Need feedback from what others know of mort. mod processing

[justbroke]

The fraud cause of action stems from "offering" somethey had no intention of fulfilling. They enticed her.... Look up constructive fraud.

How? Bank of America was going to modify the loan. However, the loan was sold as a bundle. How does that constitute constructive fraud? BofA would need to have known that a.) the loan was about to be sold, b.) that they never intended to modify the loan, and c.) "constructively" worked with Litton so that they didn't have to modify the loan.

I SAID to sue for Performance.... I agree it is a real mess.

What performance? Where is the performance of requiring any Bank to modify the terms of a loan? What executed contract (singed by all parties) show that any party didn't perform under that contract or some blanket agreement?

I'd do it for educational/ training value alone, much less the entertainment value.

I agree here. Just to do it to see if it goes somewhere. However, I don't see any basis, and the whole suit thing seems frivolous on the onset.

(Remember, I always take the Trustee/Lender view of things. This puts things into perspective for everyone. I'm not even playing devil's advocate here. This is purely a matter of contract law, and I see no breaches of the original contract... except by the person seeking the modification.)

[socalgal]

BofA stranding of modification by selling NOTE

How? Bank of America was going to modify the loan. However, the loan was sold as a bundle. How does that constitute constructive fraud? BofA would need to have known that a.) the loan was about to be sold, b.) that they never intended to modify the loan, and c.) "constructively" worked with Litton so that they didn't have to modify the loan.

What performance? Where is the performance of requiring any Bank to modify the terms of a loan? What executed contract (singed by all parties) show that any party didn't perform under that contract or some blanket agreement?

I agree here. Just to do it to see if it goes somewhere. However, I don't see any basis, and the whole suit thing seems frivolous on the onset.

(Remember, I always take the Trustee/Lender view of things. This puts things into perspective for everyone. I'm not even playing devil's advocate here. This is purely a matter of contract law, and I see no breaches of the original contract... except by the person seeking the modification.)

So far, you are concentrating only on one aspect. The actual case is not the frivilous one you perceive. I would not have retained the lawyer if it boiled down to the situation you are describing. He is a reputable lawyer who would have avoided taking a frivilous case.

Because of this, I believe you may be doing an unfortunate distortion that might influence others who are considering whether to consult with an attorney. You may dissuade others who have this happen, causing them to just let the bank take their home.

Have you ever considered that you could be just a bit too heavy-handed with your 'lenders perspective' in this forum?

[OhioFiler]

I see the issue for the court to decide as whether socalgirl and BofA had a valid agreement before the note was sold to Litton. Essentially, at what precise moment in time was the signed modification effective. No one can dispute that BofA had the right to sell the note. The question is did they sell it before or after it was modified.

Justbroke is one of the most thoughtful posters on BKForums. I don't see anything in his post that would dissuade someone else from contacting an attorney in your situation.

[justbroke]

Have you ever considered that you could be just a bit too heavy-handed with your 'lenders perspective' in this forum?

I am absolutely not "heavy handed" on this or any perspective. This is an educational forum, and I would hope that people see more than just the "sue them" mantra that seems to happen. And believe me... read some of my posts... I love to say "sue them"!!! This one isn't clear cut for me. Looking at what I've seen posted, nothing would bother me defending this from the purchasing lender's point of view.

I actually look at both sides. In this instance, you handled the debtors side well. I was showing the other side.

In no way is anything I write meant to dissuade/persuade or coerce any poster to do anything but to consult legal advice. I was mentioning that based on what you wrote, that the perception, from the other view, is different. My post most specifically mentions that the creditor will say this... as their defense... because they are entitled to one.

In this particular case, we weren't talking about any lender taking a home. In this particular case, we were discussing the legal binding of the purchaser of a mortgage (secondary, tertiary market) to an agreement, that was never executed or recorded by the seller. In this particular case, I see clearly that the purchasing lender (buyer) is not at fault.

I can also see where an individual in this circumstance, may feel that the selling lender (seller) is responsible for not having executed the agreement. However, I don't see that as having more weight than the former.

It's just a perspective. I'm not a conspiracy person, although I love a good conspiracy... doesn't everyone?

Perhaps it was just a mistake on the seller's part. That still does not obligate the buyer. That's all I'm saying. I also said to pursue this just for the fun of it. I also stated to actually try to work with the buyer rather than immediately yelling it's a breach of a contract which -- I'll concede -- may or may not exist.

[socalgal]

BofA stranding of modification by selling NOTE

I am absolutely not "heavy handed" on this or any perspective. This is an educational forum, and I would hope that people see more than just the "sue them" mantra that seems to happen. And believe me... read some of my posts... I love to say "sue them"!!! This one isn't clear cut for me. Looking at what I've seen posted, nothing would bother me defending this from the purchasing lender's point of view.

I actually look at both sides. In this instance, you handled the debtors side well. I was showing the other side.

In no way is anything I write meant to dissuade/persuade or coerce any poster to do anything but to consult legal advice. I was mentioning that based on what you wrote, that the perception, from the other view, is different. My post most specifically mentions that the creditor will say this... as their defense... because they are entitled to one.

In this particular case, we weren't talking about any lender taking a home. In this particular case, we were discussing the legal binding of the purchaser of a mortgage (secondary, tertiary market) to an agreement, that was never executed or recorded by the seller. In this particular case, I see clearly that the purchasing lender (buyer) is not at fault.

I can also see where an individual in this circumstance, may feel that the selling lender (seller) is responsible for not having executed the agreement. However, I don't see that as having more weight than the former.

It's just a perspective. I'm not a conspiracy person, although I love a good conspiracy... doesn't everyone?

Perhaps it was just a mistake on the seller's part. That still does not obligate the buyer. That's all I'm saying. I also said to pursue this just for the fun of it. I also stated to actually try to work with the buyer rather than immediately yelling it's a breach of a contract which -- I'll concede -- may or may not exist.

I have yet to see the letter that was sent on my behalf, the copy is in the mail to me. Apparently my lawyer did indeed have some 'fun' with BOTH BofA and Litton.

We shall see. I'm not above asking that people pray that this resolves in my favor. I also have an experienced, well-respected lawyer handling the case.

I just do not agree, nor would he, about the case being 'frivolous'. He would have told me just to work on getting a new mod with Litton. (That can be a bigger mountain that getting the BofA mod applied.)

That will be a 'fall-back' if necessary. Certainly this action does no harm to the already-failed attempts to get Litton to consider the mod. Even for a new mod, Litton, incorrectly, has claimed I make too much for a mod.

As far as the lender taking the home, THAT IS LITTON'S ULTIMATE GOAL it would seem, even with a defective notification of default letter. If the note really was bought from BofA by a private investor, that investor has NO desire to allow the mod. Must think he found a slick way to acquire a house that is going to improve in value faster than other areas. (It is in a desirable zip code.)

[justbroke]

I have yet to see the letter that was sent on my behalf, the copy is in the mail to me. Apparently my lawyer did indeed have some 'fun' with BOTH BofA and Litton.

Just the thing to do... but he's having fun... not submitting a lawsuit. Regardless of whether there's a case or not, having a lawyer look at any legal documents for review, or to write letters for you... is always smart in my book.

Do you have a case? Yes. Is it frivolous? Not based on the information I've seen so far. I just hate to get to a point where you waste money pursuing it.

We shall see. I'm not above asking that people pray that this resolves in my favor. I also have an experienced, well-respected lawyer handling the case.

I actually hope it does go in your favor!

I just do not agree, nor would he, about the case being 'frivolous'. He would have told me just to work on getting a new mod with Litton. (That can be a bigger mountain that getting the BofA mod applied.)

I think we misunderstand each other, and I'll clarify. I think making a case out of this is indeed frivolous. However, having your lawyer poke around and try to get the ball rolling, is neither frivolous nor a waste of time! My statement had to do with purely just saying "sue them". Your lawyer is handling it properly, as I can tell by your posting.

That will be a 'fall-back' if necessary. Certainly this action does no harm to the already-failed attempts to get Litton to consider the mod. Even for a new mod, Litton, incorrectly, has claimed I make too much for a mod.

Absolutely does no harm! That's why I think I and someone else posted to have fun with it. You will be no worse off than before.

As far as the lender taking the home, THAT IS LITTON'S ULTIMATE GOAL it would seem, even with a defective notification of default letter.

Nice. No one ever said they were smart.

If the note really was bought from BofA by a private investor, that investor has NO desire to allow the mod. Must think he found a slick way to acquire a house that is going to improve in value faster than other areas. (It is in a desirable zip code.)

While that's speculation, I tend to agree that it could be a strategy. There are investors looking to make money out there. There are investors who pray upon people in Bankruptcy, like us.

I hate to see big Banks, investors, or predatory lenders... pray upon those in need.

[Hodgini66]

You might find this link interesting, about how the banks are passing Notes around, dodging bullets... Some have recently been getting busted with HUGE sanctions:

http://www.bkforum.com/showthread.php?t=39675&highlight=forbearance

This site also sheds some better light on the subject of enforceability, for all of us:

http://www.brokencredit.com/category/forbearance/

[justbroke]

You might find this link interesting, about how the banks are passing Notes around, dodging bullets... Some have recently been getting busted with HUGE sanctions

What do you mean by passing notes? Do you mean selling Mortgage/Notes or "notations" on an account?

[Hodgini66]

From the BrokenCredit site link, above:

December 9, 2008
Are Loan Modifications & Forbearance Agreements Binding?
Filed under: Forbearance, Loan Modification, RESPA
I understand RESPA< Tila, etc. under each I can question my mortgage loan history via a Qualified Written Request, or that's what I thought. I got a loan in 1996, no problems until it was sold in 1999. Within 5 months, after making the $3,100.00/mo pymts. payments, my loan servicer filed a NOD for $46,000.00 and sold the loan.

Facing a sale date the new servicer offered a forbearance agreement and promised a "loan audit". I accepted and the audit never came. I did the QWR, etc. and paid $90,000.00 in 9 months, all the time asking about the "audit", each payment postponing the sale 30 days.

I finally protested and threatened suit. They re-noticed the sale and demanded $74,000.00.

I protested and the day before the sale, another Forbearance agreement in 2001 with another "audit" promise. Same thing all over. I paid,protested, QWR. etc.

I stopped paying and they re-noticed the sale. Again they offered a forbearance agreement in 2002, this time $552,700.00 in arrears. That was the original loan in 1996.

I crossed out the wrong amount and with the officers consent for an "audit" sent them $13,000.00 as a deposit for the "audit". They sold the loan.

New servicer, same stuff all again. I had the loan audited by a nationally know audit firm and I was way ahead. The new servicer wasn't impressed and filed another NOD.

I filed a lawsuit.

The suit came down to the 2 last agreements. Which one is enforceable? Was it the 2001 that was replaced by the 2002 that was confirmed by the former bank officer or the 2002 that had nothing in arrears and promised a Federal and State mandated debt verification audit?

Guess what, the Court ruled that a forbearance agreement is not enforceable unless signed by both parties. Based on that decision it could not be the unsigned 2002 agreement, even with the verification of the bank that drafted it, it had to be the 2001 unsigned agreement.

My question is, how can a Court enforce an unsigned agreement when they just declared that an agreement had to be signed to be enforceable? With that question, how can a State Court bar me from my Federal rights under RESPA, etc. via a QWR?

The other problem is since I am the first case in California of this type, what is going to happen to all of the borrowers that are getting these agreements and do not know they are unenforceable against the lender?

When the economy recovers the banks will come back and with my case, void all of the agreements and immediately claim all of the deferred or reduced payments.

Gene
———-
Hello Gene,

I found three cases dealing with servicers entering into workouts (or workouts were alleged) and then a disagreement ensued where the court issued an opinion.

Wright v. Litton Loan Servicing, L.P. (No. 05-02611, E.D. Pa., April 4, 2006) is a case where the borrower entered into a modification with one mortgage lender which resulted from a settlement out of bankruptcy court. All was well until the loan was transferred to Litton Loan Servicing. This decision was ruled for the borrower for actual and statutory damages for failure to respond properly to the homeowner’s QWR, plus violations under the FDCPA. The actual damages included “pain, suffering, and emotional distress”. Of course, Litton was also ordered to pay the borrower’s attorney fees.

Hauf v. HomeQ Servicing Corporation, (No. 4:05-CV-109, M.D. Ga. Jan 23, 2007) [B]is the story of a forbearance agreement entered into with The Money Store and then subsequently not honored by HomeQ Servicing. This is an actionable offense. The court refused to dismiss the borrower’s “breach of contract” claims against the servicer.[/B]

So far, that’s score 2 for the homeowner and 0 for the lender. Moving on…

JP Morgan Chase Bank v. Murdock (No. L-06-1153, Ohio Ct. App. Feb 23, 2007) is a case where the borrower’s affidavit stating that he entered into a workout agreement with Chase failed to stop the foreclosure.

Three cases above and none of them touch on the exact issue that you described. My guess would be that the fact that the 2002 agreement was modified on your end without execution on the lender’s side failed to make a valid contract as a matter of law. And as to a QWR RESPA claim in an affirmative action, that can generally be brought in state or federal court but has a three-year statute of limitations. I’d say you should be asking your attorney these questions and I am hopeful that consumers are working with attorneys because the pro se litigant creates bad case law for other consumers more often than not.

Thanks for the questions and hope this helps.

Paul

This author is not an attorney and this information should not be considered legal advice. Please consult an attorney for legal advice.

[Hodgini66]

Passing, as in "Pass the hot potato"????

Or... "Pass the grenade"?

LOL

NOBODY wants to be holding when the potato dings or the nade explodes!

Read on, you'll get the picture REAL quick.

[Hodgini66]

THIS is the post in that thread....

FOLLOW THE LINKS!!!

Bubbles,

Here is the grandslam court ruling that an attorney may be very interested in. It deals with "covenant of good faith and fair dealing" in addition to UCC matters as I noted, Fair Lending, TILA, RESPA and so many other things that look applicable to you.

http://www.goodwinprocter.com/Files/CFSA/rm_Nosek.pdf

Here is another source of many rulings that have peripheral relations to your issue:

http://www.abiworld.org/committees/newsletters/consumer/vol6num4/Consumer_Sept_2008_NE08_Messing_Mortgages_Cases.pdf

Note that the first case, which seems likely to be a case-law reference for your attorney to use in court, applied hundreds and hundreds of thousands of dollars in sanctions, all based on the idea that the lender was basically. . . behaving like an idiot and not honoring their agreements, while attempting to mislead the court.

[justbroke]

NOBODY wants to be holding when the potato dings or the nade explodes!

Selling bad debt portfolios has been done forever. As a matter of fact, the secondary and tertiary mortgage market is just that. They sold, re-sold, collaterlized, and securitized all the bad debt.

I don't see anything new. There are always TILA, RESPA, and other violations probably daily. If you have a suit under any of those, or underlying State laws... go for it.

I just don't see a conspiracy. People in this business make lots of money. Even the guy who buys the BK'd debt and then tries to collect it. He can still earn big money.. knowing it's BKd! Chapter 13 debt buyers make a lot of money buying debt that the original creditor thought may never be recovered. One of those JDBs just bought about $75K of my American Express debt from American Express for some amount (who knows)... and I'm in a 0% payback plan. They don't do this for charity.

[socalgal]

BofA Stranded my Modification by Selling the NOTE!

My loan is of the proper vintage and other requirements (owner-occupied, etc) to qualify for California SB 1137. [Took effect in 2008.]

Both lenders have bungled compliance with that bill regarding my loan. Several points are being iggied by each of them.

Also, the exact wording of that bill: "Any loan modification or workout plan offered at the meeting by the mortgagee, trustee, beneficiary, or authorized agent is subject to approval by the borrower;"

The 'meeting is allowed to occur by phone' so that would have been, at best, Countrywide's phone call telling me the mod package was going into the mail.

Did you notice that the claws, ahem, clause, only cited the package was subject to MY APPROVAL????????????????????????? Once they offer, the is NO LANGUAGE IN THE BILL FOR ANY 'RE-THINK' BY THE OTHER SIDE.

There is no REQUIREMENT to MAKE an offer, but once one is made, the only option is for the BORROWER under CA SB 1137. That is apparently WHY certain CA lawyers have stated that the mod was just up to the borrower to accept or reject.

[justbroke]

My loan is of the proper vintage and other requirements (owner-occupied, etc) to qualify for California SB 1137. [Took effect in 2008.]

California is certainly lone of the more, ahem, progressive States when it comes to the People's rights... so I applaud them for that.

Any new law is always subject to litigation and I'm glad that there are CA lawyers just itching to see how strong the teeth are in the new legislation.

I hope it works for you. Maybe we can get Florida to get such a bill too.

[socalgal]

CA SB 1137 and Mortgage Mod Processing

If this bill works, it could help some people. It is targeted for owner-occupied, no bankruptcy filed, loans made from Jan 2003 to Dec 2007.

Those are the only restrictions (the property the note is recorded on has to be in CA).

IF it can help, other heavily impacted states should consider it.

It is interesting that the one MAJOR area that BofA just stomped all over is a clause that was apparently accepted without comment from any of the groups submitting comments before it became law.

Both lenders have failed to abide by other clauses also. The law even states that when the lender calls to contact the borrower, if they use an auto-dialer, the call has to be transferred to a human. HA, Ha, Ho, right, tell that to Litton. They have a recording that tells YOU where to call and that 'They already tried to reach you earlier today'. Caller ID shows that recording is UNTRUE. And that recording does not forward you to a person, nope, you are to call in, waste your time trying to get to someone. (You are lucky if the call is not disconnected abruptly at least once.) And it is always the collection arm of Litton, not the Loss Mitigation. They seem to use their 'Research' department as Loss Mitigation. Contact with 'Research' is ONLY via FAX.

So, if this SB 1137 can force the lenders to stop all the contorsions so they are able to sit on their butts instead of having their head in the way, then it would be good for other states to model one after it.

SB 1137 is written to only be in effect for a certain number of years (I think it ends in 2013).