First one, now all. Just as we predicted - fan: meet feces.
Fresh off the presses at Bloomberg:
JPMorgan Based Foreclosures on Faulty Documents, Lawyers Claim
JPMorgan Chase & Co. faces a legal challenge next month that could cast doubt on thousands of foreclosures after a mortgage executive at the bank said she didn’t verify documents used to justify home seizures.
Lawyers for a Palm Beach County, Florida, homeowner asked a judge to throw out a foreclosure as a penalty for misleading the court, according to attorney Tom Ice of Ice Legal PA. They’re citing a May 17 deposition in which the JPMorgan executive said she signed thousands of affidavits and documents supporting the New York-based bank’s claims without personally checking loan records. The court is scheduled to hear arguments Oct. 19.
The Chase Home Finance operation supervisor, Beth Ann Cottrell, said in May she was among eight managers who together sign about 18,000 documents a month, according to a transcript of her sworn deposition provided by Ice. Asked how they were prepared, she said she relied on other people at the firm.
“My review is more or less signing the document unless it’s questionable,” she said. That means, “somebody has a question and brings it to me and says, ‘Beth, can you take a look at this?’”
Inaccurate statements by banks in foreclosure documents may give borrowers who have lost their homes a legal basis to challenge the seizures, derailing resales and casting doubts on property titles. A Florida court sanctioned Ally Financial Inc.’s GMAC Mortgage unit for faulty affidavits in 2006, and the firm suspended evictions in 23 states this month after finding employees still signing affidavits without checking the data.
Titles in Doubt
JPMorgan spokesman Tom Kelly declined requests for comment.
Cottrell didn’t return phone calls to her office requesting comment. A lawyer representing her at the deposition, Joseph Mancilla of the Florida Default Law Group PL, didn’t return calls. Cottrell isn’t named as a defendant.
Cottrell signed the affidavit at issue in the case, dated June 2009, while at her previous employer, an outside servicing firm working for JPMorgan, according to court documents. When signing documents there for the JPMorgan unit, she used the title “assistant secretary and vice president” of Chase Home Finance, according to the transcript. She became a JPMorgan employee about three months after signing the affidavit.
Document signers sometimes endorse affidavits on behalf of other firms as a way to streamline the foreclosure process, said Dustin Zacks, an attorney at Ice’s firm.
JPMorgan was the third-largest U.S. servicer of home mortgages as of June 30, with $1.35 trillion or almost 13 percent of the market, according to industry newsletter Inside Mortgage Finance. Ally is the fifth-biggest mortgage servicer, with $349.1 billion. The other three in the top five are Bank of America Corp., Wells Fargo & Co., and Citigroup Inc.
Title Insurers
“I’m sure a lot of title insurance companies are concerned about the potential liability right now,” as borrowers challenge how banks made statements, he said. “The judges could absolutely hold the bank and attorneys in contempt.”
U.S. home seizures reached a record for the third time in five months in August as lenders completed the foreclosure process for thousands of delinquent owners, according to RealtyTrac Inc.
Ice, the founding partner of his foreclosure-defense law firm in Royal Palm Beach, Florida, said some lenders are accepting voluntary dismissal of their cases.
During the deposition, Cottrell said a staff of in-house specialists scrutinize loan documents and prepare affidavits, the transcript shows. If they have difficulties or questions, they come to her. She signs in a notary’s presence, she said.
‘No Knowledge’
During questioning by Ice lawyer Zacks, Cottrell said she had worked at Chase Home Finance for about eight months, according to the transcript.
“As to everything in the affidavit, did you have personal knowledge?” Zacks asked.
“My own personal knowledge, no,” Cottrell answered.
“You stated ‘That plaintiff is entitled to enforce the note and mortgage,’” Zacks said. “Again, did you have personal knowledge of that?”
“No knowledge,” she answered.
Florida Attorney General William McCollum is investigating three law firms that represent loan servicers in foreclosures, and are alleged to have submitted fraudulent documents to the courts, according to an Aug. 10 statement. The firms handled about 80 percent of foreclosure cases in the state, according to a letter from U.S. Representative Alan Grayson, a Florida Democrat.
Judges overseeing foreclosures in the wake of the housing crisis are growing skeptical of banks, said Christopher L.
Peterson, a professor at the University of Utah’s S.J. Quinney College of Law. A surge in proceedings has helped expose a variety of paperwork lapses, he said in an interview.
“Early in the process the judges were very cavalier and they just took the financiers’ word,” Peterson said. “Now there are enough disputes out there about ownership of loans that the judges are starting to feel like they need to hold the financial institutions to the basic rules of evidence.”
Yesterday, five homeowners in the state of Maine filed a class action suit against GMAC Mortgage, accusing them of filing knowingly false certifications for foreclosure, and false affadavits which back up the documents. Maine is one of the 23 states where judicial sign-off is required to move ahead with a foreclosure, and where GMAC (now Ally Financial) has suspended evictions.
In depositions of GMAC/Ally officials as well as those at top mortgage lenders across the country, employees have admitted that they do not spend any time verifying the accuracy of the foreclosure documents, and often use a “robo-signer” who looks at the materials for less than 30 seconds and signs up to 10,000 affadavits a month.
The lawsuit alleges that thousands of Maine homeowners have lost their homes unfairly due to judgments based on false documents, and that most of them had no attorney operating in their defense. GMAC has been sanctioned in a Maine court for their “high-volume and careless approach to affidavit signing.” Local attorneys, along with the offices of Maine Attorneys Saving Homes, the National Consumer Law Center and the Center for Responsible Lending are working on the case.
Bank of America, the largest holder of mortgages in the country, yesterday admitted to this practice and suspended foreclosure processes while they review the documents. They plan to “amend all affidavits in foreclosure cases that have not yet gone to judgment,” a process that could take months or even years. Citi and Wells Fargo, the only major lenders which have not slowed their foreclosures yet, have defended their documentation actions, with Wells Fargo standing by the accuracy of their affadavits. If all lenders eventually submit to review, it could put on hold the future of 4.37 million households either in foreclosure or severe delinquency.
The lenders often just service the loans, without owning the title. Private investment pools or even the government, in the form of Fannie Mae and Freddie Mac, often own the homes. Sometimes the owner cannot be determined because of securitization and sloppy processes during the housing bubble, leading to foreclosures by servicers who cannot establish ownership.
Connecticut, a judicial foreclosure state, has suspended all foreclosures for 60 days while the Attorney General investigates. California, a non-judicial state, has asked GMAC/Ally and JPMorgan Chase, another lender reviewing their documents, to halt their foreclosure operations. Asm. Ted Lieu, the state legislator who wrote the law that requires lenders in California to try to contact borrowers and document the outcome before any foreclosure, said yesterday that the state should call for a foreclosure moratorium.
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First one, now all. Just as we predicted - fan: meet feces.
Fresh off the presses at Bloomberg:
JPMorgan Based Foreclosures on Faulty Documents, Lawyers Claim
JPMorgan Chase & Co. faces a legal challenge next month that could cast doubt on thousands of foreclosures after a mortgage executive at the bank said she didn’t verify documents used to justify home seizures.
Lawyers for a Palm Beach County, Florida, homeowner asked a judge to throw out a foreclosure as a penalty for misleading the court, according to attorney Tom Ice of Ice Legal PA. They’re citing a May 17 deposition in which the JPMorgan executive said she signed thousands of affidavits and documents supporting the New York-based bank’s claims without personally checking loan records. The court is scheduled to hear arguments Oct. 19.
The Chase Home Finance operation supervisor, Beth Ann Cottrell, said in May she was among eight managers who together sign about 18,000 documents a month, according to a transcript of her sworn deposition provided by Ice. Asked how they were prepared, she said she relied on other people at the firm.
“My review is more or less signing the document unless it’s questionable,” she said. That means, “somebody has a question and brings it to me and says, ‘Beth, can you take a look at this?’”
Inaccurate statements by banks in foreclosure documents may give borrowers who have lost their homes a legal basis to challenge the seizures, derailing resales and casting doubts on property titles. A Florida court sanctioned Ally Financial Inc.’s GMAC Mortgage unit for faulty affidavits in 2006, and the firm suspended evictions in 23 states this month after finding employees still signing affidavits without checking the data.
Titles in Doubt
JPMorgan spokesman Tom Kelly declined requests for comment.
Cottrell didn’t return phone calls to her office requesting comment. A lawyer representing her at the deposition, Joseph Mancilla of the Florida Default Law Group PL, didn’t return calls. Cottrell isn’t named as a defendant.
Cottrell signed the affidavit at issue in the case, dated June 2009, while at her previous employer, an outside servicing firm working for JPMorgan, according to court documents. When signing documents there for the JPMorgan unit, she used the title “assistant secretary and vice president” of Chase Home Finance, according to the transcript. She became a JPMorgan employee about three months after signing the affidavit.
Document signers sometimes endorse affidavits on behalf of other firms as a way to streamline the foreclosure process, said Dustin Zacks, an attorney at Ice’s firm.
JPMorgan was the third-largest U.S. servicer of home mortgages as of June 30, with $1.35 trillion or almost 13 percent of the market, according to industry newsletter Inside Mortgage Finance. Ally is the fifth-biggest mortgage servicer, with $349.1 billion. The other three in the top five are Bank of America Corp., Wells Fargo & Co., and Citigroup Inc.
Title Insurers
“I’m sure a lot of title insurance companies are concerned about the potential liability right now,” as borrowers challenge how banks made statements, he said. “The judges could absolutely hold the bank and attorneys in contempt.”
U.S. home seizures reached a record for the third time in five months in August as lenders completed the foreclosure process for thousands of delinquent owners, according to RealtyTrac Inc.
Ice, the founding partner of his foreclosure-defense law firm in Royal Palm Beach, Florida, said some lenders are accepting voluntary dismissal of their cases.
During the deposition, Cottrell said a staff of in-house specialists scrutinize loan documents and prepare affidavits, the transcript shows. If they have difficulties or questions, they come to her. She signs in a notary’s presence, she said.
‘No Knowledge’
During questioning by Ice lawyer Zacks, Cottrell said she had worked at Chase Home Finance for about eight months, according to the transcript.
“As to everything in the affidavit, did you have personal knowledge?” Zacks asked.
“My own personal knowledge, no,” Cottrell answered.
“You stated ‘That plaintiff is entitled to enforce the note and mortgage,’” Zacks said. “Again, did you have personal knowledge of that?”
“No knowledge,” she answered.
Florida Attorney General William McCollum is investigating three law firms that represent loan servicers in foreclosures, and are alleged to have submitted fraudulent documents to the courts, according to an Aug. 10 statement. The firms handled about 80 percent of foreclosure cases in the state, according to a letter from U.S. Representative Alan Grayson, a Florida Democrat.
Judges overseeing foreclosures in the wake of the housing crisis are growing skeptical of banks, said Christopher L.
Peterson, a professor at the University of Utah’s S.J. Quinney College of Law. A surge in proceedings has helped expose a variety of paperwork lapses, he said in an interview.
“Early in the process the judges were very cavalier and they just took the financiers’ word,” Peterson said. “Now there are enough disputes out there about ownership of loans that the judges are starting to feel like they need to hold the financial institutions to the basic rules of evidence.”
Yesterday, five homeowners in the state of Maine filed a class action suit against GMAC Mortgage, accusing them of filing knowingly false certifications for foreclosure, and false affadavits which back up the documents. Maine is one of the 23 states where judicial sign-off is required to move ahead with a foreclosure, and where GMAC (now Ally Financial) has suspended evictions.
In depositions of GMAC/Ally officials as well as those at top mortgage lenders across the country, employees have admitted that they do not spend any time verifying the accuracy of the foreclosure documents, and often use a “robo-signer” who looks at the materials for less than 30 seconds and signs up to 10,000 affadavits a month.
The lawsuit alleges that thousands of Maine homeowners have lost their homes unfairly due to judgments based on false documents, and that most of them had no attorney operating in their defense. GMAC has been sanctioned in a Maine court for their “high-volume and careless approach to affidavit signing.” Local attorneys, along with the offices of Maine Attorneys Saving Homes, the National Consumer Law Center and the Center for Responsible Lending are working on the case.
Bank of America, the largest holder of mortgages in the country, yesterday admitted to this practice and suspended foreclosure processes while they review the documents. They plan to “amend all affidavits in foreclosure cases that have not yet gone to judgment,” a process that could take months or even years. Citi and Wells Fargo, the only major lenders which have not slowed their foreclosures yet, have defended their documentation actions, with Wells Fargo standing by the accuracy of their affadavits. If all lenders eventually submit to review, it could put on hold the future of 4.37 million households either in foreclosure or severe delinquency.
The lenders often just service the loans, without owning the title. Private investment pools or even the government, in the form of Fannie Mae and Freddie Mac, often own the homes. Sometimes the owner cannot be determined because of securitization and sloppy processes during the housing bubble, leading to foreclosures by servicers who cannot establish ownership.
Connecticut, a judicial foreclosure state, has suspended all foreclosures for 60 days while the Attorney General investigates. California, a non-judicial state, has asked GMAC/Ally and JPMorgan Chase, another lender reviewing their documents, to halt their foreclosure operations. Asm. Ted Lieu, the state legislator who wrote the law that requires lenders in California to try to contact borrowers and document the outcome before any foreclosure, said yesterday that the state should call for a foreclosure moratorium.
Monday's <b>news</b>: Saturday's opener can't get here soon enough! - On <b>...</b>
At long last, we've got some honest-to-goodness competitive NHL hockey to look forward to this week as the 2010-11 season opens Thursday evening.
UKIE: More research needed on addiction issue | <b>News</b>
UKIE chairman Andy Payne has stressed that more research is needed into the issue of possible addiction to videogames - a...
IMPORTANT: Bing <b>News</b> RSS feed has moved! (France National Soccer <b>...</b>
... FIFA World Cup™ problems which followed the sending home of Nicolas Anelka after his clash with Blanc's predecessor Raymond Domenech. Blanc banned the entire 23-man FIFA World Cup squad from his first More FIFA World Cup News ...
eric seiger eric seiger
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