Wells Fargo Attempting to “offer” Modifications But Refusing to Put it in Writing
As reported by Neil Garfield
Danielle Kelley, Esq. is getting corroboration on trial modifications from lawyers and other professionals assisting homeowners all over the country. She is bearing down hard on situations where the homeowner enters into the trial modification, complies with all the terms, and then is faced with a unilateral decision by the bank to foreclose anyway.
Decisions are coming that have forced the banks to reconsider that position and lately there are other tricks being deployed — like refusing to put the modification offer in writing. Thus puts the homeowner in the position of paying money for nothing, which appears to be exactly what the banks want. Read more here
65 SIGNS THAT YOUR MORTGAGE LOAN & FORECLOSURE DOCUMENTS COULD BE FRAUDULENT
Here are some signs of mortgage fraud:
1. The Mortgage or Deed of Trust is assigned from the Originator directly to the Trustee for the Securitized Trust.
2. The Mortgage or Deed of Trust is assigned months and sometimes years after the date of the origination of the underlying mortgage note.
3. The Mortgage or Deed of Trust is assigned from the initial aggregator directly to the Securitized Trust with no assignments to the Depositor or the Sponsor for the Trust.
4. The Mortgage or Deed of Trust is executed, dated or assigned in a manner inconsistent with the mandatory governing rules of Section 2.01 of the Pooling and Servicing Agreement.
5. The assignment of the Mortgage or Deed of Trust is executed by a legal entity that was no longer in existence on the date the document was executed.
6. The assignment of the mortgage or Deed of Trust is executed by an entity whose name is different than the entity named in the original document (i.e., National City Bank Corporation in lieu of ABC Corporation as a division of National City Bank).
7. The assignment was executed by a party pursuant to a Power of Attorney but no Power of Attorney is attached to the instrument or filed with the instrument or otherwise recorded with local land registry.
8. The mortgage note is allegedly transferred in a single document along with the Mortgage or Deed of Trust (i.e., “Assignment of the Note and Mortgage”). You cannot “assign” a mortgage note. You can only “negotiate” a mortgage note under Article 3 of the UCC.
9. The assignment is executed by a party who claims to be an “attorney in fact” for the assignor.
10. The assignment is notarized by a notary in Dakota County, Minnesota.
11. The assignment is notarized by a notary in Hennepin County, Minnesota.
12. The assignment is notarized by a notary in Duval County, Florida.
13. The assignment is executed by an officer or secretary of MERS.
14. The assignment is notarized by a secretary or paralegal employed by the attorney for the mortgage servicer.
15. The assignment is executed or notarized by an employee of MR Default Services, Promiss Solutions LLC, National Default Exchange, LP, LOGS Financial Services, or some similar third-party.
16. The endorsement on the note is actually on an allonge affixed to the note. In most states, an allonge cannot be used if there is a sufficient amount of room at the “foot” or the “bottom” of the original note for the endorsement.
17. The allonge is not “permanently” affixed to the original note. The term permanent excludes the use of staples and tape and as a result you must use a sold fastener such as glue. Allonges are commonly referred to “in the business” as “tear-off fraud papers.”
18. The note proffered in evidence is not the original but a copy of the “certified copy” provided to the debtors at the closing.
19. The note is endorsed in blank with no transfer and delivery receipts. It is fine to endorse a note in blank, in which case it becomes “bearer” paper under the UCC. However, in order to prove a true sale from the Sponsor to the Depositor you must have written delivery and transfer receipts and proof of pay outs and pay in transactions.
20. The note proffered in evidence is not endorsed at the foot of the note or on an affixed allonge.
21. The assignment of the mortgage or deed of trust post-dates the filing of the court pleading.
22. The assignment of the mortgage or deed of trust is executed after the filing of the court pleadings but claims to be “legally effective” before the filing. For example, the deed of trust is assigned on June 1, 2009, with an effective date of May 1, 2007.
23. The parties who executed the assignment and who notarized the signature are in fact the same parties.
24. The signor states that he or she is an “agent” for the executing entity.
25. The signor states that he or she is an “attorney in fact” for the executing entity.
26. The signor states that he or she is an employee of the executing entity but claims to have custody and control of the records of the entity.
27. The signor of the document makes statements about the status of the mortgage debt based on his or her review of the “records of the plaintiff” or the “records of the moving party.”
28. The proponent of the original note files an Affidavit of Lost Note.
29. The signor claims that the allegations in the court pleading are correct but the assignment of the mortgage and/or delivery and transfer of the note occurs after the law suit or the motion for relief from stay was filed.
30. One or more of the operative documents in the case is signed by one of the attorneys for the mortgage servicer.
31. The default payment history filed in the case is prepared by the attorney for the mortgage servicer or a member of his or her staff.
32. The affidavit filed in support of legal fees is not signed by an attorney with the firm involved in the case.
33. The name of one or more of the signors is stamped on the document.
34. The document is a form with standard “fill-in-the-blanks” for names and amounts.
35. The signature of one or more parties on the document is not legible and looks like something a three year old might have done.
36. The document is dated and signed years before the document is actually filed with the register of real estate documents or deeds or mortgages.
37. The proffered document has the word C O P Y stamped on or embedded in the document.
38. The document is executed by a notary in Denton County, Texas.
39. The document is executed by a notary in Collin County, Texas.
40. The document includes a legend “Hold for” a named law firm after recording.
41. The document was drafted by a law firm representing the mortgage servicer in the pending case.
42. The document includes any type of bar code that was not added by the local register or filing clerk for such instruments.
43. The document includes a reference to an “instrument number.”
44. The document includes a reference to a “form number.”
45. The document does not include any reference to a Master Document Custodian.
46. The document is not authenticated by any officer or authorized agent of a Master Document Custodian.
47. The paragraph numbers on the document are not consistent (the last paragraph on page one is 7 and the first paragraph on page two starts with number 9).
48. The endorsement of the note is not at the “foot” or “bottom” of the last page of the note. For example, a few states allow an endorsement on the back of the last page of the note but the majority requires it at the foot of the note.
49. The document purports to assign the mortgage or the deed of trust to the Trustee for the Securitized Trust before the Trust was registered with the Securities and Exchange Commission. This type of registration is normally referred to as a “shelf registration.”
50. The document purports to transfer the note to the Trustee for the Securitized Trust before the date the Trust provides for the origination date of instruments in the Trust. The Prospectus, the Prospectus Supplement and the Pooling and Servicing Agreement will clearly state that the pool of notes includes those originated between date X and date Y.
51. The document purports to transfer the note to the Trustee for the Securitized Trust after the cut-off date for the creating of such instruments for the Trust.
52. The origination date on the mortgage note is not within the origination and cut-off dates provided for the by terms of the Pooling and Servicing Agreement.
53. The “Affidavit of a Lost Note” is not filed by the Master Document Custodian for the Trust but by the Servicer or some other third-party.
54. The document is signed by a “bank officer” without any designation of the office held by the said officer.
55. The affidavit includes the following language on the bottom of each page: “This is an attempt to collect a debt. Any information obtained will be used for that purpose.”
56. The document is signed by a person who identifies himself or herself as a “media supervisor” for the proponent.
57. The document is signed by a person who identifies himself or herself as a “media coordinator” for the proponent.
58. The document is signed by a person who identifies himself or herself as a “legal coordinator” for the movant.
59. The date of the signature on the document and the date the signature was notarized are not the same.
60. The parties who signed the assignment and who notarized the signature are located in different states or counties.
61. The transferor and the transferee have the same physical address including the same street and post office box numbers.
62. The assignor and the assignee have the same physical address including the same street and post office box numbers.
63. The signor of the document states that he or she is acting “solely as nominee” for some other party.
64. The document refers to a power of attorney but no power of attorney is attached.
65. The document bears the following legend: “This is not a certified copy.”
Avoid Loan Modification Traps, Pitfalls, and Scams
The Business Model of Loan Servicers is to Foreclose on Innocent Borrowers. Securitization is the reason lenders attempt to foreclose on homeowners even when giving them a loan modification is the right thing to do.
When a bank assigns the risk of a loan to the investors (certificate holders) of a Real Estate Investment Conduit Trust (SPV), the “bank” is no longer a traditional bank assuming the risk; instead the “bank” is merely a loan servicer benefiting from the mortgage payments.
Mortgage banks and loan servicers approve as few modifications as possible, complying, minimally, with statutes enacted to protect borrowers, while employing tricks to “cash in” on homeowners’ defaulted loans, in an attempt to foreclose on them.
Mortgage lenders, banks, and loan servicers benefit from foreclosures more than loan modifications because of something called “creaming the debt.” If a Bank modifies a loan, their penalties and fees might not get paid to them. When they foreclose, they get their penalties first, before the investors– which is the “creaming.” Oftentimes a bank can make more money from foreclosure than they can from servicing the loan.
When foreclosure becomes an option, the bank will seize the opportunity for increased profits from foreclosure. Foreclosure is the pot of gold at the end of the mortgage loan rainbow. Banks risk the chance of litigation because they know that very few people will take action and file suit against them or are aware of the many tricks and tactics they employ to push borrowers into foreclosure.
Here are six common tricks loan servicers employ against unsuspecting homeowners in order to push them into foreclosure:
Refusing Payments: Banks refuse a homeowner payment. The bank may offer a reason (for example, there’s a mistake on the account, they lost the payment, ext.) or they may offer no explanation at all. The bank may even offer the homeowner a loan modification. The bank does this to delay the homeowner from immediately contacting an attorney to pursue a breach of contract claim. The bank may take trial payments in an effort to further delay the homeowner until the arrears (also known as the forbearance) becomes so great that the homeowner is ineligible for a loan modification or unable to repay the arranges of the loan to bring their loan current and avoid foreclosure.
Switching Servicers during Modification: A homeowner applies for a loan modification with their loan servicer, makes trial payment(s), and the servicer transfers loan servicing rights to another loan servicer. The new servicer pretends to know nothing about the modification and delays the homeowner, often times for months, claiming they are missing relevant paperwork needed to approve the loan modification. No matter how many times the borrower submits the necessary paperwork the servicer refuses to approve the modification because servicers are paid up to $2500 by the government for each new loan modification submitted. So, they continually lose borrowers documents and reassign their files to new servicers or agents to resubmit the loan modification request as a new file; and thereby are paid multiple times, while delaying and denying homeowners loan modification applications. In some States it is a violation of State Law not to honor a modification from a prior servicer, so do not let your loan servicer to take advantage of you and your rights.
Breaching a Modification Contract: A borrower gets a loan modification that includes a balloon payment of, for example, $75,000 after 25 years. After paying on this loan modification for some time, the borrower receives a new modification request in the mail from the same servicer with a balloon payment of $100,000. No matter how many times the borrower calls the servicer about the existing modification; the servicer’s agent responds with a scripted response that does not acknowledge the prior modification and only refers the new modification amount. The borrower often feels like they are talking to a robot working for the bank. Eventually, if the borrower does not sign and execute the new modification, the bank will begin to refuse the payments on the previously agreed to modification and begin to foreclose on the property. Servicers will also create a fake paper trail to tell a different story than what is actually happening. If the bank is trying to stick a borrower with a new modification, the paper trail will show the borrower is refusing the modification and mention nothing about the old one. Eventually, the servicer will stop accepting payments unless the homeowner acquiesces to the new loan modification.
Extra Fees & Escrow Accounts: A borrower notices extra fees from nowhere resulting in the mortgage payment suddenly becoming unaffordable. The loan servicer refuses to accept any “partial payments” and continues to add more fees each month, increasing the amount the borrower has to pay to reinstate the loan, or bring the loan current. The servicer may offer the borrower a loan modification as a distraction in order to trick the borrower further into default. The borrower may think they are approved for the modification, and so they, oftentimes, will spend the money they would have put towards their mortgage or loan modification payment, resulting in the borrower being unable to pay the outstanding loan amount, if and when, the loan modification falls through. In addition, the servicers often times will pay the property taxes and then accuse the homeowner of not paying them so they can raise the interest rate on the loan and make the borrower pay forced place insurance at a much higher cost than the borrower was paying. Unfortunately, by the time borrowers find out about this it’s too late, and the amount owed is more than they can afford.
Giving False Notices about the Amount Owed to Cure the Foreclosure: In non-judicial foreclosure States like California and Texas, foreclosure is done by first recording a notice of default. The Notice of Default (NOD) states the amount of arrears the borrower must pay to reinstate the loan and bring it current. Mortgage loan servicers routinely overstate the amount to bring the loan current by up to $20,000 in an attempt to scare the borrower with the inflated amount needed to cure the loan, and to create a fake paper trail for the banks so they can claim more money from investors.
Dual Tracking and Multiple Modifications: Loan servicers are required to respond to a borrower’s loan modification application with either a denial or approval within a definite period. A denial must be in writing and must inform the borrower of the right to appeal. The loan servicer is not supposed to commit dual tracking (the practice of pretending to do a loan modification, while simultaneously moving forward with the foreclosure behind the borrowers back) nevertheless loan servicers, like Bank of America, routinely use this illegal technique to push borrowers into foreclosure. Although there are penalties for dual tracking, loan servicers are rarely punished for engaging in this illegal practice because they will often times deny a loan modification over the phone while encouraging a borrower to apply again, while quietly moving forward with the foreclosure action behind the borrowers back. Once the borrower becomes what’s known as a “serial modifier” the loan servicer can commit dual tracking without any statutory penalties…. And they will. Watch this real life horror story of one family’s ordeal with Bank of America and Dual Tracking.