Love for Life

WELCOME TO FORECLOSURE DEFENSE NATIONWIDE

August 1, 2008

Foreclosure Defense Nationwide (FDN) is a resource which provides free and public information as to issues and developments in the defense of foreclosure actions throughout the United States, including the filing of legal actions, judicial rulings, generic forms, and articles on various foreclosure defense matters. FDN also provides links to resources such as auditors, attorneys, mediators, and real estate professionals to assist those facing either the threat of foreclosure or an actual foreclosure proceeding.

We will endeavor to respond to every request made to us, whether by phone, fax, or e-mail, as quickly and as thoroughly as possible. This may include a reference to one or more professionals. When using our “Contact Us” link, please be sure to include all requested information so that you may be provided with the most accurate assistance.

Unless otherwise noted, the articles and commentary and the sample court filings which appear on this blog were authored by Jeff Barnes, Esq. As blogs contain information available to the “Internet public”, you may see some of these articles and court filings on other blogs (sometimes with the names redacted). Blogs do share information so that as many foreclosure victims as possible may obtain information on foreclosure defense.

The sample court filings which appear on this website are public information for informational purposes only; were specifically prepared as to specific facts for specific cases in specific jurisdictions; and are not meant or intended to be copied or otherwise used for any other purpose. FDN does not counsel, approve, or condone the copying or other use of any matters in the sample court filings for any purpose, any case, or any situation, and anyone who uses this material in any case does so at their own risk and without any approval from FDN or its attorneys.

Legal defense of foreclosure proceedings is a highly complicated, intricate, and sophisticated procedure which should only be undertaken by attorneys who practice in this area of the law on a regular basis. Non-attorneys who attempt to practice law may find themselves hurting their case and ultimately losing in court and possibly being subject to sanctions from the Court as well.

ABOUT FORECLOSURE DEFENSE NATIONWIDE
AND WILLIAM JEFF BARNES, ESQ.

Jeff is the founder of the Foreclosure Defense Nationwide (FDN) website and blog. His law practice is heavily oriented towards defense of foreclosure actions throughout the United States, with his Firm currently representing victims of foreclosure and predatory lending practices in the states of Alaska, Arizona, California, Colorado, Delaware, Florida, Georgia, Hawaii, Illinois, Maryland, Massachusetts, Michigan, Missouri, Montana, New Jersey, New York, North Carolina, Ohio, Oregon, South Carolina, Texas, Vermont, Virginia and Wisconsin.

Jeff has been a member of the Florida Bar since 1988 and the Colorado Bar,first admitted in1990. He has been previously admitted to practice in the Superior Court for the State of New Jersey (Atlantic City); the Hennepin County Circuit Court (Minnesota); the Norfolk Superior Court (Commonwealth of Massachusets); the Circuit Civil Court of Walker County, Alabama; and the Superior Court for the State of California (Orange County).

He is also admitted to the United States District Court for the Southern and Middle Districts of Florida, and the United States Courts of Appeals for the Third, Tenth and Eleventh Circuits. Jeff has been previously admitted to practice in the United States District Court for the District of Minnesota (Duluth); the United States District Court for the District of New Jersey (Newark); the United States District Court for the District of Wyoming; and is currently admitted pro hac vice to the United States District Court for the Northern District of Ohio (Eastern Division); the United States Bankruptcy Court for the Northern District of California (San Jose Division); the United States District Court for the District of Maryland (Baltimore and Greenbelt Divisions); the United States District Court for the Northern District Georgia (Newnan Division); the Superior Court of New Jersey (Atlantic County); the Superior Court of Massachusetts (Plymouth); the Superior Court of Coweta County (Georgia); the Superior Court of Washington (Ferry County); and is currently seeking admission pro hac vice to the Supreme Court of New York (Suffolk County), the Superior Court of Beaufort County South Carolina, and the State Court of Maricopa County,Arizona, in connection with foreclosure defense litigation.

Jeff has spent over twenty years litigating throughout the United States in the areas of business tort litigation, contract litigation, insurance litigation (coverage, claims, premium fraud defense, and Unfair and Deceptive Insurance Practices), fraud litigation, real estate litigation, and Administrative proceedings involving defense of chiropractors in disciplinary proceedings and appeals in deportation proceedings. His practice includes both trials (jury and non-jury) and appeals.

After graduating from Franklin & Marshall College in Lancaster, Pennsylvania with a degree in Experimental Psychology, Jeff obtained a Master of Science degree in Education and his Juris Doctor (law) degrees from the University of Miami (Florida). Between graduation from college and prior to law school, Jeff was a public and private school teacher in Miami, Florida, having taught elementary, junior, and senior high students, as well as serving as an assistant adjunct professor at Florida International University in the areas of Behavioral Science Statistics and Preventive Law to Master’s and Doctoral candidates. While in law school, Jeff served as a prosecutor in the Office of the State Attorney in Miami, Florida.

FDN handles foreclosure defense matters in both judicial and non-judicial (trustee) jurisdictions and is affiliated with mortgage loan auditors who conduct a review of mortgage documents to ascertain any violations of Federal lending laws. An audit is strongly recommended for anyone seeking to defend a foreclosure action. FDN will provide contact information for an auditor upon request made through our “Contact Us” link.

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SUPREME COURT OF KANSAS BLASTS MERS’ ALLEGED RIGHT TO ASSIGN MORTGAGES AND NOTES: DECISION HAILED AS MILESTONE VICTORY FOR BORROWERS DEFENDING FORECLOSURE PROCEEDINGS INVOLVING MERS ASSIGNMENTS

By Jeff Barnes, Esq.

September 17, 2009

The Supreme Court of Kansas has issued a landmark decision which, although decided on a narrow legal issue involving a request by MERS and Sovereign Bank to set aside a default and intervene in a foreclosure action, essentially invalidates all MERS assignments based on the Court’s finding that MERS never had any legal interest to assign the note. The full text of the Court’s opinion and additional commentary may be found by contacting mortgagefrauds@aol.com.

In the case, which is styled Landmark National Bank v. Kesler, Supreme Court of Kansas No. 98,489 (Opinion released August 28, 2009), MERS and Sovereign Bank sought to overturn lower court rulings that a non-lender is not a “contingency necessary party” (also termed an “indispensable party” in other jurisdictions) in a mortgage foreclosure action, and that due process did not require that a non-lender be allowed to intervene in a mortgage foreclosure action. Although not appealed on the specific ground of MERS’ legal authority to assign mortgages and notes, the Supreme Court of Kansas went to painstaking detail to discuss this alleged authority in connection with MERS’ claim that it had the right to intervene in and be made a party to the foreclosure action, ultimately finding that MERS had no such authority and thus the lower courts properly denied MERS’ and Sovereign’s requests.

The borrower took out a first and second mortgage with two different lenders, each of which recorded their mortgages. The original lender on the second mortgage, that being Millennia Mortgage Corp. (of Laguna Hills, Orange County, California), allegedly assigned, through MERS, the mortgage and note to Sovereign without either MERS or Sovereign recording the alleged assignment. A foreclosure was instituted by the original lender on the first mortgage which named the borrower and Millennia. Neither MERS nor Sovereign was named in the action as the alleged assignment of the second mortgage from Millennia to Sovereign by MERS was never recorded. MERS and Sovereign thereafter found out about the foreclosure and sought to set aside the default against Millennia (which obviously did not respond to the lawsuit as it had assigned the mortgage to Sovereign, or so it thought) and intervene in the foreclosure action, doing so well after the Sheriff’s sale of the property.

The MERS assignment contained the typical language where MERS was the alleged “nominee” and functioned solely in that capacity for Millennia. The Kansas Supreme Court noted that the attorneys attempted to define what a “nominee” is “in much the same way that the blind men of Indian legend described an elephant-their description depended on what part they were touching at any given time”. Notwithstanding the strained attempts of the attorneys, the Kansas Supreme Court held that “The relationship that MERS has to Sovereign is more akin to that of a straw man than to a party possessing all the rights given a buyer”, and that the mortgage document consistently limits MERS to acting “solely” as the nominee of the lender (and not with any authority to assign).

The Court further held that “in the event that a mortgage loan somehow separates interests of the note and the deed of trust, with the deed of trust lying with some independent entity, the mortgage may become unenforceable” as “The practical effect of splitting the deed of trust from the promissory note is to make it impossible for the holder of the note to foreclose, unless the holder of the deed of trust is the agent of the holder of the note. Without this agency relationship, the person holding only the note lacks the power to foreclose in the event of default”. This holding is particularly significant in securitized mortgage loan transactions where the mortgage was assigned to a securitized mortgage loan trust as collateral in connection with the issuance of mortgage-backed securities (also termed “certificates”), and the purported “assignment” of the Note by MERS was ineffective due to a lack of authority, thus severing the note from the mortgage.

The Kansas Court further held, citing legal decisions from other jurisdictions, that because MERS was not the original holder of the promissory note and because the record contained no evidence that the original holder of the note authorized MERS to transfer the note (as MERS’ authority, as set forth in the mortgage document itself, was “solely as nominee”), the language of the assignment purporting to transfer the promissory note was ineffective. The Court held that for there to be a valid assignment, there must be more than just the assignment of the deed alone and that the note must also be assigned, and although MERS purportedly assigned both the note and deed of trust, there was no evidence that established that MERS either held the note or was given the authority to assign the note, resulting in the assignment being ineffective.

The Court went on to note that “The practices of the various MERS members, including both the original lender and the mortgage purchaser, in obscuring from the public the actual ownership of the mortgage (as the MERS assignment from Millennia to Sovereign was not recorded), thereby creating the opportunity for substantial abuses and prejudice to mortgagors, should not be permitted to insulate the mortgage purchaser from the consequences of its actions in accepting a mortgage from an original lender that was already the subject of litigation in which the original lender erroneously represented that it had authority to act as mortgagee”.

We presently have several cases where different foreclosing parties, most notably IndyMac Bank, are engaging in this type of wrongful action: that is, attempting to foreclose representing that they have an interest in the mortgage when they previously “assigned” their interest to one or more third parties, including securitized mortgage loan trusts, through MERS.

We have also previously reported that a Federal Court in Nevada similarly attacked MERS’ purported “authority”, finding that there was no evidence that MERS was the agent of the note’s holder (In Re: Joshua and Stephanie Mitchell, Case No. BK-S-07-16226-LBR [U.S. Bankruptcy Court, District of Nevada, Memorandum Opinion of August 19, 2008]. The Court of Common Pleas of Sumter County, South Carolina also found that MERS’ rights were not as they were represented to be; that MERS had no rights to collect on any debt because it did not extend any credit; none of the borrowers owe MERS any money; that MERS does not own the promissory notes secured by the mortgages; and that MERS does not acquire any loan or extension of credit secured by a lien on real property. Mortgage Electronic Registration Systems, Inc. v. Girdvainis, Sumter County, South Carolina Court of Common Pleas Case No. 2005-CP-43-0278 (Order dated January 19, 2006, citing to the representations of MERS and court findings in Mortgage Electronic Registration Systems, Inc. v. Nebraska Dept. of Banking and Finance, 270 Neb. 529, 704 NW 2d. 784). As such, ALL MERS assignments are suspect at best, and may in fact be fraudulent.

The importance of the findings of the Supreme Court of Kansas cannot be overemphasized. It is generally the law in all states that if the law of one state has not specifically addressed a specific legal issue that the court may look to the law of states which have. The Kansas Court acknowledged that the case was one of “first impression in Kansas”, which is why the Kansas Court looked to legal decisions from California, Idaho, New York, Missouri, and other states for guidance and to support its decision. As we have previously reported, the Ohio Courts have looked to the legal decisions of New York to resolve issues in foreclosure defense, most notably issues of standing to institute a foreclosure.

It is practically certain that this decision will be the subject of review by various courts. MERS has already threatened a “second appeal” (by requesting “reconsideration” by the Supreme Court of Kansas of its decision by the entire panel of Judges in that Court). However, for now, the decision stands, which decision is of monumental importance for borrowers. It thus appears that the tide is finally starting to turn, and that the courts are beginning to recognize the extent of the wrongful practices and fraud perpetrated by “lenders” and MERS upon borrowers, which conduct was engaged in for the sole purpose of greed and profit for the “lenders” and their ilk at the expense of borrowers.

Onward and upward!!!

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

E-mail: info @ ForeclosureDefenseNationwide.com

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WHY “LOAN MODS” ARE NOT BEING ACCEPTED: BANKS MAKING MORE MONEY ON FORECLOSURES; “BALANCE SHEET ECONOMICS”

By Jeff Barnes, Esq.

September 11, 2009

While in California on a foreclosure defense case about 3 weeks ago, I read a front-page article in one of the daily newspapers alerting readers that the reason why “lenders” and “servicers” are not inclined to grant loan modifications is that they and their affiliates are making more money on foreclosures. The article detailed the “cottage industries” that have sprung up around foreclosures: foreclosure law Firms, appraisers and brokers doing “price opinions”, companies which arrange for trustee sales, secondary-market purchasers of the foreclosed properties, etc. The article also highlighted that by foreclosing, banks “make” more money by charging late fees, foreclosure fees and costs, and penalties.

The real reason why “loan mods” are thus being routinely rejected is pure and simple “balance sheet economics”. A bad loan is a liability on a lender’s balance sheet. A “modified loan” is just a lesser example of a loan which is already a liability, and a modified loan does not result in any money to the brokers, appraisers, trustee sale companies, or foreclosure mill law Firms.

By foreclosing and obtaining a money judgment (for the amount due on the note) and the property, the “bank” turns a non-performing liability into a two-tiered asset in the form of a receivable (the amount “due” from the borrower per the Judgment), and a tangible asset (the property) with its inflated value as the result of an inaccurate or outright false “broker price opinion” (BPO) which was prepared by the “bank’s” broker on nothing more than a “drive by” of the property (that being no interior inspection for defects, necessary repairs, wear and tear, etc.). In one case where we questioned the obviously inflated bank BPO (which was over 33% more than the most recent comparable sale for the same house in the same neighborhood), the “bank” refused to produce this phantom BPO or even disclose the date that it was prepared, taking the position that they “do not have to produce it”, and only agreeing to resolve the foreclosure if the borrower agreed to pay over 90% of this phantom BPO. The reasons for the bank’s “position” should be more than obvious to anyone.

As such and as the “foreclosure industry” appears to show no signs of slowing (CNN reported that over 365,000 foreclosure notices were filed nationwide in the month of July, 2009 alone), and as the “banks” and their “affiliate” lawyers, brokers, and trustee-sale companies continue to reap untold fortunes from foreclosures, don’t expect the foreclosure tsunami to subside any time soon. Sorry for the “doom and gloom”, but this is the real “reality show”, folks.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

E-mail: info @ ForeclosureDefenseNationwide.com

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FORGED “ORIGINAL” NOTES ARE POPPING UP LIKE MUSHROOMS AFTER A RAINSTORM

By Jeff Barnes, Esq.

September 10, 2009

We previously advised about a situation in a judicial foreclosure where the attorney for the foreclosing party offered what was represented by that attorney to be an “original promissory note” at a summary judgment hearing. When the Judge asked that it be shown to the borrower, the borrower pulled out her driver’s license (bearing her real signature) and advised the Court that the “signature” on the “original note” produced by the foreclosure mill attorney was not hers. Needless to say, the foreclosure attorney’s motion for summary judgment was denied.

We have recently been advised that, with the current photocopying technology which can make copies with “blue ink” signatures and red notary seals that more and more of these fraudulent “original notes” are being presented to the courts by foreclosure attorneys when the borrower raises the “produce the note” issue. We thus caution any borrower defending a foreclosure proceeding to CLOSELY examine any purported “original note” produced by the foreclosure attorney, as it may not be “original” at all, especially in situations where the foreclosure lawsuit alleges a “re-establishment of lost note” claim or states in the lawsuit that the original note has been “lost or destroyed”. Indeed, it is more than curious for an “original” note to pop up all of the sudden at a summary judgment hearing when the filed lawsuit claimed that it was “lost or stolen”.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

E-mail: info @ ForeclosureDefenseNationwide.com

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BEWARE THE “END-RUN” (SNEAK) FORECLOSURE

By Jeff Barnes, Esq.

September 10, 2009

FDN is experiencing a recent wave of inquiries requesting assistance with what we have decided to term the “end-run”, or “sneak”, foreclosure. This is a situation where a borrower who is being threatened with foreclosure is contacted, usually by the servicing entity, with a request as to whether the borrower would like to “modify the loan”. When the borrower responds and inquires about what will become of the impending foreclosure, paperwork is sent to the borrower and the borrower is told “don’t worry about the foreclosure; we are going to work with you.” Of course, the servicing entity does not put this in writing. The borrower, not being a lender or servicing agent, reasonably relies on this affirmative representation from the servicing entity, only to later find out (when the loan modification is denied) that their home has (a) either already been sold, or (b) is about to be sold without sufficient time for the borrower to mount a defense to the sale.

This practice is prevalent in the “non-judicial” (Trustee’s Sale) states, as there is generally no court proceeding pending when a trustee’s sale is scheduled by the company hired by the foreclosing party to set up and conduct the sale (examples of such companies being ReContrust [for Countrywide and now Bank of America], and Trustee’s Services Corp., Quality Loan Service Corp., and Northwest Trustees Services [for various entities]).

In the “judicial” states where there is a foreclosure lawsuit pending, the borrower has the opportunity to seek a stay of the existing lawsuit based on modification negotiations. Provided the borrower is actively defending the case or has an attorney doing so, the “end-run” should not occur, as a foreclosure can only take place in judicial foreclosure proceedings on formal motion with advance notice to all parties of record so that there is an opportunity to defend, with the proceeding being in control of a Judge.

In the non-judicial states, there is generally no Judge involved with a trustee’s sale; the sales are set up by companies (not the Court); and the sales take place without the necessity of a foreclosure lawsuit being filed (although post-sale “unlawful detainer” [eviction] actions are filed in the court). A variation on this is the procedure utilized in North Carolina, where a Trustee’s Sale is scheduled but a court case is initiated which schedules a hearing before the sale to provide the borrower with an opportunity to challenge the pending sale in court without the borrower having to file an independent lawsuit themselves (as borrowers generally have to do in non-judicial states in order to seek court assistance to challenge a foreclosure).

If the servicer tells a borrower, on initiation of any “loan modification” or “loss mitigation” request, “not to worry” about a foreclosure, the borrower should immediately confirm this in writing with confirmed delivery of the writing. NEVER assume anything; make a record of everything; and keep copies in a safe place as well. This could wind up being important evidence in any legal proceeding to either seek to stop or set aside an end-run or “sneak” foreclosure which was done essentially behind the borrower’s back and despite ongoing “modification negotiations” instituted by the servicing entity with the “not to worry” promise.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

E-mail: info @ ForeclosureDefenseNationwide.com

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FDN ADDS STATES OF VERMONT, NORTH CAROLINA, AND MISSOURI IN CONNECTION WITH REPRESENTATION OF BORROWERS

By Jeff Barnes, Esq.

August 27, 2009

Yesterday, we advised that FDN had added the states of Wisconsin, Oregon, and Illinois where Jeff Barnes, Esq. represents borrowers defending foreclosure proceedings. Today, three more states, those being Vermont, North Carolina, and Missouri were added as well in connection with pending foreclosure actions where Mr. Barnes will be representing borrowers challenging foreclosure.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

e-mail: info @ ForeclosureDefenseNationwide.com

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FLORIDA DEPARTMENT OF FINANCIAL REGULATION ENTERS EMERGENCY ORDERS SHUTTING DOWN TAYLOR BEAN & WHITAKER MORTGAGE GROUP: “SECOND” EMERGENCY ORDER RECITES TBW’S FAILURE TO COMPLY WITH PRIOR EMERGENCY ORDER; FAILURE TO FUND CLOSINGS; AND THAT TBW HAS “ALREADY CAUSED CONSIDERABLE HARM TO FLORIDA CONSUMERS“: ORDER ALSO REVOKES TBW’S MORTGAGE LICENSE AND ORDERS THAT ALL FORECLOSURE PROCEEDINGS CEASE

By Jeff Barnes, Esq.

August 27, 2009

By Emergency Orders to Cease and Desist dated August 7 and August 21, 2009, the Florida Department of Financial Regulation has ordered mortgage lender Taylor Bean & Whitaker to, among other things:

(a) immediately cease all business operations;

(b) immediately cease all foreclosure proceedings that it is conducting or contemplating; and

(c) not report any Florida consumers to a credit bureau for any payment due beginning August 1, 2009.

The August 7 Order recites that on August 4, 2009, the following actions were taken against TBW:

(1) The United States Department of Housing and Urban Development issued a release that the Federal Housing Administration (FHA) had suspended TBW from originating loans insured by FHA;

(2) the Government National Mortgage Association (“Ginnie Mae”) had defaulted and terminated TBW as an issuer in Ginnie Mae’s mortgage-backed security program;

(3) the Mortgage Review Board of HUD had suspended TBW’s originating and underwriting approval;

(4) Ginnie Mae had defaulted and terminated TBW’s authority to act as a Ginnie Mae issuer or servicer under any of its guaranty agreements; and

(5) the Federal Home Loan Mortgage Corporation (“Freddie Mac”) had terminated TBW’s eligibility to sell and service mortgage loans for Freddie Mac.

The August 7 Order also recites that there were approximately 60 TBW loans which had closed but which had not been funded, and that the state agencies of Massachusetts, New Jersey, and Pennsylvania had already entered adverse administrative orders acting against licenses held by TBW.

The August 21 Order immediately suspended TBW’s Mortgage Lending License in the State of Florida, finding that TBW violated Florida state statutes governing the funding of mortgage loans. The August 21 “Second” Emergency Order was issued as TBW had failed to comply with the provisions and mandates of the August 7, 2009 Order, which included providing certain specific financial information, and recited that after entry of the August 7 Order that TBW had “attempted to open new bank accounts at two different financial institutions”.

The August 7 Order further recited TBW had admitted to depositing operating funds and custodial funds (including borrower mortgage and escrow payments) into its single bank account and that it was paying its employees from this one account. The Order found that this intermingling of funds which TBW was using for its daily operations “represents a serious risk to Florida consumers”, especially considering that TBW was failing to fund loans already closed. Further administrative proceedings against TBW will be taking place.

The full text of both Emergency Orders will be posted on this website shortly.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

e-mail: info @ ForeclosureDefenseNationwide.com

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PLAYING WITH FIRE: NON-ATTORNEYS ATTEMPTING TO PRACTICE FORECLOSURE DEFENSE

By Jeff Barnes, Esq.

August 26, 2009

We are getting more and more e-mails from people who are essentially attempting to practice foreclosure defense law by “surfing the net” and copying pleadings, motions, case law, and arguments from other jurisdictions for use in their own cases. This is a dangerous endeavor which can (and usually does) result in the non-attorney litigant impairing their case, missing issues, and ultimately losing in court and thus losing their home. We are also getting an increasing number of e-mails from those who have tried to defend their own cases but quickly realize that they are in over their heads and are now pleading for help. This usually means more work for the attorney who has to come in after-the-fact and try to clean up or mitigate the damage done by the non-lawyer who tried to defend a foreclosure on their own.

As an example, we received an e-mail today from someone in one state who admitted that they simply took something which was posted on this website from another case and tried to use it in their case in another state, and seemed surprised that they lost in court. The person (a non-attorney) claimed that they “followed your procedure exactly”, but admitted that their papers were filed late. Of course, we do not know what “procedure” this non-attorney person was referring to other than a reference to a filing which we posted on this website from another case in another state.

Although all court filings posted on this website are public information, this does not equate to the use of such information by either an attorney or non-attorney in another case. The sample filings posted on this website were specifically prepared for a specific case in a specific jurisdiction under a specific set of facts and filed according to a specific timeframe. For a non-attorney to try to use such information in a totally unrelated case in another jurisdiction is foolhardy at best.

Foreclosure defense is a highly specialized, intricate, and complicated area of the law which is emerging and changing on many fronts. Each case is subject to the particular facts of the case; the number and scope of the legal issues involved; the forms of relief available in each state; when and how they are to be presented; and the rulings of whatever Judge is assigned to the case.

Foreclosure defense is, in essence, brain surgery. You would not want your plumber to perform cosmetic surgery on you. Non-attorneys (and attorneys who do not practice this type of law on a regular basis) should realize that “dabbling” in foreclosure defense by noodling around on the internet is a disaster just waiting to happen.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

e-mail: info @ ForeclosureDefenseNationwide.com

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FDN ADDS STATES OF WISCONSIN, OREGON, AND ILLINOIS TO SCOPE OF BORROWER REPRESENTATION; PRELIMINARY INJUNCTION GRANTED AGAINST FORECLOSURE IN CALIFORNIA

By Jeff Barnes, Esq.

August 26, 2009

As the number of inquiries and e-mails to FDN increase by the day, FDN has added the states of Wisconsin, Oregon, and Illinois to those where Jeff Barnes, Esq. presently represents borrowers defending foreclosures. Inquiries from additional states, including Vermont, North Carolina and Indiana, continue to pour in by the day. As of this date (August 24, 2009), Mr. Barnes represents borrowers with foreclosure proceedings pending in the states of Massachusetts, New Jersey, New York, Delaware, Maryland, Virginia, South Carolina, Georgia, Florida, Ohio, Wisconsin, Illinois, Iowa, Texas, Colorado, Montana, Oregon, Arizona, California, Alaska, and Hawaii.

Adding to the recent string of borrower victories, a California Superior Court has granted a Preliminary Injunction restraining IndyMac Bank, First Federal Bank of California FSB, NDEx West LLC, and OneWest Bank FSB from selling, transferring, encumbering, or conveying title to the borrower’s property or commencing any unlawful detainer action against the borrower pending the borrower’s lawsuit against IndyMac et al. The lawsuit was filed by Jeff Barnes, Esq. through local California counsel in response to a threatened foreclosure which is grounded on loan documents containing forged initials and signatures of the borrower on Option ARM documents which the borrower never signed. A similar fact pattern (borrower’s signature forged on loan documents) is being litigated by Mr. Barnes in the state of Montana as well.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

e-mail: info @ ForeclosureDefenseNationwide.com

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FORCLOSURE ATTORNEY ARROGANCE STOOPS TO NEW LOW: SLANDEROUS DISRESPECT OF THE LAW AND ATTEMPTS TO WRONGFULLY INFLUENCE THE JUDICIARY

By Jeff Barnes, Esq.

August 11, 2009

I just returned from two weeks of attending court hearings around the U.S. in numerous foreclosure defense cases in several states. The majority of the attorneys “on the other side” are professional and argue their positions in proper court manner. However, two instances occurred over the last 2 weeks which caused me pause, which foreclosure defense counsel and litigants should be made aware of as these instances could signal the ushering in of a new wave of arrogance and contempt brewing among attorneys representing servicing companies and “trustees” seeking foreclosure who become very angered and insouciant when a borrower attempts to assert their rights under the law.

The first incident, which occurred in Florida, was in connection with a motion to vacate a final summary judgment where the trustee of the securitized mortgage loan trust inconsistently claimed, in both its lawsuit and its summary judgment motion, that it both “owned and holds the note and mortgage” but simultaneously, in the same papers, claimed that “the note has been lost and is not in the possession or custody or control of the Plaintiff”. Notwithstanding that the law does not allow you to have it both ways, summary judgment was apparently entered as there was no opposition by the borrower. When I attempted to point this and other significant legal issues out to the Judge (after being retained to seek to vacate the summary judgment which had been entered approximately two months before I was retained), the attorney from the foreclosure mill representing the trustee of the securitized trust said “Sounds right out of a seminar…they just are delaying, Judge.” The Judge then stated to me “so it looks like your new client just wants to delay this, what, another 150 days?” Needless to say our Motion was denied.

When closely examined, the flippant remark from the foreclosure mill attorney smacks not only of contempt for the law, but also a wrongful attempt to influence a judge. Legal seminars are subject to scrutiny by the State Bar, and the instructors have to be licensed attorneys. The matters in the seminars constitute existing decisional and statutory law, including recent court decisions. Matters such as legal standing to institute a foreclosure and chain of title are laws which have been on the books for centuries. Federal laws such as the Truth-In-Lending Act (TILA), the Real Estate Settlement Procedures Act (RESPA), and the Fair Credit Reporting Act (FCRA) have been in place for decades. For an attorney to insinuate that because these laws may have been taught in a seminar somehow deletes their legal force and effect or should be disregarded is not only a misrepresentation of the law, but in the context that the insinuation was made (during the course of a court hearing), is a wrongful and illegal attempt to influence a judge.

The second incident was relayed to me in an e-mail from an attorney in New Jersey who came upon our recent victory in that state. He stated that when he presented argument to the judge to oppose a foreclosure, the judge stated to him: “I am not going to permit any ‘internet defenses’”. Again, simply because existing statutory or decisional (case) law is circulated on the internet in no way diminishes its importance or effect. In fact, it is largely because of the publication of laws on the internet that borrowers have been able to defend themselves against predatory lenders, servicers, and “trustees” against wrongful attempts to foreclose.

The Hon. Federal Judge Christopher Boyko expounded on the importance of the judiciary closely examining legal standing in foreclosure cases and the impropriety of permitting the law to take a back seat to “convenience”:

This Court possesses the independent obligations to preserve the judicial integrity of the federal court and to jealously guard federal jurisdiction. Neither the fluidity of the secondary mortgage market, nor monetary or economic considerations of the parties, nor the convenience of the litigants supersede these obligations. Unlike the focus of financial institutions, the federal courts must act as gatekeepers, assuring that only those who meet diversity requirements are allowed to pass through. Counsel for the institutions are not without legal argument to support their position, but their arguments fall woefully short of justifying their premature filings, and utterly fail to satisfy their standing and jurisdictional burdens. The institutions seem to adopt the attitude that they have been doing this for so long, unchallenged, this practice equates with legal compliance. Finally put to the test, their weak legal arguments compel the Court to stop them at the gate.

Numerous other judges around the US have recognized the improper and bullying tactics of foreclosure counsel, and at least one court has severely sanctioned not only the “institutions”, but their counsel as well (see article on this blog previously published, and later decision upholding sanctions against one institution and certain counsel as well).

Standing, whether in state or Federal court, is the key to open the door to the courthouse. Without it, there can be no foreclosure. It is up to those of us who challenge foreclosures to remind all concerned that this is the law, and that the arrogant attitude of foreclosure counsel who take the “how dare you defend this case” position is nothing more than an exhibition of their personal frustration of someone interrupting their “business as usual” factory-type foreclosure processing with (heaven forbid!) the actual law.

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

e-mail: info @ ForeclosureDefenseNationwide.com

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FLORIDA JUDGE DENIES SERVICING COMPANY’S MOTION TO DISMISS BORROWER’S COUNTERCLAIMS FOR DECLARATORY AND INJUNCTIVE RELIEF: RULING PERMITS FLORIDA BORROWERS CHALLENGING FORECLOSING PARTY’S STANDING AND CHAIN OF TITLE TO NOTE AND MORTGAGE TO ASSERT COUNTERCLAIMS TO FORECLOSURE

By Jeff Barnes, Esq.

August 11, 2009

FDN attorney Jeff Barnes has scored another victory for borrowers, this time in Florida where a Circuit Judge denied Aurora Loan Servicing’s Motion to Dismiss the borrower’s Counterclaims for Declaratory and Injunctive Relief. The borrower has challenged Aurora’s standing to bring the foreclosure action, requesting a judicial declaration that Aurora has no rights in either the Note or the mortgage, and for an injunction precluding the foreclosure based on lack of standing. Aurora took the position that no such counterclaims could be asserted based on “negotiable instruments” law and disputing the facts in the counterclaims. The Judge denied Aurora’s Motion to Dismiss. The borrower’s counterclaims shall now proceed to trial absent any pretrial resolution of the case.

Significantly, Aurora has objected to the borrower’s discovery as to, among other things, documents evidencing Aurora’s standing and chain of title to the Note and mortgage and as to documents relating to securitization of the mortgage loan, claiming “trade secrets”. Securitized mortgage loan trust documents, which are required to be filed by the Securities Exchange Commission, are public documents, and thus Aurora’s “trade secrets” position is without merit and has apparently been interposed for the purpose of hindering the borrower’s quest for the truth as to his loan.

A hearing is being scheduled on Aurora’s objections to producing documents. For those who follow this website, you may recall that a Judge in New Jersey dismissed, on Motion of Jeff Barnes and his local counsel representing the borrower, a foreclosure upon Deutsche Bank’s repeated refusal to produce discovery documents despite multiple court orders to do so (which included, among other things, documents relating to Deutsche Bank’s standing and interest in the Note and mortgage).

Jeff Barnes, Esq.

www.ForeclosureDefenseNationwide.com

e-mail: info @ ForeclosureDefenseNationwide.com

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