Will Home Owners Seeking Mortgage Modification Benefit As Result of Accusations that Banks and the Lawyers Who Represent Them Engaged in a Massive Scheme of Foreclosure Fraud & Perjury to Circumvent the Laws that Govern Foreclosure.
Employees of mortgage foreclosure mills that are operated by banks have testified that they were instructed to routinely and repeatedly sign affidavits about the contents of the documents being submitted to courts to obtain foreclosure judgments which falsely stated that they had examined the documents and that they had personal knowledge of the contents of documents and that the documents were accurate and complete.
In FEDERAL NATIONAL MORTGAGE ASSOC vs. NICOLLE BRADBURY, GMAC MORTGAGE, d/b/a DiTech, ) the Court in the BRIDGTON DISTRICT COURT of MAINE found that an employee of GMAC Mortgage had admitted during his deposition “which took place on June 7, 2010, Stephan testified that he signs some 400 documents per day, and that the process he follows in signing summary judgment affidavits is consistent with GMAC’s policies and procedures. The Court is particularly troubled by the fact that Stephan’s deposition in this case is not the first time that GMAC’s high-volume and careless approach to affidavit signing has been exposed. Stephan himself was deposed six months earlier, on December 10, 2009, in Florida. His Florida testimony is consistent with the testimony given in this case: except for some limited checking of figures, he signs summary judgment affidavits without first reading them and without appearing before a notary. troubling, in addition to that Florida action, in May, 2006 another Florida court only admonished GMAC, it sanctioned the Plaintiff lender for GMAC’s affidavit signing practices. As part of its order, the Florida court required GMAC to file a Notice of Compliance, indicating its commitment to modify its affidavit signing procedures to conform to proper practices. The experience of this case reveals that, despite the Florida Court’s order, GMAC’s flagrant disregard apparently persists. It is well past the time for such practices to end.”
Other courts have refused to allow banks to proceed with foreclosure because of apparent disregard of the laws which govern the assignment (purchase and transfer of mortgages) foreclosure proceeding. In Bank of NY v. Mulligan, 2010 NY Slip Op 51509 – NY: Supreme Court 2010, the Court wrote “the Mortgage Electronic System (MERS) which was created by several large participants in the real estate mortgage industry to track ownership interests in residential mortgages and to avoid the time and cost of complying with state law governing the assignment ( transfer) of mortgages did not have the authority to transfer a mortgage from one entity to another”
” The DECISION ONE mortgage, executed on October 28, 2005 by defendant MULLIGAN, clearly states on page 1 that “MERS is a separate corporation that is acting solely as a nominee for Lender [DECISION ONE] and LENDER’s successors and assigns . . . FOR PURPOSES OF RECORDING THIS MORTGAGE, MERS IS THE MORTGAGEE OF RECORD’
The Court rejected the attempt of IndyMac Bank to back the assignment of the mortgage to it and wrote the “instant mortgage and note were assigned to INDYMAC two days later on March 26, 2008. The assignment states that MERS, as nominee for INDYMAC, “has caused this instrument to be assigned by its Vice President and attested to on this 26th day of March, 2008. Effective as of October 1, 2007.” This attempt to retroactively predate the assignment to October 1, 2007 is a legal nullity, and fails to demonstrate INDYMAC’s ownership interest in the instant mortgage and note on the action’s commencement date.The Court also questioned “The incestuous relationship between INDYMAC’s agent, MERS, and INDYMAC is evidenced by: Ms. Johnson-Seck’s affidavit in the instant action as Vice President of INDYMAC, but claiming to be Vice President of both MERS and Deutsche Bank in Deutsche Bank v Maraj, supra; and, Ms. Hescott’s assignment of the instant mortgage and note as Vice President of MERS in the instant action, but claiming to be Vice President of INDYMAC in Indymac Bank, FSB v Boyd. and ruled that Indymac Bank could not proceed against the homeowners property until submitted the it submitted affidavits which explained who they worked.
“Affidavit of Erica A. Johnson-Seck, Vice President of plaintiff INDYMAC BANK, F.S.B., explaining: her employment history for the past three years; and, why a conflict of interest does not exist in how she acted as Vice President ofassignee INDYMAC BANK, FSB in the instant action, and Vice President of both MORTGAGE ELECTRONIC REGISTRATIONS SYSTEMS, INC. and Deutsche Bank in Deutsche Bank v Maraj, 18 Misc 3d 1123 (A) (Sup Ct, Kings County 2008);
Affidavit by Laura Hescott, Vice President of MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. explaining: her employment history for the past three years; and, why a conflict of interest does not exist in how she actedas the assignor of the instant mortgage and note to INDYMAC BANK, F.S.B. IndyMac Bank, FSB v. Bethley
The attorneys general of all fifty states have now announced investigations prompted by the recent allegations that mortgage-servicers, which include units of major banks such as Bank of America Corp.(BAC), submitted fraudulent documents in thousands of foreclosure proceedings nationwide. The banks say the document problems are technical–largely the result of papers approved by so-called robo-signers with little review–and don’t reflect substantive problems with foreclosures. The Office of The Attorney General of New Jersey and the Division of Consumer Affairs have issued a joint statement about the investigation “In New Jersey, foreclosure actions must be supported by an Affidavit of Amount Due, which establishes the identity of the mortgage/note holder and information concerning the default. Recent reports suggest that mortgage servicers are having employees sign these affidavits without confirming their accuracy. This is not a gray area. Either our legal requirements for filing foreclosures were followed or they weren’t, and we will hold the companies accountable for their systematic violations,” Attorney General Paula T. Dow said.”
It remains to be seen whether the disclosures about the illegal practices of the banks with result in a greater willingness to ease the burden to those facing foreclosure by providing reasonable mortgage modifications.