues; and

(e) utility bills.

14.3.4. REO Documents. Upon request, the Servicer shall send copies
to the Master Servicer and, where applicable, to the respective Primary Mortgage
Insurer and/or the respective Pool Insurer, of the following documents relating
to each REO:

(a) any forced placed Hazard Insurance policy or Flood Insurance
policy, if applicable;

(b) any maintenance contracts;

(c) any contractor bids relating to the rehabilitation of such REO
pursuant to Section 14.5.3 hereof;

(d) an updated Title Insurance policy which reflects the occurrence
of foreclosure; and

(e) plat map or house location survey, if already available.

Section 14.4 REO Marketing

14.4.1. REO Marketing Efforts. The Servicer shall begin efforts to
market a REO as soon as marketable title is acquired by the Trustee.

14.4.2. REO Sales. (a) The Servicer shall obtain the best market
price for a REO for the Trustee while disposing of such REO in a timely and
efficient manner. The Servicer, acting on behalf of the Trustee, shall dispose
or cooperate with the Trustee in disposing of such REO prior to the close of the
third calendar year following the year of its acquisition by the Trustee (the
"REO Disposition Period") or, if an extension has been obtained from the
Internal Revenue Service pursuant to Section 14.4.2(b), within such period. If
the Servicer is otherwise unable to sell such REO, the Servicer shall before the
end of the REO Disposition Period or, if an extension has been obtained from the
Internal Revenue Service pursuant to Section 14.4.2(b), before the end of such
period, following the acquisition of such REO, auction such REO to the highest
bidder in an auction reasonably designed to bring a fair price. The Servicer is
eligible to bid in such an auction.

(b) The Servicer may apply to the Internal Revenue Service, in the
manner contemplated by Code Section 856(e)(3), for an extension of the REO
Disposition Period with respect to an REO.

14.4.3. Primary Mortgage Insurance Considerations. The Servicer must
ensure that any action taken with respect to the sale of a REO does not
jeopardize the maximum benefits available under the related Primary Mortgage
Insurance Policy, if any, with respect to the related Mortgage Loan. The
Servicer must inform the related Primary Mortgage Insurer of any listing
agreements or purchase offers that are received before the related Primary
Mortgage Insurer has finalized the disposition of the claim.

14.4.4. Master Servicer Instructions. Where the Servicer receives
instructions from the Master Servicer regarding the marketing and sale of a REO,
either with respect to a specific property or generally, such instructions shall
govern the Servicer's actions, notwithstanding any provision herein.

14.4.5. Pool Insurance Considerations. The Servicer must ensure that
any action taken with respect to the sale of a REO does not jeopardize the
maximum benefits available under the related Pool Insurance Policy, if any, with
respect to the related Mortgage Loan. The Servicer must inform the related Pool
Insurer of any listing agreements or purchase offers that are received before
the Primary Mortgage Insurer has finalized the disposition of the claim.

Section 14.5 REO Rehabilitation

14.5.1. REO Rehabilitation Requirement. Unless the Master Servicer
shall otherwise direct, and subject to Section 3.2.2(ii) and Section 17.6.2, the
Servicer must ensure that any rehabilitation work (which shall not include the
cleaning of a recently acquired REO property) to any REO which is necessary to
restore such REO to a marketable condition is performed and that such work is
performed in a professional and workmanlike manner.

Saturday, July 3, 2010

WHAT TO DO BEFORE YOU SUE YOUR LENDER

Federal Agencies Becoming More Helpful: Give them a Call, Give them a Push
Posted on June 19, 2010 by Neil Garfield
Under pressure from the Obama Administration, Federal agencies that turned a deaf ear to consumers, borrowers and debtors, are starting to investigate, prosecute and reveal predatory, deceptive and illegal activities of the entire securitization chain.
Now is the time for us to make sure they get a copy of your qualified written request. And the QWR or DVL should be agency specific. Make sure you state both the category and the facts on each violation. Call them to ask what they are doing about it. You might get a pleasant surprise.

Can’t find your bank’s name or have a banking question? Contact any of the federal bank regulators noted below:
Office of the Comptroller of the Currency at (800) 613-6743
Federal Reserve Board at (888) 851-1920
Federal Deposit Insurance Corporation at (877) 275-3342
Office of Thrift Supervision at ( 800) 842-6929

Qualified Written Request | Loans - Credit - Debt - LoanSafe.org
Aug 10, 2009 ... What a homeowner can do under RESPA is request in writing what is called a “ Qualified Written Request (QWR). In this letter you can as about ...
http://www.loansafe.org/qualified-written-request-2

Should We Send In QWR? - Loans, Debt & Credit
Mar 13, 2008 ... I’m reading up on RESPA and the use of the Qualified Written Request (QWR). ... So what I'm saying here is we can all send in QWR's but we have to ...
http://www.loansafe.org/forum/loan-modification/240-should-we-send-qwr.html

RESPA - Qualified Written Request
May 27, 2008 ... 9 Comments on RESPA - Qualified Written Request ... if there more than one lender, then is it necessary to send a QWR to each one of them? ...
http://activerain.com/blogsview/526435/respa-qualified-written-request

HUD RESPA: More Information
Section 6 of RESPA, per 12 U.S.C. 2605, provides that a borrower may send a QWR directly to a loan servicer for information relating to the servicing of ...
http://www.hud.gov/offices/hsg/ramh/res/loanservice.cfm

QWR QUALIFIED WRITTEN REQUEST - TO YOUR LENDER(S) RESPA ...
Section 6 of RESPA, per 12 U.S.C. § 2605, provides that a borrower may send a QWR directly to a loan servicer for information relating to the servicing of a ...
http://www.scribd.com/doc/17695673/QWR-QUALIFIED-WRITTEN-REQUEST-TO-YOUR-LENDERS-RESPA-FOR

Sample RESPA Qualified Written Request for Foreclosure Cases
Oct 14, 2009 ... Sample RESPA Qualified Written Request for Foreclosure Cases. ... legal right to send to their lender is a Qualified Written Request (QWR). ...
http://www.foreclosurefish.com/blog/index.php?id=896

QWR, Qualified Written Request, QWR Services
Send a qualified written request to your mortgage lender. ... QWR-Qualified Written Request pursuant to RESPA section 6. Home Owners: ...
http://www.virginiainvestmentproperty.com/QWR-QualifiedWrittenRequest

Qualified Written Requests, RESPA and Mortgage Servicing ...
If you think there is a discrepancy, you should send a Qualified Written Request (“QWR”) under RESPA. Qualified Written Requests are also being used to put ...
http://www.foreclosureindustry.com/2009/08/qualified-written-requests-respa-and-mortgage-s

Sample Qualified Written Request Under RESPA
Sample Qualified Written Request Under RESPA. If [1] you believe the mortgage loan servicer or ... Send all letters by certified mail and keep the receipt. ...
http://www.louisvilleky.gov/NR/rdonlyres/B4155FAD-0835-4EE8-92DA-C4DCEFE4446A/0/SampleQual

Friday, July 2, 2010

ALESSANDRO MACHI MAKES AN EXCELLENT POINT: WHY ARE HOMEOWNERS WITH THOUSANDS OF DOLLARS IN EQUITY BUILT UP IN THEIR HOMES BEING FORECLOSED UPON? I HAD OVER $100,000.00 IN EQUITY BUILT UP IN MY HOME WHEN WELLS FARGO MADE A SERVICING ERROR ON MY MORTGAGE ACCOUNT

SWARM THE BANKS UPDATE
By Alessandro Machi
Shame on Sixty Minutes
and their
Strategic Default Homeowner Story


I felt like Sixty Minutes COMPLETELY IGNORED the other side of the home foreclosure discussion. What is the point in staying in ANY home that is upside down if years later the bank will not let you access the home equity line that you may have built up by staying in the home, and making payments until the home was no longer upside down?

The homeownership carrot of a home equity line has been taken away by the same banksters that then stole bailout money and kept for their own bonuses and to see wall street to suck you back in there!

Instead, Sixty Minutes focused their story on "Strategic Defaults" as if these homeowners are thieves!
If the banks and government banking regulations can take away a homeowner's option to use their own home as their own survival equity bank when times are tough, why should a homeowner keep their word years earlier when the home may be upside down?
NOBODY in the media is talking about the banksters stealing homeowners down payments and their built up equity via foreclosure, instead, the news continually focuses on all the "upside down" homes, as if that is the only issue on the table.

I presume the sixty minutes story about Strategic Default, slated for May 09, 2010 on CBS, won't delve into people who don't presently have a job but have plenty of home equity in their home, being denied access to their home equity and even being foreclosed upon as a result.

Posted by Alessandro Machi at 7:39 AM 0 comments Links to this post
Labels: 4closureFraud, CBS Sixty Minutes Story on Strategic Defaults, May 09 2010, Strategic Default
Tuesday, May 4, 2010

Should homeowners
be foreclosed upon
if they have built up
equity in their home?

It is a struggle for me to understand how homeowners are being foreclosed upon if they have built up equity in their home. Example, a home is worth $200,000, and the homeowner has either paid either made a healthy down payment of $75,000, or over the years has built up $75,000 dollars worth of home equity. Is it really fair for the banks to foreclose on the home, short sell it for $125,000 dollars, and basically rob the homeowner of the $75,000 dollar down payment or the home equity that they have already built up?

I consider the above scenario insane and until Barack Obama and Congress deal with this issue head on, they are frauds in my book, ALL OF THEM. How dare they give out tax credits to first time home owners while they allow the banks to steal built up wealth from existing homeowners.

I am pretty certain Hillary Clinton would not have allowed this plundering to occur, and that is why her campaign was sabotaged behind the scenes by democratic higher ups during the 2008 democratic primary.

Posted by Alessandro Machi 



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WELLS FARGO ARE YOU AMERICA'S DEUTSCH? I'M BETTING YOU ARE...TIME WILL TELL.

"KING" DEUTSCH CITED FOR DESTRUCTION OF CITIES
Neil Garfield | July 2, 2010 at 3:40 am

The article below was purloined from www.foreclosureblues.wordpress.com --- the comments are mine. Neil Garfield

"According to the Federal Deposit Insurance Corporation (FDIC), Deutsche Bank now holds loans for American single-family and multi-family houses worth about $3.7 billion (€3.1 billion). The bank, however, claims that much of this debt consists of loans to wealthy private customers. (EDITOR'S NOTE: THUS ALL THE OTHER LOANS IT CLAIMS TO OWN, IT DOESN'T OWN)

The bank did not issue the mortgages for the many properties it now manages, and yet it accepted, on behalf of investors, the fiduciary function for its own and third-party CDOs. In past years, says mortgage expert Steve Dibert, real estate loans were “traded like football cards” in the United States. (Editor's Note: This is why we say that the loan never makes it into the pool until litigation starts AND even if it was ever in the pool there is no guarantee it remained in the pool for more than a nanosecond). Sworn testimony from Deutsch employees corroborate that no assignments are done until "needed," which means that in the mean time they are still legally owned by the loan originator. The loan originator therefore created an obligation that was satisfied simultaneously with the closing on the loan. The note is therefore evidence of an obligation that does not legally exist. Thus there are possible equitable theories under which investors could assert claims against the borrower, but the note and deed of trust or mortgage are only PART of the evidence and ONLY the investor has standing to bring that claim. Recent cases have rejected claims of "equitable transfer.")

How many houses was he responsible for, Co was asked? “Two thousand,” he replied. But then he corrected himself, saying that 2,000 wasn’t the number of individual properties, but the number of securities packages being managed by Deutsche Bank. Each package contains hundreds of mortgages. So how many houses are there, all told, he was asked again? Co could only guess. “Millions,” he said.

The exotic financial vehicles are sometimes managed by an equally exotic firm: Deutsche Bank (Cayman) Limited, Boundary Hall, Cricket Square, Grand Cayman. In an e-mail dated Feb. 26, 2010, a Deutsche Bank employee from the Cayman Islands lists 84 CDOs and similar products, for which she identifies herself as the relevant contact person.

However, C-BASS didn’t just manage abstract securities. It also had a subsidiary to bring in all the loans that were subsequently securitized. By the end of 2005 the subsidiary, Litton Loan, had processed 313,938 loans, most of them low-value mortgages, for a total value of $43 billion.

EDITOR'S NOTE: Whether it is Milwaukee which is going the the way of Cleveland or thousands of other towns and cities, Deutsch Bank as a central player in more than 2,000 Special Purpose Vehicles, involving thousands more pools and sub-pools, is far and away the largest protagonist in the foreclosure crisis. This article, originally written in German, details just how deep they are into this mess, while at the same time disclaiming any part in it. It corroborates the article I wrote about the Deutsch Bank executive who said ON TAPE, which I have, that even though Deutsch is named as Trustee it knows nothing and does nothing.

SPIEGEL ONLINE
06/10/2010 07:42 AM
‘America’s Foreclosure King’
How the United States Became a PR Disaster for Deutsche Bank
By Christoph Pauly and Thomas Schulz

Deutsche Bank is deeply involved in the American real estate crisis. After initially profiting from subprime mortgages, it is now arranging to have many of these homes sold at foreclosure auctions. The damage to the bank’s image in the United States is growing.

The small city of New Haven, on the Atlantic coast and home to elite Yale University, is only two hours northeast of New York City. It is a particularly beautiful place in the fall, during the warm days of Indian summer.

But this idyllic image has turned cloudy of late, with a growing number of houses in New Haven looking like the one at 130 Peck Street: vacant for months, the doors nailed shut, the yard derelict and overgrown and the last residents ejected after having lost the house in a foreclosure auction. And like 130 Peck Street, many of these homes are owned by Germany’s Deutsche Bank.

“In the last few years, Deutsche Bank has been responsible for far and away the most foreclosures here,” says Eva Heintzelman. She is the director of the ROOF Project, which addresses the consequences of the foreclosure crisis in New Haven in collaboration with the city administration. According to Heintzelman, Frankfurt-based Deutsche Bank plays such a significant role in New Haven that the city’s mayor requested a meeting with bank officials last spring.

The bank complied with his request, to some degree, when, in April 2009, a Deutsche Bank executive flew to New Haven for a question-and-answer session with politicians and aid organizations. But the executive, David Co, came from California, not from Germany. Co manages the Frankfurt bank’s US real estate business at a relatively unknown branch of a relatively unknown subsidiary in Santa Ana.

How many houses was he responsible for, Co was asked? “Two thousand,” he replied. But then he corrected himself, saying that 2,000 wasn’t the number of individual properties, but the number of securities packages being managed by Deutsche Bank. Each package contains hundreds of mortgages. So how many houses are there, all told, he was asked again? Co could only guess. “Millions,” he said.

Deutsche Bank Is Considered ‘America’s Foreclosure King’
Deutsche Bank’s tracks lead through the entire American real estate market. In Chicago, the bank foreclosed upon close to 600 large apartment buildings in 2009, more than any other bank in the city. In Cleveland, almost 5,000 houses foreclosed upon by Deutsche Bank were reported to authorities between 2002 and 2006. In many US cities, the complaints are beginning to pile up from homeowners who lost their properties as a result of a foreclosure action filed by Deutsche Bank. The German bank is berated on the Internet as “America’s Foreclosure King.”

American homeowners are among the main casualties of the financial crisis that began with the collapse of the US real estate market. For years, banks issued mortgages to homebuyers without paying much attention to whether they could even afford the loans. Then they packaged the mortgage loans into complicated financial products, earning billions in the process — that is, until the bubble burst and the government had to bail out the banks.

Deutsche Bank has always acted as if it had had very little to do with the whole affair. It survived the crisis relatively unharmed and without government help. Its experts recognized early on that things could not continue as they had been going. This prompted the bank to get out of many deals in time, so that in the end it was not faced with nearly as much toxic debt as other lenders.

But it is now becoming clear just how deeply involved the institution is in the US real estate market and in the subprime mortgage business. It is quite possible that the bank will not suffer any significant financial losses, but the damage to its image is growing by the day.

‘Deutsche Bank Is Now in the Process of Destroying Milwaukee’

According to the Federal Deposit Insurance Corporation (FDIC), Deutsche Bank now holds loans for American single-family and multi-family houses worth about $3.7 billion (€3.1 billion). The bank, however, claims that much of this debt consists of loans to wealthy private customers.
More damaging to its image are the roughly 1 million US properties that the bank says it is managing as trustee. “Some 85 to 90 percent of all outstanding mortgages in the USA are ultimately controlled by four banks, either as trustees or owners of a trust company,” says real estate expert Steve Dibert, whose company conducts nationwide investigations into cases of mortgage fraud. “Deutsche Bank is one of the four.”

In addition, the bank put together more than 25 highly complex real estate securities deals, known as collateralized debt obligations, or CDOs, with a value of about $20 billion, most of which collapsed. These securities were partly responsible for triggering the crisis.

Last Thursday, Deutsche Bank CEO Josef Ackermann was publicly confronted with the turmoil in US cities. Speaking at the bank’s shareholders’ meeting, political science professor Susan Giaimo said that while Germans were mainly responsible for building the city of Milwaukee, Wisconsin, “Deutsche Bank is now in the process of destroying Milwaukee.”

As Soon as the Houses Are Vacant, They Quickly Become Derelict

Then Giaimo, a petite woman with dark curls who has German forefathers, got to the point. Not a single bank, she said, owns more real estate affected by foreclosure in Milwaukee, a city the size of Frankfurt. Many of the houses, she added, have been taken over by drug dealers, while others were burned down by arsonists after it became clear that no one was taking care of them.

Besides, said Giaimo, who represents the Common Ground action group, homeowners living in the neighborhoods of these properties are forced to accept substantial declines in the value of their property. “In addition, foreclosed houses are sold to speculators for substantially less than the market value of houses in the same neighborhood,” Giaimo said. The speculators, according to Giaimo, have no interest in the individual properties and are merely betting that prices will go up in the future.

Common Ground has posted photos of many foreclosed properties on the Internet, and some of the signs in front of these houses identify Deutsche Bank as the owner. As soon as the houses are vacant, they quickly become derelict.

A Victorian house on State Street, painted green with red trim, is now partially burned down. Because it can no longer be sold, Deutsche Bank has “donated” it to the City of Milwaukee, one of the Common Ground activists reports. As a result, the city incurs the costs of demolition, which amount to “at least $25,000.”

‘We Can’t Give Away Money that Isn’t Ours’

During a recent meeting with US Treasury Secretary Timothy Geithner, representatives of the City of Milwaukee complained about the problems that the more than 15,000 foreclosures have caused for the city since the crisis began. In a letter to the US Treasury Department, they wrote that Deutsche Bank is the only bank that has refused to meet with the city’s elected representatives.

Minneapolis-based US Bank and San Francisco-based Wells Fargo apparently took the complaints more seriously and met with the people from Common Ground. The activists’ demands sound plausible enough. They want Deutsche Bank to at least tear down those houses that can no longer be repaired at a reasonable cost. Besides, Giaimo said at the shareholders’ meeting, Deutsche Bank should contribute a portion of US government subsidies to a renovation fund. According to Giaimo, the bank collected $6 billion from the US government when it used taxpayer money to bail out credit insurer AIG.

“It’s painful to look at these houses,” Ackermann told the professor. Nevertheless, the CEO refused to accept any responsibility. Deutsche Bank, he said, is “merely a sort of depository for the mortgage documents, and our options to help out are limited.” According to Ackermann, the bank, as a trustee for other investors, is not even the actual owner of the properties, and therefore can do nothing. Besides, Ackermann said, his bank didn’t promote mortgage loans with terms that have now made the payments unaffordable for many families.

The activists from Wisconsin did, however, manage to take home a small victory. Ackermann instructed members of his staff to meet with Common Ground. He apparently envisions a relatively informal and noncommittal meeting. “We can’t give away money that isn’t ours,” he added.

Deutsche Bank’s Role in the High-Risk Loans Boom

Apparently Ackermann also has no intention to part with even a small portion of the profits the bank earned in the real estate business. Deutsche Bank didn’t just act as a trustee that — coincidentally, it seems — manages countless pieces of real estate on behalf of other investors. In the wild years between 2005 and 2007, the bank also played a central role in the profitable boom in high-risk mortgages that were marketed to people in ways that were downright negligent.

Of course, its bankers didn’t get their hands dirty by going door-to-door to convince people to apply for mortgages they couldn’t afford. But they did provide the distribution organizations with the necessary capital.

The Countrywide Financial Corporation, which approved risky mortgages for $97.2 billion from 2005 to 2007, was the biggest provider of these mortgages in the United States. According to the study by the Center for Public Integrity, a nonprofit investigative journalism organization, Deutsche Bank was one of Countrywide’s biggest financiers.

Ameriquest — which, with $80.7 billion in high-risk loans on its books in the three boom years before the crash, was the second-largest subprime specialist — also had strong ties to Deutsche Bank. The investment bankers placed the mortgages on the international capital market by bundling and structuring them into securities. This enabled them to distribute the risks around the entire globe, some of which ended up with Germany’s state-owned banks.

‘Deutsche Bank Has a Real PR Problem Here’

After the crisis erupted, there were so many mortgages in default in 25 CDOs that most of the investors could no longer be serviced. Some CDOs went bankrupt right away, while others were gradually liquidated, either in full or in part. The securities that had been placed on the market were underwritten by loans worth $20 billion.

At the end of 2006, for example, Deutsche Bank constructed a particularly complex security known as a hybrid CDO. It was named Barramundi, after the Indo-Pacific hermaphrodite fish that lives in muddy water. And the composition of the deal, which was worth $800 million, was muddy indeed. Many securities that were already arcane enough, like credit default swaps (CDSs) and CDOs, were packaged into an even more complex entity in Barramundi.

Deutsche Bank’s partner for the Barramundi deal was the New York investment firm C-BASS, which referred to itself as “a leader in purchasing and servicing residential mortgage loans primarily in the Subprime and Alt-A categories.” In plain language, C-BASS specialized in drumming up and marketing subprime mortgages for complex financial vehicles.

However, C-BASS didn’t just manage abstract securities. It also had a subsidiary to bring in all the loans that were subsequently securitized. By the end of 2005 the subsidiary, Litton Loan, had processed 313,938 loans, most of them low-value mortgages, for a total value of $43 billion.

One of the First Victims of the Financial Crisis

Barramundi was already the 19th CDO C-BASS had issued. But the investment firm faltered only a few months after the deal with Deutsche Bank, in the summer of 2007. C-BASS was one of the first casualties of the financial crisis.

Deutsche Bank’s CDO, Barramundi, suffered a similar fate. Originally given the highest possible rating by the rating agencies, the financial vehicle stuffed with subprime mortgages quickly fell apart. In the spring of 2008, Barramundi was first downgraded to “highly risky” and then, in December, to junk status. Finally, in March 2009, Barramundi failed and had to be liquidated. (EDITOR'S NOTE: WHAT HAPPENED TO THE LOANS?)


While many investors lost their money and many Americans their houses, Deutsche Bank and Litton Loan remained largely unscathed. Apparently, the Frankfurt bank still has a healthy business relationship with the subprime mortgage manager, because Deutsche Bank does not play a direct role in any of the countless pieces of real estate it holds in trust. Other service providers, including Litton Loan, handle tasks like collecting mortgage payments and evicting delinquent borrowers.

The exotic financial vehicles are sometimes managed by an equally exotic firm: Deutsche Bank (Cayman) Limited, Boundary Hall, Cricket Square, Grand Cayman. In an e-mail dated Feb. 26, 2010, a Deutsche Bank employee from the Cayman Islands lists 84 CDOs and similar products, for which she identifies herself as the relevant contact person.

Trouble with US Regulatory Authorities and Many Property Owners

The US Securities and Exchange Commission (SEC) is now investigating Deutsche Bank and a few other investment banks that constructed similar CDOs. The financial regulator is looking into whether investors in these obscure products were deceived. The SEC has been particularly critical of US investment bank Goldman Sachs, which is apparently willing to pay a record fine of $1 billion to avoid criminal prosecution.

Deutsche Bank has also run into problems with the many property owners. The bank did not issue the mortgages for the many properties it now manages, and yet it accepted, on behalf of investors, the fiduciary function for its own and third-party CDOs. In past years, says mortgage expert Steve Dibert, real estate loans were “traded like football cards” in the United States.

Amid all the deal-making, the deeds for the actual properties were often lost. In Cleveland and New Jersey, for example, judges invalidated foreclosures ordered by Deutsche Bank, because the bank was unable to come up with the relevant deeds.

Nevertheless, Deutsche Bank’s service providers repeatedly try to have houses vacated, even when they are already occupied by new owners who are paying their mortgages. This practice has led to nationwide lawsuits against the Frankfurt-based bank. On the Internet, angry Americans fighting to keep their houses have taken to using foul language to berate the German bank.

“Deutsche Bank now has a real PR problem here in the United States,” says Dibert. “They want to bury their head in the sand, but this is something they are going to have to deal with.”

Translated from the German by Christopher Sultan

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Thursday, July 1, 2010

WELLS FARGO A LAUNDRY MAT FOR MEXICAN DRUG SMUGGLERS (I wondered why homeowners documents kept getting lost! Wells must be sniffing the laundry.)

Seal of the United States Office of the Comptr...
Seal of the United States Office of the Comptroller of the Currency, part of the Department of the Treasury. The design is the same as the Treasury seal with a Comptroller of the Currency inscription. (Photo credit: Wikipedia)
accused of laundering at least
$110 million in Mexican drug money
June 30, 9:18 PM  Manhattan Headlines

Bloomberg Markets Magazine senior writer Michael Smith came through for Americans – and the world – this week in exposing the rampant criminality of mega-banks headquartered in the United States. Yesterday, Smith revealed that Wachovia, acquired by Wells Fargo at the height of the 2008 financial crisis, has served as a laundry mat for “Mexican drug smugglers”, including those selling cocaine.

At this juncture, it is not surprising that most mainstream media outlets in the US do not consider these charges to be front page news; to them, Larry King’s departure from CNN is more important.

In spite of said failures, embedded within the Bloomberg report is a link to a Factual Statement from the US Attorney’s Office, South District of Florida, which presents the findings of a joint inquiry it conducted with the Drug Enforcement Agency and Internal Revenue Service:

The investigation has identified at least $110 million in drug proceeds that were funneled through [Mexican currency exchange house] accounts held at Wachovia.

Even though high finance apologists will quickly move to dismiss the severity of this situation, US Attorney for the Southern District of Florida Jeffrey H. Sloman told Smith, “Wachovia’s blatant disregard for our banking laws gave international cocaine cartels a virtual carte blanche to finance their operations."

Bank of America and London-based HSBC are also implicated in handling funds tied to Mexican drug dealers. Smith reports:

Drug traffickers used accounts at Bank of America in Oklahoma City to buy three planes that carried 10 tons of cocaine, according to Mexican court filings.

Federal agents caught people who work for Mexican cartels depositing illicit funds in Bank of America accounts in Atlanta, Chicago and Brownsville, Texas, from 2002 to 2009. Mexican drug dealers used shell companies to open accounts at London-based HSBC Holdings Plc, Europe's biggest bank by assets, an investigation by the Mexican Finance Ministry found.


Furious Americans – and their representatives in Congress – should demand accountability from the institutions tasked with supervising these banks; Wachovia’s primary regulator is the Office of the Comptroller of the Currency, a bureau of the US Treasury. In addition, The Federal Reserve Board of Governors must ultimately bear responsibility here as well: as the exclusive supervisor of bank holding companies, including Bank of America and Wells Fargo, the Fed has clearly failed to satisfy its categorical imperatives.

Based on all that has transpired since 2008, I sincerely believe the US banking system remains fundamentally flawed; criminals arrogantly suppose they can operate above-and-beyond laws, obligations, or any morals whatsoever. While this status quo has deep-seated roots, the fact of the matter is that it cannot continue ad infinitum. Based on Wachovia’s actions, the OCC should make a stern example of this criminal bank, and place it into receivership for immediate liquidation.

Otherwise, our society can try to continue looking the other way – as most news outlets have – and hope that public rage will simply disappear, even as blatant criminals continue their follies. While that approach is a surefire recipe for disaster, it is foolishly considered the appropriate modus operandi by some American leaders.

That being the case, Congress should consider a recent report from London’s Daily Mail, which divulges that Jose Manuel Barroso, President of the European Commission, is worried that “military coups or popular uprisings” may result in Greece, Spain and Portugal. Although the article largely avoids the real issue at hand – public rage at taxpayer-funded bank bailouts – it nevertheless serves as a warning to America.

Sure, plenty of critics will counter that these apocalyptic scenarios could never happen in the US: I beg to differ.

As public faith in American leadership and mainstream media continually erode, more people are incentivized to venture online for news reports. While the Internet offers myriad analyses of contemporary events, an emerging consensus is that the international financial sector is entirely out-of-control – and US politicians are doing little to protect Americans.

One can easily ascertain this conclusion from a wide variety of sources, such as the recently published 13 Bankers, which is written by two highly respected authors, and demonstrates:

The largest banks have become more powerful and more emphatically “too big to fail,” with no incentive to change their behavior in the future. This only sets the stage for another financial crisis, another government bailout, and another increase in our national debt.


Should the US continue on a Titanic-like approach, it is very likely that, among other consequences, violence towards bankers and politicians will emerge; these suggestions are well established, and backed up by the recent assertion of Admiral Mike Mullen, chairman of the Joint Chiefs of Staff, who has said on multiple occasions that public debt is the largest threat to our national security.

Americans are witnessing what appears to be a de facto financial coup on our Republic, and eventually, a boiling point will emerge. When people believe their rights are being threatened by tyrannical maniacs, they are apt to defend themselves from those perceived as enemy forces – whether domestic, foreign, or both. As George Santayana so brilliantly wrote more than 100 years ago, "Those who cannot remember the past are condemned to repeat it."

With that in mind, this author will soon provide an astonishing history lesson for bankers, in tandem with the following warning: do not foolishly attempt to seize or dominate any sovereign nation's economic and/or political powers. The forthcoming, meticulously researched report shall document the ironic connections between current events, and a 15th century bankers’ plot to overthrow the Medici Family of Firenze.

Evidently, a certified independent report maintains that one co-conspirator of the Pazzi plot, Bernardo di Bandino Baroncelli, may have descended from the same bloodline as yours truly. While I sincerely hope this is not the case, I do take pleasure in noting that Baroncelli was hung at The Bargello for his crimes; the palace, also known as Palazzo del Popolo, or Palace of the People, is the oldest public building in Firenze, and more likely demonstrates the origin of my surname.

I encourage readers not to fall prey to the misassumption that I merely seek to emerge as an enemy of the financial world; as previously stated, many close friends and family members of mine work in finance, which is why I have zero tolerance for financial terrorists, and the criminals they aid-and-abet.

Optimistic observers should also take solace in the fact that many scholars trace the roots of the European Renaissance to Firenze – a beautiful city I had the pleasure of calling home several years ago. More importantly, I have since written about humanity’s need for The Great American Renaissance.
Though it is admittedly eccentric to present Italian history in tandem with my editorial views, as any enlightened person can tell you, we do not always choose our circumstances in life. Sometimes we must acknowledge reality and simply say, "It is what it is."


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